1 The Current Topic for Transnational Bribery Regulation Analysis
Transnational bribery, sometimes called âinternational corruptionâ (Magnuson 2013: 369), âextraterritorial payment of bribesâ (Salbu 1997: 233), âoverseas briberyâ (Tarullo 2004: 673), or âbribery of foreign public officialsâ (OECD 1997), refers to one countryâs nationals or entities paying bribes to foreign public officials in international business transactions. The acts of transnational bribery often take place in the home country of bribe payees, and the bribe payers often seek to gain or retain business opportunities.
Many jurisdictions had criminalized domestic corruption in their own history (Carrington 2009: 149; Schmidt 2009: 1125; Nichols 2000: 650â655; Davis 2002: 315â316). However, transnational bribery used to be viewed as a legal business activity enjoying tax deduction (OECD 1996). The criminalization of transnational bribery around the world was a recent event (Schmidt 2009: 1125), marked by two milestones. First, in 1977, the US enacted Foreign Corrupt Practices Act (FCPA), which for the first time in human history took acts of transnational bribery as criminal offense (Magnuson 2013: 383; Koehler 2012). Second, in 1997, 34 countries (including the US) signed the OECD Convention on Combating Bribery of Foreign Officials in International Business Transactions (OECD Anti-bribery Convention) (OECD 1997), which internationalized the FCPA approach. Among a series of interstate treaties on similar theme launched since the 1990s, such as the OAS Inter-American Convention Against Corruption, the EU Convention Against Corruption 1997, and the UN Convention Against Corruption 2003 (OAS 1996; EU 1997; UN 2003), the OECD Anti-bribery Convention is the central governing legal instrument with the strongest enforcement. For this reason, this book takes the OECD Anti-bribery Convention as the landmark of the internationalization of the FCPA approach.
The creation and internationalization of the FCPA approach raised two questions for theoretical analysis. First, the FCPA is an anti-corruption initiative which unprecedentedly relies on supply-side control of corruption and extraterritorial enforcement of criminal law, and as such, its wisdom was questioned. Scholars used to focus on the nature of transnational bribery (e.g., its deleterious effects on social life), the legitimacy of regulatory tools (e.g., supply-side control of bribery), and the externalities of the anti-bribery initiative (e.g., its impact on one countryâs business interests in foreign markets). Relevant academic literature gave both liberal and realist explanations of why the FCPA should be retained or repealed. Then, due to the efforts of governments, non-governmental organizations (NGOs), and scholars, the wisdom of the FCPA-style approach was called into question less since the 2000s. Academic focus was shifted to signatoriesâ actual enforcement of the OECD Anti-bribery Convention: by 2014, the OECD Anti-bribery Convention has been enforced for over 15 years. Its practical effect in controlling transnational bribery is a question concerning scholars.
The central mission of the present-day analysis of global regulation of transnational bribery is to explain the status quo of signatoriesâ domestic enforcement of the OECD Anti-bribery Convention and prescriptively provide policy recommendations to improve the level of signatoriesâ domestic enforcement of the Convention.
This book is no exception, and there are two caveats. First, since previous literature has given a more than elaborate explanation of why we should regulate transnational bribery, this book takes the legitimacy of the FCPA approach as a given premise and focuses exclusively on how to achieve this goal. Second, considering that transnational bribery regulation is inherently of international relevance and we cannot understand it deeply until we understand it systemically, this book focuses on general characteristics of signatoriesâ domestic enforcement of the Convention rather than an ad hoc analysis of specific signatories.
Defining analytical questions is a vital but difficult part of serious theoretical thinking because the posed question would not only set the logical starting point of oneâs argument but also epitomize oneâs preconception of the subject matter and orient the selection of methods. In a prescriptive analysis of how to systemically improve signatoriesâ domestic enforcement of the OECD Anti-bribery Convention, the way one poses the question often reflects how one has portrayed the status quo of Convention enforcement. For example, a question such as âwhy did the apparent commitment of signatories to combat corruption dissipate after the international agreements were signed?â (Tarullo 2004: 666) reflects oneâs preconception that signatories showed positive performance in the stage of establishing the Convention but negative performance in the stage of enforcing the Convention. These preconceptions serve as underlying forces orienting oneâs analysis into different lines of logic. It is no exaggeration to say that the most significant difference among academic arguments on the same subject matter often lies in the questions they pose (Keohane 1989: 29; Robinson 2011: 88).
