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Notice of Uncontested Sanctions Proceedings
April29, 2014
Sanctions Case No. 302 IDA Credit Number 4378-BO
(Bolivia Second Participatory Rural Investment Project)
Respondents: Comsatel
Artifex Telecomunicaciones S.R.L. Mr. Samuel Cardenas Colque Mr.
Alfredo Echalar Franco
1. On January 24, 2014, the World Bank' s Chief Suspension and
Debarment Officer (the "SDO") issued a Notice of Sanctions
Proceedings (the "Notice") to Comsatel, Artifex Telecomunicaciones
S.R.L. ("Artifex"), Mr. Samuel Cardenas Colque ("Mr. Cardenas") and
Mr. Alfredo Echalar Franco ("Mr. Echalar") (the "Respondents")
pursuant to Section 4.0l(a) of the World Bank Sanctions Procedures,
as adopted by the World Bank as of Aprill5, 2012 (the "Sanctions
Procedures").
2. The Statement of Accusations and Evidence ("SAE") prepared by
the Bank's Integrity Vice Presidency ("INT") and appended to the
Notice contained INT's accusation that the Respondents engaged in
sanctionable practices in connection with the above-named project
(the "Project"). The SAE also contained the evidence gathered by
INT in support of this accusation.
3. The specific accusation made by INT in the SAE was that the
Respondents engaged in collusive practices by taking part in an
arrangement designed to establish prices at artificial,
non-competitive levels and to deprive the borrower of the benefits
of free and open competition. This arrangement involved fixing the
prices and coordinating the preparation of the firms' bids for
three World Bank-financed supply contracts.
4. Based on a review ofiNT's SAE conducted in accordance with
Section 4.0l(a) of the Sanctions Procedures, and pursuant to
Section 4.0l(c), Section 9.01 and Section 9.04 of the Sanctions
Procedures, with due consideration of the factors set forth in
Section 9.02 ofthe Sanctions Procedures and in the World Bank
Sanctioning Guidelines, the SDO recommended in the Notice that the
Respondents, together with certain Affiliates (as defined in the
Sanctions Procedures) where so specified, be sanctioned as
follows:
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Respondent 1 Comsatel
It is recommended that Comsatel (together with any entity that
is an Affiliate directly or indirectly controlled by Comsatel) be
declared ineligible (i) to be awarded or otherwise benefit from a
Bank-financed contract, financially or in any other manner, 1 (ii)
to be a nominated2 sub-contractor, consultant, manufacturer or
supplier, or service provider of an otherwise eligible firm being
awarded a Bank-financed contract, and (iii) to receive the proceeds
of any loan made by the Bank or otherwise to participate further in
the preparation or implementation of any project or program
financed by the Bank and governed by the Bank's Procurement
Guidelines, Consultant Guidelines or Anti-Corruption Guidelines,·
provided, however, that after a minimum period of ineligibility of
seven (7) years, Comsatel may be released from ineligibility only
ifComsatel has, in accordance with Section 9. 03 of the Sanctions
Procedures, demonstrated to the Bank Group's Integrity Compliance
Officer that Comsatel has complied with the following
condilions:
(a) Comsatel has taken appropriate remedial measures to address
the sanctionable practices for which Comsatel has been sanctioned,·
and
(b) Comsatel has adopted and implemented an effective integrity
compliance program in a manner satisfactory to the Bank.
In determining this recommended sanction, the SDO took into
account as aggravating/actors (i) the involvement ofComsatel 's
manager in the misconduct and (ii) the fact that Comsatel 's
manager played a central role in the organization of the alleged
collusive scheme. The SDO also took into account as aggravating
factors (iii) the fact that Comsatel submitted bids in multiple
selection processes affected by the Respondents ' collusive
practices and (iv) the fact that Comsatel 's manager inte!fered
with the investigative process by making false statements to
investigators in order to materially impede the Bank's
investigation.
For the avoidance of doubt, the declaration of ineligibility to
be awarded a contract will include, without limitation, {i)
applyingfor pre-qualification, expressing interest in a
consultancy, and bidding, either directly or as a nominated
sub-contractor, nominated consultant, nominated manufacturer or
supplier, or nominated service provider, in respect of such
contract, and (ii) entering into an addendum or amendment
introducing a material modification to any existing contract. }
A nominated sub-contractor, nominated consultant, nominated
manufacturer or supplier, or nominated service provider (different
names are used depending on the particular bidding document) is one
which has been: (i) included by the bidder in its pre-qualification
application or bid because it brings specific and critical
experience and know-how that allow the bidder to meet the
qualification requirements for the particular bid; or {ii)
appointed by the borrower.
