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JunHe Helped a Leading Listed Technology Company to be Released from World Bank Group’s Sanction

2021.02.08

The Client (“Company” or “Client”) is an internationally renowned listed technology company, which has market across 147 countries and regions with annual revenues amounting to over USD 8 billion. In 2017, the World Bank Group (“WBG”) initiated an investigation against the unintentional misconduct committed by an employee of a subsidiary of the Company in the bidding for a WBG-financed infrastructure project in Africa and issued a Show Cause Letter to the Company.


Upon the engagement by the Client, JunHe immediately assisted Client to sort out background information and collect mitigating evidences, and promptly developed a basic strategy of actively reaching settlement with the WBG and seeking for mitigated sanction. Following such basic strategy, JunHe assisted the Company to collect and organize large amount of evidence that is conducive to mitigate the WBG sanction, drafted and submitted a number of letters in English in response to the WBG to clarify relevant factual and legal issues. In the meantime, JunHe represented the Client to carry out several rounds of negotiation with WBG’s Integrity Vice Presidency and ultimately entered into a Settlement Agreement with WBG who agreed to mitigate the sanction imposed on the Company. 


In order to comply with the Settlement Agreement and the WBG’s Integrity Compliance Guidelines, JunHe helped the Client establish thirteen (13) sets of compliance rules of WBG’s integrity compliance standards, and conducted various compliance trainings to the senior executives, compliance officers and all employees of the Company, and promote the implementation of a compliance system consistent with international standards by the Company. During the course of compliance rectification, JunHe assisted the Company to actively cooperate with the Independent Integrity Compliance Monitor (“Monitor”) appointed by and on behalf of the WBG, such as providing the materials requested and answering the questions raised, in particular demonstrating the significant improvement in the compliance management and rectification during the three site visits by the Monitor, which was recognized and commended by both the Monitor and the WBG. 


What is worth being highlighted is that the pandemic of COVID-10 broke during the critical period of compliance rectification, as a result, various compliance work has been negatively affected to a certain extent. Nevertheless, JunHe and the Company made joint efforts to overcome the difficulties caused by the pandemic and pioneered virtual site visits to ensure all the compliance work move as originally scheduled under the Settlement Agreement and avoid the delay for the release from sanction. Upon successful completion of all three site visits, JunHe drafted the dozens-pages Application for Release from Sanction in English on behalf of the Company, together with more than 150 supporting evidences articulating in detail the reasons and grounds for the Company to be released from the WBG sanction. Based on all the work above, WBG ultimately issued an official notice to the Company on January 20, 2021 notifying that the Company has satisfied all the conditions of release required in the Settlement Agreement, and the WBG has determined to release the Company from the sanction according to the WBG Sanctions Procedures. 


Being released from sanction is of great significance to the Company, which not only helps the Company regain the opportunities to participate in the projects financed by WBG and other multilateral development banks, but also catalyzes from scratch the establishment of a well-functioning compliance management system within the Company with international standards to ensure the sustainable and healthy development of the Company. In the Release Notice, the WBG spoke highly of the Company’s compliance management achievements and invited the Company to serve as a “Mentor” to other companies sanctioned by WBG to share the Company’s successful experience in improving compliance management, which fully demonstrates the WBG’s recognition of the achievements made by the Company in compliance management. 


This is another example in which JunHe has assisted Chinese company to be successful released from the MDB sanction through negotiating reaching settlement with the WBG and carrying out all-round compliance rectification, and is also the first good news at the beginning of 2021 for a Chinese company being released from the WBG sanction, which again demonstrates JunHe’s in-depth understanding of the WBG integrity compliance rules as well as the abundance experiences of JunHe team in handling WBG sanction-related investigations and compliance matters. 


The leading Partners of this case are Ms. Christine KANG and Mr. ZHOU, Xianfeng (Elvis).

JunHe is the only Chinese law firm to be admitted as a member of Lex Mundi and Multilaw, two international networks of independent law firms. JunHe and selected top law firms in major European and Asian jurisdictions are “best friends.” Through these connections, we provide high quality legal services to clients doing business throughout the world.