World Bank debars two Alstom groups and affiliates

WASHINGTON, D.C. 3/5/12 (PennWell) — Alstom Hydro France and Alstom Network Schweiz AG of Switzerland and their affiliates have been debarred by the World Bank Group for a period of three years.

The debarment comes after Alstom acknowledged misconduct in relation to a World Bank-financed hydropower project, the Zambia Power Rehabilitation Project.

In 2002, Alstom made an improper payment of 110,000 euros to an entity controlled by a former senior government official for consultancy services in relation to this project.

The Zambia Power Rehabilitation Project took effect in 1998 with an overall objective to enhance the ability of Zambia’s electricity supply industry to provide electricity at the lowest cost and in an efficient and sustainable manner. The project includes rehabilitating hydro plants and distribution and transmission systems to improve technical efficiency and the quality and reliability of supply. Three hydro projects included in this overall project are 900-MW Kafue Gorge, 600-MW Kariba North Bank and 108-MW Victoria Falls.

The debarment is part of a Negotiated Resolution Agreement between Alstom and the World Bank that also includes restitution totaling about US$9.5 million to be made by the two companies. In addition, Alstom SA, the two named companies and their affiliates commit to cooperating with the World Bank’s Integrity Vice Presidency and continuing to improve their internal compliance program.

The World Bank says the debarment of these two Alstom companies can be reduced to 21 months — with enhanced oversight — if the companies comply with all conditions of the agreement.

The debarment means Alstom Hydro France and Alstom Network Schweiz are considered cross-debarred by other multilateral development banks under 2010’s Agreement of Mutual Recognition of Debarments. The agreement includes the African Development Bank, Asian Development Bank, European Bank for Reconstruction and Development, Inter-American Development Bank Group and World Bank Group.

Alstom SA and other affiliates are conditionally non-debarred, the World Bank says.

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