Anti-corruption Policy

Anti-bribery and Anti-corruption Policy

Arch Star recognizes that our reputation for conducting business in an ethical and honest way is a core company value that must be valued and protected.

 The purpose of this policy is to establish controls to ensure compliance with all applicable anti-bribery and corruption regulations and to ensure that Arch Star conducts business in a socially responsible manner.

Bribery is the offering, promising, giving, accepting, or soliciting of an advantage as an inducement for an action that is illegal or a breach of trust. A bribe is an inducement or reward offered, promised, or provided in order to gain any commercial, contractual, regulatory, or personal advantage.

It is our policy to conduct all of our business in an honest and ethical manner. We take a zero-tolerance approach to bribery and corruption. We are committed to acting professionally, fairly, and with integrity in all our business dealings and relationships wherever we operate and implementing and enforcing effective systems to counter bribery.

We will uphold all laws relevant to countering bribery and corruption in all the jurisdictions in which we operate. We remain bound by the Iraq anti-corruption laws, and where relevant take due note of our obligations and responsibilities under other legislative jurisdictions including the United Kingdom Bribery Act 2010, and the United States Foreign Corrupt Practices Act (FCPA) in respect of our conduct both at home and abroad.

Arch Star has a “zero tolerance” approach to acts of bribery and corruption by any of our employees or contractors. As well as being morally wrong, bribery and corruption are criminal offenses that expose Arch Star and individuals to the risk of prosecution, fines, and imprisonment.

Any breach of this policy may result in disciplinary action, including termination of employment or contract. If the matter involves a breach of law or other regulation, the matter may also be referred to an appropriate law enforcement authority.

This policy covers Arch Star Logistics Limited and controlled entities (Arch Star).

This policy applies to all individuals working for or on behalf of Arch Star at all levels and grades, including directors, managers, employees (whether permanent, part-time, or casual), contractors, sub-contractors, labor-hire personnel, consultants, or any other person associated with us, or any of our subsidiaries or their employees, wherever located (collectively referred to as employees in this policy).

This policy applies to your interactions with any individual or organization you come into contact with during the course of your work for us and includes actual and potential clients, customers, suppliers, distributors, business contacts, agents, advisers, and government and public bodies, including their advisors, representatives and officials, politicians and political parties.

This policy covers:
– Bribery and corruption;
– Receiving gifts, entertainment, and favors;
– Giving gifts, entertainment, and favors;
– Facilitation payments;
– Political and charitable contributions.

Bribery and corruption
Bribery means the offering or providing, promising, giving, accepting, or soliciting of an advantage (loan, gift, trip, entertainment, donation, payment, or any other thing of value) as an inducement for an action that is illegal, unethical, a breach of trust, or to secure an improper advantage.

Acts of bribery are designed to influence individuals to act dishonestly in the performance or discharge of their duty.

Corruption means dishonest activity in which a director, executive, manager, employee, or contractor of an entity acts contrary to the interests of the entity and abuses his/her position of trust in order to receive some personal gain or advantage for him or herself or for another person or entity.

Employees must not engage in any form of bribery or corruption, either directly or through any other party (such as an agent or distributor). Specifically, employees must not bribe a foreign public official anywhere in the world.

 Receiving gifts, entertainment and favours
It is not unusual for an individual or a company to give gifts or provide entertainment, meals, or tickets to events.

The receipt of gifts or favors by staff can give rise to embarrassing situations and may be seen as an improper inducement to grant some concession in return. Employees must not compromise either themselves or Arch Star in conducting Arch Star’s business.

The following principles should be followed:
– Gifts or favors must not be solicited
– Gifts of money must never be accepted
– Reasonable small tokens and hospitality may be accepted provided they do not place the recipient under any obligation, are not capable of being misconstrued, and can be reciprocated at the same level.

Without the express authority of a director of Arch Star, the acceptance of gifts of more than a nominal value ($100) is prohibited under this policy as being a conflict of interest. Other conflicts such as excessive entertainment, services, or substantial favors or benefits are also prohibited. Where an entity has no prior or current trading relationship with Arch Star (i.e., is not a currently approved supplier or customer) the acceptance of ANY gift is prohibited.

All gifts, entertainment, or favors offered, whether accepted or not, must be reported to the director in charge of your division.

Any gifts, entertainment, or courtesies must not influence your business decisions. If accepting a gift influences your business judgment then the gift must be declined. Any offer which you think is given in order to influence your business decision must also be declined.

 Giving gifts, entertainment, and favors
The giving of any gifts, entertainment, or favors to any customer or supplier is prohibited, except that token gestures up to a nominal value ($100) may be allowed with the prior approval of the director in charge of your division. Where an entity has no prior or current trading relationship with Arch Star (i.e., is not a currently approved supplier or customer) the provision of ANY gift is prohibited.

Any such activity is also prohibited if Arch Star will then receive or appear to receive an improper commercial advantage.

It is Arch Star’s policy to deal with customers and suppliers solely on the basis of price, quality, reliability, service, and long-term benefit to Arch Star. Customers and suppliers must be dealt with in a fair and honest manner, with integrity and independent judgment.

