The Future of Anti-Bribery Legislation: Global Trends

Bribery refers to the act of giving an incentive to influence someone’s actions. It is often a financial incentive but that is not always the case. Bribes create a culture of corruption and unfairness. Anti-bribery legislation is put in place by organisations and government bodies to identify and combat bribery.

The former president of the United States, billionaire Donald Trump, has been in the news over recent years accused of various financial crimes, including an attempt to bribe and put pressure on two Michigan officials not to sign papers to verify the 2020 election results. The world has also watched on during his landmark criminal trial this April, which has seen him accused of falsifying accounts and paying ‘hush money’ to a former adult film star.

Whether the former US president is found guilty or not, this landmark trial has seeded in the minds of people across the globe, that bribery and corruption continue to be problems in the world of politics and business in 2024.

The Current Landscape of Anti-Bribery Legislation

There is no singular, globally accepted definition of the word bribery. However, bribery is widely regarded as giving someone an incentive (financial or otherwise) to perform (or agree to perform) their functions or role in a way that is improper or unfair. It could also be given to reward them for having already done so. 

Acts of bribery can be split into two distinct categories:

• Active bribery
• Passive bribery

When an individual offers, promises or provides a bribe, this is called active bribery. 

When an individual requests, takes or accepts a bribe, this is called passive bribery.

The global connectedness that the internet and international air travel have afforded, means that organisations can work together more easily than ever to meet common goals and identify issues that need to be addressed. 

Bribery continues to be an issue in:

• Politics
• Business
• Sports
• The financial sector

Anti-bribery defines the key principles that go against bribery and corruption. Businesses may be required to have a specific policy against bribery and others may opt to have one, even if it is not a requirement.

Anti-bribery is about transparency and compliance; it aims to avoid unfair and unlawful practices that happen in businesses or other organisations. 

• To be anti-bribery is to be opposed to, or against, bribery and corruption. Laws exist to combat and prosecute acts of bribery.
• Taking bribes is illegal – it is also illegal to offer or request a bribe.

We know that there is currently no single, specific definition of bribery as such, but the simple definition of anti-bribery is a framework that protects people from bribery and goes against the acts of bribery and corruption. Strong anti-bribery legislation makes bribery more difficult to happen and easier to identify and prosecute when it does. 

Key pieces of legislation that relate to anti-bribery across the world include:

• The UK’s Bribery Act 2010
• The USA’s Foreign Corrupt Practices Act 1977 (FCPA)
• The 1997 Convention on fighting corruption involving officials of the EU or officials of EU countries
• The 2003 Council Framework Decision on combating corruption in the private sector, which criminalises both active and passive bribery
• The 2008 Council Decision 2008/852/JHA on a contact-point network against corruption

Emerging Trends in Anti-Bribery Legislation

Tackling bribery across the globe continues to be a hot topic for lawmakers and legislators as the consequences can be so far-reaching, both financially and in terms of reputational damage.

A snapshot of the cost of bribery in the contemporary world:

• 24% of global organisations have reported being victims of bribery and corruption
• An estimated USD1 trillion is paid in bribes each year globally
• Up to USD2.6 trillion is lost to corruption each year
• Luxury car firm Rolls-Royce had to pay USD671 million to settle bribery allegations

The US continues to be a world leader in anti-bribery. In December 2023 congress passed a new anti-bribery law:

• The Foreign Extortion Prevention Act (FEPA)

This new legislation brings the US Department of Justice (DOJ) more in line with UK law as it sets out new rules around the ‘demand’ side of bribery of foreign officials. Previously, the focus was on the ‘supply’ side of acts of bribery under FCPA (the people offering the bribe), rather than focusing on the criminal elements of corrupt foreign officials themselves. 

FEPA was passed as part of the US’s annual National Defense Authorization Act which builds on Biden’s 2021 Strategy on Combatting Corruption. The Biden administration has pushed a strong anti-corruption agenda and the passing of the new FEPA gives a strong message to their continued commitment to national security and anti-corruption measures. 

Strengthening Enforcement Mechanisms 

It is vital that countries can work together across the globe to combat bribery. By allowing corruption, either on purpose or through poor legislation or careless practice, you undermine international agreements and standards on fair trade and ethics. 

To help to strengthen enforcement and communication methods across the globe, countries should be encouraged to adopt:

• Better and more streamlined communication channels
• Methods to identify problematic and high-risk areas
• A collaborative approach
• Increased protection for whistleblowers
• The development and implementation of new technologies
• Evidence-based strategies

Government agencies, international cooperation and clearer, standardised frameworks are key mechanisms in the global battle against bribery. 

Expanding Jurisdiction and Extra-Territorial Reach

International efforts against bribery will continue to be strengthened by formalised agreements between countries. It continues to be an issue that some countries have a less strict approach to bribery than others and that investigation and prosecution levels vary greatly between different areas.

In 2022 it was announced that the EU had plans to strengthen their legislative framework around anti-corruption. On 3 May 2023 the Commission proposed this new legislation that had the subject of bribery at its core. Some of its key aims include:

• Strengthening anti-corruption by raising awareness about the negative impact corruption can have on citizens and wider societies
• Extending the definitions of criminal corruption to include misappropriation, trading in influence, abuse of functions, obstruction of judgment and illicit enrichment as well as traditional bribery offences
• Introducing penalties and sanctions that will apply across all member states
• Extending the statute of limitation for corruption offences
• Empowering all investigators and law enforcers by ensuring they have the tools and resources required to investigate and fight corruption
• Removing or reducing some of the risks that come with corporate self-reporting

Corporate Compliance and Due Diligence 

Global trading can pose operational challenges in:

• Identifying supply chains
• Operating through multiple distribution channels
• Language barriers and cultural differences

Large multinational corporations introduce additional risks, such as:

• Complex networks of interconnected entities
• Affiliates or joint ventures
• Registrations and/or operations in different countries (including tax havens)

It is important that organisations act within the law and have strategies in place to protect their clients, stakeholders and employees. They should also disclose their ownership structure and beneficial ownership holdings (known as organisational transparency). 

