Port highway project: Chosen Chinese company debarred by WB

The Chinese company that recently received a letter of intent from the Road Development Authority (RDA) to carry out civil works related to the Asian Development Bank (ADB)-funded port access elevated highway project has been debarred by the World Bank (WB).

The WB, on June 5, announced a nine-month debarment of China Railway Construction Corporation Ltd (CRCC), its wholly owned subsidiaries and 730 controlled affiliates. One of these is China Civil Engineering Construction Corporation ( CCECC) which in May received a letter of intent for the RDA's highway project after becoming the “lowest evaluated substantially responsive bidder”. The cost of the civil works is estimated at Rs 28bn.

The WB action is in connection with misconduct under the EastWest Highway Corridor Improvement Project in Georgia. The three companies directly affected are China Railway Construction Corporation Ltd. (CRCC) and its wholly-owned subsidiaries, China Railway 23rd Bureau Group Co Ltd (CR23) and China Railway Construction Corporation ( International) Limited (CRCC International).

The debarment is part of a settlement agreement with the relevant parent companies related to misconduct during the procurement process for a highway construction contract, a statement from the multilateral agency said.

Two RDA officials who were part of the evaluation process for the civil works related to the port access elevated highway project said they were unaware of the debarment.

The WB said that, during the prequalification and bidding forces for a highway contract under the East-West Highway Corridor Improvement Project in Georgia, the three named companies “prepared and submitted information that misrepresented the personnel and equipment of CR23 and the experience of other entities in its group as CRCC's”. These are considered fraudulent practices under the WB Procurement Guidelines.

Following their ninemonth debarment, CRCC, CR23, CRCC International, and their 730 controlled affiliates will be conditionally non- debarred for 24 months, the WB said in a statement.

“During this period, they will again be eligible to participate in World Bankfinanced projects as long as they comply with their obligations under the settlement agreement,” it explained. “If they do not, the conditional non-debarment will convert to debarment with conditional release.”