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NOTE
ENSURING UNIFORMITY IN THE IMPLEMENTATION OF

THE 1997 OECD CONVENTION ON COMBATING
BRIBERY OF FOREIGN PUBLIC OFFICIALS IN
INTERNATIONAL BUSINESS TRANSACTIONS
I. INTRODUCTION
Since the passage of the Foreign Corrupt Practices Act (FCPA)

in 1977,1 the United States has worked to persuade other nations
to forbid bribery of foreign public officials in an effort to secure
business abroad. 2 As a result of pressure from the United States
and the increased costs associated with corruption, the interna-
tional tide is turning against transnational bribery.3 In order to
capitalize on this global shift towards condemnation of corruption,
twenty-nine Organization for Economic Cooperation and Develop-
ment (OECD) 4 member countries and five non-member countries
signed the Convention on Combating Bribery of Foreign Public
Officials in International Business Transactions (Convention) on
December 17, 1997. 5 The Convention is an effort to cut off transna-
1. The Foreign Corrupt Practices Act of 1977 (FCPA), 15 U.S.C. §§ 78a, 78m, 78dd-
1, 78dd-2, 78ff (1994 & Supp. IV 1998).
2. Lisa Harriman Randall, Note, Multilateralizationof the Foreign CorruptPracticesAct, 6
MINN. J. GLOBAL TRADE 657, 657 (1997).
3. See Lucinda A. Low, Transnational Corruption: New Rules For Old Temptations, New
Players to Combat a Perennial Evi 92 AM. Soc'Y INT'L L. PROC. 151, 151 (1998) ("[N]ew
public intolerance of corruption worldwide has catapulted anticorruption efforts onto the
agenda of international organizations."); Nancy Zucker Boswell, New Tools to Fight Corrup-
tion, Center for International Private Enterprise (1998), at http://www.cipe.org/e28/
boswe28.html. See generally Nancy Zucker Boswell, Law and Ethics in Emerging Markets: An
Emerging Consensus on Controlling Corruption, 18 U. PA. J. INT'L ECON. L. 1165 (1997) (dis-
cussing the increasing destructiveness of corruption and the necessity for international
anti-corruption reform).
4. "Since it took over from the Organization for European Economic Cooperation
(OEEC) in 1961, the OECD vocation has been to build strong economies in its member
countries, improve efficiency, hone market systems, expand free trade and contribute to
development in industrialised as well as developing countries.... After more than three
decades, the OECD is moving beyond a focus on its own countries and is setting its analyti-
cal sights on those countries - today nearly the whole world - that embrace the market
economy." OECD Origins (1998), at http://www.oecd.org/about/origins/index.htm.
5. Press Release, OECD, OECD Convention on CombatingBribery to Enter into Force on 15
February1999 (Dec. 17, 1998), available at http://www.oecd.org/news and-events/release/
nw98-124a.htm [hereinafter OECD NEws RELEASE]. Member countries include: Australia,
Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece,
The Geo. Wash. Int'l L. Rev. [Vol. 33
tional bribery at its source. 6 Consequently, in signing the Conven-

tion all signatory countries made the commitment to "pass
legislation necessary for [the Convention's] ratification and imple-
7
mentation into national law."
Article 15 of the OECD Convention provides that the Conven-
tion shall enter into force two months after "five of the ten coun-
tries which have the ten largest export shares, and which represent
by themselves at least sixty percent of the combined total exports of
those ten countries," have placed their instruments of ratification
on file with the OECD Secretary General. 8 On December 17, 1998
Canada became the fifth country in this category to ratify the Con-
vention. 9 Consequently, the OECD announced that the Conven-
tion would enter into force on February 15, 1999.10
Although the successful ratification and entry into force of the
OECD Convention is itself a significant triumph against corrup-
tion,1 1 the true measure of the Convention's success will depend
on whether the international community succeeds in ensuring uni-
Hungary, Iceland, Ireland, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New
Zealand, Norway, Poland, Portugal, Spain, Sweden, Switzerland, Turkey, United Kingdom,
and the United States of America. Non-member signatories include: Argentina, Brazil, Bul-
garia, Chile and the Slovak Republic. Id. Australia signed as a member country on Decem-
ber 7, 1998. Australia Signs OECD Anti-Bribery Pact,J. COM., Dec. 9, 1998, at 6A.
6. Press Release, OECD, Convention on Combating Bribery of Foreign Public Officials in
International Business Transactions Adopted, (Nov. 21, 1997), available at http://
www.oecd.org/news-and-events/release/ nw97104a.htm.
7. OECD NEws RELEASE, supra note 5.
8. OECD Convention on Combating Bribery of Foreign Public Officials in Interna-
tional Business Transactions, Dec. 17, 1997, art. 15, entered into force Feb. 15, 1999, available
at http://www.oecd.org/daf/cmis/bribery/20novle.htm [hereinafter Convention].
9. OECD NEws RELEASE, supra note 5.
10. Id,
11. David A. Andelman, Bribery: The New Global Outlaw, MGMT. REv. Apr. 1998, at 49,
51 (quoting Transparency International (TI) American Chapter Chairman, Fritz Heimann
as saying, "This is going to be a step-by-step process taking a lot of time. But this is a very
big step."); see also Cheryl W. Gray and Daniel Kaufmann, Corruptionand Development, FIN. &
DEV., Mar. 1998, at 7 (referring to the Convention as "a landmark resolution to criminalize
bribery."); David Ivanovich, More NationsJoin U.S. War on Bribery, Hous. CHRON., Oct. 30,
1998, at IC (quoting Arthur Downey, head of the American National Association of Manu-
facturers' task force on international bribery); Extortion and Bribery in InternationalBusiness
Transactions, International Chamber of Commerce (ICC), available at http:www.iccwbo.
org/home/statementsrules/rules/1999/briberydoc99.asp (finding that there has been
substantial progress in addressing bribery in international business transactions, "[miost
importantly, the OECD Convention."). But see Rachel Ehrenfeld & Charles Saphos, Cor-
rupt? Absolutely, 77 FOREIGN AFF. 168, 168 (1998) ("IT]he convention does little, if any-
thing, to combat the threat [of corruption]. . . .The OECD has abdicated even the
appearance of respect for the rule of law. The United States settled for this empty shell
because of domestic political scandals alleging the influence of foreign bribers received by
the White House.").
2000] Ensuring Uniformity Implementing the 1997 OECD Convention 99
form implementation and enforcement of the Convention among

countries with very different legal systems and enforcement
resources.
This Note examines the OECD Convention to determine
whether it contains both the substantive and procedural elements
necessary for its successful uniform implementation among all sig-
natory states. Section I describes the development of a general
world revulsion of corruption, and concludes that the OECD Con-
vention owes its passage to the fact that bribery is no longer fash-
ionable due to the increased political and economic costs
associated with the practice. Section II first examines the substan-
tive and procedural provisions of the OECD Convention, conclud-
ing that the substantive provisions do not establish clear standards
to ensure uniformity in implementation. Next, the section exam-
ines the Convention's monitoring procedures, concluding that
they are flawed in two respects. First, these procedures are
designed to ensure that signatory countries are satisfying the vague
standards set by the substantive portions of the Convention. Sec-
ond, the Convention explicitly and implicitly limits the monitoring
roles of third parties. Section III evaluates additional pressures and
resources necessary to both assist motivated countries to comply
with the Convention as well as remind derelict countries of the
increasing costs associated with corruption.
II. DISCUSSION: THE DEVELOPMENT OF A "GENERAL WORLD

REVULSION OF CORRUPTION"
When asked to explain why the OECD Convention successfully

passed in 1997, Arthur Downey, head of the United States'
National Association of Manufacturers' Task Force on Interna-
tional Bribery said, " [f]or 20 years we've tried this and now it's
happening. What has changed in the world? How come it just
worked? I have concluded that it is because there is a general,
world revulsion to corruption."1 2 This "world revulsion to corrup-
tion" is a result of the realization that the potential and actual lia-
bilities associated with corrupt practices are making those practices
cost-prohibitive. 13
12. Ivanovich, supra note 11, at IC.

13. Barbara Crutchfield George et al., On the Threshold of the Adoption of the Global
Antibribery Legislation: A CriticalAnalysis of Current Domestic and InternationalEfforts Toward the
Reduction of Business Corruption, 32 Vand. J. Transnat'l L. 1, 17 (1999).
A. Stage 1: The United States and the Foreign Corrupt PracticesAct

In the wake of the Watergate scandal of the early 1970s, the U.S.
Securities and Exchange Commission (SEC) investigators applied
techniques used by the Watergate investigators to uncover hun-
dreds of cases in which American companies failed to report cor-
14
porate slush fund payments used to bribe foreign public officials.
To address this explosion of unethical conduct, the United States
Congress (Congress) held hearings concerning allegedly improper
payments made by U.S. corporations to foreign government offi-
cials. 1 5 Some claim that the resulting public unveiling of corrupt
practices contributed to the removal of a Central American presi-
dent, the resignation of Prince Bernhardt of the Netherlands, legis-
lative paralysis in Japan and an erosion of public support for the
Italian government. 16 Al of these incidents have had an effect on
the close ties between the United States and these countries, with
foreign policy problems often following. 17 Consequently, Congress
passed the FCPA in response to the need for an effective remedial
measure to combat the corrupt behavior of U.S. corporations
abroad."'
The strategy underlying the FCPA is to "cut off the supply of
bribes flowing from American businesses to corrupt foreign offi-
14. Stanley Sporkin, The Worldwide Banning of Schmiergeld: A Look at the Foreign Corrupt
Practices Act on its Twentieth Birthday, 18 Nw. J. INT'L L. & Bus. 269, 272 (1998) (Judge
Sporkin is a United States DistrictJudge for the District of Columbia and a former Director
of the Enforcement Division of the Securities and Exchange Commission). In his article,
Sporkin describes a discovery made while he was at the SEC: "We discovered that the funds
were masked in secret mislabeled accounts, and their use was not confined to illegal politi-
cal contributions. Indeed, these secret funds were used to make many other forms of illicit
payments, including payments of bribes to high officials of foreign governments. At this
point, the inquiry was expanded and soon turned into a full-fledged formal SEC investiga-
tion." Id. at 272; see also Harriman Randall, supra note 2, at 658-59 (arguing that these
disclosures resulted in domestic political tumult and disrupted diplomatic relations with
other countries).
15. Tamara Adler, Comment, Amending the Foreign Corrupt Practices Act of 1977: A Step
Toward Clarification and Consolidation,73J. CIM. L. & CRIMINOLOGY 1740, 1744 (1982).
16. H.R. REP. No. 95-640 (1977); Adler, supra note 15, at 1745; Gerald T. McLaugh-
lin, The Criminalization of Questionable Foreign Payments by Corporations: A Compara-
tive Legal Systems Analysis, 46 FORDIAM L. REv. 1071, 1072 (1978).
17. Adler, supra note 15, at 1745 ("Congress was concerned over the public scandals
engendered by bribery and the resulting foreign policy problems for the United States
when friendly governments were embarrassed."); Harriman Randall, supra note 2, at 658-
59.
18. Adler, supra note 15, at 1746; David A. Gantz, A Post-UruguayRound Introduction to
InternationalTrade Law in the United States, 12 ARiz. J. INT'L & CoMP. L. 7, 177 (1995); see also
Harriman Randall, supra note 2, at 664 (describing Congress' policy objectives underlying
the FCPA).
cials." 19 The FCPA prohibits U.S. companies from using instrumen-

