ScotWind process accused of giving 'free ride' on corruption checks

Energy firms were given a “free ride” on corruption, bribery and human rights checks when bidding for ScotWind leases, with one company’s offences missed by due diligence checks.

The Scottish Government received a £700m windfall from the first round of ScotWind leasing, with successful bidders including Shell, BP and SSE Renewables.

As part of the process, companies were asked to provide a declaration with a formal, written assurance, that they have not been convicted of unlawful activity including around bribery and corruption.

Research by the Scottish Liberal Democrats uncovered Crown Estate Scotland, the agency in charge of ScotWind, restricted the declaration to the last five years only.

Crown Estate Scotland said the time limit was not implemented following any request by companies and formed part of their overall approach to due diligence.

This approach meant, however, that historical charges against Marubeni, who formed part of the £86m bid from SSE Renewables, were not picked up by the agency or taken into consideration.

The Japanese firm pled guilty in 2014 to foreign bribery charges in the US for its involvement in a scheme to pay bribes to high-ranking officials in Indonesia to secure a lucrative power project.

It also paid a $55m fine to settle an investigation into its involvement in a decade-long scheme to bribe Nigerian officials to obtain contracts to build liquefied natural gas facilities in Nigeria.

The Scottish Liberal Democrats have criticised ScotWind's checks on human rights.

Crown Estate Scotland also admitted it did not have evidence of considering Scottish Government guidance around human rights due diligence, something Net Zero secretary Michael Matheson said was expected of the agency.

Instead it based its approach on procurement guidelines used by the government.

Scottish Liberal Democrat leader, Alex Cole-Hamilton, labelled it “shocking” that a company with a record of corruption was given a “free ride” to profit from Scotland’s energy resources.

He said: “The notion that Marubeni passes the ethical bar for not being caught out in the last five years, while multiple cases of bribery as recently as eight years ago go unnoticed, is laughable.

"Scottish Liberal Democrats previously exposed the Scottish Government for getting into bed with fraudsters and human rights abusers. They promised to change their ways but it seems that government bodies are still not performing stringent checks on who they partner with.

“The revelations that Crown Estate Scotland dramatically undersold these development rights, gives the undeniable impression that ScotWind is shaping up to be yet another disaster for the Scottish Government’s industrial strategy.”

A spokesperson for Crown Estate Scotland said their declaration requirement also allows them to void any agreement if companies submitted false information, adding they would not hesitate to act “if needed”.

They added: “In designing the ScotWind process, there was robust consideration of how Crown Estate Scotland should secure human rights assurances from developers.

"The approach we adopted not only secured assurances from applicants, but also provides a contractual basis for Crown Estate Scotland taking action if needed, including ending agreements.

“The five-year period was informed by public sector regulations and applied consistently across all applicants.”

The Scottish Government said it would support Crown Estate Scotland in any such action.

Marubeni was contacted for comment.