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Last Updated: Monday, 16 October 2006, 09:37 GMT 10:37 UK
Compass settles UN deal lawsuits
UN peacekeepers on patrol in Monrovia, Liberia
Inquiries surrounded a contract to supply peacekeepers in Liberia
UK catering giant Compass has reached legal settlement with two rivals after a probe into how United Nations' (UN) contracts for Liberia were awarded.

It was alleged that Compass unit ESS got insider details about contracts.

Compass said total costs relating to the settlement, with Monaco-based ES-KO International and Switzerland's Supreme Foodservice, were less than 40m($74m).

The firm did not admit legal liability, but said it was "in the best interests" to avoid a prolonged legal battle.

My focus is on the future and this settlement is a major step in putting the matter behind us
Richard Cousins, Compass CEO

Back in October 2005 the UN said it was investigating claims Compass-owned division Eurest Support Services (ESS) had improperly obtained information on a $62m (35m) three-year contract to supply UN peacekeepers in Liberia with food and water.

Compass was suspended as a registered vendor by the UN, and three ESS employees were dismissed.

Law firm Freshfields was also brought in by Compass to investigate the relationship between ESS and the UN. Compass also restructured its management at ESS.

In February 2006, the three-month internal Compass investigation found serious irregularities in relation to the behaviour of some staff.

'Ethical treatment'

ES-KO had accused Compass and ESS of "a criminal scheme and conspiracy to rig bidding" for the UN awards, and Supreme claimed they had engaged in "an illegal scheme".

Announcing its deal with the two firms on Monday, Richard Cousins, Compass chief executive, said: "My focus is on the future and this settlement is a major step in putting the matter behind us."

He added: "Moreover, I am determined to ensure that our reputation for the ethical treatment of clients, suppliers and competitors, over and above any issues of legal liability, is underlined.

"I am now seeing through a programme of systems and control changes to ensure that all lessons are learned from this experience."

He also said that if Compass had decided to face its rivals in court then it would have "resolutely defended" itself.

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