What sanctions are used to punish the corrupt activities of a supplier?
Australia score: 50/100
Procurement officials have no authority to exclude companies or individuals implicated in bribery or corruption related offences.
Procurement officials have limited authority to exclude companies and senior company officials where there is a conviction or reasonable evidence of bribery & corruption related offences.
There is clear legislation and implementing guidelines empowering procurement officials to exclude companies and senior company officials where there is a conviction or credible evidence of bribery & corruption related offences.
Australia has been criticised for not having a formal debarment regime to exclude companies accused of bribery, corruption, and anti-competitive practices, though procurement officials are allowed to exclude companies and officials in the absence of official guidelines. The OECD [1, 2] and Transparency International  have both expressed their concern at a lack of government-wide debarment regime over several years. Additionally, there is a lack of consistency in debarment policy. The OECD Phase 4 report on Australia’s implementation of the Anti-Bribery Convention states that since at least 2012, “Australian public procurement agencies had the discretion to debar companies convicted of domestic or foreign bribery. It was a matter for individual agencies to develop their own policies in this regard” . The Senate Economics References Committee inquiry into Foreign Bribery report recommended in March 2018 that the government introduce a consistent and comprehensive debarment policy , but the government has not responded to or acted on this recommendation as of June 2020 . The Australian government justifies the lack of debarment regime by explaining, “it was inappropriate to ‘specify particular offences as grounds for termination,'” though many Australian allies, such as the U.S., Canada, and the European Union have successful debarment regimes that do specify particular offences as grounds for termination . In the absence of a formal debarment regime, the Foreign Bribery report stated that “while it is true that under the current Procurement Rules, relevant authorities have the discretion to debar (preclude) companies convicted of domestic or foreign bribery from public procurement contracts, this is not clearly stated” [4, p169]. It is not clear how aware Defence procurement officials are of the possibility of debarment, how exactly debarment works in Defence, or how often it is implemented, given the lack of legislation or policy outlining official powers and obligations. There is no evidence that an official debarment list exists, or that any company has ever been debarred for corruption and/or bribery by the Department of Defence or the Australian Commonwealth Government .
 Organisation for Economic Cooperation and Development, Implementing the OECD Anti-Bribery Convention: Phase 4 Report: Australia (December 2017), http://www.oecd.org/corruption/anti-bribery/Australia-Phase-4-Report-ENG.pdf, 46;
 Organisation for Economic Cooperation and Development, Phase 3 Report on Implementing the OECD Anti-Bribery Convention in Australia (October 2012), https://www.oecd.org/daf/anti-bribery/Australiaphase3reportEN.pdf, 46;
 Transparency International Australia, Submission to Senate Economics Committee Inquiry into Foreign Bribery (September 2015), https://www.aph.gov.au/DocumentStore.ashx?id=fddf6fc2-8da5-46b4-ae31-2a12c7fd0d56&subId=402434;
 Senate Economics References Committee, Foreign bribery (March 2018), https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Foreignbribery45th/~/media/Committees/economics_ctte/Foreignbribery45th/report.pdf, 175;
 Parliament of Australia. “Government Response.” https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Foreignbribery45th/Government_Response;
 Brian Whisler and Raija Churchill, Public Tools, Private Integrity: Shaping Exclusion Regimes to Motivate Business Integrity and Inclusive Growth (2017), https://www.oecd.org/cleangovbiz/Integrity-Forum-2017-Whisler-Churchill-exclusion-regimes.pdf;
 Media search by Country Assessor
69b. Undue influence
Australia score: 75/100
There is a complete failure to investigate or prosecute, even in the face of clear evidence.
Cases are superficially investigated, or receive "show" hearings in which defendants are not punished.
Cases are investigated but not often prosecuted. There is clear undue influence in the decision making process.
Cases are investigated or prosecuted through formal processes, but undue political influence is attempted, and sometimes effective at derailing prosecutions.
Cases are investigated or prosecuted through formal processes and without undue political influence.
The legal system in Australia is generally considered robust and without undue influence, with Australia ranked 12 of 126 countries for the quality of its criminal justice system by the World Justice Project in its 2019 Rule of Law Index . Procurement officials are expected to follow clear Codes of Conduct, which precludes favouritism and unethical behaviour, in all areas of responsibility [2, 3], including in their decisions to debar companies. However, in the absence of clear, public guidelines and policies, the door is open to subjective debarment decisions which may be influenced, intentionally or not, by relations with suppliers or political considerations. It is alleged that political considerations and supplier relations played a large role in the unprecedented forced redaction by the Attorney-General of a critical Australian National Audit Office report on the Hawkei combat vehicle . While undue influence does not appear to be a concern in the legal system, the Hawkei case and enhanced secrecy around politically compromising information [5-7] creates reasonable doubt that undue influence would not be a concern among procurement officials, particularly political appointees who make high-level decisions. There are no recent public cases where companies were debarred from Defence contracts for corruption related offences , but concern has been raised over the engagement of and lack of corruption controls employed for Naval Group on the Future Submarine Program. Naval Group has been repeatedly embroiled in corruption scandals, yet it was chosen as the supplier for the $50 billion Future Submarines Project, seemingly without any corruption control requirements built into the contract . Observers have made arguments that Naval Group was probably chosen for reasons of political expediency [5, 10].
