ScotWind partner given “free ride” on corruption by Crown Estate Scotland

Scottish Liberal Democrat leader Alex Cole-Hamilton has today called for the Scottish Government to review its approach to human rights and due diligence checks, after it was disclosed that corruption charges by a partner involved in one of the largest successful ScotWind applications were not picked up by Crown Estate Scotland (CES) in its screening of ScotWind project partners.

Alex Cole-Hamilton will be asking a topical question to the Cabinet Secretary for Net Zero, Energy & Transport on the issue, after 2pm today.

New guidance on human rights checks was introduced by the Scottish Government, after Economy Secretary Keith Brown was forced to apologise for his role in the collapse of a possible £10 billion agreement with two Chinese companies, China Railway Engineering Group Number 3 and SinoFortone, which were exposed by Scottish Liberal Democrats as committing human rights abuses and only owning a pub in Oxfordshire respectively.

However, Scottish Liberal Democrat research has now revealed that CES did not follow these new procedures during the ScotWind leasing round, and that the full extent of its due diligence amounted to requiring ScotWind project partners to provide written assurance that they have not been convicted of unlawful activity in relation to requirements including corruption, bribery, fraud, and human trafficking within the last five years. These self-declarations were the sole basis for checking the human rights records of prospective partners. 

This five-year declaration window required by CAS, adopted from Scottish Government procurement regulations, failed to capture a recent bribery conviction against Marubeni, a partner organisation in SSE Renewables’ successful £86 million bid to establish offshore windfarms on Scotland’s coastline. This conviction, secured in 2014, fell less than two and a half years outside the five year declaration window.

CES have confirmed that there is “no documented evidence” that they ever considered the due diligence guidance. CES initially claim that they were not required to do so but, in a written response to a Scottish Liberal Democrat question, Energy Secretary Michael Matheson stated: “We expect Crown Estate Scotland to undertake appropriate due diligence on companies, including their human rights record, in line with the Guidance on due diligence: human rights”. He further claimed, erroneously, that the five-year declaration was CES’ interpretation of the guidance.

CES have further confirmed that, having now been made aware of the Scottish Government’s human rights guidance, they are planning to incorporate it into future leasing rounds.

Commenting on the findings, Mr Cole-Hamilton said: 

“It is shocking a company with a proven record of corruption has been given a free ride to profit off of Scotland’s energy resources. 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.”  

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