Facilitation payments
Facilitation payments are a form of bribery made for the purpose of expediting or facilitating the performance of a public official for a routine governmental action, and not to obtain or retain business or any improper business advantage. Facilitation payments tend to be demanded by low-level officials to obtain a level of service to which one would normally be entitled to.

Our strict policy is that facilitation payments must not be paid.

In exceptional circumstances where there is a risk to the personal security of an employee or his/her family and where a facilitation payment is therefore unavoidable, then the following steps must be taken:

– Keep any amount to the minimum;
– Create a record concerning the payment; and
– Report it to your line manager.

In order to achieve our aim of not making any facilitation payments, each business of the Company will keep a record of any such payments made, which must be reported to the director in charge of your division, in order to evaluate the business risk and to develop a strategy to minimize or eliminate such payments in the future.

Political and charitable contributions
We do not make donations, whether in cash or kind, in support of any political parties or candidates, as this can be perceived as an attempt to gain an improper business advantage.

Charitable support and donations are acceptable (and indeed are encouraged), whether of in-kind services, knowledge, time, or direct financial contributions. However, employees must be careful to ensure that charitable contributions are not used as a scheme to conceal bribery.

Arch Star will only make charitable donations that are legal and ethical under local laws and practices, and no donation must be offered or made on behalf of Arch Star without the prior approval of an Arch Star director.

All charitable contributions should be publicly disclosed.

You must ensure that you read, understand, and comply with this policy.

The prevention, detection, and reporting of bribery and other forms of corruption are the responsibility of all those working for Arch Star or under our control. All employees are required to avoid any activity that might lead to, or suggest, a breach of this policy.

You must notify your manager or a member of Arch Star’s executive committee as soon as possible if you believe or suspect that a conflict with or breach of this policy has occurred, or may occur in the future.

Any employee who breaches this policy will face disciplinary action, which could result in dismissal for gross misconduct. We reserve our right to terminate our contractual relationship with other workers if they breach this policy.

Arch Star must keep financial records and have appropriate internal controls in place which will evidence the business reason for making payments to third parties.

You must declare and keep a written record of all hospitality or gifts accepted or offered, which may be subject to management review.

You must ensure all expense claims relating to hospitality, gifts, or expenses incurred to third parties are submitted in accordance with our expense procedures and specifically record the reason for the expenditure.

All accounts, invoices, memoranda, and other documents and records relating to dealings with third parties, such as clients, suppliers, and business contacts, should be prepared and maintained with strict accuracy and completeness. No accounts must be kept “off-book” to facilitate or conceal improper payments.

Raising a concern about business conduct ultimately protects Arch Star, its employees, and other stakeholders. If you think a decision, action or practice is unethical, or in breach of this Policy, the Arch Star Code of Conduct, other Arch Star policies, or a breach of the law, you have the right and an obligation to raise that concern.

You should immediately raise this with either your supervisor, manager, or a member of Arch Star’s executive committee who will help you create a report.

It is important that you tell your manager or a member of Arch Star’s executive committee as soon as possible if you are offered a bribe by a third party, are asked to make one, suspect that this may happen in the future, or believe that you are a victim of another form of unlawful activity.

Employees who refuse to accept or offer a bribe, or those who raise concerns or report another’s wrongdoing, are sometimes worried about possible repercussions. Arch Star encourages openness and will support anyone who raises genuine concerns in good faith under this policy, even if they turn out to be mistaken.

Arch Star is committed to ensuring no one suffers any detrimental treatment as a result of refusing to take part in bribery or corruption, or because of reporting in good faith their suspicion that an actual or potential bribery or other corruption offense has taken place, or may take place in the future. Detrimental treatment includes dismissal, disciplinary action, threats, or other unfavorable treatment connected with raising a concern. If you believe that you have suffered any such treatment, you should inform your manager immediately. If the matter is not remedied, and you are an employee, you should raise it formally.

Training on this policy forms part of the induction process for all new employees. All existing employees will receive training on how to implement and adhere to this policy.

Our zero-tolerance approach to bribery and corruption must be communicated to all suppliers, contractors, and business partners at the outset of our business relationship with them and as appropriate thereafter.

The board of directors has overall responsibility for ensuring this policy complies with our legal and ethical obligations, and that all those under our control comply with it.

Management at all levels is responsible for ensuring those reporting to them is made aware of and understand this policy and are given adequate and regular training on it.

The board of directors will monitor the effectiveness and review the implementation of this policy, considering its suitability, adequacy, and effectiveness. Any improvements identified will be made as soon as possible. Internal control systems and procedures will be subject to regular audits to provide assurance that they are effective in countering bribery and corruption.

All employees are responsible for the success of this policy and should ensure they use it to disclose any suspected danger or wrongdoing.

Employees are invited to comment on this policy and suggest ways in which it might be improved. Comments, suggestions, and queries should be addressed to the Company Secretary.

This policy may be amended at any time.

This policy has been endorsed by the board of directors of Arch Star Logistics Limited

Hami Salih Tamoo

24 September 2010