Fighting Corruption and Promoting Integrity in Public Procurement

Much is at stake in the global effort to tackle corruption in public procurement. Corruption diverts public funds from worthwhile development projects, holds back economic growth and undermines public trust in government.
This publication captures the main points of the Global Forum discussions and presents expert analysis of the main issues and case studies from the varied experiences of countries and specialised bodies, mainly in Europe, Asia and Latin America, that contributed to the event.



Public procurement – the purchase of goods and services by governments and state-owned enterprises – accounts for about 15 per cent of GDP in OECD countries and is highly exposed to corruption. Both public and private actors in the procurement process may be tempted to divert goods and services or public funds for their personal use.

To identify "weak links" in the public procurement process where the risk of corruption is high, to explore the best ways of improving transparency and accountability and to identify effective actions to prevent, detect and sanction corruption in this field, the OECD organised a Global Forum on Governance event on "Fighting Corruption and Promoting Integrity in Public Procurement", hosted by the French Ministry of Economy, Finance and Industry in Paris in November 2004.

Table of Contents
Executive Summary
Part I PUBLIC PROCUREMENT: OECD PERSPECTIVES
Chapter 1 Fighting Corruption in International Business Transactions: Major Considerations Regarding Public Procurement by Mark Pieth
Chapter 2 Improving Integrity in Public Procurement: The Role of Transparency and Accountability by Robert A. Burton
Chapter 3 Competition and Anti-Corruption Considerations in Public Procurement by Frédéric Jenny
Chapter 4 Development Assistance Cooperation: How Building Procurement Capacities Can Help Improve Integrity by Richard Manning

Part II PROMOTING INTEGRITY THROUGH EFFECTIVE TRANSPARENCY AND ACCOUNTABILITY MECHANISMS
Part IIA. Improving Transparency in Public Procurement
Chapter 5 Main Findings of the Forum Workshop on “Improving Transparency in Public Procurement” by Élodie Beth
Chapter 6 Grey Zones and Corruption in Public Procurement: Issues for Consideration by Tina Søreide
Chapter 7 Bulgaria, Czech Republic, Romania and Slovenia: The Use Of Contacts and Informal Networks in Public Procurement by Åse Grødeland PH.D
Chapter 8 Russia: Conflict of Interest and Related Corrupt Practices in Public Procurement by Andrei Khramkin
Chapter 9 The Role of Transparency in Preventing Corruption in Public Procurement: Issues for Consideration by János Bertók
Chapter 10 Republic of Korea: The Potential of E-Procurement by Kyung-Soo Choi
Chapter 11 Mexico: Lessons Learned in Promoting Transparency by Roberto Anaya
Part IIB. Ensuring Accountability: Designing and Controlling Sound Procurement Procedures
Chapter 12 Main Findings of the Forum Workshop on “Designing and Controlling Sound Procurement Procedures to Ensure Accountability” by Élodie Beth
Chapter 13 Linking Islands of Integrity to Promote Good Governance in Public Procurement: Issues for Consideration by Wayne A. Wittig
Chapter 14 Ensuring Accountability in Public Procurement: Bridging Information Asymmetry by Peter Trepte
Chapter 15 A Comparative Analysis of Public Procurement Practices: A French Perspective by Jacques Bayle and Jean-Pierre Jochum
Chapter 16 Latin America: Conditions for Effective Public Procurement Regulations by Claudio Weber Abramo
Chapter 17 China: Legislating Anti-Corruption Measures in Government Procurement by Yu An
Chapter 18 Hungary: Establishing Control Mechanisms in Contract Award Procedures by András Nagy
Chapter 19 Poland: How the New Law on Public Procurement Implements the Anti-Corruption Recommendations of the Supreme Chamber of Control by Alina Hussein

Part III PREVENTION, DETECTION AND SANCTION OF CORRUPTION IN PUBLIC PROCUREMENT
Part IIIA. Identifying Risks in the Bidding Process
Chapter 20 Main Findings of the Forum Workshop on “Identifying Risks in the Bidding Process to Prevent and Sanction Corruption in Public Procurement” by Giorgio Sacerdoti
Chapter 21 Inventory of Mechanisms to Disguise Corruption in the Bidding Process and Some Tools for Prevention and Detection by Jean-Pierre Bueb and Nicola Ehlermann-Cache
Chapter 22 Argentina: Identifying Risks of Corruption in Public Procurement by Nicolás Raigorodsky
Chapter 23 Latvia: Procurement Methods and Risks of Corruption in Public Procurement by Diana Kurpniece
Chapter 24 Mexico: Identifying Risks In The Bidding Process To Prevent Corruption by Guillermo Haro
Chapter 25 Asian Development Bank: Action to Identify Risks in the Bidding Process to Prevent Corruption by A. Michael Stevens
Part IIIB. Compliance with Anti-Corruption Laws through Access to Public Procurement: Sanctioning or Voluntary Self-Regulation?
Chapter 26 Main Findings on the Forum Workshop on “Compliance with Anti-Corruption Laws through Access to Public Procurement: Sanctioning or Voluntary Self-Regulation” by Valérie Dervieux
Chapter 27 Regulating Access to Public Procurement: Issues for Consideration by Nicola Ehlermann-Cache
Chapter 28 The World Bank’s Sanctions Process by Françoise Bentchikou
Chapter 29 Compliance with Anti-Corruption Laws Through Access to Public Procurement: The Asian Development Bank Experience by A. Michael Stevens
Chapter 30 Exclusion of Tenderers in the European Union: The Only Way Forward Against Procurement Fraud? by Simone White
Chapter 31 Italy’s Anti-Corruption Legislation: Disqualification from Public Bidding as a Sanction by Matteo Saccavini
Chapter 32 The Challenges Facing Debarment and the European Union Public Procurement Directive by Kirstine Drew
Chapter 33 Ensuring Compliance with Anticorruption Laws Through Sanctioning or Voluntary Self-Regulation by Michael H. Wiehen
Chapter 34 The Korean Public Procurement Service Integrity Pact
Annex I Agenda of the OECD Global Forum on Governance: Fighting Corruption and Promoting Integrity in Public Procurement