Procurement Risk:
Critical
Score:
9/100
Government Policy
Q57
0/100
Does the country have legislation covering defence and security procurement with clauses specific to corruption risks, and are any items exempt from these laws?
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Existing legislation offers no explicit reference of laws governing Iraq’s defence procurement needs (1) which at best, appears scattered and vague. Public Contracts Law…
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Corruption risks associated with defence procurement are loosely addressed and defined under Iraq’s Civil (1) and Military Penal Code (2). Despite that, the prevalence…
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As mentioned in Q57A, there is no legislation which explicitly regulates defence procurement within Iraq. Press coverage offers an adequate account of what can…
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Q58
25/100
Is the defence procurement cycle process, from assessment of needs, through contract implementation and sign-off, all the way to asset disposal, disclosed to the public?
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In light of poor procurement regulations, procurement procedures, at any given stage in the procurement cycle, are generally not disclosed to the public. There…
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As mentioned in 58A, no stage of the procurement cycle is publicly disclosed. The official Directory of Iraqi Tenders (1) features a digitised catalogue…
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An important regulation surfaces in Article 3.3A of ‘Regulations for Implementing Government Contracts’ [4], as part of Iraq’s coverage commitments towards corruption-reduction under OECD’s…
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Q59
8/100
Are defence procurement oversight mechanisms in place and are these oversight mechanisms active and transparent?
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Procurement processes in Iraq have suffered from underdevelopment (1), and in the absence of a mature acquisitions system, procurement oversight is not transparent. The…
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Investigations or calls for investigations are often obstructed or inconclusive due to political pressure or threats (1), (2), (3). In other cases, investigations have…
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While mechanisms exist, they do not translate into a regulatory framework adhered to by political officials and members of the special committee formed to…
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Needs are not outlined beneath a comprehensive strategy. Iraq’s parliamentary and defence committee discuss its advisory and capacity to support defence purchases in round…
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There is rarely any data about future purchase plans unless the information is leaked from inside the MoD. This was the case back in…
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Potential and actual defence purchases are not disclosed on official ministerial platforms, nor are the legal provisions that demand the GoI or MoD to…
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Even when deals are publicly disclosed, ambiguity reigns; it happened in 2014 when a defence purchase with Iran was made public, but then immediately…
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Capability Gap and Requirements Definition
Q62
0/100
What procedures and standards are companies required to have – such as compliance programmes and business conduct programmes – in order to be able to bid for work for the Ministry of Defence or armed forces?
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While various state ministries have published specific public contract guides, ministry of defence contracts are only briefly mentioned in ‘A Guide to the Implementation…
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Without the existence of a broader procurement strategy, it cannot be said that Iraq’s MoD and armed forces conduct compliance programmes in which contracting…
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Q63
0/100
Are procurement requirements derived from a national defence and security strategy, and are procurement decisions well-audited? Are defence purchases based on clearly identified and quantified requirements?
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Iraq’s existing NSS, the contents of which are discussed but not publicly available, does not appear to inform procurement requirements. An anti-corruption roadmap is…
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Scrutiny is a right which is exercised by IG offices tied to the respective ministry, who ought to preside over the procurement cycle and…
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The core expenditure of both the Ministry of Defence and Interior is determined by annual budget allocations and the degree of military engagement and…
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Tender Solicitation, Assessment and Contract Award
Q64
0/100
Is defence procurement generally conducted as open competition or is there a significant element of single-sourcing (that is, without competition)?
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In January 2010, the Iraqi government approved a set of competition laws, designed to ensure fair competition for locally produced goods and services. However,…
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An Iraqi contracts lawyer, questioned the efficacy of full and open competition, “although it exists on paper, your bid will only be considered if…
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Q65
19/100
Are tender boards subject to regulations and codes of conduct and are their decisions subject to independent audit to ensure due process and fairness?
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Before tenders can be issued/uploaded on the relevant company site and or, the Iraqi Tenders Directory, the product in pursuit must be studied and…
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Regulations and tender specifications adopted by the MoD internal tender committee are not subject to external verification. As Transparency International’s 2015 assessment notes, the…
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“Responsibility to ensure procurement methods do not unfairly discriminate against any one firm, falls under the tender bid-evaluation committees established inside each ministry for…
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Regulations and tender specifications adopted by MoD internal tender committee are not subject to external verification. As Transparency International’s 2015 assessment notes, the responsibility…
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Q66
6/100
Does the country have legislation in place to discourage and punish collusion between bidders for defence and security contracts?
