GLOBAL ANTI-CORRUPTION LEGISLATION
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Expanding Anti-Corruption Legislation
Anti-corruption legislation now incorporates nearly every country, leaving few legal safe havens for
bribery payments
in international business transactions. And it is not just international conventions, like the OECD Convention and UNCAC that possess global reach, but also national legislation in the US (FCPA) and UK (Bribery Act). Today a growing number of countries are moving to enact strict anti-corruption legislation and increase enforcement of existing laws. Recent national anti-corruption legislation has been enacted in Russia, China, India and Brazil. Companies can no longer avoid compliance obligations under national and international legislation. However, companies that have implemented policies and procedures to avoid the risks and costs of corruption possess a competitive business advantage in the global marketplace.
The OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions
The Organisation for Economic Co-Operation and Development Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (OECD Convention) is the most widely binding anti-corruption convention. It does not prohibit
passive bribery
, business to business bribery or
facilitation payments
, much like the US FCPA.
The aim of the OECD Convention is to provide a level playing field for the international business environment.
The UN Convention against Corruption
The United Nations Convention against Corruption (UNCAC) is the most comprehensive, both in terms of state parties and scope, anti-corruption convention. It contains similar provisions as the OECD Convention, but also prohibits passive bribery. The UNCAC included business to business bribery and contains no exception for facilitation payments. However, the UNCAC is limited by weak implementation and international monitoring.
The US Foreign Corrupt Practices Act (FCPA)
The US Foreign Corrupt Practices Act of 1977 (FCPA) is the first legislation to introduce corporate liability, responsibility for third parties and extraterritoriality for corruption offences. The FCPA holds companies criminally responsible for the corrupt acts employees and third parties abroad. The legislation has nearly global jurisdiction, applying to companies listed or doing business in the US – virtually all the world’s large companies. Prohibition of bribery payments is limited to foreign officials, and the FCPA includes a limited exception for facilitation payments. The FCPA is widely enforced and there has been a trend towards increased actions and fines.
The UK Bribery Act 2010
The UK Bribery Act 2010 (Bribery Act) is among the toughest and widest reaching anti-corruption legislation. It establishes corporate liability for corrupt acts committed by persons acting on behalf of a company, and makes it a criminal offence for companies not to have prevented bribery, among others, due to not having an adequate compliance system. The Bribery Act has nearly global jurisdiction, applying to UK companies and those ‘carrying on business’ in the UK. Unlike the FCPA, there is no distinction, and therefore no exception, between bribery payments and facilitation payments, and it also applies to business to business transactions as well as those with foreign officials.