Country Enforcement of the OECD Anti-Bribery Convention — Progress Report 2012

Transparency International (TI) released its eighth annual progress report on the enforcement of the OECD Anti-Bribery Convention today.

The progress report represents an independent assessment of the status of OECD enforcement, based on reports from TI national chapters in 37 OECD Convention countries. Countries are classified in four enforcement categories this year: active, moderate, little, and no enforcement.

No surprise that the United States topped the list with the most cases, followed by Germany. 

There are a couple of notable developments. One is that there was a substantial increase in the number of cases brought by countries in the active enforcement category. Another positive development is that three countries, Australia, Canada, and Austria moved up to the moderate enforcement category.

While some countries increased their enforcement, only seven countries out of 37 reviewed made the list of active enforcers and this number has not changed since 2009. According to TI, for the Convention to reach the tipping point, there needs to be active enforcement in six to ten additional countries. Active enforcement of the Foreign Corrupt Practices Act by the U.S. has led to substantial improvements in the compliance programs of the companies subject to it. If there were comparable enforcement by other countries, their companies would be motivated to respond in a similar fashion.

There are 18 countries in the little and no enforcement categories and these include countries like New Zealand, Chile, and Luxembourg with high scores on TI’s Corruption Perception Index (CPI) and high standards for integrity in their own countries. Given the magnitude of global corruption, the detrimental consequences of bribery in countries where the bribes are paid, and the damage caused to honest businesses, urgent action is needed by the laggard countries. Major economies like China, India, and Indonesia should sign the Convention as recommended by the G20 and submit themselves to the peer review mechanism. Further, Governments should also resist business pressure to relax enforcement.

According to Fritz Heimann (TI-USA board member and one of the authors of the TI report), “For the Convention to gain momentum, pressure must be kept up on Governments in countries where the enforcement is inadequate.”  The only way to encourage that is through active engagement by the OECD Secretary General and for other countries who are active enforcers to push other laggard countries to follow suit.

Read the executive summary or download the full report here.

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Shruti J. Shah is a contributing editor of the FCPA Blog. She’s a Senior Policy Director at Transparency International-USA, responsible for the promotion of TI-USA’s anti-corruption law and regulation policy agenda. She can be contacted here.