The International Fraud and Corruption Sanctioning System

This chapter focuses on an unexplored aspect of Chinese state-owned enterprises (SOEs) doing business overseas--the interaction of these companies with the integrity systems implemented by the multi-lateral development banks and development institutions (MDBs), aimed at preventing fraud, corruption, and other abuses in projects undertaken by those institutions. In recent years, many more Chinese companies have begun doing business overseas, encouraged by the ‘Going Out Policy’ and One Belt One Road and have been more actively bidding for MDB projects. For various reasons, some Chinese companies fall foul of the MDBs’ integrity systems. The chapter provides a brief overview of the integrity systems developed the MDBs, focusing on Chinese company interactions with that system, the efforts of the Asian Infrastructure Investment Bank (AIIB) to integrate with that system, as well as the view of the Chinese government towards this system. It looks at the status of and possible trends in the integration of the Chinese anticorruption regulatory system with the MDB system.