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The foregoing declaration of ineligibility will extend across
the operations of the World Bank Grolf, including IFC, MIGA and the
guarantee operations of the Bank. The Bank will also provide notice
of this declaration of ineligibility to the other multilateral
development banks ("MDBs ") that are party to the Agreement for
Mutual Enforcement of Debarment Decisions (the "MDB Cross-Debarment
Agreement") so that they may determine whether to enforce the
declarations of ineligibility with respect to their own operations
in accordance with the MDB Cross-Debarment Agreement and their own
policies and procedures. 4
Respondent 2 Artifex Telecomunicaciones S. R.L. ("Artifex ")
It is recommended that Artifex (together with any entity that is
an Affiliate directly or indirectly controlled by Artifex) be
declared ineligible (i) to be awarded or otherwise benefit from a
Bank-financed contract, financially or in any other manner, 5 (ii)
to be a nominatecf sub-contractor, consultant, manufacturer or
supplier, or service provider of an otherwise eligible firm being
awarded a Bank-financed contract, and (iii) to receive the proceeds
of any loan made by the Bank or otherwise to participate
{World Bank Sanctions Procedures} , at 23-24 (Section 9.0/(c)).
For the avoidance of doubt, the declaration of ineligibility also
extends to activities financed through trustfimds administered by
the Bank to the extent governed by the Bank 's Procurement
Guidelines, Consultant Guidelines or Anti-Corruption Guidelines.
Jd. at 2 (Section 1. 0 I (c)(i)).
At present, the MDBs that are party to the MDB Cross-Debarment
Agreement are the Bank Group, the African Development Bank Group,
the Asian Development Bank, the European Bank for Reconstruction
and Development and the inter-American Development Bank Group. The
MDB Cross-Debarment Agreement provides that, subject to the
prerequisite conditions set forth in the MDB Cross-Debarment
Agreement, unless a p articipating MDB (i) believes that any of the
prerequisite conditions set forth in the MDB Cross-Debarment
Agreement have not been met or (ii) decides to exercise its rights
under the "opt out " clause set forth in the MDB Cross-Debarment
Agreement, each participating MDB will promptly enforce the
debarment decisions of the other participating MDBs. More
information about the MDB Cross-Debarment Agreement is available on
the Bank 's external website (http://go.worldbank. org/B699B73QOO).
5 For the avoidance of doubt, the declaration o[fneligibility to be
awarded a contract will include, without limitation, (i) apply ing
f or pre-qualification, expressing interest in a consultancy, and
bidding, either directly or as a nominated sub-contractor,
nominated consultant, nominated manufacturer or supplier, or
nominated service provider, in respect of such contract, and (ii)
entering into an addendum or amendment introducing a material
modification to any existing contract. 6 A nominated
sub-contractor, nominated consultant, nominated manuf acturer or
supplier, or nominated service provider (different names are used
depending on the particular bidding document) is one which has
been: (i) included by the bidder in its pre-qualification
application or bid because it brings specific and critical exp
erience and know-how that allow the bidder to meet the
qualification requirements for the particular bid; or (ii)
appointed by the borrower.
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further in the preparation or implementation of any project or
program financed by the Bank and governed by the Bank's Procurement
Guidelines, Consultant Guidelines or Anti-Corruption Guidelines;
provided, however, that after a minimum period of ineligibility of
two (2) years, Artifex may be released from ineligibility only if
Artifex has, in accordance with Section 9. 03 of the Sanctions
Procedures, demonstrated to the Bank Group's Integrity Compliance
Officer that Artifex has complied with the following
conditions:
(a) Artifex has taken appropriate remedial measures to address
the sanctionable practices for which Artifex has been sanctioned;
and
(b) Artifex has adopted and implemented an effective integrity
compliance program in a manner satisfactory to the Bank.
In determining this recommended sanction, the SDO took into
account as aggravating factors (i) the involvement of Artifex 's
general manager in the misconduct and (ii) the fact that Artifex
submitted proposals in multiple selection processes affected by the
Respondents' collusive practices. The SDO took into account as a
mitigating factor the fact that Artifex was a minor participant in
the misconduct, and a designated loser in each of the selection
processes. The SDO also took into account as a mitigating factor
INT's representations as to the extent of Artifex 's cooperation
during the course of the investigation, noting in particular that
Artifex 's general manager met with INT and admitted that Artifex
had engaged in the alleged sanctionable practice.