talities of U.S. interstate commerce to give anything of value to a
foreign official, political party, or political candidate in an attempt
to influence "any act or decision" in his official capacity. 20 Sanc-
tions under the FCPA include a per bribe fine of $2 million,
imprisonment for both the bribers and their supervisors, and cessa-
21
tion of government procurement or export privileges.
Although the United States passed the FCPA, other countries
were not quick to follow suit.2 2 Indeed, some countries even
allowed tax deductions for bribes. 23 Members of the U.S. business
community criticized the FCPA because they believed the law
placed them at a severe competitive disadvantage. 24 The American
business community claimed that they were losing contracts
because foreign corporations were bribing public officials to secure
those deals. 25 According to a United States Commerce Department
study, the total value of contracts lost, just between the period of
May 1997 and April 1998, as a result of the uneven playing field
created by the FCPA as is $3 billion; other government officials
believe the number may be substantially higher at between $20 and
26
$30 billion a year.
19. Harriman Randall, supra note 2, at 664.

20. See FCPA, 15 U.S.C. § 78dd-2.
21. Id.; see also Andelman, supra note 11, at 49 (describing a Department of Justice
(DOJ) enforcement action against Lockheed Martin in January of 1995, resulting in: (1)
the payment of $24.8 million in fines (twice the company profits); (2) the director of
regional sales pleading guilty to a misdemeanor; and (3) a sentencing of over a year in
prison and a personal fine of $125,000 for the director of marketing).
22. See Ivanovich, supra note 11, at I C; Beverly Earle, The United States'ForeignCorrupt
Practices Act and the OECD Anti-Bribery Recommendation: VWhen Moral Suasion Won't Work, Try
The Money Argument, 14 DicK. J. IT'L L. 207, 207 (1996).
23. William Daley, Meeting to Combat Bribey Is a Step in the Right Direction, Bus. DAY
(South Africa), Feb. 18, 1999, at 17. In 1996 "14 of the 29 current members of the OECD
allowed their companies not only to pay bribes but to declare them as legitimate business
expenses." Ivanovich, supra note 11, at IC. For example, "German companies . . .were
spending more than $5 billion a year on bribes, then writing those payments off on their
taxes.. ." Id.
24. See Andelman, supra note 11, at 49; see also Sporkin, supra note 14, at 276 (describ-
ing this criticism as whining by American corporations).
25. Andelman, supra note 11, at 49.
26. Ivanovich, supra note 11, at 1C. The report further acknowledges that over the
past four years "'significant allegations' about bribery by foreign firms have been raised
regarding 240 international commercial contracts valued at $108 billion." Id Out of 61
contracts awarded between May 1997 and April 1998, the study found U.S. firms lost 13 of
them, valued at $3 billion, because of bribes by companies from other countries. Id; see also
Andelman, supra note 11, at 52 ("the cost of doing business the 'old-fashioned way' [is
also] escalating for foreign companies willing and legally able to use [bribes]."); cf Skip
Kaltenheuser, Schmiergel, AcRoss THE BOARD, Nov.-Dec. 1998, at 36, 42 ("Given the stealth
nature of most bribery, and the salesman's temptation to blame it for a lost contract, one
In response to the business community's criticism, Congress

passed the 1988 Amendments to the FCPA. 27 These 1988 amend-
ments required the President to pursue an international agree-
ment criminalizing foreign bribery through the OECD. 28 Six years
later the OECD passed the 1994 Antibribery Recommendation,
urging member nations to adopt legislation criminalizing bribery
of foreign public officials. 29 Although there was no great rush by
OECD member states to enact legislation, the 1994 Recommenda-
tion prompted an increased awareness of the economic costs of
30
bribery, and provided the framework for the 1997 Convention.
The United States' motive for pursuing the multilateralization of
the FCPA was not strictly to end immoral practices by American
firms abroad. Instead, the United States' diligence is better under-
stood as an effort to "level the playing field" for U.S. firms while
maintaining its political legitimacy abroad.3 1 Among those same
lines, the OECD nations' reluctance to pass legislation outlawing
bribery is best recognized as permitting their multinational firms to
take full advantage of the superior bargaining position granted to
them by the United States legislation. Only when the costs associ-
ated with transnational bribery began to outweigh the benefits of
the practice did countries began following the United States'
2
lead.3
B. The Increasing Costs Associated With Corruption

The historic argument in support of corruption in developing
countries is that it is "a necessary lubricant for the wheels of soci-
ety," eventually becoming a practical necessity for developing
nations as a get-rich-quick scheme.3 3 Additionally, the expense of
addressing corruption was seen as cost-prohibitive because corrup-
might well be skeptical of the various estimates. But it is undeniable that bribery cuts into
U.S. firms' profits.").
27. Earle, supra note 22, at 208.
28. Id. at 208 n.4.
29. Id. at 208.
30. Id.
31. Id. at 207.
32. See generally Andelman, supra note 11, at 50 (quoting Thomas White, chief U.S.
negotiator for the OECD Convention as saying, "[iun the last few years, countries have
begun to wake up and say the costs of this kind of corruption are unacceptably high.")
33. Robin Crompton, Doubts About Corruption:These Days We Hear a Lot About the Evils of
Corruption, KoREA HERALD, Dec. 25, 1998, at 6; see also Gray and Kaufmann, supra note 11,
at 8; Reginald Dale, Crisis Stills Apologists for Corruption, INT'L HERALD TajB., Sept. 29, 1998,
at 13 (stating "Until recently, societies in Asia and elsewhere often turned a blind eye to
corruption, and some Western economists even argued that it could help developing coun-
tries grow by 'greasing the wheels' of rigid economic systems.").
tion was pervasive in a majority of the world's countries. 34 Few

countries had the requisite enforcement resources to mount a seri-
ous offensive against corruption. 35 Others argue that what some
consider "corruption" is better understood as an exercise of cul-
tural identity, and consequently international anti-corruption
movements risk "the dangers of intrusiveness, paternalism, and
imperialism .. *"36 Despite the practical and philosophical argu-
ments raised by corruption apologists, there is increasing evidence
to suggest that corruption "grates" rather than "greases" both the
37
economic and the political machinery of society.
1. Economic Costs
In the 1980s the Indonesian economy experienced double-digit
growth that some economists attributed to the "grease" of Presi-
dent Suharto's regime of institutionalized corruption. 38 Their
argument was that the institutionalized corruption reduced uncer-
tainty in business transactions, thereby encouraging foreign invest-
ment.3 9 If a foreign firm had the capital and the moral and legal
fortitude -or lack thereof- to bribe a corrupt Indonesian public
official, it was assured the government contract.
Similarly, economists agreed that South Korea's miraculous
growth was due, at least in part, to an institutionalized system of
corruption.4 0 Following Japanese occupation and the scourges of
World War II, South Korea emerged as one of the world's poorest
34. Kaltenheuser, supra note 26, at 38 (explaining that a slang expression in Hong
Kong regarding the prevalence of corruption sums up the practical arguments against any
anti-corruption efforts: "One could 'get on the bus' and embrace corruption, or 'run
alongside the bus' and not interfere. Only fools would 'stand in front of the bus.' ").
35. Id.
36. Steven Salbu, Are ExtraterritorialRestrictions on Bribery a Viable and Desirable Interna-
tional Policy Goal Under the Global Conditions of the Late Twentieth Century?, 24 YALE J. INT'L L.
223, 226 (1999). "Taken to the extreme, social, cultural, or religious imperialism logically
can result in war. . . .At the very least, the resentment engendered by these forms of
imperialism can strain international relations, potentially endangering cooperation and
free trade." Id. at 227 n.25.
37. News Reporters Lead Fight Against Corruption, FIN. TIMEs AsiA INTELLIGENCE WIRE,
Dec. 24, 1998; see also Paolo Mauro, Corruption: Causes, Consequences, and Agenda for Further
Research, FIN. & DEv., Mar. 1998, at 11, 12 (explaining that "there is a well-established body
of theoretical knowledge, as well as some tentative results on the causes and consequences
of corruption. ..").
38. James Walsh, A World War on Bribery, Time Int'l, June 22, 1998, at http://
www.time.com/time/magazine/ 1998/int/980622/index.html.
39. Id.
40. William Overholt, A Dangerous,Decisive Year, Newsweek: Atlantic Ed., Nov. 9, 1998,
at 28, availale at http://newsweek.com/nw-sr/issue/19-98b/printed/int/asia/
ov0819_l.htm.
The Geo. Wash. Int'l L. Rev. [Vol.
[ 33
nations. 41 By 1996,,however, South Korea had become the world's

eleventh largest economy, producing ships, steel, automobiles and
semiconductors. 42 South Korea's miraculous achievement is attrib-
uted to government-sponsored incest between banks and industry
leaders; a relationship in which "credit was allocated not by credit-
worthiness but by political fiat, bribery and hapless support to cus-
tomers too big to be cut off."43 This economic system prospered
through General Park Chung Hee's powerful coalition in which
"political leaders directed the economy by allocating credit, indus-
trial magnates financed the leader's campaigns, bureaucrats
44
enforced the decisions, and the army suppressed opposition."
Widespread corruption in developing nations may lead to mirac-
ulous short term development, but the recent economic crisis in
Asia and the collapse of the ruble in Russia have forced economists
to take a hard look at the long-term consequences of corrupt sys-
tems of public administration. 4 5 In Indonesia, the misuse of bil-
lions of dollars of World Bank aid resulted in a "typhoon of
financial chaos."46 By 1998 South Korea's industrial system was
bankrupt and its banks were illiquid. 47 On October 14, 1998 the
British-based consulting firm, Control Risks Group, reported that
corruption costs Russia about $15 billion a year and was at least
partly responsible for the collapse of that country's economy in
1998.48
The World Bank's leading economist, Daniel Kaufmann,
explains the economic costs of corruption as follows: "now we have
a plethora of literature showing that corruption has a negative
impact on all those indicators we care about in development: eco-
nomic growth, domestic and foreign investment, and poverty." 49
Most economists agree that corruption results in market distortion,
price distortion, and most importantly, dries up foreign investment
41. Id.
42. Id.
43. Id.
44. Id.
45. Dale, supra note 33, at 13 ("'Crony Capitalism,' or the granting of economic
favors to friends and privileged associates, is widely believed to have contributed signifi-
candy to the Asian crisis, as well as to economic disaster in Russia."); see also Walsh, supra
note 38, ("[T]he economic collapse in Asia has driven home the price everyone pays for
such practices.").
46. Walsh, supra note 38.
47. Overholt, supra note 40, at 28.
48. Study Says Corruption Costs $15 Billion Per Year, Moscow TIMES, Oct. 15, 1998, at 1.
49. Walsh, supra note 38.
resulting in the stagnation of third world economies. 50 One Econo-

