VILNIUS - Panevezio Statybos Trestas, Lithuania's leading construction company, has been deprived the right to sign any contracts for World Bank funded projects for one year. The ruling comes after the firm was accused of unfair competition in a water supply and sewage expansion project in Klaipeda.
The sanction will remain in effect until July 19, 2006, the World Bank has announced.
The bank opted for even harsher sanctions for Hidrostatyba, a Gargzdai-based building company stripped of the liberty to sign contracts for World Bank-funded projects for a three-year period until July 2008.
"Prompt actions taken by authorities in this case were particularly useful. Cooperation enables World Bank and its member states to fight against fraud and corruption in a truly efficient manner," World Bank representative Mantas Nocius said in a press release.
According to the release, Hidrostatyba entered a secret arrangement so as to secure the $3.2 million contract for the expansion of water supply and sewage networks in Klaipeda for the Gargzdai-based company.
Panevezio Keliai, a local company, owns 49.8 percent of PST shares. The Scandinavian investment bank, Evli Group, holds a 33.34 percent stake in the building firm and has obtained regulatory approval to raise its holding to 40 percent.