These complex networks and international trade agreements can make it difficult to ensure the legitimacy of every single financial transaction or beneficiary of a contract. 

Organisational transparency can help to support anti-bribery legislation and aid in due diligence by ensuring that a company’s structure does not facilitate corruption, or aid in the disguising of illicit funds.

A consistent message across boundaries and jurisdictions that all businesses and organisations must have a zero-tolerance approach to corrupt practices is fundamental to undermining the practice of bribery. 

Due diligence refers to the mitigations an entity puts in place to limit the risk of an instance of bribery from occurring. It refers to the initial and ongoing review of associated people in business relationships. Under UK law, being able to show that you have proportionate measures and controls in place, can offer you some legal recourse if you find yourself in trouble. 

There are six principles that underpin the idea of due diligence in preventing bribery in the UK Bribery Act 2010: 

• Proportionality
• Top-level commitment
• Risk assessment
• Due diligence
• Communication
• Monitoring and review

The above principles can be applied by businesses and organisations in any part of the world to form an effective framework against bribery and corruption. 

Transparency and Reporting Requirements

Transparency plays a key role in preventing bribery and corruption. If your organisation faces accusations of bribery or any other type of investigation, having clear records and transparent business practices will aid in your defence.

Transparency has multiple benefits for businesses and organisations, such as:

• It builds trust – clients, consumers and employees prefer to work with entities that have higher levels of transparency. It can improve loyalty (both from clients and employees) and improve business relations.
• Positive reputation – companies with a commitment to transparency often have better reputations and can quickly access robust evidence that contradicts accusations of impropriety or wrongdoing.
• Legal incentives – it is important for businesses and organisations to be transparent to comply with local or international legislation. The EU Non-financial Reporting Directive, for example, may require certain material on anti-bribery and anti-corruption to be disclosed.
• Advantage over competitors – companies can leverage the power of their commitments to transparency and anti-corruption in marketing materials to give them a competitive edge and make them more attractive to consumers and potential investors.

Many countries are implementing clear and stringent reporting requirements. If you are conducting business or trade, it is vital that you understand the specific requirements in any areas that you will be operating in, including self-reporting requirements. 

Some authorities (including in the UK and the US) have sought to incentivise the self-reporting of corporate bribery and corruption, although this continues to be a grey area for many.  

The Role of International Organisations

The Organisation for Economic Co-operation and Development (OECD) is an international organisation that works to build better policies for better lives. According to their website, “our goal is to shape policies that foster prosperity, equality, opportunity and well-being for all. We draw on 60 years of experience and insights to better prepare the world of tomorrow.” 

The OECD is at the centre of international cooperation, with its member countries working with other countries, policymakers and stakeholders to create and improve policies and implement international standards across the globe.   

The OECD Anti-Bribery Convention sets standards for criminalising the bribery of foreign public officials in international transactions. In 2021 parties to the convention (38 member states and 8 non-OECD countries) agreed to adopt subsequent measures to prevent, detect and combat bribery. There have been over 800 sanctions since the OECD Anti-Bribery Convention came into force. 

The United Nations also plays a key role in educating and advising the world about bribery. The United Nations (UN) Convention Against Corruption is comprised of five key areas:

• Preventative measures
• Criminalisation and law enforcement
• International cooperation
• Asset recovery
• Technical assistance and information exchange

It is the only legally binding, anti-corruption instrument of its type and almost all of the UN member states are party to the convention. 

Predicting the Future of Anti-Bribery Legislation 

New technologies and artificial intelligence (AI) are set to have a significant role to play in the future fight against bribery and corruption. 

Automation can make identifying anomalies, tracking trends and tracing payments easier. As law enforcement adopts AI automation to deal with analysing large amounts of data, it can free up investigators’ time to work on activities that require a human touch, such as tracking corrupt officials, obtaining key evidence and witness statements and building strong cases against criminals.

Emerging anti-bribery legislation may shift at least some of its focus onto the role that digital money or cryptocurrency may have on bribery and corruption. Whilst digital currencies, such as Bitcoin, offer numerous benefits including faster transactions and lower fees, their decentralised nature and relative anonymity can make them attractive for illicit activities.

Future anti-bribery legislation will need to reflect the constantly evolving and emerging world of technology, AI and digital currencies. Governments and financial organisations are becoming increasingly aware of the risks associated with digital currencies and will likely implement future legislation that implements measures to combat their use in bribery, corruption and money laundering. 

With increasing tensions between countries and the threat of war looming in some parts of the world, the failure of some jurisdictions to act in the best interests of the global community may pose additional challenges to implementing international standards to combatting bribery. 

Conclusion 

Government, financial institutions, businesses and individuals all have a role to play in combatting bribery. This includes implementing more standardised regulations, sharing information and raising awareness of the danger that offering or accepting bribes poses.

As we begin to harness the power of digital technology to aid in the global fight against bribery over the coming years, we also need to promote clearer policymaking and enhanced cooperation between nations.