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Corporate Anti-Bribery Self-Regulation and the International Legal Framework

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Abstract

This chapter addresses the role of the private sector in the design of international responses to corrupt practices. It illustrates the increasing involvement of private actors—mostly corporations—in the international law-making process, as well as in the law enforcement process.

It shows that over a short period of time the paradigm of the so-called fight against corruption has shifted from traditional methods of internationalization of law to a modern or postmodern conception of global law: from the use of the classical legal instrument of the convention, characterized by its public and binding nature (an instrument made by the state, addressed to states, and enforced by the state), to the use of public–private partnerships through soft-law instruments and co-regulation. However, these conceptions are not mutually exclusive but rather mutually reinforcing. Their combination may be the key to the success of this new chapter for anticorruption policies and more broadly for international criminal policy.

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Notes

  1. 1.

    In the sense of Mean (2011). See also Ghérari (2011), in the same volume.

  2. 2.

    See, among many others, Small (1994), Stessens (2001), Tricot (2001).

  3. 3.

    However, a complete overview should also take account of other international instruments aimed at preventing and “sanctioning” corruption, especially those developed by multilateral development banks. Because of their peculiar nature, they will be dealt with in Sect. 4.

  4. 4.

    Since the failure within the UN in the 1970s and the 1980s. See Tricot (2001).

  5. 5.

    Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, the UK, the USA.

  6. 6.

    Argentina, Brazil, Bulgaria, Russia, South Africa.

  7. 7.

    See Inter-American Convention Against Corruption, The Organization of American States (OAS), http://www.oas.org/juridico/english/treaties/b-58.html, accessed 13 July 2013.

  8. 8.

    See Council Act of 27 September 1996 drawing up a Protocol to the Convention on the Protection of the European Communities’ Financial Interests [Official Journal C 313 of 23.10.1996], European Union, http://europa.eu/legislation_summaries/fight_against_fraud/protecting_european_communitys_financial_interests/l33019_en.htm, accessed 13 July 2013.

  9. 9.

    See Council Act of 29 November 1996 drawing up, on the basis of Article K. 3 of the Treaty on European Union, the Protocol on the Interpretation, by way of Preliminary Rulings, by the Court of Justice of the European Communities of the Convention on the Protection of the European Communities’ Financial Interests [Official Journal C 151 of 20.5.1997], European Union, http://europa.eu/legislation_summaries/fight_against_fraud/protecting_european_communitys_financial_interests/l33019_en.htm, accessed 13 July 2013.

  10. 10.

    See Council Framework Decision 2003/568/JHA of 22 July 2003 on Combating Corruption in the Private Sector, European Union, http://europa.eu/legislation_summaries/fight_against_fraud/protecting_european_communitys_financial_interests/l33019_en.htm, accessed 13 July 2013.

  11. 11.

    See Criminal Law Convention on Corruption, Council of Europe, http://conventions.coe.int/Treaty/EN/Treaties/Html/173.htm, accessed 13 July 2013.

  12. 12.

    See Additional Protocol to the Criminal Law Convention on Corruption, Council of Europe, http://conventions.coe.int/Treaty/EN/treaties/html/191.htm, accessed 13 July 2013.

  13. 13.

    See Civil Law Convention on Corruption, Council of Europe, http://conventions.coe.int/Treaty/en/Treaties/Html/174.htm, accessed 13 July 2013.

  14. 14.

    See Group of States against Corruption (GRECO), Council of Europe, http://www.coe.int/t/dghl/monitoring/greco/default_en.asp, accessed 13 July 2013.

  15. 15.

    See African Union Convention on Preventing and Combating Corruption, Council of Europe, http://www.africa-union.org/root/au/Documents/Treaties/Text/Convention%20on%20Combating%20Corruption.pdf, accessed 13 July 2013.

  16. 16.

    See Sandage, “The Universal Approach of the United Nations Convention against Corruption,” in this volume.

  17. 17.

