Paradise Papers: Booked by CBI, SNC-Lavalin went to Appleby to float firm, get National Highway projects

SNC-Lavalin is a Montreal-based engineering major, which was first implicated in a financial bribery case booked by the CBI in 2008 in which Kerala Chief Minister Pinarayi Vijayan had been named. Vijayan was cleared in August this year.

Written by Ritu Sarin | New Delhi | Updated: November 10, 2017 7:07 am
paradise papers, paradise papers india, nhai, snc lavalin, indians in paradise paper, paradise paper leaks, paradise papers names, icij investigation, indian express investigation, appleby, appleby hacked, appleby papers, panama papers, paradise paper list, black money, money laundering, indian express SNC-Lavalin is a Montreal-based engineering major, which was first implicated in a financial bribery case booked by the CBI in 2008 in which Kerala Chief Minister Pinarayi Vijayan had been named. (Source: WikiCommons)

A Canadian engineering and construction company, which has been the subject of corruption probes in India and abroad, used Appleby to register a new company and further its interests in bidding for projects of the National Highway Authority of India (NHAI), Appleby records show. SNC-Lavalin is a Montreal-based engineering major, which was first implicated in a financial bribery case booked by the CBI in 2008 in which Kerala Chief Minister Pinarayi Vijayan had been named. Vijayan was cleared in August this year.

The case related to SNC-Lavalin being contracted by the Kerala government for renovation and modernisation of hydro-electric power stations at allegedly exorbitant rates when Vijayan was the state’s Power Minister. The government also got funding from the company for a cancer hospital in North Kerala. In its chargesheet, the CBI estimated that alleged corruption had caused a loss of around Rs 370 crore to the exchequer.

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This SNC-Lavalin case was back in the headlines when the CBI challenged the 2013 reprieve given by the Special CBI Court to Vijayan and six others. In August this year, the Kerala High Court validated the clean chit given to the Chief Minister with Harish Salve appearing for him. It is not yet known if the CBI will challenge the reprieve in the Supreme Court.

In 2015, the company was in fresh controversy over allegations of pay-offs to family members and officials who worked for Libyan leader Muammar Gaddafi. In 2015, Riadh Ben Aissa, a former executive of the company, revealed details of bribes and lavish gifts allegedly given to Gaddafi’s son, Saadi Gaddafi, and claimed that SNC-Lavalin’s top brass knew about these deals to win contracts in Lybia. In 2013, as many as 115 SNC-Lavalin companies were blacklisted by the World Bank for bidding for any of its global projects.

A March 2015 Appleby Compliance Risk Review Report notes that the World Bank’s action was a “conditional non-debarment” and that SNC-Lavalin Mauritius would be required to meet certain conditions to continue to be eligible to participate in Bank-financed activities.

Other actions against the company for a bridge contract in Bangladesh; investigations undertaken by the RCMP (Royal Canadian Mounted Police) and a debarment by the Asian Development Bank (ADB) are also listed. Interestingly, the 2015 Compliance Report notes how Appleby received letters from the NHAI (in April and May 2013) “requesting for clarifications on the Company’s claimed net worth” and asked if the company had responded to them.

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Details have emerged from records that even as it became mired in these controversies, SNC-Lavalin remained focused on doing business in India and used Appleby to that effect.

In 2010, the SNC-Lavalin Group announced that it had taken a “significant stake” in Rayalseema Expressway Limited (REL), a consortium of companies to build and operate National Highway 18 for the NHAI connecting Cuddappah and Kurnool in Andhra Pradesh.

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SNC-Lavalin registered a new company named SNC-Lavalin Mauritius Ltd with Appleby appointed as Company Secretary in 2008. The company, documents show, is stated to be jointly owned by SNC Lavalin SAS and SNC-Lavalin Europe SAS. A resolution passed by Directors of SNC-Lavalin Mauritius said that they wanted to bid for a project announced by the NHAI and had signed a Joint Bidding Agreement with Piramal Roads Infra Pvt Ltd (PRIL).

Details of the NHAI project are listed in the Resolution dated April 16, 2012 passed exclusively for the company to bid for an NHAI tender for four/six-laning of the Bhavnagar-Veraval Section of NH-8E in Gujarat. According to a 2014 Business Plan prepared by Appleby, the company picked up a 10% interest in Piramal Roads Infra Private Limited as well as a 36.9% interest in Rayalseema Expressway Private Limited.

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Interestingly, according to latest NHAI records, while SNC-Lavalin is not one of the contracted firms for the Bhavnagar-Veraval section, it is listed as the contractor or consortium partner for several other highway construction projects. The NHAI’s May 2017 funding list shows SNC-Lavalin first was contracted in 2001 for constructing a 66-km stretch in Rajasthan between Bhilwara bypass and Chittorgarh.

The other projects listed for the company in partnership with other firms are: six-laning of the Gurgaon-Kotputli-Jaipur highway in 2009; four-laning of the New Mangalore Port in 2005 and a section of the Ghaziabad-Aligarh highway in 2011.

Despite detailed queries sent to SNC Lavalin’s media unit in the company’s prescribed forma a fortnight ago, no responses were received. No replies were also received to repeated reminders sent to the company by The Indian Express.

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