 World Justice Project, 2019, “Australia.” http://data.worldjusticeproject.org/#/groups/AUS;
 Department of Defence, Military Personnel Policy Manual (December 2017), https://web.archive.org/web/20200406111748/https://www.defence.gov.au/PayAndConditions/ADF/Resources/MILPERSMAN.pdf;
 Public Service Act 1999 (Cth) s. 13 (Austl.);
 Christopher Knaus, 2018, ”Coalition suppressed auditor’s finding that $1.3bn Thales arms deal could have cost half with US,” The Guardian Australia, October 22, 2018, https://www.theguardian.com/australia-news/2018/oct/22/coalition-suppressed-auditors-finding-that-13bn-thales-arms-deal-could-have-cost-half-with-us;
 Interviewee A – Dr Marcus Hellyer, Senior Analyst, Australian Strategic Policy Institute, 13 August 2019 and 29 August 2019;
 Interviewee C – National newspaper reporters, 16 August 2019;
 Interviewee D – Federal politician, 19 August 2019;
 Media search by Country Assessor;
 Chris Douglas, 2018, Australia’s Submarine Program:
A Failure in Anti-Corruption Due Diligence? (March 2018), https://static1.squarespace.com/static/56a1c11f42f55205af184069/t/5adc8d4b1ae6cfbd0c63d34a/1524403537081/Australian+Submarine+Program+A+Failure+in+Due+Diligence.pdf;
 Interviewee B – Australia anti-corruption risk expert, 13 August 2019
69c. Application of sanctions
Australia score: 25/100
It is not clear if offences result in sanctions.
Offences rarely result in sanctions.
Offences sometimes result in appropriate sanctions, but not on a regular basis.
An offence can regularly result in softer sanctions (e.g. administrative fines), but not prosecution or exclusion.
An offence can regularly result in a range of sanctions, including prosecution, exclusion from current and future competitions, or other sanctions, including heavy fines or imprisonment.
It appears that corruption-related offences do not often attract sanctions, though a paucity of examples of procurement corruption investigated or prosecuted makes it difficult to tell. There have been no recent public cases of Defence procurement corruption prosecuted . However, media reports revealed that the Defence Audit and Fraud Control Division undertook a 10-month internal investigation in 2016 in response to allegations of significant mismanagement and corruption , including wanton disregard for procurement standards and “Defence Department staffers colluding with contracting companies to design handsomely-paid jobs with requirements tailored to their own qualifications and experience” . None of the individuals or companies involved faced sanctions, nor were the allegations referred to external investigators such as the Australian Federal Police, because “‘An initial assessment of the matter determined that there was insufficient evidence to substantiate the allegations relating to fraudulent and corrupt conduct,'” though other serious problems were revealed . There was also inadequate evidence of corrupt conduct by contracting companies to warrant a deeper investigation, “although one company was no longer engaged on Defence contracts,”  though it is unclear if they were debarred or if Defence contracts they were engaged on simply ended.