    This chapter focuses on business actors, though the private sector also includes civil society actors which play a great role in the design and implementation of anticorruption policies. It will suffice to mention the well-known work of Transparency International: founded in 1993, it has become the main civil society organization combating corruption. It issues an annual Global Corruption Report, highlighting corruption in specific areas. In 2009, the report focused on the private sector. It also issued the “Business Principles for Countering Corruption,” currently under revision. See Business Principles for Countering Bribery, Transparency International, http://www.transparency.org/whatwedo/tools/business_principles_for_countering_bribery, accessed 13 July 2013. In the legal literature, see Hodess 2013. Concerning “Hunter Alliance” and “Global Witness,” see also Rose-Ackerman and Carrington 2013.

  18. 18.

    See Guidelines for Multinational Enterprises, The Organisation for Economic Co-operation and Development (OECD), http://www.oecd.org/daf/inv/mne/oecdguidelinesformultinationalenterprises.htm, accessed 13 July 2013.

  19. 19.

    See OECD Recommendation for Further Combating Bribery of Foreign Public Officials in International Business Transactions, The Organisation for Economic Co-operation and Development (OECD), http://www.oecd.org/investment/anti-bribery/anti-briberyconvention/oecdantibriberyrecommendation2009.htm, accessed 13 July 2013.

  20. 20.

    See, inter alia, Mantovani, “The Private Sector Role in the Fight Against Corruption,” in this volume. See also Vincke (2007).

  21. 21.

    Rules of Conduct to Combat Extortion and Bribery in International Business Transactions.

  22. 22.

    See ICC Rules on Combating Corruption, International Chamber of Commerce (ICC), http://www.iccwbo.org/Data/Policies/2011/ICC-Rules-on-Combating-Corruption-2011/, accessed 13 July 2013.

  23. 23.

    See ICC Guidelines on Agents, Intermediaries and Other Third Parties, International Chamber of Commerce (ICC), http://www.iccwbo.org/Advocacy-Codes-and-Rules/Document-centre/2010/ICC-Guidelines-on-Agents,-Intermediaries-and-Other-Third-Parties/, accessed 13 July 2013.

  24. 24.

    See Whistleblowing, International Chamber of Commerce (ICC), http://www.iccwbo.org/advocacy-codes-and-rules/areas-of-work/corporate-responsibility-and-anti-corruption/whistleblowing/, accessed 13 July 2013. ICC France has taken the initiative to issue guidelines on the important question of putting into place whistle-blowing mechanisms in enterprises. The purpose of these guidelines is to help companies establish and implement internal whistle-blowing programs, by setting forth practical indications that can serve as a useful point of reference, while meeting, as much as possible, the objections formulated in certain countries about certain aspects of a whistle-blowing system. These guidelines are inspired by international and national legal provisions.

  25. 25.

    See Guide to Responsible Sourcing, International Chamber of Commerce (ICC), http://www.iccwbo.org/advocacy-codes-and-rules/areas-of-work/corporate-responsibility-and-anti-corruption/Guide-to-Responsible-Sourcing/, accessed 13 July 2013. The ICC guide on responsible sourcing focuses mainly on social and environmental responsibility, but it also refers to the necessity to comply with anticorruption principles.

  26. 26.

    See ICC Anti-Corruption Clause, International Chamber of Commerce (ICC), http://www.iccwbo.org/Data/Policies/2012/ICC-Anti-corruption-Clause/, accessed 13 July 2013. See below, Sect. 4.

  27. 27.

    In the future, the ICC plans to release an Ethics and Compliance Training Handbook.

  28. 28.

    See Partnering Against Corruption Initiative (PACI), Principles for Countering Bribery, World Economic Forum, http://www.weforum.org/pdf/paci/PACI_Principles.pdf, accessed 13 July 2013.

  29. 29.

    See Good Practice Guidelines on Conducting Third-Party Due Diligence, World Economic Forum, http://www.weforum.org/reports/good-practice-guidelines-conducting-third-party-due-diligence, accessed 13 July 2013.

  30. 30.

    See Group of Twenty (G20), Group of Twenty Official website, http://www.g20.org, accessed 13 July 2013.

  31. 31.

    See Anti-Corruption, The Business 20 (B20), http://www.b20businesssummit.com/themes/anti-corruption, accessed 13 July 2013.

  32. 32.

    The G20 Anti-corruption Action Plan 2013–2014, adopted in November 2012, renews the commitments and recommendations made in 2010. See G20 website, www.g20.org/load/781360452, accessed 13 July 2013.

  33. 33.

