There are some key elements to consider when drafting the text of the Integrity Pact that is to be signed by the contracting authority and bidders.
Transparency International's Integrity Pacts in Public Procurement: An Implementation Guide outlines the substantive commitments typically included in an Integrity Pact:
- Undertaking by the authority that officials won’t demand or accept bribes, kickbacks, gifts, facilitation payments, etc., with appropriate administrative, disciplinary, civil or criminal sanctions in case of violation
- Undertaking by each bidder that it has not paid and will not offer or pay any bribes, kickbacks, facilitation payments, gifts, etc., in order to obtain or retain a contract; along with the appropriate contractual, administrative civil or criminal sanctions in case of violation
- An undertaking by each bidder that it has not colluded and will not collude with other bidders in order to rig or influence the tender process in any way
- An undertaking by each bidder to disclose to the authority and the monitor all payments made, or promised, in connection with contract in question to anybody (including agents and other middlemen). This refers to payments made directly as well as indirectly through family members, etc.
- The explicit acceptance by each bidder that the no-bribery commitment and the disclosure obligation as well as the corresponding sanctions, remain in force for the winning bidder until the contract has been fully executed.
- The explicit acceptance by each bidder that it will have to provide the same IP undertakings from all its subcontractors and joint-venture partners.
Reporting channel and dispute resolutions mechanism
Integrity Pacts should establish a clear process for reporting concerns about compliance with the anti-corruption and fair competition commitments.
The reporting process should also indicate conditions and procedures for escalating potential issues of concern, including options for dispute resolution.
Integrity Pacts are intended to complement existing legal anti-corruption and antitrust regimes, not replace them. As such, most Integrity Pacts to date have relied on existing civil or criminal sanctions that apply to the public contracting process. Some however, have included their own sanctions regime, such as:
- Denial or loss of contract;
- Forfeiture of security and performance bonds;
- Liability for damages to competing bidders; or
Where used, Integrity Pact sanctions must be effective, proportionate and dissuasive. There should also be a clear mechanism for the monitor to investigate allegations of misconduct, recommend sanctions or escalate the issue to the relevant authorities.
Integrity Pact sanctions regimes have only rarely been applied to date as their effectiveness has been difficult to measure. Whether or not sanctions are included, a clear red flags list and criteria for referral to existing civil/criminal sanctions regimes are also best practice.