Investment Agency Says Business Donations to Government Officials Violate Graft Code
By Nan Lwin 6 August 2018
YANGON — The Directorate of Investment and Company Administration (DICA) announced on Friday that companies and body corporates are not allowed to donate money either directly or indirectly to ministries or regional government departments, citing the Myanmar Companies Law 2017, to prevent corruption between government bodies and private companies.
U Aung Naing Oo, director general of the DICA, told The Irrawaddy, “We are targeting businesspeople who donate money with the expectation of getting something back from the government, especially those companies that bid for government tenders, have business dealings with government agencies or hope to receive permission for a project.”
But companies can still do corporate social responsibility (CSR) activities. For example, they can donate to government disaster relief efforts although it is important there are no business implications to the arrangement, he said.
DICA is the government body responsible for publishing company investment rules and regulations in Myanmar. It published the Companies Law 2017, as well as the anti-corruption code of ethics under the guidance of the Anti-Corruption Commission (ACC). It is also in charge of handling company registrations for local and foreign businesses under the Myanmar Companies Law.
The DICA’s anti-corruption code of ethics for companies and body corporates says that they are prohibited from offering gifts, providing entertainment or extending other preferential treatment, such as providing assistance in travelling, to ministry or regional government department officials.
Also prohibited are doing anything to confer a financial advantage to obtain a business opportunity, donating money for social work, making political contributions or providing assistance to get employment in companies or organizations, the DICA announcement says.
Over the decades, it has become part of the business culture in Myanmar to sponsor government officials’ trips by providing accommodation, airfare expenses, and covering daily food expenses. In some instances, senior government officials have been given shares in companies to help smooth their business operation.
Daw Lei Lei Thwin, a member of the ACC, told The Irrawaddy that accepting cash donations from a businessperson had been prohibited since the previous government, however most government officials did not follow the rules and accepted such donations under different categories.
“Now we have an official code of ethics. If someone [a government official] breaks the code of ethics, any citizen can report it to us and we will look into it,” she said.
According to Daw Lei Lei Thwin, under the Anti-Corruption Code of Ethics, the ACC can examine specific case where prohibited activities have allegedly been undertaken between the businesses and government bodies.
“The Code of Ethics sets down clear criteria to investigate a case. If the case involves the prohibited activities, we will take action,” Daw Lei Lei Thwin said.
The Anti-Corruption Commission is fighting corruption from three different angles: prevention, the code of conduct and risk assessment.
“Donations normally go through different channels. Sometimes, a businessperson will cover the service charges for travel or pay hotel accommodation expenses. Normally, it is hard to receive a complaint as long as the giver is satisfied with the benefit they have obtained,” Daw Lei Lei Thwin said.
The graft commission member added that a third person could file a complaint with the Anti-Corruption Commission if they had strong supporting evidence.
In July, the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) and the ACC signed a joint declaration to fight corruption among private companies, and to work on the development of ethical practices in companies and businesses in Myanmar. The declaration also included a provision to draw up a code of conduct that UMFCCI member companies were bound to follow in a bid to curb corruption.
Tackling corruption is one of the priorities of Myanmar’s de facto leader, State Counselor Daw Aung San Suu Kyi, who has promised that her NLD-led cabinet would be free of corruption. However, Planning Finance Minister U Kyaw Win resigned from his position in May after it became known that he was under investigation by the Anti-Corruption Commission. His case was the first time the NLD government had taken action against one of its own ministers.
However, some regional government senior officials continue to accept donations from businesspeople and attend the opening ceremonies of business ventures.
Yangon Chief Minister Phyo Min Thein was strongly criticized on social media last month after he accepted a 20-million-kyat donation for the government’s social work from accused Malaysian fraudster Ong Kean Swan, who is a self-styled backer of professional gamblers and the CEO of a multilevel marketing company. He has been blacklisted in Taiwan, Malaysia and China.
In June, the President’s Office also announced that government representatives including regional government officials were not allowed to attend ceremonies that were funded or planned by local or foreign businesses.
The Anti-Corruption Commission law was enacted in September 2013 and amended in 2014, 2016 and 2017. The latest amendment, Article 3 (a), tightens the stipulations about the giving and receiving of bribes after the previous article did not identify the giver or recipient.
“The amended provision allows us to take action against anyone involved,” said U Aung Kyi, the chairman of the ACC in a press conference in Naypyidaw in June.
The commission received 4,116 complaint letters from citizens and said that it had handled 4,086 complaints between November 2017 and June 2018. Of these, it could not take action in 2,989 of the complaints, due mostly to a lack of strong supporting evidence, according to the ACC’s website.