With an awareness of this, we can realize how current scholarship on the enforcement of the Convention describes questions biasedly from a single perspective. The standard analytical approach is a normative one which portrays the status quo of signatoriesâ domestic enforcement of the Convention as suffering a problem of âineffective enforcementâ (Tarullo 2004: 680; Heimann and Dell 2010: 8; Magnuson 2013: 388), causally attributes the problem to flawed institutional setting (e.g., ineffective monitoring) (Tarullo 2004: 680â689), and then purports to overcome the problem through institutional betterment. So many academic works are fitting under this approach that the divergent forms of questions posed only reflect the great inclusivity of this single perspective.
This book labels this analytical approach as a problem-solving paradigm . The term problem, in a general sense, connotes the existence of a gap between a real situation and a desirable ideal one. The term problem-solving refers to an attempt to span the gap between the real situation and the desirable one (Savranshy 2000: 3). And the term paradigm refers to an accepted framework of assumptions and rules following which scholars ask and answer questions (Robinson 2011: 88). In the discourse of this book, the problem-solving paradigm refers to a generalized analytical model employed by a large group of scholars in their explanation of and prescription for signatoriesâ collective enforcement of the OECD Anti-bribery Convention during the past years. Based on scholarsâ common preconceptions of how the OECD Anti-bribery Convention should have been enforced, a problem-solving analysis portrays the status quo of Convention enforcement as below expectation, attributes this gap between reality and expectation to the existence of âproblematicâ institutional settings, and then seeks to span this gap by amending the problematic institutional settings (Tarullo 2004).
For the purpose of analyzing the dynamics of the enforcement of the OECD Anti-bribery Convention systematically, this problem-solving paradigm that emphasizes the gap between reality and expectation enables people to borrow wisdom from existing knowledge to identify problematic institutional settings and prescribe solutions. However, after over a decadeâs research practice, this paradigm turns out to have contributed far fewer successful solutions than it expected. On the one hand, the focus of the current problem-solving literature created by economists and political scientists in the twentieth century merely addresses one level of interactions among signatories. This simplistic analytical approach is good at describing the âcollective action problemâ that signatories confront but fails to prescribe effective solutions. In order to release the full potential of the problem-solving paradigm in prescription, there is a need to restructure the specific problem-solving methods applied by current literature. On the other hand, the problem-solving paradigm which prejudges the current level of Convention enforcement as âineffectiveâ avoids drawing inspiration from a few signatoriesâ zealous enforcement against transnational bribery; it does not enable a comprehensive understanding of its object.
This introductory chapter discusses the methodology for a study of the enforcement of the OECD Anti-bribery Convention by analyzing the formation of the problem-solving paradigm , its theoretical functions, and limits. This work does not negate the academic contributions of current problem-solving scholarship but rather seeks to optimize the specific problem-solving methods so as to release the full potential of the problem-solving paradigm in prescribing effective solutions. Then, given that the problem-solving paradigm is inherently unable to explain why a few signatories have indeed enforced the Convention effectively, this chapter seeks to develop an alternative analytical approach that breaks away from the popular preconception about âineffective Convention enforcementâ and draws inspirations from actual experience. Thus the objective of this chapter is twofold: to optimize specific problem-solving methods under the standard paradigm and to develop an alternative paradigm to supplement the standard paradigm.
An analysis of the problem-solving paradigm requires most of an entire chapter because detailed analysis is required to enable us to grasp how our preconceptions enslave our perspective to the study of the enforcement of the Convention. Many deep-seated beliefs that we hold about transnational bribery regulation (e.g., our preconception of what makes the FCPA approach wise and how should the Convention be enforced) have oriented most of present prescriptive analyses to a problem-solving paradigm . They are so deeply embedded in the thinking of scholars, practitioners, and ordinary people that we cannot legitimately take a different approach without penetrating deeply into its genesis and development and laying bare its structural and fu...