Criminal Liability for Corporate Bribery: Variations Across Countries

Abstract

With respect to law enforcement, what characterizes the most ‘actionable definitions’ of corruption? If countries are to choose, should they go for a more precise definition of liability or a definition with a broader scope? What are the trade-offs for reform-friendly governments? Such questions motivated this draft paper, prepared for a volume upon a conference celebrating Susan Rose-Ackerman’s contributions to scholarship. By zooming in on countries’ regulation and enforcement of foreign bribery, we explain why, for a given scope of liability, lower precision in the definition of liability will always impede the enforcement system’s ability to sanction and deter corporate bribery. The insight is important with respect to the increasing use of non-trial resolutions in corporate bribery cases, which (compared to trials) tends to reduce the clarifying role of case law. For empirical investigation, we draw on the materials presented in an OECD report on corporate liability from 2016, and rank 36 jurisdictions according to the scope and precision of their definition of corporate liability in bribery cases. We show that there is substantial variation across jurisdictions when it comes to how they regulate corporate bribery, even if they are signatories to the same conventions. Countries that perform well in terms of their corporate bribery definition, perform well on a range of other governance indicators too, and they are better able to enforce corporate liability. As a policy implication of the study, it should be noted that criminalization of foreign bribery takes many different forms; a broad scope of liability will easily make such regulation appear more functional than it is.