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Eradication of Corrupt Business Practices Ordinance, 1998

 

An ordinance to provide for

the eradication of corrupt business practices.

 

WHEREAS it is expedient to provide for the eradication of corrupt business practices;

AND WHEREAS the National Assembly is not in session and the President is satisfied that circumstances exist which render it necessary to take immediate action;

NOW, THEREFORE, in exercise of the powers conferred by clause (1) of Article 89 of the Constitution of the Islamic Republic of Pakistan, the President is pleased to make and promulgate the following Ordinance:-

1.       Short title, commencement and extent:

(1)        This ordinance may be called the Eradication of Corrupt Business Practices Ordinance, 1998.

(2)        It shall come into force at once.

(3)        It extends to the whole of Pakistan and shall apply also to acts committed at any place outside Pakistan.

 

2.        Definitions:- In this Ordinance, unless the context otherwise requires:

(a)        “company” means a company incorporated under any law relating to the incorporation of companies, and includes any foreign juridical entity;

(b)        “contract” includes an understanding giving rise to any liability (pecuniary or otherwise), the grant of a right, lease, licence, concession, premium or conferment of any privileges:

(c)        “Government” means the Federal Government, a local body and shall include any statutory body or any body in the public sector or a body established, controlled, managed or owned by the Government has a controlling share or interest;

(d)        “indirectly” includes through any broker, associate, affiliate, sponsor, promoter, director or shareholder;

(e)        “person’ means a natural or juridical person; and

(f)        “specified contract” means a contract of a value exceeding one hundred million rupees in relation to such industry or industries as may be specified in the schedule.

3.        Corrupt business practices:

A person is said to commit a corrupt business practice if he, directly or indirectly, gives, or agrees to give, a commission, gratification, bribe, finder'’ fee or kickback, whether described as consultation fee or otherwise, with the object of obtaining or modifying a contract, permission, sanction, licence or other benefit in whatsoever form from the government.

Explanation: A consultancy agreement entered into with a person in good faith and as a bona fide arms length transaction for the rendition of commercial services at market related rates and not intended as an indirect payment intended to circumvent the above provision, shall not be deemed to be a corrupt business practice provided that it is, if so required by the government, disclosed to it for purposes of ascertainment.

 

4.        Punishment for corrupt business practices:

(1)        Whoever commits a corrupt business practice shall be guilty of an offence punishable with imprisonment for a term which may extended to seven years, or with fine, or with both.

(2)        In the event of a corrupt business practice having been committed by a company, the chief executive, by whatever name designed, the country manager or incharge (if any) and every director or officer involved shall be liable to be proceeded against and punished accordingly unless he had no knowledge of, or involvement in the offence.

 

5.        Offence of strict liability: The offence punishable under section 4 shall be one of strict liabilities and it shall not be a defence to the charge that the person giving, or agreeing to give, a commission, gratification, bribe, finder’s fee or kickback, whether described as consultation fee or otherwise, with the object of obtaining or modifying a contract, permission, sanction, licence or other benefit in whatsoever form from the government was compelled, coerced, intimidated or induced to give or agree to give, the same.

 

6.       Contract obtained through corrupt business practice to be void:  Any contract obtained by any person from the government by resort to corrupt means shall, as against the government, be void and notwithstanding anything contained in any law or contract to the contrary, no court, tribunal, arbitrator or other forum, shall, as against the government, enforce or permit to be enforced, or acted upon, any such contract.

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