Russia Signs OECD Anti Bribery Convention

Russian President Dmitry Medvedev, left, on Wednesday signed the Anti-Bribery Convention of the Organization for Economic Co-operation and Development (OECD).

The convention requires signatories to criminalize overseas bribery by their citizens and impose punishment for violations. It also requires cooperation among members to prosecute graft.

Signing the 1997 convention is a prerequisite for joining the OECD. Russia has applied for membership. Non-OECD members can also sign the convention.

China hasn't yet joined the convention but is also seeking OECD membership.

According to a report from RIA Novosti, Transparency International Russia lobbied the Kremlin for twelve years to sign the convention. The report said blogger and whistleblower Alexei Navalny also pushed for the action.

OECD members are: Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Estonia, Finland, France, Germany, Great Britain, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, the Republic of Korea, Slovakia, Slovenia, Spain, Switzerland, Sweden, Turkey, and the United States.

Non-member signatories to the OECD anti bribery convention are Argentina, Brazil, Bulgaria, and South Africa.

The OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions can be downloaded here.

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The Russian President's office issued this statement on February 1:

Dmitry Medvedev signed Federal Law On Russia’s Accession to the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.

The Organisation for Economic Cooperation and Development (OECD) adopted the convention on November 21, 1997.

The convention is an effective instrument of combat against corruption implemented by the signatory countries through the UN, G8, Council of Europe, APEC, IMF, World Bank, and other international organisations.

By joining the convention, Russia will facilitate efforts in international cooperation on combating bribery of foreign public officials, and also fulfil one of the conditions for joining the OECD.

Implementing the federal law on joining the convention will require up to 100,000 euros in additional federal budget funding, to finance Russia’s contribution for participation in the OECD Working Group. This money will be paid as part of the yearly budget funds allocated to the Russian Foreign Ministry.  

The bodies vested with powers regarding the convention will be defined by presidential executive order.

The Year Of Living Cleanly?

Russia is so mired in corruption that nothing else there seems to matter.

It ranks 143 on the corruption perceptions index, tied with Nigeria and Uganda, among others.

It's not just business that's corrupt. So are politics.

Vladimir Putin's ruling United Russia party allegedly stole the December parliamentary elections by stuffing a million or more votes into ballot boxes.

But something big is happening.

Hundreds of thousands (maybe millions) of Russians are taking to the streets across Russia's nine time zones, in the middle of winter, to protest against the sleaze.

Alexei Navalny, above, 35, a lawyer and leading anti-corruption blogger, has emerged as the leader of the opposition. He's capable and charismatic. Think JFK -- young, smart, careful, courageous, handsome, witty, articulate, optimistic, and modern.

The presidential elections are in March. Until a few weeks ago, most people assumed Putin would win again. He stepped down as president four years ago because of term limits and became prime minister.

Navalny labeled United Russia as the "party of swindlers and thieves," and the name stuck.

This week he told a Moscow radio station: "I'm ready to fight for leadership positions, including the post of president."

Even former Soviet president Mikhail Gorbachev, who hasn't said much for the past twenty years, followed Navalny's lead, telling Putin to resign and hold new parliamentary elections.

Russians Vote Against Corruption

Russia -- ranked a dismal 143 on latest the corruption perception index -- held parliamentary elections over the weekend.

Vladimir Putin's ruling United Russia party will probably finish with less than fifty percent of the votes. Four years ago it won sixty four percent.

As Reuters said, 'Many voters, fed up with widespread corruption, refer to United Russia as the party of swindlers and thieves and resent the huge gap between the rich and poor. Some fear Putin's return to the presidency may herald economic and political stagnation.'

Putin stepped down as president four years ago because of term limits and became prime minister. Despite the weekend vote, he's expected to regain the presidency in the March 2012 election.

A few years ago, we carried a post about a Moscow Times story by Anders Aslund, a senior fellow at Washington, D.C.'s Peterson Institute for International Economics.

He argued that since 1990, both authoritarianism and public corruption grew dramatically in Russia, and that there's a connection between the two. 'Authoritarian rule is often used by rulers to hide and sustain their corruption,' Mr. Aslund said. 'According to Transparency International,' he said, 'the only country with higher income per capita and more corruption than Russia is Equatorial Guinea. That is hardly a standard worthy of a great nation.'

How blatant is Russia's corruption?

Take a look at this clip from 2010.

Breuer Defends The FCPA, As Is

Associate Attorney General Lanny Breuer, left, defended the FCPA today and argued that now is not the time to water it down.

In remarks to the National Conference on the Foreign Corrupt Practices Act in Washington, D.C., he said amending the statute now, as proposed by the Chamber of Commerce and others, would send exactly the wrong message to the rest of the world.

He said,

Particularly since it has become increasingly clear over the past year that the trend across the globe is toward criminalization of foreign bribery.  The U.K. Bribery Act took effect in July.  Russia recently passed an anti-bribery law; has ratified the U.N. Convention against Corruption; and is expected soon to accede to the OECD Anti-Bribery Convention. China, too, recently passed an anti-bribery law and is an observer at the OECD’s Working Group on Bribery.

Breuer admitted that other countries are still far behind in enforcement. 'A stark reminder that the road ahead is long is that, in a report released last week, China and Russia ranked 27th and 28th, respectively, out of 28 countries on Transparency International’s 2011 Bribe Payers Index.'

But, he said, it took decades for the FCPA to become a strong an enforcement tool. 'Having come this far on what I believe is a noble journey, we cannot, and should not, start going backwards. On the contrary, the United States must continue leading the charge against transnational bribery.'

The DOJ has considered suggestions about FCPA enforcement, he said, meeting business leaders at roundtables organized by the Department of Commerce, 'during which industry representatives expressed their views on a wide range of issues related to the FCPA.'

Next year, the DOJ expects to release detailed new guidance on FCPA enforcement. Breuer hopes it will be 'a useful and transparent aid.'

And in response to the OECD’s Phase 3 Review of FCPA enforcement, Breuer said the DOJ is reworking the lay person’s guide to the FCPA (here in pdf) and 'consolidating within it much of the information that is already available from the DOJ's FCPA site.

BRIC Companies Rank Low On New TI Index

Transparency International yesterday released its 2011 Bribe Payers Index. It’s the fifth version of the index and the first update since 2008.

It ranks 28 of the world’s largest economies, TI said, ‘according to the perceived likelihood of companies from these countries to pay bribes abroad.’

The report is based on a survey of business executives. The countries ranked, TI said, cover all regions of the world and represent almost 80 percent of the total world outflow of goods, services, and investments.

It includes perceptions of public bribery and for the first time private ('business to business') bribery.

The top-ranked countries are the Netherlands and Switzerland, tied in first place. Belgium, Germany, and Japan round out the top five.

Companies from the BRIC economies are led by Brazil at 14. Russia ranked last overall at 28, India at 19, and China at 27.

The UAE, Indonesia, and Mexico complete the bottom five spots.

TI’s 2011 bribe payers index is here.