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Iraq’s Competition and Monopoly Prevention Law emphasises the importance of regulated procedures and encourages investigations into anti-competitive behaviour (Article 15) (1), but requires contractors…
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According to Al Tamimi (1) collusion in bids to tenders is illegal, but a curious loophole to evade responsibility exists; in the form of…
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There is a complete failure to investigate or prosecute, even in the face of clear evidence, which is seldom available. The catch-all phrase of…
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There is no evidence that training is provided to procurement officials on collusion.
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Contract Delivery and In-Service Support
Q67
13/100
Are there mechanisms and procedures that ensure that contractors meet their obligations on reporting and delivery?
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In Iraqi law, certified chartered accountants are obliged to audit the activities and accounts of the contractor, which is intended to shed light on…
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As Iraq’s Companies Law stipulates (Article 17), services and contracts must undergo an extensive study to assess both practical and technical feasibility (1). Approval…
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The abovementioned laws emphasise the need for approval from competent authorities and the specialised committee that reviews the projects and firm. There was little…
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It is not entirely clear if breaches of contract are acted upon, but evidence found endemic corruption and wanton disregard of procurement rules (1).…
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Q68
17/100
Are there mechanisms in place to allow companies to complain about perceived malpractice in procurement, and are companies protected from discrimination when they use these mechanisms?
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A detailed report (1), on trade and business in Iraq, reveals the introduction of commercial courts to harness dispute resolution for companies in the…
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Contractual abuse is rampant and poorly protected intellectual property rights are identified as “stymying innovation and deterring investment”. This is more relevant to business,…
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Information found online offers an indication that companies are fearful of retaliation against them should they resort to complaints mechanism and procedures. On the…
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Commercial courts are a recent addition to Iraq’s judicial environment and while their introduction can be seen as a move forward for dispute resolution…
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There has been a complete failure to investigate or prosecute corruption in the past five years based on an in-depth look into news coverage…
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No recent cases that show the enforceability of sanctions through the rule of law could be found. There was a case involving the Ministry…
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Offset Contracts
Q70
0/100
When negotiating offset contracts, does the government specifically address corruption risk by imposing anti-corruption due diligence on contractors and third parties?
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Offset defence contracts, and associated requirements and safeguards, are not discussed in the context of Iraq’s security sector. As pointed out in Transparency International’s…
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While article 4 of Iraq’s 2017 Arms Act (N 52) prohibits the sale of arms in absence of the consent of the issuing authority,…
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Official government pages and social media accounts contain no information regarding offset agreements, policies of contractual provisions concerning off-set contracting, in the realm of…
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The existence of offset obligations, requirements, standard procedures were described by a military legal advisor as a “black hole” adding that “they occurred under…
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The contracting agency, as Iraq’s public government contracts Law states, is the actor that assumes monitoring responsibilities, over accounts and transactions, but the contracting…
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No evidence shows there is an efficient procurement monitoring system that has been installed to lower corruption risks in defence offsets. In cases where…
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Iraq has no developed framework for regulating offset contracts or upholding suppliers accountable for their contractual responsibilities. There is little evidence to imply that…
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Agents / Brokers
Q73
0/100
How strongly does the government control the company’s use of agents and intermediaries in the procurement cycle?
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The law that regulates commercial agents stipulates that agents must be Iraqi nationals and reside in the country, be above 25 years of age…
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Intermediaries and commercial agents are well placed in terms of political proximity to powerful parties and security actors. Despite their common use, existing regulations…
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Financing Package
Q74
0/100
Are the principal aspects of the financing package surrounding major arms deals, (such as payment timelines, interest rates, commercial loans or export credit agreements) made publicly available prior to the signing of contracts?
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Coverage of arms deals and any controversy surrounding them is publicly available (1), (2), (3) but offers no evidence for the existence of financing…
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Seller Influence
Q75
NS/100
How common is it for defence acquisition decisions to be based on political influence by selling nations?
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Although Iraq has secured purchases from a range of military suppliers, Iran strongly influences Iraq’s defence decisions (1), (2). Details surrounding deals struck between…
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Iraq’s flawed procurement system is highly vulnerable to corruption. Iraq’s operational environment and ongoing security threats provide reasonable justification for military needs. In spite…
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As America’s influence in Iraq wanes and as it ramps down US forces, Baghdad’s recent defence acquisitions deals with Russia (1) may have been…
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