From China to Gozo with baggage

China Communication Construction Company is the Chinese company conducting a €4 million feasibility study on the feasibility of a bridge to Gozo, for free and without expecting anything in return.

Collusion in the Philippines

In January 2009, the World Bank announced the debarment of seven firms and one individual for engaging in collusive practices under a major Bank-financed roads project in the Philippines. One of the companies was China Road and Bridge Corporation, the company which later changed its name in to China Communications Construction Company (CCCC).

The company was debarred from receiving any funding from the World Bank for eight years. The debarment was the result from an in-depth inquiry conducted by the World Bank's Integrity Vice Presidency (INT). INT is responsible for investigating allegations of fraud and corruption in Bank-financed operations.

The INT investigation uncovered evidence of a major cartel involving local and international firms bidding on contracts under phase one of the Philippines National Roads Improvement and Management Program, known as NRIMP 1. INT closely analysed the procurement process the firms participated in and conducted numerous interviews before closing the investigations and initiating sanctions proceedings against the entities.

As a result of swift action when suspicions of collusion in the bidding process were raised by the project team, the World Bank stopped an estimated $33 million from being awarded.

Leonard McCarthy, World Bank Integrity Vice President, described this case as "one of our most important and far-reaching cases".

Based on INT's investigation of the NRIMP 1 case, the World Bank's Sanctions Board, made up of senior Bank officials and external legal experts, decided that the entities had participated in a collusive scheme designed to establish bid prices at artificial, non-competitive levels and to deprive the borrower of the benefits of free and open competition. According to the World Bank, this "constitutes fraudulent practices".

Three other Chinese companies namely the China State Construction Corporation, China Geo-Engineering Corporation and Dongsung Construction Limited were also debarred.

The programme involving the debarred companies was designed to assist the Philippines government to upgrade its roads network and was partially financed by a $150 million loan from the World Bank. 

In July 2011 the World Bank announced the debarment of China Communications Construction Company Limited, as the designated successor entity to China Road and Bridge Corporation.

CCCC had denied the alleged engagement in collusive activities insisting that the World Bank allegation has "no factual or legal merit". The company is also seeking clarifications from the World Bank to lift the debarment as soon as possible. 

Cheating in Malaysia

In October 2012, the Kuala Lumpur High Court found three State-owned Chinese companies and their local partner, guilty of conspiring to cheat another Malaysian company.

The case was reported by The Edge a reputable Malaysian financial and investment weekly.

The Edge reported the contents of a 55-page judgment by the High Court Judge Justice Rosilah Yop found that DCX Technologies Sdn Bhd was deprived of its rights and its interests in the project after its partner China Roads and Bridges Corporation-the mother company of CCCC, forwarded a copy of a proposal it had prepared with the assistance of DCX Technologies to its sister company China Harbour Engineering Corporation (CHEC) and to the Malaysian HRA Teguh.

CHEC and CRBC later merged for form CCCC.

CHEC proceeded to submit this proposal to the Malaysian government as its own and was awarded the contract for the construction of the bridge. In its judgment, the Malaysian high court concluded that the Chinese company CRBC failed to obtain DCX's written consent to pass a copy of their proposal to CHEC and their Malaysian partner.

"The defendants had conspired to cheat the plaintiff," the judge concluded in his sentence.

The 23.6 kilometer bridge was officially inaugurated in April.

Bribing death row official in China

Caijing a reputable independent, Beijing-based magazine reported that the Chairman of the China's Hebei Port Group, Huang Jianhua had helped China Communications Construction Company (CCCC) to win a bid or the construction project at the Huanghua Port Wharf. In exchange executives at CCCC gave Huang a house worth more than 4 million Yuan.

Jianhua was sentenced to death for receiving bribes in November 2011. CHEC and CCCC strongly deny any involvement in this case. In a press conference in Guyana, Zhongdong Tang, China Harbour Engineering Company Limited (CHEC)'s Regional Director, claimed, "this matter, which is still in court in China, is not directly related to CHEC. China Harbour is not guilty of any wrongdoing in these matters".

Corruption in Bangladesh

In January 2009, the US Department of Justice alleged that in 2005, China Harbour Engineering, a subsidiary of China Communication Construction, paid bribes totalling US $1.76 million to the Singapore account of Arafat 'Koko' Rahman, the youngest son of a former Bangladesh prime minister in connection with the Bangladesh Chittagong Port project.

In 2010, Koko, was jailed for laundering millions of dollars in bribes taken from CHEC.

In a widely covered case by the media, Rahman was jailed, in absentia, for six years for laundering money he received as kickbacks from CHEC and the Bangladesh subsidiary of Germany's industrial giant, Siemens AG.

In June 2010, Judge Mohammad Mozammel Hossain said in his verdict that Rahman was guilty of smuggling more than 200 million takas to Singapore. The judge fined Rahman 190 million takas (US$1.6M) and asked authorities to get the smuggled money returned.

Rahman was accused of taking bribes from CHEC and the Bangladesh subsidiary of Germany's industrial giant Siemens AG for helping them win government contracts during his mother's 2001-2006 premiership.

Charging Rahman of money laundering, the Bangladeshi Anti-Corruption Commission case referred to his illegal dealings with CHEC in relation to a contract for constructing New Mooring Container Terminal at Chittagong Port.

The prosecution claimed that Rahman obtained the money from CHEC in three installments - on 6 May, 31 May, and 1 August, 2005.

When quizzed about this episode in a press conference in 2012, China Harbour denied involvement arguing that it was a consultant that it hired who was involved in this case.

Questions raised in Jamaica

CHEC was also under fire in Jamaica after an independent probe revealed suspicious discrepancies over a US$400 million contract awarded in 2009 without any competition by the government to execute its Jamaica Development Infrastructure Programme.

In July 2011 the Office of the Contractor General (OCG), in a statement to the media, announced it was launching a probe to substantiate a statement by minister of transport and works Mike Henry that "the US$340-million loan being used to fund the project came from the China Ex-Im Bank with a pre-condition for a Chinese firm of their choice to undertake the programme".

In 2012, Contractor General Greg Christie raised the issue as to whether the government, in its due diligence exercises - if any in fact took place - had identified CHEC's debarred status in the World Bank's blacklist.

In a congratulatory letter to prime minister Portia Simpson Miller on her swearing in Christie also asked the new People's National Party administration to declare its hand in negotiations with China Harbour Engineering Company for completion of the US$600-million North-South Link Highway 2000, and for the consequential granting of a 50-year toll concession to that company.

Chief among the Contractor General's concerns were "strong objections to the apparent intent of the former government to award, without international competitive tender, a sole-source contract to CHEC to, among other things, complete the construction of the Spanish Town to Ocho Rios North-South Link of Highway 2000 and the Jamaica Development Infrastructure Programme (JDIP)".

Airport controversy in Guyana

In June 2012, the Chinese company denied allegations of corruption in relation to the US$150M Cheddi Jagan International Airport in the small Caribbean state of Guyana.  The airport project was awarded to China Harbour Engineering Company (which forms part of CCCC) in the absence of a public tender.

As in Malta, the Chinese company had first approached the Guyana government and than proceeded to conduct a study a feasibility study at it own costs.

The deal caused controversy in Guyana because it only came to public knowledge on the Chinese company's website.

Almost 1,000 persons will have to be relocated along with several farms and businesses.

In a press conference rebutting corruption allegations, the Chinese company insisted that it is in the business of finding projects to invest in and had approached government in early 2011 to rebuild CJIA.

Government agreed and after several meetings in Guyana, the final designs were approved and a feasibility study was started. In all, the process took around nine months from start to finish for CHEC to seal the deal.