EU Commission Appears to Permit Corrupt Practices

Earlier this year FinnishNews reported in April 2020 that the financial service giant BlackRock had been awarded a contract by the European Commission to carry out a study on integrating environmental, social and governance (ESG) objectives into EU banking rules. We pointed out that BlackRock is intimately involved as an investor with the world’s biggest banks and fossil fuel companies and would probably benefit from less regulation rather than more on matters of ESG. The column points out that there is a clear conflict of interest in BlackRock’s favour. They offer to perform the study at a price that was clearly well below the market price to secure a privileged position for itself.

The EU’s Ombudsman, on November 23rd, 2020, “has now assessed how the Commission evaluated the company’s offer in the context of the call for tenders for carrying out the study where they found that the company’s bid gave rise to concerns, since it has a financial interest in the sector at issue in the study as the world’s largest asset manager.”

“Furthermore, the low price of the company’s bid could be perceived as part of a strategy to gain insights into, and influence over, the regulatory environment in this sector.” 

“Ombudsman found that the Commission should have been more rigorous in verifying, in accordance with the rules, that the company was not subject to a conflict of interest that may negatively affect its ability to execute the contract.”

However, it appears that the EU rules on public procurement on the Commission staff are poorly constructed and did not exclude bidders due to conflicts of interest that may negatively affect the performance of the contract. 

The EU Ombudsman suggested that the applicable rules should be updated to address such situations…

The question here is that any conflict of interest should automatically disqualify any bidder right at the starting block – that is common sense!

That this is not crystal clear to the EU Commission is terrible negligence within the EU Commission – it opens the door top all types of serious corruption. 

It is also amazing that the EU Ombudsman and the EU Parliament have not demanded rule changes decades ago to prevent actual or potential conflicts of interest.

It would be interesting to hear from our MEPs have to say about this lack of control over how taxpayers’ money is being spent. Even if there is no rule about Conflict of Interest, there can be little doubt that this looks bad…

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