The US-based world's biggest retailer Wal-Mart has come under the scanner of anti- corruption watchdog Central Vigilance Commission (CVC) which has summoned its India's head amid allegations that the company gave bribes to Government officials to get customs clearances and obtain permits to set up stores in India.
“Some observations have been made that Wal-Mart gave some amount to Government officials here. It is our duty to look into it,” Vigilance Commissioner TM Bhasin said. He said the Commission has taken suo moto cognisance of it and summoned Wal-Mart's country head here.
“We have asked them to submit details to us by November 15,” Bhasin told PTI. It is for the first time that the probity watchdog has started investigation involving a private company. However, Wal-Mart spokesperson in a statement said it has not received any request from the CVC.
“We haven't received any such request so far. For Wal-Mart, compliance with the US Foreign Corrupt Practices Act (FCPA) and other anti-corruption laws is key priority.”
“We work closely with third-party compliance experts on support and training as we continuously review and strengthen our programs around the world,” it said. The CVC's move comes after a recent report by Wall Street Journal which claimed to have found evidence of Wal-Mart Stores Inc allegedly paying ‘thousands of small bribes to local officials’ in India to get customs clearances and obtain real-estate permits.
Vast majority of payments were below $200 (about Rs13,100 at current exchange rate) and some were as low as $ 5 (Rs330) but together totalled millions of dollars, the report said.
Wal-Mart, which had entered India in 2007 through a supermarket joint venture with Bharti Enterprises, parted ways with the Indian partner in 2013, and shelved plans to open retail stores in the country and instead decided to become solely a wholesaler.
The investigations in India were part of a probe that included Wal-Mart's operations in Mexico, China and Brazil, over allegations of violation of FCPA of the US, that bars bribing officials of foreign governments. The retailer's Indian unit reportedly had suffered a loss of Rs232 crore in 2014. Its revenue had dropped 32 per cent to Rs2,992.7 crore in that year.