The African Development Bank Group (AfDB) confirmed on Wednesday that it had imposed penalties on Hitachi, of Japan, following a three-year probe into allegations of “sanctionable practices” relating to Eskom’s Medupi power station boiler works contract, awarded in 2007.
AfDB is a part funder of the R105-billion project to build a six-pack coal-fired power station in Limpopo, which will have an eventual capacity of 4 764 MW.
No indication was given as to the nature of the sanctionable practices discovered. However, the penalties follow a September Foreign Corrupt Practices Act charge against Hitachi by the Securities and Exchange Commission (SEC), of the US, for inaccurately recording “improper payments to South Africa’s ruling political party in connection with contracts to build two multi-billion dollar power plants”.
Hitachi agreed to pay $19-million to settle the SEC charges.
The AfDB investigation was carried out by its Integrity and Anti-Corruption Department (IACD) into allegations against two Hitachi subsidiaries: Hitachi Power Europe (HPE), based in Germany, and Hitachi Power Africa (HPA).
“The sanctions imposed under the settlement agreement reflect the level of cooperation provided by Hitachi in the investigation of the Medupi matter, for which the IACD is grateful,” IACD director Anna Bossman said in a statement.
