OECD > INTERNATIONAL STRUGGLE

GENERAL INFORMATION

Corruption, which is defined as the biggest obstacle in front of economy and social development, has been the leading controversial issue in recent years.

While combating corruption in global scale, Financial Action Task Force (FATF), Group of States against Corruption (GRECO) and Working Group on Combating Bribery of Foreign Public Officials in International Business Transactions established within the body of OECD have great importance.

Financial Action Task Force (FATF) was established by G-7 countries in 1989 in order to combat international money laundering. In 1991, Turkey became the member of this force, which has 34 members. FATF makes necessary evaluations in member states in line with recommendations prepared for the prevention of money laundering and terrorism financing and formation of standards to combat these crimes.   

In 24th Plenary Meeting of FATF held on 15-19 October 2012, unless The Law Draft on Preventing Terrorism Financing was adopted until 22 February 2013, it was decided that Turkey’s membership would be suspended as of that date and Turkey would continue to remain in 2nd List (Dark Grey List) within the scope of FATF Listing Process. In the explanation with footnote about Turkey included in that list, it was decided that FATF would invite countries to apply necessary measures in proportion with risks originated from Turkey.

Group of States against Corruption (GRECO) is a follow-up mechanism established before Council of Europe in 1998. Turkey became the member of this group in 2004. Member states are evaluated in terms of strengthening anti-corruption systems, which contributes the application of reforms in member states. The aim of GRECO, which is a flexible and efficient monitoring body for combating corruption, is to observe anti-corruption systems member states and to help to increase their combating capacities. About the activities within the scope of monitoring, Third Round Compliance Report of our Country was adopted in 54th Plenary Meeting on 20-23 March 2012. In order to fully implement recommendations that were partially implemented before, additional time was given to our Country until 30 September 2013.     

OECD Anti-Bribery Convention stipulates that parties shall prepare comprehensive legal amendments towards prevention, detection, prosecution and penalization of bribery of foreign public officials. Moreover, according to the convention, sanctions are set forth for both real persons and legal persons and income through bribery shall be seized. In the convention, parties are obliged to regulate their accounting systems as a tool of combating bribery of foreign public officials and to make money laundering a predicate offence. At the same time, by taking international characteristic of this crime into attention, parties should benefit from exchange of information, mutual legal assistance and extradition mechanisms with efficient cooperation. The convention stipulates a monitoring mechanism to guarantee the implementation of convention, which is another important issue of this convention.     

2- THE AIM OF THE CONVENTION

In order to prevent unfair competition and to enable transparency in world trade, states sign many agreements and implement regulation before international organizations. In recent years, the most important issue in world agenda has been the efforts to combat bribery in international platform.  
If a state does not have an efficient legal regulation and implementation for combating bribery and corruption, it is very difficult to estimate what kind of “atmosphere” businessmen face with. In this context, bribery in international business transactions becomes primary problem of both firms and governments nowadays. Especially developing countries have to purchase goods and services from foreign companies for many giant investments which require advanced technology. On the other hand, military goods and equipments are also purchased from foreign companies due to their high technology components. In such international business transactions, profit margins are very high and firms use elements out of free competition market in order to win major tenders. They give bribes to tender committees and other decision-makers. This situation not only prevents efficient use of scarce resources of country, i.e. prevents purchase of high quality goods and services in affordable prices under equal competition conditions; but also causes competition inequality in international business transactions. To win tenders through bribery spreads to other countries and promotes firms, which did not apply such illegal methods before, for competition. By creating a vicious circle, this makes bribery a widespread and ordinary method in international business transactions.         

Bribery weakens economic development and diverts international competition conditions. As bribery has become a widespread method in international business transactions especially in recent years, it becomes necessary to take necessary international measures. Within this scope, first adopted international document was “OECD Recommendation on Combating Bribery in International Business Transactions” dated 27 May 1994. This document was reviewed and extended in 1997 and “Convention on Combating Bribery of Foreign Public Officials in International Business Transactions” was adopted. It entered into force in February 1997 and 30 member states of OECD including Turkey and 7 non-member states become parties to this Convention.  

The Convention aims to strengthen combating national corruption by targeting to stop bribery in order to win international business tenders, to increase participation of civil society and to develop administration standards.

Within this framework, all signatory states commit to implement provisions of the Convention related with prevention, detection, investigation and prosecution of bribery of foreign public officials.

3- CONTENTS OF THE CONVENTION

This Convention mainly deals with “active corruption” or “active bribery”, meaning the offence committed by the person who promises or gives the bribe, as contrasted with “passive bribery”, the jurisdiction of which belongs to the national legal authorities. This Convention seeks to assure a functional equivalence among the measures taken by the Parties to sanction bribery of foreign public officials, without requiring uniformity or changes in fundamental principles of a Party’s legal system.

The Convention was signed in Paris in 1997. It consists of Preamble and 17 Articles.  

As stated in the Preamble of the Convention, bribery is a widespread phenomenon in international business transactions, including trade and investment, which raises serious moral and political concerns, undermines good governance and economic development, and distorts international competitive conditions. Effective measures shall be taken to deter, prevent and combat the bribery of foreign public officials in connection with international business transactions; in particular the prompt criminalization of such bribery in an effective and coordinated manner shall be provided.
The role of governments in the prevention of solicitation of bribes from individuals and enterprises in international business transactions requires not only efforts on a national level but also multilateral co-operation, monitoring and follow-up.  

Article 1 defines the offence of bribery of foreign public officials.  

