Malta airport shareholder barred in World Bank blacklist

The World Bank has slapped SNC-Lavalin with a record-setting sanction, barring the engineering firm and 100 of its subsidiaries from bidding on any of the bank's development projects for the next decade, after SNC agreed not to dispute charges that it conspired to bribe several Bangladeshi public officials in an effort to secure a $50 million bridge contract.

The Canadian engineers own a 38% stake in the Malta Mediterranean Link consortium, the largest shareholder (40%) of Malta International Airport plc, which runs the island's only airport.

The World Bank's announcement about SNC was made Wednesday, expanding the list of countries where the engineering company has been accused of corruption.

The bank said it has uncovered evidence that SNC conspired to bribe public officials in Cambodia and that it had passed that information along to the Royal Canadian Mounted Police, who are already probing the company's activities in Libya, Algeria and Bangladesh.

The 10-year prohibition was negotiated between the company and the bank and is the largest debarment that a company has agreed to as part of a settlement since the bank began sanctioning firms that seek to corrupt public officials.

Because the bank has an agreement with four of the world's other international development banks to uphold each other's sanctions, the ban will effectively shut SNC out of many international development projects, Stephen Zimmermann, the director of operations for the World Bank's investigative arm, said.

SNC derives little business directly from the World Bank.

SNC had been vying for a $50 million contract to supervise the construction of what is known as the Padma Bridge, a massive infrastructure project designed to link Bangladesh's southwest with the capital city of Dhaka but has since been put on hold because of the corruption charges. SNC had been second in the running behind a British firm, Halcrow Group Ltd.

Since the World Bank was alerted to the alleged conspiracy it has cancelled its $1.2-billion (U.S.) loan to Bangladesh, stalling the $3-billion project. A panel of anti-corruption experts enlisted by the World Bank has urged the Bangladeshi government to criminally charge a minister, which the government has refused.

Neither the World Bank, nor SNC, would detail what the company is alleged to have done in Cambodia, except to say that SNC has agreed to not contest a charge of corruption as part of its role in a World Bank-financed electric transmission project. That particular project has since been completed, the bank said.