mist staff commentator has gone so far as to refer to corruption as
"economic malpractice. ' 51
Similarly, a basic market analysis shows that: "A fundamental
tenet of a free market system is that economic transactions should
be based solely on the price and quality of a product and the ser-
vice provided to the seller. Rather than making decisions on the
basis of cost, quality or appropriateness, bribe-taking decision mak-
ers choose products or services on the basis of personal gain." 52 As
a result, the least efficient or skilled contractor can win a contract if
he is the most effective briber.53 "This incentive structure can lead
to the choice of an inappropriate supplier, or to the selection of
54
products, services, or projects that simply are not needed."
Furthermore, due to the clandestine nature of the bribery pro-
cess, corruption results in more distortion than other damaging
55
economic phenomena such as excessive taxes and superinflation.
Suppliers can incorporate a country's tax rates or the status of fac-
tors associated with inflation into assessing risk associated with a
transaction, but they cannot know the amount necessary to success-
fully bribe a public official to secure that transaction. Conse-
quently, the contract's price takes on an arbitrary quality alien to a
56
properly functioning market.
As a consequence of the distorting effects of corruption, foreign
investors are economically discouraged from investing in countries
with high levels of corruption. Corrupt forces create an unpredict-
able investment environment which discourages foreign investors
50. Dale, supra note 33, at 13 ("It skews markets and the allocation of resources by
distorting economic incentives and the regulatory role of government, acting as an arbi-
trary tax, increasing poverty and raising the cost of business, especially for small enter-
prises."); see also Philip M. Nichols, Are ExtraterritorialRestrictions on Bribery a Viable and
Desirable InternationalPolicy Goal Under the Global Conditions of the Late Twentieth Century?
Increasing Global Security by Controlling TransnationalBribery, 20 MICH. J. INT'L L. 451, 466
(1999).
51. A Global War Against Bribery, THE ECONOMIST, Jan. 16, 1999, at 22.
52. Nichols, supra note 50, at 466 ("Most damning is a growing body of empirical work
that demonstrates a negative correlation between perceived levels of corruption and for-
eign direct investment.").
53. Id. at 464.
54. Id.; see also Earle, supra note 22, at 222 ("Corruption shifts the resources of a coun-
try from 'highest value' projects like clean water, etc., to potentially useless projects
wherein the individual may secretly profit."). See generally Carolyn Hotchkiss, The Sleeping
Dog Stirs: New Signs of Life in Efforts to End Corruption in InternationalBusiness, 17J. PUB. PoL'Y
& MARKETING 108, 111 (describing a recent focus on the economic implications of
corruption).
55. Nichols, supra note 50, at 466.
56. Id. at 465.
who rely on predictions of market forces to make investment deci-

sions. 57 A study by economist Paolo Mauro demonstrates that as a
result of a decrease in the perceived level of corruption in a coun-
try, the country will experience a four percent increase in foreign
direct investment and almost half a percent growth in its annual
58
Gross Domestic Product.
In addition to discouraging foreign private sector investment,
international aid organizations like the International Monetary
Fund (IMF) and the World Bank are establishing corruption con-
trols in their aid agreements and curbing grants to known corrupt
countries. 59 In 1997 The World Bank, which finances 40,000 con-
tracts worth $25 billion each year, asked for financial controls and
audits in countries such as Poland, Kenya, and Pakistan, and the
IMF suspended a $220 million loan to Kenya due to reports of ram-
60
pant corruption.
2. Political and Social Costs
As long as state-sponsored corruption is defensible on economic

grounds, corrupt officials continue to serve their personal interests
in a specific transaction and argue that they serve the public inter-
est in the aggregate. As the economic costs of corruption are sub-
stantiated, however, the political and social costs associated with
the practice are magnified. 6 1 Corruption undermines infrastruc-
ture development, inspires domestic unrest, and serves as a barrier
to the installation and development of democratic institutions. It is
these political and social costs that "have governments around the
62
world running scared."
57. Im Hong-Jae, Convention on Combating Bribery, KOREA HERALD, Dec. 24, 1998, at 6.
58. See Mauro, supra note 37, at 12; see also Lawrence Solomon, When Power Corrupts
Absolutely Bribery, Kickbacks and Payoffs Hurt Businesses Worldwide, LONDON FREE PREss, Jan.
23, 1999, at F2, available at http://canoe.cedrom-sni.com/scripts/cshtml.exe ("[W]hile
corruption leads the state to waste billions in white elephants, it also prevents billions in
legitimate investments from entering a country.").
59. Kimberly Ann Elliott, The Problem of Corruption: A Tale of Two Countries, 18 Nw. J.
INT'L L. & Bus. 524, 530 (1998); Hotchkiss, supra note 54, at 111. See generallyJames P.
Wesberry, Jr., InternationalFinancialInstitutions Face the CorruptionEruption: If JEIS Put Their
Muscle and Money Where Their Mouth Is, the CorruptionEruptionMay Be Capped, 18 Nw. J. INr'L
L. & Bus. 498, 503 (1998) (outlining specific efforts taken by the World Bank to fight
corruption and the policy rationale behind its decision to take action).
60. Hotchkiss, supra note 54, at 111; see also Elliott, supra note 59, at 528 ("[K]enya
ranked as the third most corrupt of the fifty-four countries analyzed by TI in 1996.").
61. See Kaltenheuser, supra note 26, at 41.
62. Id.
In corrupt economies, the least efficient or skilled contractor

63
can win a contract if he is the briber with the deepest pockets.
Consequently, corruption results in expenditures on those transac-
tions where it is easier to exact large bribes in secret. For example,
this phenomenon can lead to scenarios like the purchase of large
defense projects, rather than rural health clinics specializing in
preventative care. 64 From an economic development perspective,
corruption will ultimately result in the building of unnecessary
projects and the neglect of other needed projects.
Social "destabilization" occurs as a result of the abrogation of a
core set of laws, such as building codes, environmental controls,
and banking regulations, designed to protect the populace from
serious social harms. 65 In the 1990s alone the governments of Italy,
Brazil, Pakistan, Zaire, and Indonesia have been ousted as a result
of corruption charges. 66 In late 1998 Belgium held its "bribery trial
of the century" charging a former NATO Secretary General, three
former Belgian Ministers, and a leading French Industrialist with
criminal corruption. 67 Corruption is seen by some as anti-demo-
cratic, because "when unchecked, it may destabilize a society and
actually encourage a return to dictatorship as a method of control-
68
ling corruption."
Corruption can no longer be seen as a harmless risk-free practice
that countries are free to condone. Not only is it costing demand-
side nations dearly, corruption can have drastic consequences for
supply-side nations as well. 69 Due to the negative consequences of
corruption and the interdependence of the global economy, as
demonstrated by the collapse of the ruble in the Soviet Union and
63. See infra notes 52-54 and accompanying text.

64. Gray and Kaufmann, supra note 11, at 8; see also Mauro, supra note 37, at 12 ("Cor-
rupt politicians might therefore be more inclined to spend on fighter aircraft and large-
scale investment projects than on textbooks and teachers' salaries, even though the latter
may promote economic growth to a greater extent than the former.").
65. Gray and Kaufmann, supra note 11, at 8-9. Examples of these social harms include:
illegal logging of tropical rain forests or failure to observe building codes designed to
ensure public safety. Id at 9.
66. Dale, supra note 33, at 13 ("Mounting public revulsion against corruption played a
key role in the election of new leadership in South Korea . . . and in the subsequent
downfall of President Suharto of Indonesia."); Kaltenhauser, supra note 26, at 41.
67. IME Second Thoughts, FIN. TIMES U.K. ED., Dec. 21, 1998, available at http://
www.globalarchive.ft.com/search-components/indexjsp.
68. Earle, supra note 21, at 223.
69. Nancy Zucker Boswell, The Contributionof the Civil SocietyINGO Sector, 92 AM. Soc'Y
INT'L L. PROC. 165, 168 (1998) [ hereinafter Contribution of the Civil Society]; see also Elliott,
supra note 59, at 524 (noting the high level of corruption in developing nations and corre-
lating particular governmental regimes with an increased likelihood of corruption).
the ripple effect of the Asian economic crisis, both suppliers and
demanders of bribes are beginning to conclude corruption may
70
not be in their best interests.
3. Private Sector Costs

Bribery has become an increasingly expensive and dangerous
way to do business. 7 1 Some studies report that over $11 billion in
transnational bribes are given annually. 72 Furthermore, businesses
are reporting that bribery costs are on the rise. 7 3 During the 19 7 0s
corrupt government officials would ask for 1-5% of the value of the
contract; today some are asking upwards of 20-30% of the con-
tract. 74 Bribery is essentially an invisible tariff that increases the
cost of a contract, and increases the amount of time a corporation
must spend on securing that contract. 75 Recent studies have
demonstrated that in countries with widespread corruption, busi-
nesses spend more time overcoming regulatory impediments than
in countries with less corrupt procurement systems. 76
In the United States, the risk of stiff penalties and even jail time
for transnational bribery offenses is very real. Lockheed Martin, the
leading defense contractor in the United States, was fined $24 mil-
lion (twice the profit it had made on the deal) for bribing an Egyp-
tian official in order to secure a $79 million deal to sell its Hercules
transport planes in January of 1995, six years after the deal was
closed. 77 Two vice presidents of the corporation plead guilty to mis-
demeanors, and the Director of International Marketing, captured
70. See generally Daley, supra note 23 ("[I]f the Asian financial crisis has taught us any-
thing, it is that government corruption creates a financial structure that cannot be main-
tained. That is why the international business community is one of the strongest supporters
of the convention.").
71. Michelle Celarier, The Road to Excess;Joint Ventures and Government Corruption,MAc-
AZINE FOR SENIOR FIN. EXECUTIVES, Nov. 1998, at 67; see also Hotchkiss, supra note 54, at 111
("[Blusiness leaders from many countries have seen the effect of corruption on their profit
margins and have begun calling for curbs on corruption, rather than accepting it as a way
of doing business.").
72. Celarier, supra note 71, at 68.
73. Interview by the Center for International Private Enterprise with Eleanor Roberts
Lewis, Chief Counsel for International Commerce, United States Department of Com-
merce, Washington, D.C. (1998), available at http://www.cipe.org/e28/lewise28.html
[hereinafter Lewis Interview].
74. Id.
75. Kaltenheuser, supra note 26, at 41.
76. Gray & Kaufmann, supra note 11, at 8 (noting that a 1997 World Economic Forum
survey revealed that "enterprises reporting a greater incidence of bribery also tend.., to
spend a greater share of management time with bureaucrats and public officials negotiat-
ing licenses, permits, signatures, and taxes."); see also Solomon, supra note 58, at F2.
77. Andelman, supra note 11, at 49.
after ten months as a fugitive, was sentenced to a year and a half in

prison and fined $125,000.78
25 to 50 FCPA enforcement actions already under way; the num-
ber is expected to double after other OECD states pass implemen-
tation legislation. 79 OECD members' expected responce to the
OECD Convention is to increase enforcement actions. 80 Even if
investigations do not result in fines or prison time for corruption,
there are indications that a corporation's public image can be
adversely affected by evidence of corruption. 8 1 Ultimately, interna-
tional corporations are aware of what bribery is costing them; they
are prepared to commit to international anti-corruption efforts
because "they will consequently reap the benefits of lower costs in
82
transacting business."
C. Exacerbating the Costs of Being Corrupt: The Emergence of

