The OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (Convention) aims to reduce, according to The Convention’s preamble, the “widespread phenomenon” of bribery in international business transactions. Signatory countries have three main obligations; first, make bribery of public officials a criminal office;  second, investigate and, where appropriate, prosecute those who offer, promise or give bribes to foreign public officials and subject those who bribe to heavy penalties; and third, deny tax deductibility for bribes.

The Convention is the first and only international anti-corruption instrument focused on the ‘supply side’ of the bribery transaction. The Working Group on Bribery, an international body focused on foreign bribery, administers peer reviews which are designed to ‘name and shame’ signatory countries to implement their obligations under the Convention.

The Convention is complemented by the Recommendation for Further Combating Bribery of Foreign Public Officials in International Business Transactions (Recommendation), introduced in 2009. The Recommendation provides a series of targeted measures to enhance countries’ implementation of their Convention obligations, and better prevent, detect, and prosecute allegations of foreign bribery. For example, the Recommendation obliges countries to establish whistleblower reporting mechanisms and protections for public and private sector employees.

There are several shortcomings with the Convention. For example, in Article 1, the Convention establishes a standard for parties to meet when drafting the definition of ‘bribery’, but does not impose a specific definition for the term. As a consequence, signatories can pass legislation defining bribery in different ways, and so undermine global uniformity in the definition, detection and enforcement of bribery that the Convention seeks. Furthermore, the Convention only addresses the supply side of bribery (ie offering the bribe) and so fails to deal with the demand side (receiving the bribe).

However, the breadth of membership and relative effectiveness enforcement suggests that the Convention is a useful tool to stimulate global co-operation in reducing bribery. Currently, 38 countries have joined the Convention. The Working Group on Bribery members accounts for nearly 80% of world exports and 90% of global outward flows of foreign direct investment, enabling a large number of major economies to work together to reduce bribery. Governmental, non-governmental and business organisations such as the Council of Europe, Transparency International and the World Bank, contribute to anti-bribery discussions under the Convention, which further facilitates global co-operation. Bribery has also become a major issue for the G20, which released the G20 Anti-Corruption Action Plan on 12 November 2012.

Recent data suggests that signatory countries take their obligations seriously and enforce anti-bribery measures contained in the Convention. According to March 2011 data from the OECD, since the Convention entered into force, nearly 210 individuals and 90 entities have been sanctioned under criminal proceedings for foreign bribery in 14 countries. In addition, there are approximately 300 ongoing investigations in 26 countries.