Manning's jet and that "anti-corruption" clause

Arthur Lok Jack, the chairman of Caribbean Airlines (CAL), insists that negotiations between the airline and the Canadian aircraft manufacturer, Bombardier, for the purchase of an executive jet are still in progress. He categorically denies reports that CAL has already concluded the deal.

Lok Jack says the two parties are stuck on what he calls "the wording of an anti-corruption clause" that the government of Trinidad and Tobago is demanding.

He says the airline wants a guarantee from the Canadian company that no one profited improperly from the transaction, saying the government is holding out for "a watertight clause" which gives the assurance that if there is proof that anyone profited from the deal, the sale would cancelled and Bombardier would be obliged to return the money paid for the aircraft.

Executives close to the negotiations said Bombardier had not signed such a clause in previous transactions and is reluctant to create a precedent, which other clients might request.

Lok Jack says Bombardier is prepared to call off the deal over the issue. The government, he says, is also ready to call off the matter and look for another supplier for the jet.

But something doesn’t sound right in this whole scenario.

From the beginning, there have been conflicting reports from airline and government officials on this deal, starting from the time Prime Minister Patrick Manning went on a test flight on a Bombardier jet in 2006, only to learn that there was never any plan to buy a plane.

When a newspaper blew the whistle a series of conflicting reports came out, including quotations on the price of the jet ranging from US$52 million to US$63 million, with an additional US$2 million for maintenance. There were also different delivery dates.

Now with public pressure building against the purchase of a aircraft for more than TT$400 million, the government and CAL are talking about an anti-corruption clause, which is an insinuation that the Canadian company might be considering offering an incentive or gift to someone or some organization for this deal.

But that is hardly an issue for the respected aerospace giant that has done business with governments, private firms and airlines all over the world. Indeed Bombardier has been in negotiations with the government of Trinidad and Tobago on contracts for the proposed light rail transit system. But no one has raised any anti-corruption clause.

In reality Bombardier is already protected by a Canadian law that guard against any such underhand dealings. The Canadian anit-corruption law prohibits Canadian companies from any kind of kickback for services offered to foreign clients, including governments.

The Corruption of Foreign Officials Act sets out clear guidelines for Canadian companies doing business abroad.

The act states:

3.(1) Every person commits an offence who, in order to obtain or retain an advantage in the course of business, directly or indirectly gives, offers or agrees to give or offer a loan, reward, advantage or benefit of any kind to a foreign public official or to any person for the benefit of a foreign public official.

(a) as consideration for an act or omission by the official in connection with the performance of the official's duties or functions; or

(b) to induce the official to use his or her position to influence any acts or decisions of the foreign state or public international organization for which the official performs duties or functions.

The act defines foreign official as:

(a) a person who holds a legislative, administrative or judicial position of a foreign state;

(b) a person who performs public duties or functions for a foreign state, including a person employed by a board, commission, corporation or other body or authority that is established to perform a duty or function on behalf of the foreign state, or is performing such a duty or function.

The Canadian government is very strict about how it applies its laws. And other transparency and accountability laws ensure that every organization, including their representatives, operate within the law both inside Canada and in dealings with clients in other countries.

Read the full wording on Canada’s anti-corruption act, which governs Bombardier and all other companies.