"Watchdog Liability"
Anti-corruption "watchdog groups" including Non-Government

Organizations (NGOs), the private sector, and the international
media have recently taken a much more active role in the war
against corruption. 83 These groups have made corruption an issue
"that brings people out on the streets." 84 As such, the cost-benefit
equation of international transactions includes factoring in the
watchdog presence in an effort to avoid incensing the general pub-
lic and the international community through the additional expo-
sure these groups provide, the "Watchdog Liability."
78. Id.
79. Celarier, supra note 71, at 70 (quoting Tim Dickinson, partner in the Washington,
D.C., law firm of Dickinson Landmeier LLP).
80. IM; see alsoPeter Montagon, Public Turning Against the Use of Bribery, FIN. TIMES U.K.
ED., Oct. 14, 1998, at 7 (quotingJohn Bray, head of corporate responsibility issues at Con-
trol Risks Group, a London business risk consultancy). Bray predicts that the OECD Con-
vention will add to the pressure on international corporations to "clean up their act."
81. Montagon, supra note 80, at 7.
82. David Robertson, Licensed to Kill Off the Fat Brown Envelopes, SCOTLAND ON SUNDAY,
Oct. 11, 1998, at 6.
83. See Crutchfield George et al., supra note 13, at 28, 41-46 (describing the anti-cor-
ruption efforts of Transparency International (TI), the Hong Kong based Independent
Commission Against Corruption, the National Whistleblower Center in Washington D.C.,
the International Chamber of Commerce, the Institute for International Economics, the
World Economic Forum, and publications dedicated to foreign corruption).
84. A Global War Against Bribery, supra note 51, at 22.
1. Transparency International: The Most Influential Anti-

Corruption Non-Government Organization
In 1993, Peter Eigen, a veteran World Bank official, brought

together legislators, lawyers, development specialists, accountants,
academics, and businesspeople from around the world to form a
concerted anti-corruption effort. 8 5 This convergence marked the
inception of the world's most influential anti-corruption NGO,
Transparency International (TI) .86 TI's mission is "[t]o curb cor-
ruption by mobilising a global coalition to promote and strengthen
international and national Integrity Systems." 87 TI achieves its mis-
sion through a combination of coalition building, national chap-
ters (currently in over seventy countries worldwide) to assist in the
design and creation of anti-corruption legislation and procedures,
and collection and dissemination of information regarding the
88
impact of corruption on human and economic development.
The most influential creation of TI is the publication of its
annual Corruption Perceptions Index (CPI). 89 The CPI ranks
countries according to survey responses which track perceived cor-
ruption based on responses from business experts as well as the
public in their respective countries. 90 The ranking system is simple:
countries are given a score between zero and ten, with zero indicat-
ing a high level of corruption, and ten indicating the lowest
levels. 9 1 In 1998 TI reported that there were less than 50 countries
receiving a of score less than five, and several receiving less than a
85. Contributionof the Civil Society, supra note 69, at 166.

86. Id. at 166-67.
87. TRANSPARENCY INTERNATIONAL MISSION STATEMENT, available at http://
www.transparency.de/mission.htmnl [hereinafter TI MISSION STATEMENT]. TI's mission cen-
ters on efforts to promote 'integrity,' or the willingness to safeguard against and end
existing public corruption; integrity systems seem to be put in place to foster this ideal. See
id.; TRANSPARENCY INTERNATIONAL ACTIMTIES, available at http://www.tranparency.de/activ-
ites/index.html.
88. Id.
89. See generally, Press Release, TI, 1998 Corruption Perceptions Index (Sept. 22,
1998), available at http://www.transparency.de/documents/press-releases/1998/
1998.09.22.cpi.html (describing "the CPI [as] a 'poll of polls,' drawing upon numerous
distinct surveys of expert and general public views of the extent of corruption in many
countries around the world."); see also Mauro, supra note 37, at 11 (describing indices used
by private agencies, which grade countries by their level of corruption based on replies to
standardized questionnaires, as subjective but noting that "the correlation between indices
produced by different rating agencies is very high, suggesting that most observers more or
less agree on how corrupt countries seem to be.").
90. 1998 CORRUPTION PERCEPTION INDEX, supra note 89.
91. Id.
three. 92 The CPI "has proven to be a tremendous embarrassment 93

for perennial losers such as Nigeria, Indonesia, and Columbia."
In addition to the CPI, TI assisted with the drafting of the 1997
OECD Convention, 94 created a Source Book on best practices to
combat corruption, started several pilot projects to end corruption
in developing countries, and successfully lobbied international
organizations to support anti-corruption measures. 9 5 Currently,
several of its National Chapters are consulting their respective gov-
ernments in the drafting of the Convention's implementing
96
legislation.
In addition to TI, several private sector organizations also pro-
vide a voice for interested parties' concerns regarding incidents of
corruption and raise awareness of the effects of corruption and the
best methods to combat it. These groups included TransAtlantic
Business Dialogue, the International Chamber of Commerce, and
97
the European American Chamber of Commerce.
2. The International Media: Another Powerful International

Watchdog
Another strong voice in the war against corruption is the interna-
tional media. The media has kept the spotlight trained on both
corruption and anti-corruption efforts.9 8 "The spread of democ-
racy and economic globalization has stepped up the demands for
unvarnished information from voters and investors." 99 This
demand has resulted in a cycle of corruption coverage. In 1997 the
billion dollar excesses of Indonesian President Suharto's children
92. Id.
93. Ivanovich, supra note 11, at 1.
94. Cynthia Cotts, U. Conn. Hosts Conference on International Political Corruption, NAT'L
L.J., Nov. 30, 1998, at B5.
95. Hotchkiss, supra note 54, at 112. TheOECD, OAS, IMF, World Bank, and the
WTO have begun to focus on corruption involving senior public officials and international
bribes by taking measures such as recommending the elimination of tax deductions for
bribes by their member countries, eliciting proposals from members on how to end cor-
ruption, and tightening procurement standards. Id. at 112-13.
96. Henry Bosch, Business Advised to Have Say in Bribery Law, WAiKATO TIMEs, Mar. 11,
1999, available at 1999 WL 14149962 (Bosch, Chairman of TI Australia, explains how TI
Australia successfully lobbied to have its test for determining the definition of a facilitation
payment placed in the implementation legislation); TransparencyInternationalCanada Urges
Quick Passage of Anti-Corruption Legislation, CANADA NEWSWIRE, Dec. 3, 1998 (Wes Cragg,
Chairman of TI Canada reports that "Transparency International has worked hard to
encourage the adoption of the Convention and the passage of the necessary enabling
legislation.").
97. Contribution of the Civil Society, supra note 69, at 169.
98. Id.; Frank Vogl, The Supply Side of Global Bribery, FIN. & DEv., June 1998, at 30.
99. Dale, supra note 33, at 13.
led students to take to the streets in protest. 100 Later that year,
Zimbabwean students, influenced by the events in Indonesia
images available through and by the international press, took to
the streets with placards that read "If Indonesian students did it, we
can do it!"101 Media coverage of protests has spurred anti-corrup-
tion sentiments and motivated others around the world to raise
10 2
their voices.
Increased access, improved technology, and enhanced freedom
of the press around the world result in a spotlight on corrupt prac-
tices that were once considered the status quo. For example, the
liberation of the media from state control in the former Soviet
Union, gave both opposition political parties and ordinary citizens
a voice they did not previously have. 10 3 Journalist David Ivanovich
attributes the changing attitudes towards corruption to the
"[u]nfettered news outlets [which] are reporting more about cor-
ruption, while more independent judges and prosecutors are
cracking down on it."104 As a result of investigative reporting, high
levels of corruption were exposed throughout the former Soviet
Union. 10 5 Michael Skol, U.S. Ambassador to Venezuela from 1990-
1993, claims that "[a] nti-corruption is the most important political
issue in most of Latin America -just look at the key articles in their
newspapers."10 6 The interest of international investors in the activi-
ties of the companies in which they own stock has led many busi-
ness publications to track incidents of corruption and international
10 7
anti-corruption efforts with more vigor.
Once considered merely a distasteful business decision, bribery
is now recognized as a parasite by almost all elements of society.
Governments are embarrassed or even overthrown as a result of
corruption charges. Academics almost uniformly agree that corrup-
tion distorts the global market, undermines the development of
third-world nations, and puts the global economy at risk.108 Conse-
quently, powerful and interested parties have emerged aiming to
finally put corruption out of business. Corporations that pay bribes
are losing money and corporations who do not are losing con-
100. A Global War Against Bribery, supra note 51, at 22.

