Socialist Republic of Vietnam

Second Transmission and Distribution Project

                         Redacted Report




                                    March 2018
                                Statement of Use and Limitations

This Report was prepared by the World Bank Group (the WBG) Integrity Vice Presidency (INT).
It provides the findings of an INT administrative inquiry (the Investigation) into allegations of
corrupt, fraudulent, collusive, and/or coercive practices, as defined by the WBG for purposes of
its own policies, rules and procedures (the WBG’s Framework regarding Anti-corruption), in
relation to the WBG-supported activities. The purpose of the Investigation was to allow the WBG
to determine if the WBG’s Framework regarding Anti-corruption has been violated.

This Report is being shared to ensure that its recipients are aware of the results of the INT
Investigation. However, in view of the specific and limited purpose of the Investigation underlying
this Report, this Report should not be used as the sole basis for initiating any administrative,
criminal, or civil proceedings. Moreover, this Report should not be cited or otherwise referred to
in the course of any investigation, in any investigation reports, or in any administrative, civil, or
criminal proceedings.

This Report is provided without prejudice to the privileges and immunities conferred on the
institutions comprising the WBG and their officers and employees by their respective constituent
documents and any other applicable sources of law. The WBG reserves the right to invoke its
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subsequent judicial, administrative or other proceeding pursued in connection with this matter.
The WBG’s privileges and immunities cannot be waived without the prior express written
authorization of the WBG.




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Background

The Second Transmission and Distribution Project (the Project) in Vietnam aimed to develop an
efficient electricity transmission and distribution system in Vietnam. The Project was financed by
the International Development Association (IDA), the International Bank for Reconstruction and
Development (IBRD),1 and a trust fund. It became effective in May 2006 and closed in June 2014.

In 2012, the Southern Vietnam Power Projects Management Board (SPPMB) issued a tender for a
contract under the Project (the Contract). The bidding documents for the Contract required bidders
to submit at least two completion certificates of contracts similar to the Contract.

A consortium, which was comprised of Company A and two other companies (the Consortium),
submitted its bid for the Contract. To satisfy the prior experience requirements, the Consortium
submitted completion certificates and contract documentation representing that it had completed
Contracts 1 and 2. Subsequently, the Consortium was awarded the Contract.

Allegations

The World Bank Group Integrity Vice Presidency (INT) received an allegation that Company A
may have submitted false past experience information in its bid for the Contract.

Methodology

INT’s investigation consisted of, among other steps, a review of Project documents, as well as
statements and documents obtained from Company A, the other companies of the Consortium, and
the purported issuers of contract certificates submitted by the Consortium.

Findings

Evidence indicates that Company A submitted false past experience information in its bid
for the Contract.

As noted above, in its bid for the Contract, the Consortium submitted a completion certificate and
signed contracts for Contracts 1 and 2. INT attempted to verify the authenticity of these documents
with the relevant issuing bodies.

Regarding Contract 1, INT received written confirmation from the purported issuer of the
certificate which suggests that: (i) the completion certificate and the contract submitted by the
Consortium were forgeries; (ii) the purported issuer did not execute Contract 1; and (iii) the
purported issuer had never had a relationship with Company A.

Regarding Contract 2, INT’s investigation revealed that the purported issuing body, Company B,
did not exist as presented in the Consortium’s bid. Although INT located two companies with the
same name and corporate address, neither of the companies had any knowledge of the signatory
on the completion certificate and signed contracts submitted by the Consortium. Moreover, one

1
  The IBRD and IDA are two of the five institutions comprising the World Bank Group. The IBRD and IDA constitute
the World Bank. The IBRD, IDA, and the World Bank are used interchangeably throughout this Report.

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of the matches to the Company B’s name informed INT that it was a collection agency and not an
engineering company, and that the other match is a supplier of equipment.

Lastly, in the bid for the Contract, the Consortium specified that Company A was established on a
certain date. However, INT verified via the relevant government agency that Company A was
actually incorporated on a later date. It is unlikely that Company A could have been awarded and
completed Contracts 1 and 2 as both of these contracts were purportedly signed before Company
A’s incorporation date.

INT issued a separate Show Cause Letter regarding this matter to each of the members of the
Consortium. In response, Company A stated that it had engaged in misconduct, and specified that
it submitted false past experience information to satisfy the bidding documents’ past experience
requirement.

The other members of the Consortium submitted a joint response, with supporting documentation,
asserting that they had reasonably concluded that Company A was as qualified as it claimed to be.

Follow Up Action by the World Bank

The World Bank imposed a sanction of debarment with conditional release on Company A. This
ineligibility extends to any legal entity that Company A directly or indirectly controls.

INT did not seek sanctions against the other members of the Consortium because INT has
concluded that they may not have been aware of the false prior experience presented by Company
A in the Consortium’s bid.




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