To Bribe or Not to Bribe — A Less than Ethical Dilemma, Resolved?
| DOI | https://doi.org/10.1108/eb026024 |
| Date | 01 March 2002 |
| Published date | 01 March 2002 |
| Pages | 249-258 |
| Author | Peter M. German |
| Subject Matter | Accounting & finance |
Journal of Financial Crime — Vol. 9 No. 3
To Bribe or Not to Bribe — A Less than Ethical
Dilemma, Resolved?
Peter M. German
'Corruption is not capitalism's natural product, but
its perversion.'1
Bribery of public officers has been an offence under
Canada's criminal law since its codification in
1892.2 That offence and a collection of other little-
used provisions3 are intended to serve as a bulwark
against the corruption of Canadian public officials.
Until recently, however, the bribery of a foreign
public official was not accorded similar, or any, treat-
ment in Canada's criminal law.4 This void existed
despite passage of the Foreign Corrupt Practices
Act (FCPA) in the USA in 1977.5 The American
legislation passed unanimously in both Houses of
Congress, part of the post-Watergate attempt to
cleanse America government of unethical behaviour
and illegal conduct.6 It also came after a large
number of high-profile companies admitted to
bribing foreign officials in order to obtain large
government contracts.
For many years, the USA stood alone in its attempt
to legislate international ethical standards. Being
alone did not sit well, however, with the American
business community. Corporate America objected
to the competitive advantage it felt was enjoyed by
countries which did not require a similar high ethical
standard. A belief gradually developed that the best
way to level the playing field was not to scrap the
FCPA, but to universalise its terms.7 The exponential
increase in free-market economies after the fall of the
Iron Curtain only exacerbated the need for ground
rules to guide business, both domestic and foreign.
American pressure appears to have worked. In
recent years numerous international organisations
have studied the effects of corruption and made
efforts to reduce its impact on business. The Organi-
zation of American States,8 the Commonwealth, the
G8,9
the World Bank, multilateral development
banks,10 the Council of Europe,11 the United
Nations,12 the International Monetary Fund, the
World Trade Organization, the European
Union13
and the Financial Action Task Force14 have all
attempted to deal with the problem. Canada has
been an active participant in many of these
organisations. In addition, various non-governmental
organisations and pressure groups, notably Trans-
parency International, have lobbied for change.
The international organisation which emerged as
the most influential was the Organisation for Eco-
nomic Cooperation and Development (OECD). At
the urging of the USA, it began negotiating a con-
vention in 1989. The OECD15 is composed of 30 of
the world's most advanced economies, including
Canada.16 The Convention on Combating Bribery
of Foreign Public Officials in International Business
Transactions was signed by all members, and by
five non-member countries, in Paris on 17th
December, 1997.17 Canada took great pride in
becoming the country that triggered the Convention
coming into force on 15th February, 1999, by being
the fifth major exporter to deposit its instrument of
ratification, joining Japan, Germany, the UK and
the USA.18
In order to give substance to the Convention and
meet its obligations, Canada required domestic
enabling legislation. Bill S-21, the Corruption of
Foreign Public Officials Act, was designed to do
just that, both outlawing bribery of foreign officials
and interfacing with Canada's proceeds of crime
and money laundering laws.19 The Bill raced
through both Houses of Parliament and obtained
Royal Assent in ten days, almost a record for
criminal legislation. Although its quick passage has
been attributed to the upcoming parliamentary
Christmas break, the speed was more likely to be
a result of the politics of international diplomacy
than Yuletide festivities. Now in force, it awaits
its first test. Pity the entity which becomes
that test case for, in the words of one law firm:
'the potential for embarrassment and unwanted
publicity is obvious'.20
Without question, the legislation will have an
effect on how Canadians and Canadian corporations
carry on business abroad. For that reason alone, an
understanding of the legislation is of the utmost
importance. This paper examines the background
to the legislation, its provisions, its strengths and its
weaknesses.
Journal of Financial Crime
Vol.
9,
No.
3,
2002,
pp.
249-258
© Henry Stewart Publications
ISSN 1359-0790
Page 249
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