Earlier this year, the Organization for Economic Cooperation and Development (the “OECD”) launched its latest round of reviews to monitor the anti-bribery efforts of signatory countries to the OECD’s Anti-Bribery Convention (the “Convention”). The Convention, in force since 1999 and adopted by 41 countries, including all 35 OECD member states, requires signatories to criminalize the bribery of foreign public officials engaged in international business transactions. The OECD monitors each signatory’s implementation and enforcement of the Convention through a peer-review system, administered by the OECD Working Group on Bribery (the “Working Group”).
In previous monitoring rounds, the Working Group had in turn: (1) evaluated the adequacy of each country’s implementing legislation, (2) assessed policy effectiveness, and (3) tracked ongoing enforcement efforts and considered progress against earlier recommendations.
This newest round of successive monitoring (“Phase 4”) continues to focus on efforts to implement and enforce the Convention and the supplemental guidelines for combating bribery that parties to the Convention have since adopted. Additionally, Phase 4 takes a “tailored approach” to “identify the unique challenges and achievements of the evaluated country and to assist the country in addressing challenges in a way that is suitable and feasible within its legal system.” Accordingly, Phase 4 aims to highlight country-specific achievements, including practices that have proved effective in combating foreign bribery, and to flag any issues raised by changes in domestic legislation.
In a December 2016 Wall Street Journal interview, the Working Group’s executive, Patrick Moulette, offered that signatory countries have struggled most with implementing Article 2 of the Convention, which calls for imposing liability against “legal,” and not just natural, persons. “[E]nact[ing] a regime for prosecuting companies,” according to Mr. Moulette, “is very easy to say but it’s much more difficult to design in practice,” especially in civil law countries. As a result, “many countries in the [W]orking [G]roup have struggled to enact a regime for holding companies liable for foreign bribery.” The latest round of monitoring will oversee these challenges.
Each Phase 4 evaluation will proceed through a series of evaluative steps involving input from the evaluated country, at least two peer reviewer countries (also known as “lead examiner countries”), and OECD staff. To ensure fairness as well as sensible historical perspective, “[w]herever possible,” Phase 4 aspires for peer-reviews by countries with similar legal systems to and with previous experience in reviewing the evaluated country.
The process is designed to be collaborative and iterative, with ample opportunity for the evaluated country to set the record straight. During the Phase 4 review, evaluated countries will respond to general and country-specific questionnaires, host on-site visits by examiner countries and OECD staff, and submit comments in response to draft preliminary reports. Phase 4 envisions that the on-site visits will “address concrete cases that have arisen under . . . implementing legislation or any other legislation . . . with regard to the bribery of foreign public officials” and generate confidential discussions to “determine how the foreign bribery offence is being prosecuted, what investigative techniques are being utilised, and what hurdles are being faced by countries in the fight against the bribery of foreign public officials.” The latter may include, for instance, difficulties with “establish[ing] a good system to protect whistleblowers,” a “complex area,” in Mr. Moulette’s estimation.
The Phase 4 capstone is the Working Group’s evaluation report, which will set out “core recommendations” the evaluated country is expected to implement. Each country will then have up to two years to submit a responsive report explaining its implementation efforts. Failure to adequately address the Working Group’s recommendations could lead to additional reporting requirements.
The OECD conducted on-site visits in October in the United Kingdom and in Finland, the first two countries reviewed under Phase 4. The United States is not scheduled for review until 2019. The Phase 4 monitoring guide is available here. And the complete calendar of evaluations is available here.