The OECD Antibribery Convention requires parties to impose “effective, proportionate, and dissuasive criminal penalties” on those found guilty of bribing an official of another nation. As GAB readers know, most prosecutions for foreign bribery end not with a trial but with a settlement (here). GAB readers also know that a vigorous debate has ensued on this blog (here and here) and elsewhere (here, here and here) as to whether these settlements have met the “effective, proportionate, and dissuasive” test. In response, and with the assistance of the private bar, the OECD has been developing guidelines to help prosecutors and defense counsel ensure that future settlements do.
GAB is delighted to welcome this guest post by Peter Solmssen, a leader in this effort from the private bar, in which he describes where the guidelines project stands. As General Counsel of Siemens AG, Mr. Solmssen negotiated its settlement of foreign bribery cases with, among others, the Federal Republic of German and the United States. He now chairs the Non-trial Resolutions of Bribery Cases Subcommittee of the International Bar Association (IBA).
Work on international guidelines for the settlement of foreign bribery cases is accelerating. The IBA made its latest submission to the OECD Working Group on Bribery January 22. It there urged the Working Group to move quickly with its anticipated international guidelines on settling transnational bribery cases and to resolve those aspects of settlements that remain contentious. As described here, the IBA has been pushing the OECD to issue guidelines that will encourage prosecutors to cooperate internationally and programmatically to increase the use of settlements, or non-trial resolutions as they are formally referred to internationally.
The IBA began this campaign in 2018, when it published a study by professors Abiola Makinwa and Tina Søreide showing that most foreign bribery cases are settled rather than prosecuted to a final verdict. Their research found settlements predominate even in jurisdictions where they are ostensibly not allowed. The OECD confirmed this finding with its own study in 2019.
Both studies, and a further 2019 study by professors Radha Ivory and Tina Soreide, showed that the practice of settling cases is a mish-mash of best and worst practices. In 2020 the OECD Working Group on Bribery determined it was time to issue guidance on settlements, following in part a recommendation from a group advising the OECD Secretary General.
Criminal law and procedure vary widely among the 44 nations that have ratified the convention: the 37 OECD member states plus seven non-members – Argentina, Brazil, Bulgaria, Costa Rica, Peru, Russia and South Africa. The use of non-trial resolutions varies widely as well. While the United States has a highly sophisticated and publicized process, some countries deny that such instruments exist in their jurisprudence (while in fact engaging in their use). In lengthy, intense internal discussions, the Working Group has settled on an approach to issuing guidance that will make its members’ work, and the work of the defense bar, easier while ensuring fidelity to the convention requirement that foreign bribery be met with “effective, proportionate, and dissuasive criminal penalties.”
Should perhaps these guidelines be used/deal with not only when dealing with settlements in the criminal investigations, but also in civil and commercial matters related also to corruption?