Corruption & Bribery
What is corruption?
Transparency International defines corruption as the misuse of public power for private benefit.
What is bribery?
A form of corruption, the bribery of foreign public officials is the voluntary giving (promising or offering) of something of value to a foreign public official in order to obtain or retain business or other improper advantage in the conduct of international business.
What is a foreign official?
Includes employees, contractors and officials of foreign government bodies, employees and officers of state owned corporations, intermediaries of foreign public officials, employees of public international organisations, persons performing duties of an office under a law of that country (i.e. a judge) or any person servicing a foreign government body (i.e. a police officer or security guard).
What is a facilitation payment?
A facilitation payment is a payment intended to expedite or secure the performance of a routine government action. Under Australia's current foreign bribery laws, it is a defence if the payment was a facilitation payment. Facilitation payments may be made if the:
• Value of the payment was of a minor nature;
• The purpose of the payment was to expedite or secure a routine government action; and
• Payment was recorded.
Facilitation payments are now prohibited under the new UK Bribery Act (2010) but are currently permissible under the FCPA and Australian legislation.
What should you, as an international business, be doing to protect yourself, your employees and your reputation
Bribery and corruption has the potential to adversely impact an organisation and regulatory investigations can be onerous in terms of both time and money. The best solution is to minimise the chances of it happening in the first place.
“Bribery and corruption has a direct impact on the ability of honest businessmen and women to export and to make their living. The [UK Bribery Act] guidance that is already available should reassure companies that the prevention of bribery is commonsense and does not require unduly expensive or onerous procedures for legitimate businesses.” - Kenneth Clarke, UK Justice Secretary
The UK Ministry of Justice has published guidance in relation to the ‘adequate procedures’ that can be put in place to reduce the risk of bribery and corruption. Businesses that can demonstrate they had adequate procedures in place to combat bribery and corruption will be able to utilise this as a defence in any actions brought against them under the Act.
The procedures are based on six basic principles:
- Monitoring and review
- Proportionate procedures
- Top level commitment
- Risk assessment
- Due diligence; and
The UK Ministry of Justice has issued its guidance and reiterated the point that the action your business needs to take should be proportionate to the risks you face and to the size of your business. An exporter whose turnover is greater than $25million a year and who exports to high bribery risk jurisdictions will have very different ‘adequate procedures in the eyes of a regulator to a first-year exporter hoping to reach turnover of $1million through its supply of products to the New Zealand market.
Obtain legal advice – Where possible, your legal advisors should liaise with the regulator on your behalf and provide advice to ensure that the scope of the request is understood, legal professional privilege is maintained and to ensure that you fully comply with the request. Where a request is excessively onerous, legal advisors may be able to negotiate with the regulator on your behalf to narrow the scope of the request or to arrange an extension of time.
The ECA runs tailored workshops that cover aspects of foreign corruption and bribery:
Our goal is to bring people together to:
- build professional capabilities in trade
- elevate the profile of trade
- advocate the benefits and opportunities of trade
- facilitate networking
- improve the performance and success of companies in global trade
- boost the efficiency of trade processes.
Featured GTPA Member
Ziyaad Ebrahim, GTP
Ziyaad has close to fifteen years of experience in international trade and development.He joined the World Trade Organization (WTO) after serving 12 years in various positions within the Government of Seychelles, where he comes from.
During his time in the Government of Seychelles, he was directly involved in trade, investment and general economic policy formulation and implementation.He also has experience on WTO accession and was involved in FTA negotiations with the European Union and within the Eastern and Southern African region. He has also worked with international organisations such as the IMF, World Bank and the African Development Bank on Structural Adjustment Programmes, private sector and MSME development initiatives including gender empowerment projects.
In his current role with the WTO, he coordinates the work of the WTO LDC Group in the ongoing trade negotiations.He also monitors and assists LDC participation in specific areas of the negotiations which include Special and Differential Treatment (S&DT), fisheries subsidies, trade facilitation and LDC accession negotiations.
He is fluent in English and has working knowledge of French.
Ziyaad was one of the first people globally to be certified as a Global Trade Professional in the area of Trade Management.