101. Id.
102. See id.; Contribution of the Civil Society, supra note 69, at 169.
103. Hotchkiss, supra note 54, at 109; Ivanovich, supra note 11, at 1.
104. Ivanovich, supra note 11, at 1.
105. Hotchkiss, supra note 54, at 108.
107. See id. at 39.
108. See Ivanovich, supra note 11, at 1; Walsh, supra note 38.
tracts.1 09 Both NGOs and the media are exposing incidents of cor-
ruption, researching the effects of corruption, and spreading that
information to the rest of the world. It is now obvious to the citi-
zens of the world's most corrupt countries that "it is in their own
best interest to rid themselves of this debilitating disease."1 1 0
D. The Critics of the Anti-Corruption Movement

Support for the anti-corruption movement is far from universal.
Several critics have dismissed the movement against corruption as
another example of cultural imperialism.' Professor Steven Salbu
contends that any extraterritorial criminalization of bribery
presents more problems than solutions. 112 Salbu's argument is two-
pronged. First, he holds that there is no global consensus on what
constitutes "bribery." 1 3 Second, he argues that a state risks the
"dangers of intrusiveness, paternalism, imperialism, and disre-
spect" when it imposes its "discretionary values" (such as its own
definition of corruption) upon another state. 114 The problem
Salbu describes refers to the extraterritorial application of one
1 15
state's laws upon activities occurring in another state.
For example, according to Salbu, the distinctions between what
is and what is not an acceptable gift in Germany should be estab-
lished by German law.1 6 According to anti-corruption proponents
and the OECD Convention, those distinctions are determined by
the alleged briber's home country. 11 7 Proponents counter Salbu's
intrusiveness claim by arguing that jurisdiction follows citizen-
ship.1 1 8 Therefore, punishing a citizen for extraterritorial conduct
109. See Ivanovich, supra note 11, at 1.

110. Dale, supra note 33, at 13.
111. Salbu, supra note 36, at 226. One commentator argues that the anti-corruption
fervor lacks credibility because of the international community's past failures, stating
"international organisations would look 'nicer' if they concentrated on implementing the
human-rights we all agreed to 50 years ago instead of protecting rich foreign investors'
wealth." Letter from Ole Wagner Smitt, The OECD'sPriorities,THE ECONOMisT, Apr. 4, 1998,
at 8.
112. Salbu, supra note 36, at 226.
113. Id.
114. Id.
115. Id. at 254.
116. Id.
117. See Convention, supra note 8, at art. 2; Salbu, supra note 36, at 254. The provision
guiding jurisdiction by nationality is especially problematic for countries like Canada
whose legal systems only allow jurisdiction over crimes committed within their borders. See
Edward Greenspan and Don Jack, Bribery and the Law, NAT. POST, May 1, 1999, at D5.
118. Nichols, supra note 50, at 473 (stating that the exercise ofjurisdiction through the
nationality principle is a "well established and non-controversial" principle of international
law).
his native countryhas determined illegal is appropriate. 119 Parties

to international anti-corruption treaties are taking responsibility
for their citizens' actions abroad; they are not telling foreign gov-
ernments how to run their countries. 120
Commentator Robin Crompton takes an even harsher view on
the anti-corruption efforts, stating that "[i] n its present rabid mis-
sionizing form, obediently peddled by those handmaidens of West-
ern ideology, the OECD, International Monetary Fund (IMF), and
the International Bank for Reconstruction and Development
(IBRD), the anti-corruption drive is highly questionable. It takes
no account of sociology, psychology, or anthropology. It is unhis-
12 1
torical, superficial and one-dimensional.'
Several commentators countered this cultural imperialism argu-
ment by reminding critics that the value of traditional gifts is of an
entirely different character than the types of bribes international
agreements seek to prevent. 22 Professor Phillip Nichols criticizes
the moral imperialism argument because it is based on the premise
that the "indigenous culture is not capable of distinguishing gifts
from bribes."' 123 He argues that this "is not the case," and propo-
nents of the moral imperialism argument use examples of bribery
that are "caricatures, or are given by persons with a vested interest
in maintaining bribery." 24 Although in some circumstances the
line between criminalized corruption and culturally accepted
behavior might be hazy, international anti-corruption efforts are
not seeking to prevent borderline cases. While everyone but the
most extreme critics agree that a line can be drawn between cor-
rupt bribery and traditional cultural practices, the problem lies in
whether the parties to the OECD Convention will all draw the line
in the same place.
119. Id. (stating "A host country cannot credibly claim offense when a home country
exercises its rights to regulate the conduct of its own nationals-particularly when its regu-
lation consists merely of requiring its nationals to obey the laws of the home country.").
120. Proponents of international agreements like the OECD would probably agree that
as a result of criminalizing the supply of bribes, the demand for bribes is likely to lessen.
That is the ultimate aim of the OECD Convention.
121. Crompton, supra note 33, at 6.
122. Hotchkiss, supra note 54, at 111 (stating "Numbered Swiss Bank Accounts are not
part of any country's traditional culture, except perhaps Switzerland's."). It may also be
important to note that in 1996 Malayasia's Prime Minister, Mahathir Mohamad con-
demned the anti-corruption movement as "another example of cultural imperialism," but
now he is using TI's CPI as the basis for a national corruption awareness program. See
Kaltenheuser, supra note 26, at 40.
123. Nichols, supra note 50, at 472.
124. See id. at 471-72.
E. The Importance of Uniformity in Implementation and Enforcement

of InternationalAnti-Corruption Agreements
Critics argue that the application of international efforts to fight
corruption are either illegitimate or inappropriate because the
"global village" has yet to realize a consensus on what bribery iS. 1 25
Skeptics argue that the lack of clear assurances of enforcement by
parties to international anti-corruption agreements undermines
the credibility and may frustrate the ultimate success of those
agreements.12 6 Consequently, they doubt anything spectacular will
come out of the OECD Convention, believing that "givers and
12 7
recipients [of bribes] will find new ways to enrich themselves."
The significance of uniformity in international anti-corruption
agreements cannot be easily underestimated. According to Judge
Sporkin, for any international anti-corruption system to be success-
ful and credible "there must be uniform standards." 28 He contin-
ues by arguing that uniform standards are in "each nation's self-
interest." 129 Furthermore, uniform standards are essential for pro-
130
tecting a multinational corporation's market position.
International business transactions, can be analogized to a 'pris-
oner's dilemma-type' scenario; as long as all of the players are play-
ing by the same rules everyone wins. Governments will maintain
legitimacy, economies will operate according to genuine market
principles, corporations will keep the costs of doing business to a
minimum, and ordinary citizens will actually receive useful services
and infrastructure in return for their tax dollars. If one country
overlooks the bribing practices of its corporations-then the conse-
quences of corruption will remain. Unfortunately, if a country
overlooks the practices of its multinational corporations abroad,
but is still able to maintain compliance with international conven-
tions because of imprecise standards and lax monitoring, the nega-
tive consequences of corruption will remain. As a result, the
country supplying the bribes will incur no costs and the legitimacy
and effectiveness of international anti-corruption agreements will
be compromised.
125. Salbu, supra note 36, at 254.

126. Jack Lucentini, Convention Outlaws Bribery, J. Com., July 14, 1999, at 9.
127. Globalisation of Corruption, THE HINDU, Jan. 3, 1999, available at http://
indiaserver.com/thehindu/1999ft/01/03/stories/05032525.htm.
128. Sporkin, supra note 14, at 280.
129. Id.
130. See generally Robertson, supra note 82, at 6 (explaining how corruption jeopardizes
deals and noting that increasing bribery has led to efforts to clean up the international
trading market).
III. ANALYSIS: ENSURING UNIFORMITY IN IMPLEMENTATION OF THE

1997 OECD CONVENTION
The OECD is composed of the richest nations in the world,

accounting for sixty-one percent of world GDP and sixty-seven per-
cent of world trade in 1995.131 The goal of the OECD Convention
on Combating Bribery of Officials in International Business Trans-
actions is to criminalize the acts of bribing, attempting to bribe, or
conspiring to bribe a foreign official to significantly restrict the
source, or "supply side," of bribery. 13 2 The rationale behind attack-
ing supply-side bribery is that if a majority of the world's richest
corporations refuse to pay, the demand for bribes will eventually
dry up. 13 3 After the Convention is implemented these companies
must refuse to pay bribes to foreign officials or face enforcement
actions at home.1 34 By cutting off the supply of bribes, the OECD
hopes to decrease the number of bribes demanded in corrupt
countries. 13 5 Eleanor Roberts Lewis, Chief Counsel for Interna-
tional Commerce at the U.S. Department of Commerce, hopes the
Convention "will virtually eliminate [corruption in developing
136
countries] over the next couple of years."
Overall, the Convention contains the fundamental elements of
an effective supply side anti-corruption effort. 13 7 Professor David
Gantz describes the Convention's obligations as "generally clear
and unequivocal." 138 According to Cheryl Gray, the World Bank's
leading antibribery official, the OECD Convention "almost inevita-
bly will have a significant effect, if [the OECD] can get enforce-
131. Im Hong-Jae, supra note 37, at 6.

132. Low, supra note 3, at 155.
133. Id. ("A Convention attacking the 'supply' side of bribery whose subscribers
include the countries supplying most of the world's international trade and investment
takes on obvious and immediate importance.").
134. See Low, supra note 3, at 156; Robertson, supra note 81, at 6.
135. Andelman, supra note 11, at 51 (quoting Fritz Heimann, head of the United States
Chapter of Transparency International as saying, "When the industrialized world begins to
clean up its act, under the OECD Convention, we will be in a better position to help push
reforms in the rest of the world."); see also G. Pascal Zachary, OECD Begins Antibribery Efforts
- Deal Pushes Countries to Crack Down, WALL ST.J. EUR., Feb. 15, 1999, at 4 ("OECD officials
hope that raising the legal costs of getting caught paying a bribe will discourage
offenders.").
136. Lewis Interview, supra note 73.
137. David A. Gantz, Globalizing Sanctions Against ForeignBribery: The Emergence of a New
International Legal Consensus, 18 Nw. J. INrT'L L. & Bus. 457, 491 (1998); New Tools to Fight
Corruption, supra note 3.
138. Gantz, supra note 137, at 491.
ment."1 3 9 Some, however, consider "[e]nforcement a big 'if'." 140
The Convention's substantive provisions provide an unsatisfactory
standard for ensuring uniformity, they illogically limit the monitor-
ing role of third parties, although the Convention's procedural
14 1
provisions do provide for an effective peer-review program.
A.
The Convention's Failure to Establish Uniform
Implementation Standards
1. The Functional Equivalence Standard for Criminalizing
Bribery
The official Commentary to the Convention provides that the
Convention "seeks to assure a functionalequivalence among the mea-
sures taken by the Parties . . . without requiring uniformity or
142
changes in fundamental principles of a Party's legal system."
The Commentary continues in explanation of this standard, "[a]
Party may use various approaches to fulfill its obligations, provided
that conviction of a person for the offence does not require proof
of elements beyond those [described in paragraph one of Article 1
of the Convention.] "143 For example, consider two different laws.
The first prohibits bribery of agents in general but does not specifi-
cally address foreign officials. The second specifically prohibits
bribery of foreign officials. Under the functional equivalence stan-
dard, both of these laws could satisfy the requirements of the
144
Convention.
There are several implications stemming from the "functional
equivalence" standard for the United States. First, the legal con-
cept of "functional equivalence" is foreign to American criminal
law. In fact, it contradicts traditional methods of statutory interpre-
tation used in the American legal milieu. 14 5 Under traditional
methods of statutory construction, statutes that use different terms
139. Zachary, supra note 135, at 4.
140. Id.
141. Many other areas of the Convention are presently subject to comment. The scope
of this Note, however, is limited to implementation and whether uniformity can be
achieved in this process. For example, two areas of concern are the definition of "facilita-
tion payments," and the lack of a ban on payments to political parties and officials. For a
listing of the strengths and weaknesses of the substantive content of the OECD Conven-
tion, see StanleyJ. Marcuss, The OECD Antibribey Convention, 1057 PLI/CoRP 1223,June-July
1998.
142. Commentaries on the Convention on Combating Bribery of Officials in InternationalBusi-
ness Transactions, Nov. 21, 1997, available at http://www.oecd.org//daf/nocorruption/
revrece.htm [hereinafter Commentary] (emphasis added).
143. Id.
144. Id.
145. Marcuss, supra note 141, at 1226.
are treated differently, even if they could be interpreted as "func-