According to this Article, each party shall take such measures as may be necessary to establish that it is a criminal offence under its law for any person intentionally to offer, promise or give any undue pecuniary or other advantage, whether directly or through intermediaries, to a foreign public official, for that official or for a third party, in order that the official act or refrain from acting in relation to the performance of official duties, in order to obtain or retain business or other improper advantage in the conduct of international business.

Each Party shall take any measures necessary to establish that complicity in, including incitement, aiding and abetting, or authorization of an act of bribery of a foreign public official shall be a criminal offence. Attempt and conspiracy to bribe a foreign public official shall be criminal offences to the same extent as attempt and conspiracy to bribe a public official of that Party.

 “Foreign Public Official” means any person holding a legislative, administrative or judicial office of a foreign country, whether appointed or elected; any person exercising a public function for a foreign country, including for a public agency or public enterprise; and any official or agent of a public international organization.

“Foreign Country” includes all levels and subdivisions of government, from national to local. 

“act or refrain from acting in relation to the performance of official duties” includes any use of the public official’s position, whether or not within the official’s authorized competence.

Article 2 defines responsibility of legal persons. According to Article 2, each party shall take such measures as may be necessary, in accordance with its legal principles, to establish the liability of legal persons for the bribery of a foreign public official.  

Article 3 defines “Sanctions”.

The bribery of a foreign public official shall be punishable by effective, proportionate and dissuasive criminal penalties. The range of penalties shall be comparable to that applicable to the bribery of the Party’s own public officials and shall, in the case of natural persons, include deprivation of liberty sufficient to enable effective mutual legal assistance and extradition.

In the event that, under the legal system of a Party, criminal responsibility is not applicable to legal persons, that Party shall ensure that legal persons shall be subject to effective, proportionate and dissuasive non-criminal sanctions, including monetary sanctions, for bribery of foreign public officials.
Each Party shall take such measures as may be necessary to provide that the bribe and the proceeds of the bribery of a foreign public official, or property the value of which corresponds to that of such proceeds, are subject to seizure and confiscation or that monetary sanctions of comparable effect are applicable.

Each Party shall consider the imposition of additional civil or administrative sanctions upon a person subject to sanctions for the bribery of a foreign public official.  

Article 4 defines “Jurisdiction”.

Each Party shall take such measures as may be necessary to establish its jurisdiction over the bribery of a foreign public official when the offence is committed in whole or in part in its territory.

Each Party which has jurisdiction to prosecute its nationals for offences committed abroad shall take such measures as may be necessary to establish its jurisdiction to do so in respect of the bribery of a foreign public official, according to the same principles.

When more than one Party has jurisdiction over an alleged offence described in this Convention, the Parties involved shall, at the request of one of them, consult with a view to determining the most appropriate jurisdiction for prosecution.

Each Party shall review whether its current basis for jurisdiction is effective in the fight against the bribery of foreign public officials and, if it is not, shall take remedial steps

According to Article 5, investigation and prosecution of the bribery of a foreign public official shall be subject to the applicable rules and principles of each Party. They shall not be influenced by considerations of national economic interest, the potential effect upon relations with another State or the identity of the natural or legal persons involved.

Article 6 defines “Statute of Limitations”. Any statute of limitations applicable to the offence of bribery of a foreign public official shall allow an adequate period of time for the investigation and prosecution of this offence.

In Article 7, each party which has made bribery of its own public official a predicate offence for the purpose of the application of its money laundering legislation shall do so on the same terms for the bribery of a foreign public official, without regard to the place where the bribery occurred.

In Article 8, in order to combat bribery of foreign public officials effectively, each party shall take such measures as may be necessary, within the framework of its laws and regulations regarding the maintenance of books and records, financial statement disclosures, and accounting and auditing standards, to prohibit the establishment of off-the-books accounts, the making of off-the-books or inadequately identified transactions, the recording of non-existent expenditures, the entry of liabilities with incorrect identification of their object, as well as the use of false documents, by companies subject to those laws and regulations, for the purpose of bribing foreign public officials or of hiding such bribery. On the other hand, each party shall provide effective, proportionate and dissuasive civil, administrative or criminal penalties for such omissions and falsifications in respect of the books, records, accounts and financial statements of such companies.

Articles 9 and 10 include provisions for “Mutual Legal Assistance” and “Extradition”.

Each Party shall, to the fullest extent possible under its laws and relevant treaties and arrangements, provide prompt and effective legal assistance to another Party for the purpose of criminal investigations and proceedings brought by a Party concerning offences within the scope of this Convention and for non-criminal proceedings within the scope of this Convention brought by a Party against a legal person. A Party shall not decline to render mutual legal assistance for criminal matters within the scope of this Convention on the ground of bank secrecy.

Bribery of a foreign public official shall be deemed to be included as an extraditable offence under the laws of the Parties and the extradition treaties between them.

Each Party shall take any measures necessary to assure either that it can extradite its nationals or that it can prosecute its nationals for the offence of bribery of a foreign public official. A Party which declines a request to extradite a person for bribery of a foreign public official solely on the ground that the person is its national shall submit the case to its competent authorities for the purpose of prosecution.

According to Article 11, each Party shall notify to the Secretary-General of the OECD an authority or authorities responsible for making and receiving requests, which shall serve as channel of communication for these matters for that Party.

Article 12 deals with a program of systematic follow-up to monitor and promote the full implementation of this Convention. This duty is now implemented by “the OECD Working Group on Bribery in International Business Transactions”.

Article 13-17 includes provisions related with signature and accession, ratification and depository, entry into force, amendment and withdrawal.

1-Agreed Common Elements of Criminal Legislation and Related Action annexed to the 1997 OECD Recommendation, paragraph 5.
2-OECD, Commentaries on the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, Commentary 24.

 

 

 

 
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