While a Global Fund probe last week uncovered the payment of hundreds of thousands of dollars by suppliers to government officials in exchange for mosquito-net contracts, the investigation has also revealed a rift between Cambodian officials and the international financing institution over just what constitutes corruption.

In addition to direct payments, suppliers Sumitomo Chemicals Singapore (SCS) and Vestergaard Frandsen spent at least $20,000 on gifts, personal trips and sponsorships for government officials and staff who worked at the National Center for Parasitology, Entomology and Malaria Control (CNM) between 2004 and 2010, the investigation found.

These gratuities were considered by suppliers to be a “further means” of receiving favourable treatment in tenders and obtaining contracts from the CNM, the report says, with officials providing inside information in return.

But it appears that some officials do not see such practices – which civil society groups say are endemic in the Kingdom – as corruption.

In comments provided to the Global Fund’s Office of the Inspector General (OIG) in June of this year and published in the report, current CNM director Char Meng Chuor, who was not implicated in the corruption allegations, defends this practice.

“CNM does not accept that offerings such as fellowships or dinners can be considered as improper payments, and describes them as ‘just humanitarian and/or cultural … made in the spirit of public private partnership as a mean to achieve the Millennium Development Goals’,” the report says.

It adds that Meng Chuor used the donation of medicines by companies as “a means to explain why dinners, gifts, trips and other favours are acceptable,” an argument it describes as “misplaced”.

“The report clearly points out that the Suppliers have codes of ethics specifically prohibiting the giving of such gratuities as the ones described in this report.”

Meng Chuor could not be reached for comment for this story.

The Anti-Corruption law references two articles of the criminal code that stipulate lengthy prison terms for any civil servant or elected official who solicits or accepts donations or gifts in order to “facilitate anything using his/her functions” or obtain a job or a contract from a state institution “due to real or assumed influence”.

The OIG report offers an insight into how these under-the-table gratuities are facilitated, with evidence showing Health Ministry officials directly requested in-kind payments ranging from medical bills to tuition fees for their children’s university educations.

In one string of emails from October 2005 attached to the report, SCS offers to pay for flights, hotel and medical expenses for former CNM director Duong Socheat, after he informs them he needs to visit a medical specialist in Singapore – an offer he gladly accepts.

In another email from July 2009, an SCS sales manager asks Socheat to officially invite him to sign a fictitious contract at the CNM in Phnom Penh so he has a formal excuse to hand over a gift.

“This would give me the excuse to visit you unofficially and to pass the Nokia [N]97 handphone to your daughter. Please ask your daughter if she prefer [sic] black or white colour,” he writes.

In a September 2009 email to the SCS manager, Socheat says that a secretary of state at the Ministry of Health whose name is redacted had reminded the CNM deputy director that he had been “promised” a gift.

“I think maybe I propose you last time to give him a new mobile phone. It’s ok if you can send other stuff such as tie or watch,” the email says.

In the report, the former CNM director acknowledges the motivation of suppliers in providing such privileges.

“[Bidders] want to make friendship with us. You know I can say, yes, because not only this company, all company do the same way. When you want to do business, they give you some gifts like a tie, like a pen,” Socheat says.

He could not be reached for comment yesterday.

Anti-Corruption Unit President Om Yentieng hung up on a Post reporter, while Minister of Health Mam Bunheng said he was too busy to comment.

Senior ruling party lawmaker Cheam Yeap said the ACU should investigate the Global Fund’s findings. He added that accepting gifts designed to influence procurement contracts was a clear case of corruption.

“They should not take bribes. Getting gifts or money for sorting out something is a case of corruption and a penal crime.”

Council of Ministers spokesman Phay Siphan said he could not say for certain whether gift-giving either in the Global Fund case or in general could definitely be considered as corruption.

“We cannot [just] condemn anyone that offers [gifts] from the private sector,” he said, adding that it would depend on motives, the law, the value of the gift, whether a conflict of interest existed and whether fair competition for contracts was affected.

Cambodia’s traditional gift-giving culture had become embedded in the relationship between government and the private sector, said Preap Kol, executive director at Transparency International Cambodia.

“The problem is that [for] many government officials, [they] are used to this gift-giving process and so maybe many of them may not genuinely see it as a problem, and that is very worrying for us [in civil society],” he said.

“There needs to be education and, more importantly, a law that defines what sort of gifts are allowed. It might be difficult to eliminate gift-giving [completely] … but there needs to be regulation to determine how much value of a gift is considered OK.”

US federal government employees are allowed to accept unsolicited gifts with a market value of $20 or less, according the US Justice Department.

Ou Virak, president of the Cambodian Center for Human Rights, said events hosted by government officials such as weddings were a hot spot for this kind of corruption.

“Cambodians will have to go and give gifts … which can include huge sums of money, in the tens of thousands of dollars, or [something like] a brand-new Rolex. The business people are invited to these events and they have to turn up. And when they turn up, they have to cough up,” he said.

ADDITIONAL REPORTING BY CHHAY CHANNYDA