    See Kett, “The Role of the G20 and B20 in the Fight Against Corruption,” in this volume.

  34. 34.

    “As recently as the late 1990s, indifference and mutual suspicion characterized the relationship between the UN and business…. This began to change with the launch of the Global Compact.” See Georg Kell, UN Global Compact Executive Director Addresses Private Equity Community, CSR Press Release, http://www.csrwire.com/press_releases/27662-UN-Global-Compact-Executive-Director-Addresses-Private-Equity-Community, accessed 13 July 2013.

  35. 35.

    See resolution adopted by the General Assembly (on the report of the Second Committee (A/60/495 and Corr.1)) 60/215, Towards Global Partnerships, United Nations Information Centre Prague, http://www.osn.cz/soubory/n0550050.pdf, accessed 13 July 2013.

  36. 36.

    See Extractive Industries Transparency Initiative (EITI), Extractive Industries Transparency Initiative official website, http://eiti.org, accessed 13 July 2013.

  37. 37.

    See EITI Standard, Extractive Industries Transparency Initiative (EITI), http://eiti.org/document/standard, accessed 13 July 2013.

  38. 38.

    See, for instance, Resolution (97) 24 on the Twenty Guiding Principles for the Fight Against Corruption, Council of Europe, https://wcd.coe.int/wcd/ViewDoc.jsp?id=593789&, accessed 13 July 2013. Recommendation No. R(2000)10 on Codes of Conduct for Public Officials, Council of Europe, http://www.coe.int/t/dghl/monitoring/greco/documents/Rec%282000%2910_EN.pdf, accessed 13 July 2013. Recommendation Rec(2003)4 on Common Rules against Corruption in the Funding of Political Parties and Electoral Campaigns, Council of Europe, http://www.coe.int/t/dghl/monitoring/greco/general/Rec%282003%294_EN.pdf, accessed 13 July 2013. Resolution (99) 5 Establishing the Group of States against Corruption-GRECO, Council of Europe, http://conventions.coe.int/Treaty/EN/PartialAgr/Html/Greco9905.htm, accessed 13 July 2013.

  39. 39.

    Cf. Pieth (2011a, p. 393). For reflections from the European perspective, see Manacorda and Giudicelli-Delage (2013).

  40. 40.

    See Business Coalition: The United Nations Convention against Corruption as a New Market Force, United Nations Global Compact, http://www.unglobalcompact.org/docs/issues_doc/Anti-Corruption/Bali_Business_Declaration.pdf, accessed 13 July 2013.

  41. 41.

    See Nieto Martín and Muñoz de Morales, “Compliance Programs and Criminal Law Responses: A Comparative Analysis,” in this volume. See also Goossens (1999).

  42. 42.

    “The Guidelines provide voluntary principles and standards for responsible business conduct consistent with applicable laws and internationally recognised standards.”

  43. 43.

    See Concepts and Principles: “[Guidelines] provide principles and good practice consistent with applicable laws and internationally recognised standards.”

  44. 44.

    This typology is inspired by analysis in Deumier (2011).

  45. 45.

    False commitment, for instance, may be (and indeed has been) subject to proceedings for false publicity or illicit commercial conducts. See Directive 2005/29/CE, which explicitly mentions the noncompliance of codes of conducts and qualifies such behavior as an illicit commercial practice.

  46. 46.

    See Country Reports on the Implementation of the OECD Anti-Bribery Convention, The Organisation for Economic Co-operation and Development (OECD), http://www.oecd.org/daf/anti-bribery/countryreportsontheimplementationoftheoecdanti-briberyconvention.htm, accessed 13 July 2013.

  47. 47.

    See Group of States Against Corruption (GRECO), http://www.coe.int/t/dghl/monitoring/greco/default_en.asp.

  48. 48.

    See The United Nations Global Compact—Frequently Asked Questions, United Nations Global Compact, http://www.unglobalcompact.org/AboutTheGC/faq.html, accessed 13 July 2013.

  49. 49.

    The “fiduciary responsibility” of the bank to its shareholders upon which the sanction procedure is built is based on Article III, 65(b) IBRD Articles of Agreement.

  50. 50.

    Established in 1998, the Sanction Process progressively evolved through four rounds of reforms successively conducted in 2004, 2006, 2007, and 2009–2010.