tionally equivalent."' 146 For instance, one accused in the United
States cannot be convicted of a crime due to "functionally
equivalent" conduct; his conduct must be precisely within the7 pro-
14
hibition of the statute under which the charge is brought.
Second, the "functional equivalence" standard provides little or
no guidance to multinational corporations operating under the
laws of several countries. For example, the actions of a United
States corporation's German affiliate in Pakistan may be legal in
Pakistan and legal under German transnational laws. These same
actions, however, could be illegal pursuant to American transna-
tional anti-corruption laws. So, a United States corporation doing
business in Pakistan needs to adhere to several conflicting stan-
dards in order to avoid criminal liability.
Finally, the lack of a mandatory uniform standard makes moni-
toring the implementation and enforcement of the Convention
more difficult. The implementing legislation that the OECD will
review may be the prototypical comparison of apples and oranges,
resulting in inconsistent evaluation, feedback, and eventually non-
uniform enforcement.
2. The "As May be Necessary" Standard For Prohibiting Illicit

Accounting Procedures
The provision requiring the criminalization of illicit accounting
practices does not hold parties to a clear standard of compliance.
Article 8 of the Convention provides that each party to the Conven-
tion "shall take such measures as may be necessary. . . to prohibit
the establishment of off-the-books accounts, the making of off-the
books or inadequately identified transactions, the recording of
non-existing expenditures, the entry of liabilities with incorrect
identification of their object, as well as the use of false docu-
ments .. . for the purpose of bribing foreign public officials or of
hiding such bribery." 148 Although this language descries the type of
offenses the Convention seeks to prohibit, it fails to provide a clear
directive to countries regarding the method of prohibition to sat-
isfy the requirements of the Convention.
Furthermore, some countries have jurisdictional restraints that
prohibit prosecution of crimes that do not occur within their terri-
146. Id.
147. Id.
148. Convention, supra note 8, at art. 8.
tories. 149 These countries, like Canada, can avoid jurisdictional

restraints through rigid accounting regulations because accounting
violations occur wholly within the borders of the enforcing coun-
try. 150 Due to the absence of a clear standard to guide them, coun-
tries may be less inclined to create rigid accounting regulations.
With this wide grant of discretion the OECD Convention fails to
establish clear controls where those controls would be most effec-
tive. According to a former Justice Department Prosecutor, the
FCPA's accounting provision "with its clear standards has been
used more often than the bribery provision that presents a more
difficult case to prove." 15 ' In addition to the burden of proof, it
may be difficult to "trace records and witnesses in developing coun-
tries, which may be unfriendly to foreign intrusion." 52 As a result
of the practical concerns associated with prosecuting bribery as
opposed to prosecuting accounting violations, the 1997 Recom-
mendations emphasized the use of accounting requirements to
prevent and detect bribery. 53 According to Nancy Zucker Boswell,
Managing Director of Transparency International's Washington
D.C. Chapter, concerns regarding the weaknesses of the Conven-
tion's auditing provisions led TI to work "with accounting and
auditing firms internationally to make sure that area is sufficiently
54
stringent."1
B. Assuring Uniformity through the Convention's

Implementation Procedure
In addition to the potential disparity in the implementation of
the Convention, the functional equivalence standard could result
in disparity in the punishment imposed for the offenses. If "func-
tional equivalence" is interpreted liberally during the monitoring
process, self-serving countries and corporations could maintain
compliance with the Convention while continuing certain corrupt
practices. Whether the invitation to disparity conveyed by the Con-
vention creates an unacceptable risk of lax implementation is the
149. Greenspan and Jack, supra note 117, at D5.

150. Id.
151. Sporkin, supra note 14, at 276.
152. Greenspan and Jack, supra note 117, at D5.
153. See generally, Revised Recommendation of the Council on Combating Bribery in Interna-
tional Business Transactions, pt. V, Nov. 21, 1997, available at http://www.oecd.org//daf/
nocorruption/reverce.htm (recommending that member countries take the steps neces-
sary to follow OECD accounting requirements in order to prevent and detect bribery)
[hereinafter Recommendation].
154. Lucentini, supra note 126, at 10.
question. 155 The answer depends on whether the Monitoring

Group subjects the Parties to the Convention to meaningful con-
15 6
straints in defining their compliance.
The Convention makes it clear "that monitoring its implementa-
tion will be a permanent part of the OECD's work." 157 Article 12 of
the Convention provides that "[t] he Parties shall co-operate in car-
rying out a programme of systematic follow-up to monitor and pro-
mote the full implementation of this Convention." 158 Article 12
further provides that the OECD Working Group will determine the
framework of the monitoring program. 159 The program is broken
up into two phases. 160 The first phase is designed to evaluate the
implementation legislation of Parties to the Convention. 16 The
second phase evaluates the structures and resources dedicated to
62
the enforcement of the implementing legislation.
1. Monitoring Implementation Legislation, Phase I Analysis

Phase I (1999-April 2000) was "to evaluate whether the legal
texts through which participants implement the Convention meet
the standard set by the Convention." 163 After passing its implemen-
tation legislation, examined countries filled out a questionnaire
concerning its compliance with the Convention. 164 Three experts
155. Marcuss, supra note 139, at 1227.

156. Id. According to The Procedure of Self and Mutual Evaluation of Implementation
of the Convention and the Revised Recommendation, drafted by the Working Group, part
of that answer is a recognition of a "need for a rigorous process of multilateral surveillance
to ensure the effectiveness of the instruments to combat bribery in international business
transactions, particularly those involving criminal law." Procedureof Self and Mutual Evalua-
tion of Implementation of the Convention and the Revised Recommendation, pt. I, Jul. 1, 1998,
available at http:www.oecd.org//daf/nocorruption/selfe.htm [hereinafter Procedure]; see
also Vogl, supra note 98, at 30.
157. Vogl, supra note 98, at 30.
159. Id.
160. Procedure, supra note 156. The implementation legislation of the United States,
Germany, and Norway is scheduled for examination in April of 1999; Finland, Bulgaria,
Greece, Canada, and Korea in July, and Japan, Hungary, Belgium, Sweden and Iceland in
November of 1999. See id. at Schedule of Country Examinations.
161. Id at pt. III.
162. Id. at pt. IV. Phase II, schedule for June 2000- 05, is "to study and assess the struc-
tures put into place to enforce the laws and the application of the laws and rules in prac-
tice." Id.
163. Procedure, supra note 156, at pt. III.
164. Id. The replies to the questionnaire are to be precise and provide "sufficient detail
to permit an assessment of conformity of laws with the Convention." Id These replies
should reflect relevant elements of each county's legal system, including statutes, regula-
tions, treaties, constitutions, and judicial opinions, to provide a complete picture of the
country's implementation status. Id.
reviewed the responses and drafted a preliminary report regarding

the Party's compliance. 165 Next, the Party and the entire Working
Group engage in a face-to-face consultation to clear up any issues
16 6
left unresolved by the questionnaire or the preliminary report.
Finally, the Working Group prepared a final report on the initial
compliance of all Parties for presentation to the entire OECD
Council in Spring of 2000.167
Despite the deficiencies of the substantive portions of the Con-
vention, the monitoring program can help to ensure uniformity in
its implementation. 168 First, the program is highly efficient. The
program begins with the first countries to pass implementing legis-
lation and finishes with the last countries to pass implementing leg-
islation. 169 However simple, the ramifications of this order cannot
be easily underestimated. First, highly motivated countries, or
countries that historically have had anti-corruption legislation (i.e.,
the United States), will help establish the "functional equivalence"
standard up-front. As the process reaches the more reticent OECD
member nations, the "functional equivalence" standard will
become more concrete as the Working Group defines its role in
reviewing implementation legislation. Additionally, these countries
will have concrete models from which to develop their own legisla-
tion. Consequently, the pressure for uniformity is likely to increase
165. Id One examiner is a representative of the Secretariat, the other two represent
two OECD Member countries. The examiners will be chosen by the Secretariat, after con-
sultation with the replying country, from a roster of experts nominated by Party Countries.
In selecting the examiners factors to be considered include the objective of having one
who is familiar with the legal system of the country, and one who speaks the language of
that country, as well as seeking varied perspectives. The country will be given the opportu-
nity to review and comment on the report before it is submitted to the entire Working
Group. See Procedure, supra note 156, at pt. III.
166. Consultations last about an hour and include an initial presentation from the
replying country, comments from the lead examiners, and an opportunity for a question
and answer period to clarify issues and allow the entire Working Group to formulate con-
clusions. See Procedure, supra note 156.
167. See idt; OECD Online, Country Reports, June 27, 2000, available at htp://
www.oecd.org/def/nocorruption/report.htm [hereinafter Country Reports] The twenty-one
individual country reports can be found at OECD Online. The OECD reports that all
examined countries fully cooperated and provided in-depth responses to Working Group
questions. See Country Reports.
168. Bruce Zagaris and Shaila Lakhani Ohri, The Emergence of an InternationalEnforce-
ment Regime on TransnationalCorruption in the Americas, 30 LAw & POL'Y INr'L Bus. 53, 75-76
(1999).
169. See Procedure, supra note 156, at Schedule of Country Examinations. In addition
to the structure set forth above, the Procedure recognizes the importance of uniformity by
explicitly requiring the OECD Secretariat to meet with other international organizations
(naming the Council of Europe and the European Union) to avoid duplication and to
ensure the complimentary nature of their anti-corruption efforts. See id. at pt. III.
as the implementation stage progresses. OECD Deputy Secretary

