oecd progress/2006/in focus/news room

2006 TI Progress Report on OECD Convention Enforcement

2006 TI Progress Report: Enforcement of the OECD Convention on combating bribery of foreign public officials

Download the Report

Press Release: Enforcement of OECD Anti-Bribery Convention still deficient despite progress: new report (version française / versión en español)

Introduction and overview of the 2nd TI Progress Report
Foreign bribery prosecutions and investigations
Actions to promote enforcement
TI recommendations to increase enforcement

Destinations of foreign bribery - some case examples

Media Contacts

2nd OECD Progress Report: Enforcement of the OECD Convention on combating bribery of foreign public officials

Introduction

The second TI Progress Report on OECD Convention Enforcement examines the enforcement performance of 31 of the 36 countries that have ratified the OECD Convention on Combating Bribery of Foreign Public Officials. The previous report was issued on 7 March 2005 and covered 24 countries. TI's progress reports are intended to provide an annual assessment of government performance.

Enforcement of the OECD Convention is crucially important to the fight against international corruption. Most major multinational companies have their headquarters in signatory states and effective enforcement would significantly reduce the supply side of international corruption.

The report is based on information provided by TI national experts in each country, who are highly qualified professionals selected by TI National Chapters (Appendix A lists TI experts and their qualifications.) They responded to a questionnaire (Appendix B), after consulting with government officials and other knowledgeable persons in their country. They were aided in their work by the valuable Phase I and Phase II country reports prepared by the OECD Working Group on Bribery in the course of its reviews of government compliance with the Convention. There are seven new countries covered in this report that were not included last year.

Click here to read the report.

Overview

Overall Trend

There is now significant foreign bribery enforcement in over 1/3 of the 31 countries covered by this report, an increase to twelve countries from eight in TI’s 2005 report. However, there is as yet little or no enforcement in almost 2/3 of the countries covered.
While the trend is positive, the success of the Convention is not assured. At present limited levels of enforcement, much of the international business community is not yet convinced that foreign bribery laws must be obeyed. Enforcement must increase substantially.

Positive Indicators

Enforcement in the US has increased to 50 prosecutions in 2006, compared to 35 prosecutions in 2005.
France now has eight prosecutions, compared to three in 2005. This includes several against major multinational companies,
There is also significant enforcement in Belgium, Bulgaria, Denmark, Germany, Hungary, Korea, Norway, Spain, Sweden and Switzerland.

Negative Indicators

There is little or no enforcement in five countries that play a major role in international trade. There are no prosecutions in Japan, the Netherlands and the UK. There is only one prosecution in Italy and one in Canada, the latter a minor case.
There are ten countries with smaller shares of international trade which have no prosecutions: Argentina, Australia, Czech Republic, Estonia, Finland, Greece, Ireland, New Zealand, Portugal, Slovak Republic and Turkey.
There are significant deficiencies in the enforcement systems of 2/3 of the countries covered.

Recommendations

Governments must increase enforcement substantially in 2/3 of the countries covered. That will require clear demonstration of political will to prosecute foreign bribery and strengthening of enforcement systems.
It is particularly urgent that Japan, the UK, Italy, Netherlands and Canada meet their commitments under the OECD Convention, because they play a major role in international trade.
OECD must continue a strong follow-up monitoring programme beyond 2007, without budget reductions. With little or no enforcement in almost 2/3 of the countries covered, it is essential to build additional momentum for enforcement. This requires a strong monitoring programme. Unless this is done, there is serious danger that the Convention could fail.

Foreign bribery prosecutions and investigations (as of June 2006)

U= Information unavailable
*= Reporting for first time in 2006
**=These investigations involve allegations arising out of the UN Oil for Food programme and may not involve violations of the foreign bribery prohibition
***=Source: OECD (2005 data)

Actions to promote enforcement

A. Organization of Enforcement
B. Available Resources
C. Complaint Procedure
D. Whistleblower Protection
E. Public Awareness
F. Accounting and Auditing Requirements
G. Private Sector Efforts
H. Statutory and Other Legal Inadequacies
I. Enforcement Trends

Click here for the 2006 Report to learn more about government actions to promote enforcement.

TI recommendations to increase enforcement

A. Continue Strong OECD Monitoring
B. Publish Information about Enforcement
C. Strengthen Organization of Government Enforcement
D. Increase Awareness that Foreign Bribery is a Crime
E. Improve Access to Enforcement Systems and Reporting
F. Promote Corporate Compliance Programs
G. Improve Statutory Framework to Ensure Effective Enforcement
H. Raise Accounting and Auditing Requirements

Click here for the 2006 Report to learn more about TI's recommendations to increase enforcement.

Destinations of foreign bribery – some case examples

Foreign bribery is a serious problem in all regions. This is illustrated by the case examples listed by region below. Some of these examples were provided by TI national experts in their country reports – these are identified with a bullet point. Other examples were obtained from publicly available material including press reports and in these cases the source of the information is indicated.