Enforcement of Foreign Bribery under the OECD Anti-Bribery Convention

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Elfreda Ryan
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NOT PROTECTIVELY represent those of MARKED the

1 Enforcement of Foreign Bribery under the OECD Anti-Bribery Convention Kathleen Kao Anti-Corruption Division, OECD The views expressed in this presentation do not necessarily NOT PROTECTIVELY represent those of MARKED the OECD member countries or States Parties to the OECD Anti-Bribery Convention.

The OECD Anti-Bribery Convention 41 States Parties Non-OECD countries: Argentina, Brazil, Bulgaria, and South Africa Over 2/3 of world exports History of the OECD

2 The OECD Anti-Bribery Convention 41 States Parties Non-OECD countries: Argentina, Brazil, Bulgaria, and South Africa Over 2/3 of world exports History of the OECD Anti-Bribery Convention Came into force 15 February Anti-Bribery Recommendation 2010 Good Practice Guidance on Internal Controls, Ethics and Compliance 2

3 Comparison of Anti-corruption Instruments Bribery Offenses Other Corruptionrelated offenses Responsibility of Legal Persons Sanctions Other Standards OECD Convention UNCAC African Union Convention Active bribery of foreign public official Money laundering (with foreign bribery as predicate offense) Accounting offenses For active bribery of a foreign public official Effective, proportionate and dissuasive penalties, monetary and other sanctions Active and passive bribery of national and foreign public officials Active and passive bribery in private sector Money laundering Embezzlement, misappropriation or other diversion Obstruction of justice Trading in influence Abuse of functions Illicit enrichment Concealment Criminal, civil or administrative liability of legal persons for the offenses established by the Convention Sanctions should take into account the gravity of the offense Preventative measures in public and private sectors Asset Recovery International Cooperation Active and passive bribery of public officials Active and passive bribery in private sector Trading in influence Diversion of property by public official Illicit enrichment Money laundering Concealment Preventative measures in public and private sectors Asset Recovery International Cooperation 3

The Convention s Important Features First multilateral initiative to focus on the supply side of bribery Demonstrates willingness of world s leading exporters to take responsibility for actions of

4 The Convention s Important Features First multilateral initiative to focus on the supply side of bribery Demonstrates willingness of world s leading exporters to take responsibility for actions of their companies operating abroad Focus on the context of international business transactions Covers bribes made to public officials in non-member states Anti-corruption guide for companies adopted at an inter-governmental level Explicit non-tax deductibility of bribes 4

5 Criminalising Foreign Bribery Article 1 Criminal offense for any person or entity who intentionally offers, promises or gives a to an undue pecuniary or other advantage to a foreign public official in order to obtain or retain business. Must apply to an advantage transmitted to a third party. Must cover bribes made directly or indirectly through intermediaries. Must not contain proof of elements beyond those required to be proved in Article 1. 5

6 Holding Companies Responsible Article 2 Parties are required to establish criminal or administrative liability of legal persons for the foreign bribery offence. Companies must be held responsible for foreign bribery, regardless of whether an individual was also prosecuted/convicted. Problem areas: Level of authority that triggers liability of the corporate entity; Prosecution of legal person in absence of conviction of natural person; Proceedings against legal person dependent on those against a natural person.

7 Framework for Enforcement Articles 3, 4, and 6 The Convention requires foreign bribery be punishable by effective, proportionate and dissuasive sanctions, including: Fines and/or penalties; Return of illicit gain; Debarment from public procurement; and, Exclusion from receiving public benefits. Bribes and proceeds of bribery must be subject to seizure and confiscation. Convention countries must also establish jurisdiction and statutes of limitation that would allow the effective investigation and prosecution of foreign bribery.

8 What impact has it made? 216 individuals and 90 entities have been sanctioned under criminal proceedings for foreign bribery in just under 15 years; Maximum fine of EUR 1.24 billion against a single company; Prison sentences against at least 83 individuals; At least 85 individuals and 120 entities have been sanctioned in criminal, administrative and civil cases for other offences related to foreign bribery, such as money-laundering or accounting; 320 investigations are ongoing in 24 States Parties and prosecutions are ongoing against 148 individuals and 18 entities. 8

9 Thank you!

TREATY SERIES 2003 Nº 2. Convention on Combating Bribery of Foreign Public Officials in International Business Transactions

TREATY SERIES 2003 Nº 2. Convention on Combating Bribery of Foreign Public Officials in International Business Transactions TREATY SERIES 2003 Nº 2 Convention on Combating Bribery of Foreign Public Officials in International Business Transactions Done at Paris on 17 December 1997 Signed on behalf of Ireland on 17 December 1997