General, Joanna R. Shelton, explains, "If we find that a country has
lagged in implementing the convention, we will make that clear.
1 70
Openness and peer pressure will have an important effect."
Furthermore, the monitoring process is both fair and thorough.
Credibility should reinforce a member nation's desire to fully par-
ticipate. The first prong of the process, the questionnaire, is a self-
evaluation that allows a country to determine for itself and conse-
quently argue how it has met its obligations under the Conven-
tion. 17 1 During the second prong, mutual evaluation, the Parties to
the Convention will determine for themselves whether other coun-
72
tries have succeeded or failed to live up to their obligations.
Finally, the face-to-face meeting provides an opportunity for a dia-
logue concerning aspects of the implementation legislation and
the intent of the commentary of the preliminary report. 173 As such,
the procedures allow a country to participate in its own evaluation
as well as the evaluation of other countries. In effect, this allows
motivated parties to protect their own interests while giving them
the chance to comment on how others have sought to protect their
interests.
As designed, several aspects of the Phase I monitoring procedure
encourage member states to fully comply with the letter of the
Convention. The Convention, however, effectively discourages
compliance by explicitly denying third-parties such as Trans-
parency International and the International Media a formal moni-
toring role. 174 The Procedure states that because "peer review is an
intergovernmental process, business and civil society groups would
75
not be invited to participate in the formal evaluation process."
Third parties are denied an informal monitoring role through
the procedure's confidentiality provisions. 176 At first glance, the
Procedures seem to provide an acceptable avenue for interested
third parties by allowing them to provide written information or
170. Harry Dunphy, OECD Will Scrutinize Compliance With Anti-Bribery Treaty, ASSOCIATED
PRESS NEWSWIRE, Jun. 23, 1999.
172. Id at pt. IV.
173. Id. at pt. III
174. Id.
175. Id.
176. Laurence Cockcroft, Implementation of the OECD Convention: The Conditions for Suc-
cess, TRANSPARENCY INTERNATIONAL WORKING PAPER, available at http://www.transparency.
de/documents/work-papers/lc-oecd.html ("At present it seems likely that this will be a
relatively closed door process to which the public will have only very limited, if any,
access.").
comments "in a timely way."1 7 7 When this provision is read in con-

junction with the confidentiality provisions, however, the influen-
tial NGOs and the media itself might be silenced.
First, although the Working Group is expected to publish "as
much information as possible," it is not actually required to pro-
duce any information at all. 178 Instead, it is actually required to
keep mutual review information confidential. 179 Second, the tim-
ing of information disclosure may be problematic. Interested third
parties are allowed to make written comments in a "timely" man-
ner, but the only guidelines regarding information disclosure for
the Working Group are "the exact content of any report to be
released would have to be determined once the examinations are
completed." 180 The result is that interested third parties may even-
tually learn what the Working Group has done, but not before the
time allotted to comment on the work of the Working Group.
Finally, even if an ambitious interested third party makes com-
ments, neither the Working Group, nor the implementing nation,
is required to respond to the concerns raised.
The political shame or prestige that may be experienced as a
result of a nation's compliance is an essential element of the moni-
toring process, reinforcing a nation's motivation to assist the uni-
form implementation of the Convention. This type of monitoring
process was successful in international efforts to combat money
laundering, drugs, and terrorism, 181 but transnational bribery is a
different kind of problem. Some countries "may have less motiva-
tion to go after their own companies than to go after groups
involved in drugs or money laundering."1 8 2 Each member to the
OECD Convention has signed on with the intent to make a stand
against transnational bribery.1 83 It is doubtful that any of those
countries want to be seen as having undermined the success of the
Convention. This political pressure will correspond to the momen-
tum developed, or lack thereof, by the initial group of nations eval-
uated by the monitoring group. Consequently, several
commentators agree that the availability of information regarding

178. Id.
179. Id. The Working Group justifies this confidentiality clause with the goal of making
the peer reviews "frank and efficient." Id
180. Id.
182. Id.
the development of legislation and on enforcement is essential.184

Public pressure would thereby be put upon governments failing to
185
effectively implement its provisions.
2. Monitoring Enforcement of Antibribery Legislation Phase II
Analysis
The purpose of Phase 11 (2000-05) is "to study and assess the
structures put into place to enforce the laws and the application of
the laws and rules of practice." 186 But the OECD also considers
Phase II as the time to begin to evaluate the implementation of the
non-criminal aspects of the 1997 Revised Recommendation.1 8 7
Additionally, Phase II is designed to "serve an educative function as
participants discuss problems and different approaches." 188
Like Phase I, Phase II is composed of a questionnaire, prepara-
tion of a provisionary report, a face-to-face consultation with the
Working Group, and adoption of a final report. 189 On-site visits by
the Secretariat and lead examiners are planned in addition. to
these components. 190 The Phase II procedures are presently "pre-
liminary," some components, especially the questionnaire and the
nature of the on-site visits, may be determined, in part, by a Party's
performance during Phase 1.191
Like Phase I, Phase II is efficient, fair, and thorough, but it also
explicitly limits the monitoring role of third-parties, stating "[o]nly
Parties to the Convention would actively participate.., in the eval-
uation of whether the examined country had fulfilled the obliga-
tions of the Convention."' 9 2 Furthermore, the Phase II procedures
state that access to information "would be governed by the same
considerations as for Phase I."'193 Consequently, in this regard the
criticisms applicable to Phase I are equally applicable here.
184. Kimberly Elliott, G-7 Leaders Should Broaden Anti-Corruption Agreement, Institute for
International Economics, at http://www.ile.com/PRESS/corrptpr.htm.
185. See id.
186. Procedure, supra note 156, at pt. IV.
187. Id.
188. Id.
189. Id. The order of Phase II evaluations may be based upon the same concept used
regarding when the Convention would enter into force (i.e., "according to relative involve-
ment of economies in international trade."). Id.
190. Id.
191. Procedure, supra note 156, at pt. IV.
192. Id. ("Clear, well-structured questionnaires and reports would be important to
achieving a qualitative assessment of the examined country's performance, which all par-
ticipants could consider as the result of a fair process which applies an equal standard to all
countries.")
193. Id.
The passage of the OECD Convention owes a great deal to the

efforts of NGOs like TI, the international media, and multinational
corporations. Both phases create an efficient, fair, and thorough
monitoring process, but at the same time have ironically insulated
the Convention from those who have the most at stake in its uni-
form implementation and enforcement: The interests of multina-
tional corporations, of international aid organizations, and those
of NGO watchdog groups are more directly affected by the interna-
tional war against corruption than any one state. 194 The OECD is in
effect telling interested third parties "thank you for getting us this
far, but we'll take it from here." Experts agree that the lack of pub-
lic information creates the ideal environment for systemic corrup-
tion.19 5 The lack of access to information has not gone unnoticed
by critics of the monitoring program. Some consider this omission
the potential Achilles heel of the successful implementation of the
Convention. 196
IV. THE ROLE OF "WATCHDOG LIABILIT"': KEEPING

IMPLEMENTATION ON TARGET
A. The Role for NGOS

NGO Watchdog Groups were instrumental during the negotia-
tion stage, and they will prove equally as important, if not more so,
during the implementation and enforcement of the Convention.
Washington Lawyer Stanley Marcuss argues that the worst thing
that can happen for the international war against corruption is for
the international community to perceive the OECD Convention as
having solved the problem of transnational bribery. 19 7 Accordingly,
interested third parties should not consider theirjob complete, but
just begun. The fact that these groups are not given a formal role
in the monitoring process serves to reinforce the point that they
must remain vigilant in the fight against corruption.
First, national watchdog groups, such as TI's national chapters,
should lobby their governments concerning the country's imple-
mentation legislation.' 9 8 Some countries have gone so far as to rely
194. Susan Cote-Freeman, What NGOs Can Do Against Corruption,TRANSPARENCY INTER-

NATIONAL WORKING PAPER, available at http://www.transparency.de/documents/work-
papers/scfreeman.html.
195. Id.
196. Cockcroft, supra note 176 (arguing that "if the process is to be effective there is
every reason to involve professional bodies and others (not least TI) in having access to
governments' self-evaluation of progress.").
197. Kaltenhauser, supra note 26, at 38.
198. Id. at 40
on TI's national chapters to help draft their legislation. 199 It is

imperative that the assistance concerning the content of the legisla-
tion occur during the drafting stage. It is easier to effect a change
to the legislation prior to its enactment than to seek an amend-
ment after the fact. in addition to these practical implications,
active participation early in the process is likely to have a greater
impact on the perspective of lawmakers. This is especially true in
countries addressing international corruption for the first time.
Second, although the Convention grants them no formal role in
the implementation process, watchdog groups should take it upon
themselves to closely monitor the progress of the OECD's Working
Group. Public monitoring throughout both the implementation
and the enforcement stages is essential to "ensure that strong laws
do not become dead letters because prosecutors decide bribery is a
low priority." 20 0 This monitoring entails making regular requests
for information and regular written commentary on the strengths
and weaknesses of implementing legislation.
Third, international watchdog groups should continue to
research the incidents and effects of corruption and inform the
international community of what they uncover. The revelations
about the harmful economic and business effects of corruption are
in their infancy. Empirical evidence, produced by impartial third
parties, will reinforce the self-interest aspects necessary to battle
corruption.
TI South Africa is presently developing a website called the "Cor-
ruption Monitor"20 1 that uses media reports to classify certain types
of reported corruption in specific categories, "including locales
and government levels; sectors such as religion, civil service, busi-
ness, political parties, sports and media; allegations such as bribery,
nepotism, and money laundering; anti-corruption measures; trend
analyses; the status of investigations, and specific actions and pun-
ishments."20 2 With the development of new tools like TI South
Africa's Corruption Monitor, and continued use of the old tools
like political pressure and the international media, third parties
can have a role in the implementation of the OECD Convention.
199. Examples of these countries include Australia, Canada and Malaysia. See infra nn.
95, 121 and accompanying text.
200. Daley, supra note 23, at 17.
201. Transparency International South Africa, Corruption Monitor Website, at http://
www.tisa.org.za/cormon.htm.
B. The Role of the Private Sector as Watchdog: Protecting

Market Positions
If the international business community supports the spirit of
the Convention, the Convention will succeed. If the private sector
determines compliance to be in its best interest, it can insure the
successful implementation of the Convention. For example, prior
to the passage of the Convention, Germany implicitly condoned
bribery of foreign public officials through its tax laws. 2 3 Now, fol-
lowing the passage of a new tough anti-bribery law, German busi-
nesses are calling the OECD asking "How can I help?" 20 4 The
private sector can assist the implementation of the Convention,
through internal compliance and training programs, by reporting
a competitor's violations, pressuring corrupt governments to
change their practices, and making responsible investments.
Like watchdog groups, private sector corporations should lobby
and recommend provisions for the implementation legislation to
ensure that the end product will make compliance in their best
interest. 205 In February of 1999, at a seminar on Canada's new
antibribery legislation, Canadian businesses voiced their concerns
concerning the new law. 20 6 Timothy Martin, vice-president and
general counsel (international) of Canadian Occidental Petroleum
Ltd., argued that the Canadian government should consider
extending the scope of the law to include the imposition of civil
liability. 20 7 As opposed to criminal enforcement actions, civil
enforcement actions would be subject to a lower burden of proof
and would give the government the "ability to hit companies that
break the law in a place that matters most to them - the
' 208
pocketbook."
Because the OECD Convention cuts off supply-side bribery, cor-
porations that have considered giving a bribe as a usual cost of bus-
iness will shoulder the burden of compliance. Now when a
corporation is faced with an ultimatum of either paying a bribe or
203. See Ivanovich, supra note 11, at IC.

