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The UK government has published its final response to the Export Credits Guarantee Department’s (ECGD) consultation on the changes made to its anti-bribery and corruption procedures in December 2004.

Following two rounds of public consultation in 2005, conducted under cabinet office guidelines, ECGD will now make a number of changes to its procedures which, the government believes, reduce the risk of ECGD supporting contracts tainted by corruption while also being workable for exporters and banks.

ECGD will continue to support the UK government’s wider commitment to combat bribery and corruption in business.

The main outcomes from the consultation, which will come into effect on July 1, are:

  •  UK exporters and investors applying for ECGD support will be requested to provide the identities of agents or other intermediaries involved in the award of a contract. ECGD is confident that it can implement these procedures in a way that will prevent inadvertent disclosure of sensitive information. It will be seeking comments from consultees on the details of its proposed internal handling arrangements for information about agents’ identities;

  •  ECGD will no longer require representations about the actions of group companies not involved in the contract for which ECGD support is being provided. These changes will provide ECGD with the precise assurances that it requires, and avoid customers having to provide information that is not necessary;

  •  ECGD will have the power to audit the accuracy of those representations relating to the issue of bribery and corruption, on notice, at any time, rather than just when it suspects that bribery has taken place.

    Breaches of the new procedures will entitle ECGD to terminate the relevant insurance policy, or, in the case of other ECGD facilities, to seek financial redress from the exporter where the taxpayer has suffered loss.

    UK trade minister Ian Pearson says: “Ministers carefully considered the representations received during the public consultation. The key concern has been to ensure that we reduce the risk of ECGD supporting contracts tainted by corruption, and that we do so in a way that is workable for exporters.

    “ECGD’s revised procedures achieve this aim and will contribute to the government’s wider aim to combat bribery and corruption in business.”
    John Elkington, chairman of the Export Guarantees Advisory Council (Egac) and founder of the business consultancy SustainAbility, adds: “The critical thing to remember is that all sides agree that corruption is bad for business: it distorts the market, stifles innovation and prevents fair competition. So the issue is not whether bribery and corruption should be controlled, but how. ECGD has consulted widely on the best ways forward, and Egac is confident that the rules announced today will send a clear message that the UK will not support corrupt practices.

    “Our assessment is that these new arrangements will helpfully clarify what is expected from exporters who want ECGD support. We conclude that the procedures do not place uncompetitive restrictions on exporters – and, importantly, give the UK a strong position from which to argue for equivalent standards to be introduced internationally.”