EBRD announces settlement with Turkish company Onur

• EBRD and Onur reach settlement regarding collusive practice in EBRD-financed project
• Sanction consists of a debarment of 1 year and 3 months followed by a 2-year conditional non-debarment
• Settlement reduces debarment period due to Onur’s previous suspension, cooperation, admission of culpability and other mitigating factors

The European Bank for Reconstruction and Development (EBRD) has announced a sanction of 3 years and 3 months on Turkish construction company ONUR Taahhüt Taşımacılık İnşaat Ticaret ve Sanayi A.Ş. (Onur) and its 53 subsidiaries. The settlement was reached in connection with a collusive practice relating to an EBRD-financed project in Ukraine.

The settlement provides for a debarment period of 1 year and 3 months, followed by a 2-year period of conditional non-debarment.

An investigation by the EBRD’s Office of the Chief Compliance Officer (OCCO) found an improper arrangement that aimed to secure the award of the contract to Onur in violation of the EBRD’s Procurement Policies and Rules. Under the EBRD’s Enforcement Policy and Procedures this constitutes a collusive practice in connection with an EBRD-financed project.

The settlement agreement provides for a reduced sanction, taking into account mitigating factors, including Onur’s admission of culpability, its cooperation with OCCO during the settlement process and the steps taken to strengthen its compliance programme. Onur’s sanction was significantly reduced further in light of a lengthy period of suspension previously imposed on Onur by the EBRD.

During the debarment period, Onur and its 53 subsidiaries are ineligible to participate in projects financed by the Bank.

This is part of a settlement agreement under which Onur admitted culpability for the underlying prohibited practice and agreed to meet specified conditions in order to be released from the conditional non-debarment.

Following the debarment, Onur will be eligible to participate in EBRD-financed projects during the conditional non-debarment period, subject to continued compliance with the terms of the settlement agreement and to ongoing cooperation with the EBRD.

Under the terms of the settlement, Onur has agreed to further enhance its compliance programme and to report on its progress through an independent consultant for a period of 2 years as a condition of release from the sanction. Onur will also conduct compliance audits to mitigate integrity risks across its activities and perform an internal investigation related to the EBRD-financed project.

In case of non-compliance with the conditions of the settlement, the conditional non-debarment will convert into an additional 5-year debarment period, in accordance with the terms of the settlement agreement.

The 1-year-and-3-month debarment qualifies for cross-debarment by other multilateral development banks under the Agreement for Mutual Enforcement of Debarment Decisions signed on 9 April 2010.

About OCCO

OCCO plays a central role in the EBRD’s commitment to integrity through its mandate to investigate prohibited practices in EBRD-financed projects. More information on OCCO’s broader mandate and the EBRD’s sanctions system is available on our website.