  51. 51.

    See Zimmerman, “Globalizing the Fight against Corruption,” in this volume; Heilbrunn, “The Fight Against Corruption: The World Bank Debarment Policy,” in this volume.

  52. 52.

    “An administrative remedy utilized to disqualify contractors from obtaining public contracts or acquiring extensions to existing contracts for alleged breaches of law or ethics,” Schooner (2004), cited in Boisson de Chazournes and Fromageau (2012, p. 7).

  53. 53.

    See Guidelines Procurement under IBRD Loans and IDA Credits, 2011, The World Bank, http://siteresources.worldbank.org/INTPROCUREMENT/Resources/Procurement-Guidelines-November-2003.pdf, accessed 13 July 2013.

  54. 54.

    See Sanctions System at the World Bank, The World Bank, http://www.worldbank.org/sanctions, accessed 13 July 2013.

  55. 55.

    Almost all sanctions adopted between March 1999—the date of the first debarment order—and April 2001 were made for an indefinite period. The majority of the sanctions since then have been for an average period of 3 years. This might be seen as a follow-up of recommendations made by the Thornburgh Report.

  56. 56.

    There are four EOs, one for the International Bank for Reconstruction and Development and International Development Association (who focuses on this work exclusively) and three part-time EOs for the Multilateral Investment Guarantee Agency, International Finance Corporation, and Bank Guarantee Projects.

  57. 57.

    See Agreement for Mutual Enforcement of Debarment Decisions, 9 April 2010, European Bank for Reconstruction and Development (EBRD), http://www.ebrd.com/downloads/integrity/Debar.pdf, accessed 13 July 2013.

  58. 58.

    See Integrity Vice Presidency (INT) Annual Reports 2010, The World Bank, http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/ORGANIZATION/ORGUNITS/EXTDOII/0,,contentMDK:22203443~menuPK:5372841~pagePK:64168445~piPK:64168309~theSitePK:588921,00.html, accessed 13 July 2013.

  59. 59.

    See Integrity Vice Presidency (INT) Annual Reports 2011 and 2012, The World Bank, http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/ORGANIZATION/ORGUNITS/EXTDOII/0,,contentMDK:22203443~menuPK:5372841~pagePK:64168445~piPK:64168309~theSitePK:588921,00.html, accessed 13 July 2013.

  60. 60.

    “Article 34. Consequences of acts of corruption: With due regard to the rights of third parties acquired in good faith, each State Party shall take measures, in accordance with the fundamental principles of its domestic law, to address consequences of corruption. In this context, States Parties may consider corruption a relevant factor in legal proceedings to annul or rescind a contract, withdraw a concession or other similar instrument or take any other remedial action.”

  61. 61.

    “Article 35. Compensation for damage: Each State Party shall take such measures as may be necessary, in accordance with principles of its domestic law, to ensure that entities or persons who have suffered damage as a result of an act of corruption have the right to initiate legal proceedings against those responsible for that damage in order to obtain compensation.”

  62. 62.

    For a recent and comprehensive retrospective of the arbitral approach toward corruption, see Meyer (2013).

  63. 63.

    In this respect, a definition of the term “corruption” has not been established so far. But such a definition has not been necessary because the legal condemnation of the alleged behavior was not the issue, which consisted, on the contrary, mostly in problems of proof or concerned the appropriate consequences for a finding of corruption.

  64. 64.

    See No. IV.7.2—Invalidity of Contract due to Bribery, Trans-Lex Law Research, accessed July 14, 2013, http://www.trans-lex.org/938000.

  65. 65.

    However, an arbitration clause may be included in integrity pacts initiated by Transparency International in which all bidders agree not to pay bribes (see TI website, Integrity Pacts). It could then be possible that unsuccessful applicants would bring claims in arbitration against the successful bidder.

  66. 66.

    See ICC Anti-Corruption Clause, http://www.iccwbo.org/Data/Policies/2012/ICC-Anti-corruption-Clause/.

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Tricot, J. (2014). Corporate Anti-Bribery Self-Regulation and the International Legal Framework. In: Manacorda, S., Centonze, F., Forti, G. (eds) Preventing Corporate Corruption. Springer, Cham. https://doi.org/10.1007/978-3-319-04480-4_11

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