International companies are becoming large and growing proportion of the world’s total business due to globalization, which has forced western capitalists to interact with their counterparts in lower-income and developing countries, in the course of expanding business horizons and opportunities. Malaysia realizes that companies do not operate within national boundaries but in multiple countries, each with its own set of norms and rules. In the competition to secure supplies from foreign countries and compete against products and services, companies tend to violate laws and rules especially pertaining to corruption.
Domestic bribery has long been recognized as a crime in almost all countries including Malaysia. However, bribery of foreign officials is of a relatively recent occurrence. The tendency to commit foreign bribery has risen dramatically due to globalization, which has let to a significant increase in international economic activities.
In responding to the growing tendency and in relation to article 16 of the United Nation Convention Against Corruption (UNCAC), which makes explicit reference to the bribery of not only foreign public officials but also officials of public international organizations. Malaysia responded well to offences of bribery by foreign public officials by taking the necessary steps to incorporate a new specific provision for bribery of foreign public officials into the domestic legislation.
Section 22 of the Malaysian Anti-Corruption Commission Act 2009 represents Malaysia’s legislative contribution to the international effort to criminalize such conduct. The provision stipulates that any person who by himself, or by or in conjunction with any other person gives, promises or offers, or agrees to give or offer, to any foreign public official, or being a foreign public official, solicits, accepts or obtains, or agrees to accept or attempts to obtain, whether for the benefit of that foreign public official or of another person, any gratification as an inducement or reward for, or otherwise on account of:
- the foreign public official using his position to influence any act or decision of the foreign state or public international organization for which the official performs any official duties;
- the foreign public official performing, having done or forbone to do, or abstaining from performing or aiding in procuring, expediting, delaying, hindering or preventing the performance of, any of his official duties; or
- the foreign public official aiding in procuring or preventing the granting of any contract for the benefit of any person,
commits an offence, notwithstanding that the foreign public official did not have the power, right or opportunity so to do, show or forbear, or accepted the gratification without intending so to do, show or forbear, or did not infact so do, show or forbear, or that the inducement or reward was not in relation to the scope of his official duties. Shall on conviction be liable to an imprisonment for a term not exceeding twenty years and a fine of not less than five times the sum or value of the gratification or ten thousand ringgit, whichever is the higher.
For the purpose of the offence, foreign public official defined as includes any person who holds a legislative, executive, administrative or judicial office of a foreign country whether appointed or elected. Apart from that it also includes a person who exercises a public function for a foreign country and any person who is authorized by a public international organization to act on behalf of that organization.
In addition, the provision covers any act of aiding and abetting in the commission of the offence, conspiring to commit the offence or attempting to commit the offence. Some countries will argue that it is their culture in giving gifts which on their own way may denote respect, appreciation or gratitude, without specifying large and small gifts or the value of the gifts. Thus, in Malaysian, we have within our legislation, that evidence of custom is inadmissible as a defence to an offence of bribery of a foreign public official.
Lobbying by a foreign public official in order to persuade a local public official to act in the supplicant’s is another area that is open to abuse. Lobbying, per se, that does not require a payment and which does not persuade a political figure from violating the social trust of his constituents and his parliamentary code of ethics, is legitimate. However, when lobbying is done with a payment for the same purpose and for the political figure to breach any social trust that he has with his constituents, then it constitutes an offence domestically. The giver and receiver of bribe in such cases commit an offence and would be prosecuted in Malaysia.
Facilitation payments also known as ‘grease payments’ has been described by the OECD as low level payments designed to expedite performance of a ‘routine government action’. It is corrosive in its nature towards sustainable development of a country and the rule of law. Malaysia too has recognized facilitation payments as a form of corruption within the domestic anti-corruption legislation.
The Malaysian Anti-Corruption Commission Act 2009 provides that the evidence of an accomplice and agent provocateur could be used as admissible evidence in the prosecution of offences of bribery of foreign public officials. This provision would be of invaluable, as one is only to aware that corruption is sometimes regarded as ‘silent crime’ between consenting adults. Hence, if there is any other compelling independent and corroborative evidence, then the giver and receiver of the bribe could be prosecuted, respectively. Plea bargaining is being introduced into the Criminal Procedure Code in Malaysia, which would again enable the cooperation of co-offenders in the prosecution of bribery offences.
Apart from that, there is also within the scheme of the Act, a provision that there is a duty to report all forms of attempted bribery transactions and failure to do so is an offence, which on conviction be liable to a fine of not exceeding one hundred thousand ringgit or to imprisonment for a term not exceeding ten years or both. If bribery is being solicited or obtained, or an attempt has been made to obtain then failure to report such act, will on conviction be liable to a fine not exceeding ten thousand ringgit or to imprisonment for a term not exceeding two years or to both. Thus, it is the duty of either the potential giver or receiver to report bribery and failure to do so may land them to a criminal charge.
Tools of investigation for the offence of bribery of foreign public officials are enshrined in the Act. A glimpse of these powers would indicate that there are explicit provisions overriding banking secrecy laws and professional legal privilege. Further, the Act provides that officers of the Commission have the power to obtain information in the course of investigation for an offence under the Act, including bribery of a foreign public official, about property that reasonably believed to have been acquired through proceeds of bribery. The information may be secured from the suspect himself, his relatives or associates, or any other person whom the anti-graft officer has reasonable ground to believe can assist in the investigations. Failure by any party to provide the information required is a criminal offence, and may face a criminal charge. On conviction may liable to imprisonment and fine.
If it is established that the suspect against whom the information is sought is an officer of a public body in Malaysia and is in excess of wealth against his present and past emoluments and all other relevant circumstances, then the said officer of a public body, can be prosecuted for the excess wealth. The officer of the public body shall on conviction be liable to an imprisonment for a term not exceeding twenty years and a fine which is not less than five times the value of the excess or ten thousand ringgit, whichever is the higher.
The Act also provides well defined powers to freeze the assets of a suspect and subsequent forfeiture. Where the offence is proved against the accused person, but the property cannot be traced or is disposed, the court can order the accused to pay a penalty, the sum of which is equivalent to the amount of the gratification. The penalty is over and above the punishments provided for under the Act.
The officers of the anti-graft Commission in Malaysia are constantly required to attend capability-building programmes in order to enhance their investigative skills and to network informally with counterparts of theirs from other jurisdictions. Such networking would invariably facilitate cross-border investigations. The investigative programmes are organised domestically under the auspicious of the Malaysia Anti-Corruption Academy, or internationally.
Corruption, as we all know is a crime without boundaries. Hence, the Malaysian Anti-Corruption Commission has also beefed up international investigation unit to cope with this new phenomenon, bribery of foreign public officials.
Last and not least, Malaysia is committed in taking important steps to facilitate rightful recoveries of proceeds of bribery and is prepared to set aside the obstacles of differing legal regimes, political chauvinism, suspicions and cultural differences, and adopt a common stand on the eradication of this new phenomenon, the offence of bribery of foreign public officials.
(The article was adopted from presentation by Mr Anthony Kevin Morais, Senior Deputy Public Prosecutor attached to the MACC, who made the presentation at an international conference – Shaping a New World: Combating Foreign Bribery in International Business Transactions which was held at Hyatt Hotel, Nusa Dua, Bali, Indonesia, organized by Corruption Eradication Commission (CEC), Indonesia in collaboration with the Organization for Economic Cooperation and Development (OECD).
Written by: SAC Muhammad Salim Sundar, Head of Corporate Communication, MACC.