On October 28, 2020, the World Bank Group announced the conditional non-debarment and debarment, respectively, of two Chinese engineering companies, China National Electric Engineering Company Limited (CNEEC) and its wholly owned subsidiary, China Electric Design and Research Institute Company Limited (CEDRI). The World Bank reported that CEDRI was debarred for 18 months for committing fraud in connection with the Lusaka Transmission and Distribution Rehabilitation Project in Zambia. Specifically, according to the World Bank’s press release, CEDRI failed to disclose a conflict of interest and “present[ed] false documents with CNEEC’s company name in order to meet the requirements of a contract under the project.” CNEEC was sanctioned with conditional non-debarment because of its failure in overseeing CEDRI.
Under its conditional non-debarment, CNEEC is allowed to participate in World Bank projects as long as it complies with the terms of the settlement agreement; if any terms are violated, the conditional non-debarment will convert to a debarment with a conditional release. In that case CNEEC could not participate in World Bank projects unless and until the conditions for release in a settlement agreement were reached. CEDRI received an 18 months sanction of debarment with conditional release, making the company ineligible to participate in World Bank projects during that time.
The sanctions were reduced due to the companies’ cooperation with the World Bank. The companies also committed to developing an integrity compliance program.