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Foreign bribery enforcement

Photo: Kadir Celep / unsplash.com

Companies engage in the bribery of foreign public officials— known as 'foreign bribery'— when they offer, promise or give a bribe to a foreign official to win advantages in international business transactions, such as winning a construction contract, an oil or gas concession, or an operating license.

According to the Organisation for Economic Cooperation and Development (OECD) the construction, mining, defence and military industries, natural resources and energy, medical and pharmaceutical, telecommunications, transportation sectors, infrastructure projects and property development activities seem to be particularly prone to foreign bribery.

Bribes are often negotiated by intermediaries and transferred into foreign bank accounts via shell companies with the assistance of a range of enablers. Sometimes they are paid through fake contracts or as donations to charities.

The OECD Anti-Bribery Convention, adopted in 1997, requires each signatory country to make foreign bribery a crime. The 44 signatory countries are responsible for approximately two-thirds of world exports and almost 75 per cent of total foreign direct investment outflows. Thanks to the

OECD Working Group on Bribery’s robust monitoring process it is the foremost instrument for efforts to curb the “supply side” of international corruption.

Other international anti-corruption conventions also require the criminalisation of foreign bribery including notably the UN Convention against Corruption, ratified by 187 states.

How does foreign bribery affect you?

If you live in a country where bribes are being paid by foreign companies to win procurement contracts, licenses and other favourable treatment, public resources are being diverted and decision-making is being distorted by foreign bribery, to the detriment of the economy, state institutions and public services.

Foreign bribery affects you if you live in a country where the companies or individuals engaged in foreign bribery, or in facilitating the laundering of the proceeds of that corruption, are based. It undermines the integrity of the private sector as well as of your financial system, and it contributes to weakness and instability in other countries that can affect conditions in your country.

What needs to be done?

The key actions that need to be taken in foreign bribery enforcement include:

  • Strengthen the framework for detecting and investigating foreign bribery including whistleblower protection and public registers of beneficial ownership
  • Strengthen the legal framework for sanctioning foreign bribery, including criminal liability of companies, deterrent sanctions and adequate statutes of limitations
  • Improve enforcement systems, including providing adequate resources and training, and ensuring independence of police, prosecution and judiciary
  • Ensure that there are high standards of transparency and accountability in foreign bribery settlements (also called non-trial resolutions)
  • Ensure compensation to victims for the harm caused by foreign bribery

What we are doing about it?

  • Comparative monitoring: TI produces a periodic progress report on enforcement of the OECD Anti-Bribery Convention presenting an independent comparative assessment of the status of enforcement in the parties to the convention as well as, since 2018, non-Parties to the Convention: China, Hong Kong SAR, India and Singapore.
  • Country reviews: TI national chapters make inputs to country reviews of monitoring mechanisms for the OECD Anti-Bribery Convention and UNCAC as well as the GRECO review mechanism for the Council of Europe Criminal Law Convention on Corruption
  • Advocacy: TI national chapters engage in advocacy activities aimed at persuading their governments to step up enforcement against foreign bribery and at encouraging the private sector to introduce measures to ensure compliance with the laws prohibiting foreign bribery

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