The Convention is important for curbing foreign bribery because its forty one signatory countries collectively account for approximately two-thirds of world exports. TI’s annual Progress Report, issued today, presents an independent assessment of the status of enforcement of the Convention by 40 of the 41 Parties.
The Progress Report ranks Parties’ enforcement efforts into four enforcement categories — active, moderate, limited, and little or no enforcement, based on each country’s enforcement actions from 2010 to 2013. Only four countries rank as “active” enforcers, with the United States topping the list with the highest number of investigations and cases. The other active enforcers are Germany, the U.K, and Switzerland. Five countries rank as moderate enforcers — Italy, Canada, Australia, Austria, and Finland.
The remaining Parties fall into the categories of limited and little or no enforcement, which means there is no deterrence to foreign bribery in countries which make up 34.6% of the world’s exports.
Across the G20, the results are equally sobering. Four G20 countries (China, India, Indonesia, and Saudi Arabia) are not yet parties to the Convention. Of the other G20 countries, nine are in the little or no enforcement category, despite the fact that the G20 countries have repeatedly, including in their 2013-2014 Anti Corruption Action Plan, recognized that effective enforcement of legislation against foreign bribery is critical to tackling corruption.
The overall level of enforcement remains inadequate and there is little improvement since last year. Only Canada improved its ranking; it significantly amended the Corruption of Foreign Public Officials Act in 2013 and criminally charged a former senior SNC-Lavalin Group Inc. executive who oversaw the company’s bid to supervise the construction of the Padma Bridge in Bangladesh.
TI’s Progress Report, available here, makes recommendations for both Governments and the OECD Working Group on Bribery, including providing adequate funding and support for enforcement, continuing the rigorous OECD monitoring program, and collecting and publishing data on mutual legal assistance requests relating to foreign bribery. In addition, TI recommends that joint civil society and business sector advocacy programs should be conducted in countries with lagging enforcement.
In addition to statistics on enforcement, the Progress Report includes country assessment reports, recent developments in national legal frameworks and enforcement systems, and recommendations for priority actions.
TI-USA recommended that the U.S. Department of Justice and the U.S. Securities and Exchange Commission provide regular information regarding the number of all investigations commenced, ongoing, and concluded without enforcement action, and their reasons for declinations. Provision of such information on declinations by the enforcement authorities would provide valuable guidance as to what types of preventative and/or remedial behavior may give rise to a declination. In addition, it would be valuable for the U.S. enforcement agencies to provide information regarding the number of referrals provided to and received from other countries.
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.