U.S. Should Remain Leader in Anti-Bribery Efforts

September 27th, 2011

Protests in Alexandria, Egypt

Al Jazeera English/Flickr*

Last May, President Obama delivered his widely viewed “Arab Spring” speech, in which the President made a clear link between combating corruption, the stability of nations and human dignity.  Unfortunately, proposed amendments to the Foreign Corrupt Practices Act (FCPA) by the U.S. Chamber Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce, go against the current global trend, and threaten to undermine America’s role as a global leader against corruption.

Earlier this month, I attended an FCPA briefing on Capitol Hill  launching a new report, “Busting Bribery: Sustaining the Global Momentum of the Foreign Corrupt Practices Act.” The authors of this important study, David Kennedy, Professor of Law at Harvard University, and Dan Danielsen, Professor of Law at Northeastern University, spoke at length about the dangers of proposed amendments. They began by outlining the Chamber’s suggested changes to the FCPA, including reducing liability for companies with compliance programs and removal of liability for subsidiary companies. Danielson countered the claim of overly-zealous enforcement and described how the U.S. government has only prosecuted companies for FCPA violations in the most “egregious” cases. Instead, government regulators have mainly used the law to raise awareness with companies and give them opportunities to reform their practices.  He also pointed out that removing liability for subsidiary companies would openly promote corruption by fostering an “I didn’t know” defense. After hearing both speakers, it became clear to me how much our nation stands to lose by accepting the proposed amendments.

The United States acted as a pioneer in establishing the FCPA in 1977; since then, over 40 governments have adopted similar legislation. The cumulative result has reduced entry barriers for smaller companies, improved competitiveness in global and national markets, and enhanced the environment supporting the rule of law. The FCPA has set clear guidelines for companies to follow and has established a precedent for other national governments to adopt, which improves efficiency and puts the emphasis back on the product or service instead of the payoff. Compliance programs promote better business practices by emphasizing transparency and making it easier for foreign governments to crack down on corrupt practices. An enhanced global business environment also directly impacts American jobs and investments as U.S. companies can take advantage of a level playing field when doing business in foreign markets.

The “Arab Spring” led citizens to the streets, often risking their lives in support of transparent and fair political systems. President Obama commented, “No development strategy can be based solely upon what comes out of the ground. Nor can people reach their potential when you cannot start a business without paying a bribe.” Taking a retroactive step by giving in to the Chamber of Commerce’s request to amend the FCPA would be an utter embarrassment to our reputation for promoting and upholding the rule of law and would risk increasing the dangers described by the President.

Please, support the global campaign against corruption by backing the FCPA.

A video of the Capitol Hill briefing on the Busting Bribery report can be viewed below:

* Image license: Some rights reserved by Al Jazeera English

Written by Matias Francone

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