The foregoing declaration of ineligibility will extend across
the operations of the World Bank Grolff, including IFC, MIGA and
the guarantee operations of the Bank. The Bank will also provide
notice of this declaration of ineligibility to the other
multilateral development banks ("MDBs ") that are party to the
Agreement for Mutual Enforcement of Debarment Decisions (the "MDB
Cross-Debarment Agreement'') so that they may determine whether to
enforce the declarations of ineligibility with respect to their own
operations in accordance with the MDB Cross-Debarment Agreement and
their own policies and procedures. 8
[World Bank Sanctions Procedures}, at 23-24 (Section 9.0/(c)).
For the avoidance of doubt, the declaration of ineligibility also
extends to activities financed through trust funds administered by
the Bank to the extent governed by the Bank's Procurement
Guidelines, Consultant Guidelines or Anti-Corruption Guidelines. ld
at 2 (Section 1.0/(c)(i)). 8 At present, the MDBs that are party to
the MDB Cross-Debarment Agreement are the Bank Group, the Afhcan
Development Bank Group, the Asian Development Bank, the European
Bank for Reconstruction and Development and the Inter-American
Development Bank Group. The MDB Cross-Debarment Agreement provides
that, subject to the prerequisite conditions set forth in the MDB
Cross-Debarment Agreement, unless a participating MDB (i) believes
that any of the prerequisite conditions set forth in the
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Respondent 3 Mr. Samuel Cardenas Co/que ("Mr. Cardenas ")
It is recommended !hat Mr. Cardenas (together with any entity
that is an Affiliate directly or indirectly controlled by Mr.
Cardenas) be declared ineligible (i) to be awarded or otherwise
benefit from a Bank-financed contract, financially or in any other
manner, 9 (ii) to be a nominated10 sub-contractor, consultant,
manufacturer or supplier, or service provider of an otherwise
eligible firm being awarded a Bank-financed contract, and (iii) to
receive the proceeds of any loan made by the Bank or otherwise to
participate further in the preparation or implemenlation of any
project or program financed by the Bank and governed by the Bank's
Procurement Guidelines, Consultant Guidelines or Anti-Corruption
Guidelines; provided, however, that after a minimum period of
ineligibility of seven (7) years, Mr. Cardenas may be released from
ineligibility only if Mr. Cardenas has, in accordance wilh Section
9. 03 of the Sanctions Procedures, demonstrated to the Bank Group
's Integrity Compliance Officer that Mr. Cardenas has complied with
the following conditions:
(a) Mr. Cardenas has taken appropriate remedial measures to
address the sanctionable practices for which Mr. Cardenas has been
sanctioned;
(b) Mr. Cardenas has compleled training and/or other educational
programs that demons/rate a continuing commitment to personal
integrity and business ethics,· and
(c) Any entity that is an Affiliate directly or indirectly
controlled by Mr. Cardenas has adopted and implemented an effective
integrity compliance program in a manner satisfactory to the
Bank.
MDB Cross-Debarment Agreement have not been met or (ii) decides
to exercise its rights under the "opt out " clause set forth in the
MDB Cross-Debarment Agreement, each participating MDB will promptly
enforce the debarment decisions of the other participating MDBs.
More information about the MDB Cross-Debarment Agreement is
available on the Bank's external website (http://go.
worldbank.org/8699873QOO). 9 For the avoidance of doubt, the
declaration of inelig ibility to be awarded a contract will
include, without/imitation, (i) apply ing f or pre-qualification,
expressing interest in a consultancy, and bidding, either directly
or as a nominated sub-contractor, nominated consultant, nominated
manufacturer or supplier, or nominated service provider, in respect
of such contract, and (ii} entering into an addendum or amendment
introducing a material modification to any existing contract. 10 A
nominated sub-contractor, nominated consultant, nominated
manufacturer or supplier, or nominated service provider (different
names are used depending on the particular bidding document) is one
which has been: (i) included by the bidder in its pre-qualification
application or bid because ft brings sp ecific and critical
experience and know-how that allow the bidder to meet the
qualification requirements f or the particular bid,· or (ii}
appointed by the borrower.