205. Business Advised to Have Say in Bribery Law, supra note 96 (suggesting that corpora-
tions "get in and have a look [at draft implementation legislation] and see that they [gov-
ernment officials] draft it in a sensible way."); see also Marta Steeman, Close Watch Urged on
Corruption Law, THE DOMINION, Mar. 11, 1999, available at 1999 WL 7347877.
206. A. Timothy Martin, Foreign Bribery Law a Positive Step but It May Not Go FarEnough,
NAT'L Posr, Feb. 9, 1999, at C6.
207. Id.
208. Id. Of course, decriminalizing bribery would have the opposite effect on compa-
nies' other reputational interests. The gravitas of peer or consumer censure might not be
as high for civil liabilities.
The Geo. Wash. Int'l L. Rev.. [Vol. 33
not conducting business in a particular country, not only will it be

encouraged to deny the request in order to comply with its home
country's legislation, it will also want to report the request to the
appropriate enforcement personnel. Often if a corrupt govern-
ment official requests a bribe from a United States company, typi-
cally the same practice occurs in dealings with a German, United
Kingdom, or Japanese company. 20 9 For the OECD Convention to
succeed, corporations facing bribery demands, or that have knowl-
edge of other corporations engaging in corrupt acts need to report
such information to their home authorities or to the OECD
0
itself.21
Finally, a multinational corporation can use private sector
resources to investigate alleged misconduct. Private investigation
firms, like the Control Risks Group, Ltd. and Decision Strategies
Fairfax International LLC, provide a variety of services to compa-
nies who are seeking to "keep other companies honest." 2 11 Michael
Hershman, Chairman of Decision Strategies claims that his firm
successfully pressured the Indian government to void a contract
2 12
granted under questionable circumstances.
Although multinational corporations "rarely speak about
changes in their antibribery practices, because simply saying there
are taking a tougher stand might suggest that they were too lax in
the past. But there is anecdotal evidence that many multinationals
are trying harder to avoid situations where bribes are demanded
and employees thus face temptation." 21 3 With the coming of the
OECD Convention, companies are further encouraged to avoid
any activity that may subject them to prosecution. As a result, mul-
tinational companies, investment banks, and commercial banks are
adopting internal compliance programs and adding new compo-
21 4
nents to their due diligence procedures.
To avoid potential violations, companies should first establish
corporate compliance programs. 21 5 Furthermore, they should pro-

210. Id. Lewis said, "another option for companies complaining of bribery is to have an
OECD official study their complaint and possibly bring it to the attention of the accused
country without naming the complaining party." Lucentini, supra note 126, at 10. Such an
option would reduce the risk of repercussions for the complaining party.
212. Id.
213. See Zachary, supra note 135, at 4.
214. Thomas B. McVey & Carole Basri, InternationalBusiness Risks Increase,N.Y. L.J., May
10, 1999, at S3.
215. Corruptionin the Limelight, MININGJ., Oct. 16, 1998, at 302 (describing the "newspa-
per test" as a method to account for corporate conduct, "If details of a transaction were to
vide training to employees so they know that compliance programs

are to be taken seriously.2 1 6 In addition to traditional auditing
practices, compliance programs should include social auditing
components disclosing a company's "social" performance. 2 17 Social
performance is typically evaluated by looking at factors like a com-
pany's environmental liabilities, conditions of labor, and potential
criminal or civil liabilities.2 18 All of these measures will assist com-
panies in creating a "culture of compliance."
New professional anti-corruption groups are emerging to assist
multinational corporations to develop anti-corruption compliance
and training programs. On the anniversary of the signing of the
OECD Convention, the Center for Anti-Corruption Compliance
was established in Paris.2 1 9 The Center was established to assist cor-
porations, governments, and international organizations in
responding to a more demanding and rapidly changing interna-
tional regulatory environment requiring heightened attention to
anti-corruption compliance. 220 The Center's Director, Seth
Goldschlager, described the Center as "a one-stop source of exper-
tise and management training that will enable both corporations
and government regulators to develop the compliance programs
that are becoming the new legal requirements." 22 1 The Center will
bring together experts who have drafted national and international
laws and who currently advise governmental and business entities
on compliance with laws against corruption and other interna-
tional financial crimes to address new requirements. 2 22 In addition
to its Paris headquarters, the Center will have offices in Basel, New
be published in the national press, would it cause embarrassment to the employee involved
or to the company?").
216. See id. One study revealed that although 90% of the companies surveyed had
codes of conduct condemning bribery, only 28% provided training on how to apply those
codes. Id
217. See David Hess, Social Reporting: A Reflexive Law Approach to CorporateSocial Respon-
siveness, 25 IowAJ. CORP. L. 41, 43(1999).
218. See id. at 44. Such programs are already in use by some large corporations like The
Body Shop and Ben and Jerry's. Id. at 72-80. It is significant to note that many of these
factors, if the company has securities listed on U.S. exchanges, will have to disclose them in
one or both of the section entitled "Risk Factors" or "Management's Discussion and Analy-
sis" of their registration materials.
219. Center for Anti-Corruption Compliance Launches on Anniversary of InternationalAnti-
bribery Convention, Bus. WiRE, Dec. 17, 1998.
220. Id.
221. Id. Some of these experts include a Swiss law professor who has chaired the OECD
Working Group on Bribery since 1991, a leading authority on the U.S. FCPA, and an
expert on 'best practices' in internal control management systems to deter corruption. Id.
222. Centerfor Anti-Corruption Compliance Established, MONEY LAUNDERING, Dec. 1998, at
York, and Washington. 223 Furthermore, Goldschlager argues that

"integrating these new requirements into daily management prac-
tices provides the only assurance that new norms for international
business truly go global in the uniform fashion required for anti-
22 4
corruption treaties and laws to be effective."
Finally, the private sector determines the flow of investment capi-
tal. Several countries that have historically been on the "demand"
side of bribery, requesting bribes, are presently instituting reforms
to protect their economies and governments from the risks of cor-
ruption. 225 Private sector investors should encourage these efforts
through carefully selected investment opportunities. Although, the
Asian financial crisis is "over," investors should not begin repeating
old mistakes. To do so would undermine present reform efforts,
and potentially cause the Asian economy to spin out of control
once again.
V. CONCLUSION
The passage of the OECD Convention on Combating Bribery of

Foreign Public Officials in International Business Transactions
should be recognized as a landmark achievement in the war
against international corruption. Both the public and the private
sector have realized that the costs associated with bribery have
become too expensive to make the practice of bribing foreign offi-
cials profitable. Nevertheless, this "general world revulsion to cor-
ruption" will only continue as long as bribery remains a cost-
prohibitive practice. The Convention has the substantive and pro-
cedural content to ensure that bribery remains too expensive and
too risky for multinational corporations. For the Convention to
succeed, however, the Parties to the Convention must have the
political will to enforce its provisions on its own citizens. To
encourage Parties to have this political will, NGOs, the Interna-
tional Media, and the private sector must maintain the same vigi-
lance with the implementation of the Convention as they have
demonstrated in achieving the passage of the OECD Convention.
If they are not permitted to participate in the Convention review
process, they must continue to threaten 'Watchdog Liability.'
Robert D. Tronnes
223. Id.
224. Id.
225. See generally Daley, supra note 23 (acknowledging that several countries are taking
steps to fight corruption because bribery hurts the citizens as well as the governments of
corrupt countries by creating weak financial structures).

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ENSURING UNIFORMITY IN THE IMPLEMENTATION OF

Since the passage of the Foreign Corrupt Practices Act (FCPA)

tional bribery at its source. 6 Consequently, in signing the Conven-

form implementation and enforcement of the Convention among

II. DISCUSSION: THE DEVELOPMENT OF A "GENERAL WORLD

When asked to explain why the OECD Convention successfully

12. Ivanovich, supra note 11, at IC.

A. Stage 1: The United States and the Foreign Corrupt PracticesAct

cials." 19 The FCPA prohibits U.S. companies from using instrumen-

19. Harriman Randall, supra note 2, at 664.

In response to the business community's criticism, Congress

B. The Increasing Costs Associated With Corruption

tion was pervasive in a majority of the world's countries. 34 Few

nations. 41 By 1996,,however, South Korea had become the world's

resulting in the stagnation of third world economies. 50 One Econo-

who rely on predictions of market forces to make investment deci-

2. Political and Social Costs

As long as state-sponsored corruption is defensible on economic

In corrupt economies, the least efficient or skilled contractor

63. See infra notes 52-54 and accompanying text.

3. Private Sector Costs

after ten months as a fugitive, was sentenced to a year and a half in

C. Exacerbating the Costs of Being Corrupt: The Emergence of

Anti-corruption "watchdog groups" including Non-Government

1. Transparency International: The Most Influential Anti-

In 1993, Peter Eigen, a veteran World Bank official, brought

85. Contributionof the Civil Society, supra note 69, at 166.

three. 92 The CPI "has proven to be a tremendous embarrassment 93

2. The International Media: Another Powerful International

100. A Global War Against Bribery, supra note 51, at 22.

D. The Critics of the Anti-Corruption Movement

109. See Ivanovich, supra note 11, at 1.

his native countryhas determined illegal is appropriate. 119 Parties

E. The Importance of Uniformity in Implementation and Enforcement

125. Salbu, supra note 36, at 254.

III. ANALYSIS: ENSURING UNIFORMITY IN IMPLEMENTATION OF THE

The OECD is composed of the richest nations in the world,

131. Im Hong-Jae, supra note 37, at 6.

are treated differently, even if they could be interpreted as "func-

2. The "As May be Necessary" Standard For Prohibiting Illicit

tories. 149 These countries, like Canada, can avoid jurisdictional

B. Assuring Uniformity through the Convention's

149. Greenspan and Jack, supra note 117, at D5.

question. 155 The answer depends on whether the Monitoring

1. Monitoring Implementation Legislation, Phase I Analysis

155. Marcuss, supra note 139, at 1227.

reviewed the responses and drafted a preliminary report regarding

as the implementation stage progresses. OECD Deputy Secretary

comments "in a timely way."1 7 7 When this provision is read in con-

177. Procedure, supra note 156, at pt. III.

the development of legislation and on enforcement is essential.184

The passage of the OECD Convention owes a great deal to the

IV. THE ROLE OF "WATCHDOG LIABILIT"': KEEPING