Integrity Pacts

Integrity Pacts are in the news because of the Rs.3600 crore VVIP Chopper deal.  As allegations of bribery have arisen, the GoI has warned of takin strict legal action invoking the integrity pact that provides for cancellation of the contract if bribes are paid and recovery of the money paid. 3

Integrity Pacts are a tool for preventing corruption in public contracting. They are essentially an agreement between the government agency offering a contract and the companies bidding for it that they will abstain from bribery, collusion and other corrupt practices for the extent of the contract.  To ensure accountability, Integrity Pacts also include a monitoring system typically led by civil society groups.

Integrity Pacts have been around since the 1990s, and have been applied in more than 15 countries.1

Purpose
It is intended to accomplish two primary objectives:
1.    To enable companies to abstain from bribing by providing assurances to them that (i) their competitors will also refrain from bribing, and (ii) the government procurement, privatisation or licensing agencies will undertake to prevent corruption, including extortion, by their officials and to follow transparent procedures.

2.    To enable governments to reduce the high cost and the distortionary impact of corruption on public procurement, privatisation or licensing. 2

Customs Law

Meaning
Customs duty is a duty or tax, which is levied by Central Govt. on import of goods into, and export of goods from, India. It is collected from the importer or exporter of goods, but its incidence is actually borne by the consumer of the goods and not by the importer or the exporter who pay it.