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In determining this recommended sanction, the SDO took into
account as aggravating factors (i) the fact that Mr. Cardenas was
the manager of one of the corporate Respondents and (ii) the fact
that Mr. Cardenas played a central role in the organization of the
alleged collusive scheme. The SDO also took into account as
aggravating factors (iii) the fact that Mr. Cardenas submilted bids
in multiple selection processes affected by the Respondents'
collusive practices and (iv) the fact that Mr. Cardenas interfered
with the investigative process by making false statements to
investigators in order to materially impede the Bank's
investigation.
The foregoing declaration of ineligibility will extend across
the operations of the World Bank Grou;;, including IFC, MIGA and
the guarantee operations of the Bank. 1 The Bank will also provide
notice of this declaration of ineligibility to the other
multilateral development banks ( "MDBs ") that are party to the
Agreement for Mutual Enforcement of Debarment Decisions (the "MDB
Cross-Debarment Agreement'') so that they may determine whether to
enforce the declarations of ineligibility with respect to their own
operations in accordance with the MDB Cross-Debarment Agreement and
their own policies and procedures. 12
Respondent 4 Mr. Alfredo Echalar Franco ("Mr. Echalar ")
It is recommended that Mr. Echalar (together with any entity
that is an Affiliate directly or indirectly controlled by Mr.
Echala1) be declared ineligible (i) to be awarded or otherwise
benefit from a Bank-financed
fi ' ll . h 13 r;l b . d/4 contract, nancra y or zn any ot er
manner, 1 u1 to e a nom mate
II [World Bank Sanctions Procedures}, at 23-24 (Section
9.01(c)). For the avoidance of doubt, the declaration of
ineligibility also extends to activities financed through trust f
unds administered by the Bank to the extent governed by the Bank 's
Procurement Guidelines, Consultant Guidelines or Anti-Corruption
Guidelines. fd at 2 (Section I.OI(c)(i)). 12 At present, the MDBs
that are party to the MDB Cross-Debarment Agreement are the Bank
Group, the African Development Bank Group, the Asian Development
Bank, the European Bank for Reconstruction and Development and the
Inter-American Development Bank Group. The MDB Cross-Debarment
Agreement provides that, subject to the prerequisite conditions set
f orth in the MDB Cross-Debarment Agreement, unless a participating
MDB (i) believes that any oft he prerequisite conditions set f orth
in the MDB Cross-Debarment Agreement have not been met or (ii)
decides to exercise its rights under the "opt out " clause set
forth in the MDB Cross-Debarment Agreement, each participating MDB
will promptly enforce the debarment decisions of the other
participating MOBs. More information about the MDB Cross-Debarment
Agreement is available on the Bank's external website (http://go.
worldbank. org/B699B73QOO). 13 For the avoidance of doubt, the
declaration of inelig ibility to be awarded a contract will
include, without limitation, (i) apply ing f or pre-qualification,
expressing interest in a consultancy, and bidding, either directly
or as a nominated sub-contractor, nominated consultant, nominated
manufacturer or supplier, or nominated service
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sub-contractor, consultant, manufacturer or supplier, or service
provider of an otherwise eligible firm being awarded a
Bank-financed contract, and (iii) to receive the proceeds of any
loan made by the Bank or otherwise to participate further in the
preparation or implementation of a11y project or program financed
by the Bank and governed by the Bank's Procurement Guidelines,
Consultant Guidelines or Anti-Corruption Guidelines; provided.
however, that after a minimum period of ineligibility of two (2)
years, Mr. Echalar may be released from ineligibility only if Mr.
Echalar has, in accordance with Section 9. 03 of the Sanctions
Procedures, demonstrated to the Bank Group's Integrity Compliance
Officer that Mr. Echalar has complied with the following
conditions:
(a) Mr. Echalar has taken appropriate remedial measures to
address the sanctionable practices for which Mr. Echalar has been
sanctioned,·
(b) Mr. Echalar has completed training and/or other educational
programs that demonstrate a continuing commitment to personal
integrity and business ethics; and
(c) Any entity that is an Affiliate directly or indirectly
controlled by Mr. Echalar has adopted and implemented an effective
integrity compliance program in a manner satisfactory to the
Bank.
