Companies should note that there is a very high risk of encountering corruption in public procurement. Irregular payments or bribes in connection with the awarding of public contracts or licenses are common (GCR 2015-2016). Evidence suggests that officials involved in the tendering process are required to pass on envelopes with bribes, extracted from business executives who were awarded the public contracts, to their superiors (Macra Tadin, Jan. 2015). In one instance, an entrepreneur was asked by a procurement official to deposit the envelope with the agreed amount of approximately USD 350,000. Later, he was told that the bribe would not guarantee him the contract, thus pushing the executive to pay an even bigger bribe (Macra Tadin, Jan. 2015). Reportedly, procurement officials have delayed the process of awarding contracts to extort more bribes. Tenders dating from 2012 and 2013 were still in the pipeline in 2015 due to these methods (Macra Tadin, Jan. 2015).
Businesses report that favoritism in the decisions of government officials are common and that public funds are usually diverted (GCR 2015-2016). Nepotism and cronyism are pervasive in government procurement (TI, Aug. 2014), and procurement officials tend to favor negotiated deals rather than implement standard tender procedures (Macra Tadin, Jan. 2015). Construction, services and supplier contracts that exceed USD 10 million have to be approved by the president and the minister of the economy and finances. However, to get around these regulations contracting authorities illegally break up the tender into smaller contracts amounting to less than USD 10 million, and these payments simply require invoicing (Macra Tadin, Jan. 2015). Contracts for construction work are frequently given to people connected with government officials (BTI 2016), despite the law that prohibits government officials from engaging in commercial activities (Macra Tadin, Jan. 2015). Another example is a private company owned by a relative of the president, which was awarded the right to print passports (BTI 2016). Companies are thus strongly recommended to use a specialized due diligence tool on public procurement in order to mitigate corruption risks associated with public procurement in Chad.