WASHINGTON, June 16, 2021—The World Bank Group today announced the two-year debarment of China-based Zhejiang First Hydro & Power Construction Group Co. (“Zhejiang First Hydro”) in connection with fraudulent and corrupt practices under the Guangxi Laibin Water Environment Project in China.
The debarment makes Zhejiang First Hydro ineligible to participate in projects and operations financed by institutions of the World Bank Group. It is part of a settlement agreement under which Zhejiang First Hydro acknowledges responsibility for the underlying sanctionable practices and agrees to meet specified compliance requirements as a condition for release from debarment.
The Guangxi Laibin Water Environment Project was designed to reduce flood risks and improve drainage in selected areas of Laibin city.
According to the facts of the case, Zhejiang First Hydro’s de facto agent and subcontractor offered and paid bribes to two government officials in exchange for a contract. Zhejiang First Hydro also misrepresented its intent to mobilize the resources required to implement the contract as well as the availability of experts proposed in its bid. These are corrupt and fraudulent practices, respectively.
The settlement agreement provides for a significantly reduced period of debarment with conditional release in light of Zhejiang First Hydro’s extraordinary cooperation and voluntary remedial actions. As a condition for release from sanction under the terms of the settlement agreement, Zhejiang First Hydro commits to undertake integrity compliance programs consistent with the principles set out in the World Bank Group Integrity Compliance Guidelines. Zhejiang First Hydro also commits to continue to fully cooperate with the World Bank Group Integrity Vice Presidency.
The debarment of Zhejiang First Hydro qualifies for cross-debarment by other multilateral development banks (MDBs) under the Agreement for Mutual Enforcement of Debarment Decisions that was signed on April 9, 2010.