In determining this recommended sanction, the SDO took into
account as aggravating factors (i) the fact that Mr. Echalar was
the general manager of one of the cmporate Respondents and (ii) the
fact that Mr. Echalar allowed the submission of proposals in the
name of his firm in multiple selection processes affected by the
Respondents ' collusive practices. The SDO took into account as a
mitigating factor the fact that Mr. Echalar was a minor participant
in the misconduct, and that his firm was a designated loser in each
of the selection processes. The SDO also took into account as a
mitigating factor INT's representations as to the extent of Mr.
Echalar 's cooperation during the course of the investigation,
noting in particular that Mr. Echalar met with !NT and admitted
that he had engaged in the alleged sanctionable practice.
The foregoing declaration of ineligibility will extend across
the operations of the World Bank Group, including IFC, MIGA and the
guarantee
provider, in respect of such contract, and (ii) entering into an
addendum or amendment introducing a material modification to any
existing contract.
A nominated sub-contractor, nominated consultant, nominated
manufacturer or supplier, or nominated service provider (different
names are used depending on the p articular bidding document) is
one which has been: (i) included by the bidder in its
pre-qualification application or bid because it brings specific and
critical experience and know-how that allow the bidder to meet the
qualification requirements f or the particular bid; or (ii)
appointed by the borrower.
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operations of the Bank. 15 The Bank will also provide notice of
this declaration of ineligibility to the other multilateral
development banks ("MDBs ") that are party to the Agreement for
Mutual Enforcement of Debarment Decisions (the "MDB Cross-Debarment
Agreement") so that they may determine whether to enforce the
declarations of ineligibility with respect to their own operations
in accordance with the MDB Cross-Debarment Agreement and their own
policies and procedures. 16
5. In accordance with Section 4.02(b) ofthe Sanctions
Procedures, Comsatel and Mr. Cardenas submitted a written
Explanation (as defined in the Sanctions Procedures) on February
28, 2014. After consideration of the arguments and evidence
presented by INT in the SAE appended to the Notice and the
arguments and evidence presented in the Explanation, the SDO
determined that there was no basis for (i) a withdrawal of the
Notice pursuant to Section 4.03(a)(i) ofthe Sanctions Procedures;
or (ii) a revision of the recommended sanction pursuant to Section
4.03(a)(ii) of the Sanctions Procedures.
6. Neither Artifex nor Mr. Echalar submitted a written
Explanation (as defined in the Sanctions Procedures) in accordance
with Section 4.02(b) of the Sanctions Procedures.
7. Section 4.04 of the Sanctions Procedures provides that if a
respondent does not contest the accusations or the sanction
recommended by the SDO in a Notice of Sanctions Proceedings by
submitting a Response (as defined in the Sanctions Procedures) to
the World Bank Group Sanctions Board (the "Sanctions Board") within
ninety (90) days after delivery of such Notice of Sanctions
Proceedings, the sanction(s) recommended by the SDO shall enter
immediately into force.
8. No Response having been submitted to the Sanctions Board by
any of the Respondents within the specified period, INT' s
accusation in the SAE and the sanctions recommended by the SDO in
the Notice are deemed uncontested for
15 [World Bank Sanctions Procedures} , at 23-24 (Section
9.0/(c)). For the avoidance of doubt, the declaration of
ineligibility also extends to activities financed through trust
funds administered by the Bank to the extent governed by the Bank
's Procurement Guidelines, Consultant Guidelines or Anti-Corruption
Guidelines. /d. at 2 (Section / .0/(c)(i)).
16 At present, the MDBs that are party to the MDB
Cross-Debarment Agreement are the Bank Group, the African
Development Bank Group, the Asian Development Bank, the European
Bank f or Reconstruction and Development and the Inter-American
Development Bank Group. The MDB Cross-Debarment Agreement provides
that, subject to the prerequisite conditions set f orth in the MDB
Cross-Debarment Agreement, unless a participating MDB (i) believes
that any of the prerequisite conditions set forth in the MDB
Cross-Debarment Agreement have not been met or (ii) decides to
exercise its rights under the "opt out " clause set f orth in the
MDB Cross-Debarment Agreement, each participating MDB will promptly
enforce the debarment decisions of the other participating MDBs.
More information about the MDB Cross-Debarment Agreement is
available on the Bank's external website (http://go. worldbank.
org/B699B73QOO).
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purposes of Section 4.04 of the Sanctions Procedures, and the
recommended sanctions set forth in paragraph 4 above have entered
into force as of the date hereof.
Pascale Helene Dubois Chief Suspension and Debarment Officer
Office of Suspension and Debarment (OSD) The World Bank
9