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Harry Cassin
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Facilitating Payments (De)Mystified, Redux

I labeled my previous post in this series the “conclusion,” and I really meant it. At the time. But we’ve received a number of wonderfully thoughtful comments in response, and they deserve to be aired. 

The impetus for this series was the startling finding that the OECD Convention actually does not prohibit facilitating payments. The Convention’s Commentaries go even further, explicitly suggesting that in some OECD countries criminalizing these payments “does not seem practical or effective.”

But some readers found this an incomplete, and perhaps even unfair, characterization of the Convention.  They pointed out, rightly, that the Commentaries describe facilitating payments as “corrosive.”  Moreover, the 2009 Guidance advises member nations to “encourage companies to prohibit or discourage” their use.

Okay, that’s something. Of course, encouraging companies to prohibit their use is a lot different than encouraging lawmakers to do so, but it’s not nothing.

So let’s imagine a spectrum. On one side lies the FCPA, which famously contains a facilitating payments exception. On the other side lies the UK Bribery Act, which famously contains a prohibition. It may be fair to say that the OECD Convention occupies the middle point. The spectrum then looks something like this: the FCPA permits, the OECD Convention discourages, and the UK Act prohibits facilitating payments.

One final thought, again inspired by a reader’s response. Let’s look at law as enforced, rather than as written. By this analysis, might the FCPA and UK Bribery Act actually reverse positions on the spectrum? The DOJ’s increasing intolerance for facilitating payments, and its narrowing of the exception almost to the point of non-existence, are widely noted in the blogosphere. Meanwhile, many suspect that enforcement of the UK Bribery Act will focus only on big-ticket bribery, and effectively ignore the facilitating payments prohibition.  If that proved true, then might facilitating payments in fact be more dangerous under the FCPA than the UK Act? “Strange days indeed,” said John Lennon.

Thanks again to the readers.  Further comments are always welcome.


Andy Spalding is the senior editor of the FCPA Blog. A former Fulbright Senior Research Scholar in Asia, he’s Assistant Professor at the University of Richmond School of Law.

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