SNC-Lavalin can still bid for government work despite corruption charges

Canadian engineer SNC-Lavalin has signed a deal with the Canadian government allowing it to continue bidding for federal contracts until corruption charges it faces are resolved.

The company, which has been hit by corruption scandals around the world in recent years, said the agreement signed under the government’s new integrity regime recognises its efforts to improve its ethics and compliance.

SNC insists it has made "huge investments in time and money" turning itself into an ethical company

In February Canadian police laid corruption and fraud charges against three of the firm’s legal entities as part of a criminal investigation that started in 2011 into the company’s business dealings in Libya.

The charges, which SNC denied and has pledged to contest, raised fears that it would lose out on billions of dollars worth of public contracts.

This unprecedented agreement, announced 10 December, will allay those fears for the time being. The ongoing case is expected to return to court in February 2016.

"This agreement is a milestone that allows us to continue to be an important contributor to the Canadian economy. It protects the public, and is good for our employees, clients, investors and all of Canada," said SNC’s president and chief executive, Neil Bruce, in a statement.

Bruce, who took over as CEO in October this year, has previously said the charges have limited the firm’s competitiveness in its target markets in many G7 countries.

SNC-Lavalin has been lobbying for so-called deferred prosecution agreements found in other countries that would allow companies to settle corporate corruption cases.

Under new rules announced in July, companies in Canada are barred from government contracts for 10 years if they have been convicted of bribery, money laundering or other criminal offences in the past three years. But that ban can be cut in half if the company co-operates with authorities and takes remedial action.

The government can also suspend a supplier for up to 18 months if it has been charged or has admitted guilt to a listed offence.

SNC insists it has made "huge investments in time and money" turning itself into an ethical company.

"The tone from the top is clear and unequivocal; there is zero tolerance for ethics violations," it said in a statement.

It points out that "individuals alleged to have been involved in past ethical issues" are no longer with the company. These include the former president and chief executive, Pierre Duhaime, who faces fraud charges.

Other measures have included implementing an antitrust and competition policy, a programme for whistleblowers, appointing compliance officers for every business sector, and giving compliance training and obligatory annual certification for all employees.

Photograph: SNC-Lavalin’s president and chief executive, Neil Bruce. In October 2015 Bruce replaced Robert Card, who took the helm of the company from Pierre Duhaime as multiple corruption scandals erupted in late 2012 (SNC-Lavalin)

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