Fewer of the world’s biggest exporting countries are actively investigating and punishing companies paying bribes abroad, according to a new report released by Transparency International. Exporting Corruption 2020: Assessing Enforcement of the OECD Anti-Bribery Convention finds that active international enforcement against foreign bribery is shockingly low.
Only four out of 47 countries, which make up 16.5 per cent of global exports, actively enforced legislation against foreign bribery, compared to seven countries and 27 per cent of global exports in 2018.
Exporting Corruption in New Zealand
The report labels New Zealand at “limited enforcement” and finds that New Zealand needs to do a better job of fighting foreign bribery.
“The threat of New Zealand being used for international corruption remains real”, says Professor John Hopkins, the lead New Zealand author, on behalf of TINZ. Hopkins adds “The combination of a reputation for probity coupled with limited enforcement capacity and legislative gaps (around beneficial ownership for example) is an extremely dangerous one. New Zealand risks being seen as a soft target for criminal entities wishing to legitimise their activities.”
Recommendations
Recommendations for New Zealand include:
- Improve availability of statistics and information on investigations, mutual legal assistance (MLA) requests and cases in relation to foreign bribery
- Develop central registers (new or existing) to ensure public accessibility of beneficial ownership information for all New Zealand companies and trusts
- Remove the “routine government action” (facilitation payment) exemption from Section 105C of the Crimes Act 1961
- Introduce clear and specific legislative protection for auditors (and others) who report suspicions of bribery to the relevant authorities
- Improve protection for whistleblowers by strengthening the provisions in the Protected Disclosures Act 2000, and other legislative amendments. An example of this is the extension under the Anti-Money Laundering and Countering Financing of Terrorism Act 2015, of auditor protection to include foreign bribery
- Introduce a positive requirement for commercial organisations to prevent foreign bribery by introduction of an offence of failure to prevent bribery (see The UK Bribery Act 2010, s7)
- Give greater priority and resources to the proactive investigation of foreign bribery to assess its extent in New Zealand
- Consider creating an independent anti-corruption agency, whose remit includes managing foreign bribery investigations
- Remove the requirement that the Attorney-General consent to foreign bribery prosecutions
“Foreign bribery is not an abstract phenomenon; it has huge consequences for both the payer and recipient. Money lost to foreign bribes creates significant economic repercussions, triggers unfair competitive advantages and results in fewer public services for the people who need them most. New Zealand needs to take action and demonstrate world leadership in the fight against corruption", says Julie Haggie, CEO of Transparency International New Zealand.
Webinar
As we go to press on Thursday 15 October, Transparency International New Zealand, Transparency International Australia and the Transparency International secretariat will hold a webinar discussing foreign bribery and the Exporting Corruption Report.
[Editor note: The webinar recording is now available here.]
View the full report Exporting Corruption 2020: Assessing Enforcement of the OECD Anti-Bribery Convention report on the Transparency International Website.
