Transparency International: Revised Business Principles Ban Facilitation Payments | Practical Law

Transparency International: Revised Business Principles Ban Facilitation Payments | Practical Law

Transparency International released an updated version of its Business Principles for Countering Bribery. Among other changes, the new edition strengthens the organization's stance against facilitation payments by suggesting that they should be banned.

Transparency International: Revised Business Principles Ban Facilitation Payments

Practical Law Legal Update 9-553-9458 (Approx. 4 pages)

Transparency International: Revised Business Principles Ban Facilitation Payments

by Practical Law Commercial
Published on 07 Jan 2014 • USA (National/Federal)
Transparency International released an updated version of its Business Principles for Countering Bribery. Among other changes, the new edition strengthens the organization's stance against facilitation payments by suggesting that they should be banned.
Transparency International (TI), an organization that combats corruption and promotes transparency in government, business and development assistance, recently released the third edition of its Business Principles for Countering Bribery (Principles). The Principles require companies to implement anti-bribery policies and are widely used by businesses and anti-bribery experts in developing and maintaining effective anti-bribery controls.
The most drastic revision in the new edition is TI's stance on facilitation payments. Past versions of the Principles recognized facilitation payments as bribes and suggested that companies should work to identify and eliminate them. However, the new edition of the Principles takes this policy a step further, suggesting that enterprises should prohibit facilitation payments entirely. In a press release announcing the new edition, TI cites changing corporate practices and the prohibition of facilitation payments in new legislation like the UK Bribery Act. Facilitation payments are not illegal under the Foreign Corrupt Practices Act.
Other changes to the Principles include:
  • Highlighting the importance of considering a business's unique risks when developing an anti-bribery policy.
  • A section on monitoring and managing conflicts of interest and their potential connection to corruption.
  • A section calling on entities to cooperate with relevant authorities during bribery investigations and prosecutions, aligning the Principles with the United Nations Convention Against Corruption.
  • Updated guidance on managing relationships with business partners, both when the entity has effective control over a business partner and when it does not.
  • Specific references to lobbyists in clauses setting out the risks posed by intermediaries.
  • Reporting requirements that encourage entities to publicly report their anti-bribery programs and payments made to governments on a country-by-country basis.
The new edition of the Principles maintains earlier editions' recommendation that a company's anti-bribery policy should be tailored to its special needs, covering, at a minimum, risks such as:
  • Bribes.
  • Political contributions.
  • Charitable contributions and sponsorships.
  • Facilitation payments.
  • Gifts and hospitality.
The Principles place special emphasis on the leadership role a business's board of directors and senior management play and on creating an anti-bribery culture among its employees.
For more information on bribery and corruption, see Bribery and Corruption Toolkit.