Legal Regulation Of Transnational Commercial Bribery

When the trend of economy globalization becomes the reality that all governments have to confront, together with which commercial bribery gradually became the global concern. Multinational corporations gained competitive advantages by commercial bribery in the world market, which seriously damaged the fair competition order around the world. The commercial bribery in the international business transactions is raised as a new issue in the context of globalization. Such kind of commercial bribery has been called "foreign corruption", "foreign bribery" or "transnational commercial bribery." To emphasize the commercial purpose, it will be called as "transnational commercial bribery" in this paper. Transnational commercial bribery can be understood both in a broad and a narrow sense. The keystone of International Commercial Bribery in a narrow sense is that this kind of bribery always being made by the private sector to the public sector. In contrast, its broad sense also includes the bribery among the private sectors. The legal regulation of the bribery in a narrow sense is to be analyzed in this paper. Transnational commercial bribery is dangerous for both host and home countries on different level. The law is the key to regulate transnational commercial bribery. At present, the statutory measures mainly emphasized to the limitation of supply side of bribery, and to apply penal sanctions.The formation and development of transnational commercial bribery law is lagging behind the practices. In 1977, the formulation of U.S. "foreign corrupt practices act"("FCPA") indicates the initial formation of transnational commercial bribery law. However, the FCPA's rigorous regulations made U.S. lose a large amount of overseas markets and international competitive advantages. Motivated by the U.S. a political and economic interest, transnational commercial bribery law is pushed to apply strongly by it at the multilateral level. The history of the formation and development of transnational commercial bribery law, in a sense, is the formation and its internationalization of the FCPA. By tracing back the history, it also can be explained that of the basic rules and features of the formation and development of transnational bribery laws. In order to effectively combat transnational commercial bribery, transnational bribery laws is to be entrusted to the extraterritorial jurisdiction, and at the same time, encourage the cooperation among countries in the world, all countries and international organizations, international organizations.International Legal consolidation on transnational commercial bribery laws is not only motivated by the United States but also is modeled based on the FCPA. Therefore, it is indispensable to the explanation of the basic elements of FCPA for the study of the legal regulation of transnational commercial bribery, which includes two main provisions: First, anti-bribery provisions, and second, bookkeeping, record-keeping and accounting internal control provisions. The United States DOJ and SEC are responsible for enforcement of FCPA. American companies or natural persons violating the FCPA will be subject to severe penal, civil or administrative sanctions. Forthe implementation of the "OECD Convention", the FCPA was amendment in 1998 to extend the jurisdiction reach of the government's enforcement powers on the foundation of the territoriality principle and the nationality principle. Moreover, in practice, the United States Congress claims the jurisdiction of FCPA should be consistent with the principle of effects (foreign bribery to the United States), and the principle of reasonability (considering other national interests and the interests of the client). As foreign subsidiaries of transnational companies have played an important role in the overseas bribery, its parent company will be responsible for the activity or omission of the subsidiaries under FCPA. FCPA will have inevitably moral imperialism for the cultural morality of Bribery. And FCPA can help to establish and maintain fairly competing order in the world market from the supply-side approach to withstanding transnational commercial bribery.Along with United States pursuing its FCPA internationalization, the most important achievement is the "OECD Convention" and later the "United Nations Convention against Corruption". Penal sanction is the important approach to regulate transnational bribery in the "OECD Convention" and the "United Nations Convention against Corruption". But the difference is that not only the supply-side measures but also the demand-side measures should be taken against transnational commercial bribery in the "United Nations Convention against Corruption". In the "OECD Convention" the supply-side approach is provided. International cooperation and coordination is essential to govern transnational commercial bribery. "OECD Convention" and the "United Nations Convention against Corruption" provide an effective international cooperation and coordination mechanism system in extradition, legal assistance and other areas of the international criminal law. Meanwhile, the "United Nations Convention against Corruption" avoids the conflict between national sovereignty and the extraterritorial jurisdiction, as well as stresses that the extraterritorial jurisdiction of transnational commercial crime should be implemented in the principles of laws of nations.The important achievement made by U.S. on controlling transnational commercial bribery at multilateral level transnational is also reflected by the WTO transparency principle "in government procurement agreement", as well as the demand-side measures taken by the international financial organizations to control transnational commercial bribery. At international economic law level, it is necessary to clarify the legal issues, including whether transnational commercial bribery is trade barriers; is it appropriate that the transnational commercial bribery of multilateral negotiations under the framework of WTO? is transnational commercial bribery a problem of investment discipline? what is the relationship between investment treatment and transnational commercial bribery? What kind of responsibility are transnational corporations as the principal international investors should bear under transnational commercial bribery law? All above issues shall be analyzed and discussed tentatively in this paper.Although the global community has made best efforts to control the transnational commercial bribery, the effectiveness is not significant. The implementation of FCPA has been weak. In the implementation of FCPA, the U.S. government has impelled the "compliance program ". Because of the Federal Sentencing Guidelines, DOJ's "Thomas memorandum," and the SEC's "Seaboard report", especially the formulation of the Sarbanes-Oxley Act of 2002, the FCPA's effectiveness of the implementation gradually increased. As a result of its feeble enforcement mechanism, the effectiveness of "OECD Convention" is not satisfying. To enhance the effectiveness of theConvention, it is necessary to reform the mechanism for its implementation. "United Nations Convention against Corruption" has innovated in many aspects, but at the same time, Corruption in the private sector was not mandatory for States Parties to the Convention. Since the short time of its entry into force, its implementation shall depend on States Parties'practices. It is not practical that the controlling of transnational commercial bribery is solely relying on the penal punishment. The private sector probably shall dominate Anti-bribery action around the world. In addition, another future transnational commercial bribery laws may strengthen the demand-side measures against bribery and develop from prohibition of the private sector's bribery to prohibition of the public sector, not only including the private sector's bribery to the public sector but also the bribery among the private sectors.The influence and inspiration of the legal governance of transnational commercial bribery by the international community is profound to China. We should deal with the conflict between the FCPA's extraterritorial jurisdiction and Chinese jurisdiction. Also we should study the FCPA enforcement mechanism, strengthen corporate governance and internal governance responsibility. China shall prohibit the foreign company's bribery of our public officials, also should prohibit bribery of foreign public officials. This is not only the principle of reciprocity, but also an expression of judicial sovereignty. China has signed to perform the obligations of the "United Nations Convention against Corruption", China should not only carry out the mandatory requirements of the Convention; on the other hand, consider non-mandatory compliance based on the reality of our own and the issue of coordination with the existing legal norms. The "United Nations Convention against Corruption" will have a positive effect to the work of anti-transnational commercial bribery in China.Transnational corporations dominate the globalization of the world economy. China is an important component of the distribution of global strategy. As China's capital economy is not flourishing, and concentrating scarce public resources, and Chinese Anti-Unfair Competition Law still has some shortage, the lure of huge profits in the Chinese market, transnational corporations do commercial bribery to our public officials vigorously regardless of the violation of their home country and our laws and regulations, in order to obtain a competitive advantage. China should learn from foreign experiences in commercial bribery legal system, improve the legal system and the implementation of anti-corruption laws to against China's commercial bribery, completely combat multinational corporations'the transnational commercial bribery in China. In recent years, China's foreign direct investment to transnational corporations developed rapidly. Chinese overseas enterprises provided a great deal of transnational commercial bribery. In the global anti-corruption initiative, to safeguard the integrity of China's multinational corporations in the global market, China should establish Foreign Bribery Prevention Act by modeling on FCPA or relevant laws and regulations of other countries.