 Media search by Country Assessor;
 Steven Trask, 2017, ”Allegations of systemic fraud sparked Defence Department internal audit,” The Sydney Morning Herald, December 15, 2017, https://www.smh.com.au/public-service/allegations-of-systemic-fraud-sparked-defence-department-internal-audit-20171114-gzkw5j.html;
 Steven Trask, 2017, ”Whistleblower sparks Defence Department fraud investigation,” The Sydney Morning Herald, October 16, 2017, https://www.smh.com.au/public-service/whistleblower-sparks-defence-department-fraud-investigation-20171013-gz08zx.html
Compare scores by country
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|Country||69a. Sanctions||69b. Undue influence||69c. Application of sanctions|
|Albania||100 / 100||50 / 100||0 / 100|
|Algeria||100 / 100||50 / 100||0 / 100|
|Angola||100 / 100||50 / 100||0 / 100|
|Argentina||100 / 100||50 / 100||0 / 100|
|Armenia||100 / 100||75 / 100||100 / 100|
|Australia||50 / 100||75 / 100||25 / 100|
|Azerbaijan||50 / 100||0 / 100||0 / 100|
|Bahrain||0 / 100||NA||NA|
|Bangladesh||50 / 100||NEI||NEI|
|Belgium||75 / 100||100 / 100||NEI|
|Bosnia and Herzegovina||100 / 100||0 / 100||NEI|
|Botswana||100 / 100||50 / 100||NEI|
|Brazil||50 / 100||75 / 100||75 / 100|
|Burkina Faso||100 / 100||25 / 100||25 / 100|
|Cameroon||0 / 100||NA||NA|
|Canada||100 / 100||75 / 100||100 / 100|
|Chile||75 / 100||NEI||NEI|
|China||100 / 100||50 / 100||25 / 100|
|Colombia||50 / 100||50 / 100||100 / 100|
|Cote d'Ivoire||100 / 100||100 / 100||100 / 100|
|Denmark||100 / 100||100 / 100||100 / 100|
|Egypt||0 / 100||NA||NA|
|Estonia||100 / 100||100 / 100||100 / 100|
|Finland||100 / 100||100 / 100||NEI|
|France||75 / 100||100 / 100||75 / 100|
|Germany||100 / 100||75 / 100||75 / 100|
|Ghana||100 / 100||50 / 100||0 / 100|
|Greece||100 / 100||75 / 100||100 / 100|
|Hungary||100 / 100||50 / 100||50 / 100|
|India||50 / 100||75 / 100||100 / 100|
|Indonesia||100 / 100||75 / 100||75 / 100|
|Iran||0 / 100||NA||NA|
|Iraq||25 / 100||50 / 100||0 / 100|
|Israel||100 / 100||75 / 100||50 / 100|
|Italy||100 / 100||75 / 100||100 / 100|
|Japan||100 / 100||100 / 100||100 / 100|
|Jordan||0 / 100||NA||NA|
|Kenya||75 / 100||NEI||50 / 100|
|Kosovo||100 / 100||75 / 100||25 / 100|
|Kuwait||0 / 100||NA||NA|
|Latvia||100 / 100||100 / 100||NEI|
|Lebanon||100 / 100||0 / 100||0 / 100|
|Lithuania||50 / 100||100 / 100||75 / 100|
|Malaysia||25 / 100||75 / 100||50 / 100|
|Mali||50 / 100||25 / 100||25 / 100|
|Mexico||50 / 100||0 / 100||75 / 100|
|Montenegro||75 / 100||0 / 100||0 / 100|
|Morocco||0 / 100||NA||NA|
|Myanmar||0 / 100||NA||NA|
|Netherlands||100 / 100||50 / 100||NEI|
|New Zealand||100 / 100||100 / 100||NEI|
|Niger||100 / 100||0 / 100||0 / 100|
|Nigeria||NEI||50 / 100||0 / 100|
|North Macedonia||50 / 100||75 / 100||100 / 100|
|Norway||100 / 100||100 / 100||100 / 100|
|Oman||0 / 100||NA||NA|
|Palestine||100 / 100||50 / 100||25 / 100|
|Philippines||100 / 100||50 / 100||0 / 100|
|Poland||100 / 100||75 / 100||25 / 100|
|Portugal||50 / 100||100 / 100||75 / 100|
|Qatar||0 / 100||NA||NA|
|Russia||100 / 100||75 / 100||75 / 100|
|Saudi Arabia||0 / 100||NA||NA|
|Serbia||50 / 100||100 / 100||0 / 100|
|Singapore||100 / 100||100 / 100||75 / 100|
|South Africa||75 / 100||25 / 100||75 / 100|
|South Korea||100 / 100||100 / 100||100 / 100|
|South Sudan||100 / 100||NEI||0 / 100|
|Spain||50 / 100||NEI||50 / 100|
|Sudan||0 / 100||NA||0 / 100|
|Sweden||100 / 100||100 / 100||100 / 100|
|Switzerland||50 / 100||NEI||NEI|
|Taiwan||100 / 100||100 / 100||75 / 100|
|Tanzania||100 / 100||25 / 100||0 / 100|
|Thailand||50 / 100||0 / 100||0 / 100|
|Tunisia||100 / 100||75 / 100||50 / 100|
|Turkey||50 / 100||25 / 100||25 / 100|
|Uganda||100 / 100||25 / 100||50 / 100|
|Ukraine||50 / 100||25 / 100||75 / 100|
|United Arab Emirates||0 / 100||NA||NA|
|United Kingdom||100 / 100||100 / 100||25 / 100|
|United States||100 / 100||100 / 100||75 / 100|
|Venezuela||50 / 100||0 / 100||0 / 100|
|Zimbabwe||100 / 100||75 / 100||NEI|