Since 2010, the various Multilateral Development Banks (MDBs) have enforced the Agreement for Mutual Enforcement of Debarment Decisions,90 also known as the Cross-Debarment Agreement. The Agreement, signed by the World Bank, the Asian Development Bank (ADB), the African Development Bank (AfDB), the European Bank for Reconstruction and Development (EBRD) and the Inter-American Development Bank (IDB) stipulates that entities debarred by one MDB will be sanctioned for the same conduct by the other signatories.
A debarment decision will be eligible for cross debarment if it is:
This cross-debarment cooperation among multilateral development banks aims to strengthen the effectiveness of anti-corruption measures by preventing an individual or entity from circumventing the sanctions and promotes harmonization in the fight against corruption.
In addition to cross-debarment, six MDBs — the African Development Bank, Asian Development Bank, European Bank for Reconstruction and Development, European Investment Bank (EIB), Inter-American Development Bank, and the World Bank Group — have agreed and published new General Principles for Business Integrity Programmes.91 The General Principles set out important guidance relating to the MDBs’ efforts to ensure the funds they lend to States are used only for development purposes. The General Principles are intended as guidance relating to the prevention of fraud and corruption and can be adopted and implemented by entities in all sectors and of all sizes.92 Companies that adhere to these principles should be able to avoid finding themselves in a situation where the cross-debarment agreement is triggered.
Importantly, MDB requirements may also have an impact on business-to-business practices, requiring due diligence procedures before entering into a subcontracting arrangement with a supplier or an agreement with an agent. States may also be able to legislate due diligence requirements for business partners obliging contracting entities to conduct a certain level of due diligence on their business partners. For the private sector, it is becoming more and more important to have a fulsome view of the supply chain and ensure that suppliers do not run afoul of anti-corruption laws and policies.
Source :Asia Development Bank https://www.adb.org/ , Africa Development Bank https://www.afdb.org/, European Bank for Reconstruction and Development https://www.ebrd.com/home , Inter-American Development Bank https://www.iadb.org/ , European Investment Bank https://www.eib.org/de/, World Bank https://www.worldbank.org/
