International Corruption Control in Government Procurement: The role of UNCITRAL in generating global public goods
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1 + International Corruption Control in Government Procurement: The role of UNCITRAL in generating global public goods Dr Kamala Dawar Sussex University, School of Law
2 + Presentation Overview UNCITRAL important role in network of international texts addressing government procurement and corruption control: Best practices guidelines Soft law conventions Hard law provisions with DSU Comparison of international texts indicate variations in comprehensiveness of rules but cornerstone principles similar transparency, competition, objectivity, integrity International network is stronger than individual parts A tightening noose on corruption
3 + The Significance of Corruption in Government Procurement 2010 EU procurement spending 2406bn Average 15-20% GDP world wide big business bn spent under EU Directives = fees for LLM studies for 51m EU citizens = combined state budget Poland, Cz Rep and Latvia EU: 18% contract projects direct public loss 13% corruption; + 5% grey cases
4 + "United by greed, they converted the UN into a platform for profit" New York Prosecutors say Mr John Ashe used his position as UN General Assembly President and permanent representative to introduce a UN document supporting a multibillion-dollar UNsponsored conference centre in Macau, where real estate mogul Ng Lap Seng lived In return for 1.3m US in Rolex watches, a basketball court and bespoke suits, John Ashe sold himself and the global institution he led, said US Federal Attorney
5 + Corruption Kills Losses from corruption more significant in conditions of scarcity health, education and infrastructure sectors 2011 study poor building practices can turn moderate earthquakes into major disasters e.g. Haiti vs New Zealand similar intensity no fatalities. Nicholas Ambraseys and Roger Bilham, Nature, vol. 469 at 153 (Jan. 13, 2011) Concluded 83 % of all deaths from building collapses in earthquakes over the past 30 years occurred in countries perceived to have abnormally high levels of corruption. Study quantifying link between corruption and deaths of children due to poor health care M Hanf, A Van-Melle, F Fraisse, et al., Estimating the Global Impact of Corruption on Children Death
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7 + Corruption and Government procurement procedures Choice of procurement procedure crucial factor in procurement process => Role of UNCITRAL MODEL LAW Corruption risks throughout procurement cycle: pre-tender stage what to buy and how to buy it unjustified large infrastructure projects tender stage invitation to tender and decision to award contract restricting competition due to favouritism biased tender qualification & technical requirements post-tender stage monitoring execution of contract reduced quality of inputs overlooking non performance / bad performance
8 + UNICTRAL Model Law on Public Procurement 2011 Assists States in formulating a modern procurement law. Domestic government purchaser discretion over what to purchase and how to conduct the procurement BUT discretion is subject to safeguards that are consistent with other international standards notably, those imposed by the United Nations Convention Against Corruption (UNCAC) ALL procedures are subject to rigorous transparency mechanisms and requirements to promote competition and objectivity AND all decisions and actions taken in the procurement process can be challenged by potential suppliers - Article 64
9 + UNCITRAL Corruption Control UNCITAL contains no explicit reference to corruption control Article 21. Exclusion of a supplier or contractor from the procurement proceedings on the grounds of inducements from the supplier or contractor, an unfair competitive advantage or conflicts of interest Article 26. Code of conduct A code of conduct for officers or employees of procuring entities shall be enacted. It shall address, inter alia, the prevention of conflicts of interest in procurement and, where appropriate, measures to regulate matters regarding personnel responsible for procurement, such as declarations of interest in particular procurements, screening procedures and training requirements.
10 + Network Governance & Corruption Control UNCITRAL Model Law Articles 27 and 28 UNCAC Article 9 World Bank Integrity Principles Domestic procurement systems World Trade Organisation GPA Domestic Corruption Control OECD Principles for Integrity in Public Procurement
11 + UNCITRAL & UNCAC and UNCAC & the WTO GPA UNCITRAL Recital 4 calls for closer cooperation and coordination with other international organs and organizations active in the field of procurement law reform, UNCAC Article 9 significant influence in drafting Model Law calls for an independent domestic review mechanism monitor conflicts of interest of public procurement officials UNCITRAL Model Law implicitly provides the structured system of rules UNCAC Article 9 demands WTO GPA references UNCAC and corruption control Hard law framework importing soft law convention
12 + UNCAC Article 9. Public procurement and management of public finances 1. Each State Party shall, in accordance with the fundamental principles of its legal system, take the necessary steps to establish appropriate systems of procurement, based on transparency, competition and objective criteria in decision-making, that are effective, inter alia, in preventing corruption. Such systems, which may take into account appropriate threshold values in their application, shall address, inter alia: (a) The public distribution of information relating to procurement procedures (b) The establishment, in advance, of conditions for participation. (c) The use of objective and predetermined criteria for public procurement decisions (d) An effective system of domestic review, including an effective system of appeal, to ensure legal recourse and remedies. (e) Where appropriate, measures to regulate matters regarding personnel responsible for procurement, such as declaration of interest in particular public procurements
13 + UNCAC & the WTO GPA WTO GPA Preamble recital Recognizing the importance of transparent measures regarding government procurement, of carrying out procurements in a transparent and impartial manner and of avoiding conflicts of interest and corrupt practices, in accordance with applicable international instruments, such as the United Nations Convention Against Corruption WTO GPA Article IV General Principles 4. A procuring entity shall conduct covered procurement in a transparent and impartial manner that: (a) is consistent with this Agreement, using methods such as open tendering, selective tendering and limited tendering; (b) avoids conflicts of interest; and (c) prevents corrupt practices.
14 + Corruption Control: a Global Public Good UNCITRAL central position in international governance network Provides trusted template to promote sound procurement systems tangible reference point for domestic procurement systems, esp developing countries Relationship between international organisations reinforcing corruption control Soft law becomes referenced in hard law systems Generating synergies that enhance production of global public goods Corruption control is non-excludable and non-rivalrous does not exclude non-contributors does not exhaust But international corruption control network produce a tightening noose of corruption control as global public good UNCITRAL Model Law a tangible of developmental and economic significance
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