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The Organised Crime and Anti-corruption Bill passed in Parliament on 4 November 2015 bringing New Zealand more in line with international anti-bribery and corruption legislation. The omnibus Bill, which has been divided into 15 Amendment Acts, should also enable New Zealand to ratify the United Nations Convention against Corruption (UNCAC), which it signed in 2003.
Some of the amendments in the foreign bribery area are:
Over the years, there has been a geographical shift in the countries that New Zealand trades with. As New Zealand’s trading partners have changed, so have the foreign bribery and corruption risks. Although New Zealand is considered one of the least corrupt countries, the same cannot be said of some of our trading partners.
There are strong indications that many New Zealand businesses operating overseas are not taking foreign bribery risks seriously. A 2015 Deloitte survey of New Zealand and Australian companies showed that 40% of organisations with offshore operations do not have, or it’s not known if they have, a formal compliance programme in place to manage corruption risks.
The perception of New Zealand’s way of trading and our brand are important to future growth. All New Zealanders are involved in some way, as trade also involves importing, which is a source of many consumer goods. Corrupt behaviour could have negative effects on our reputation, and the perception that Kiwis are a people with a high degree of honesty and integrity.
New Zealand companies already face the risk of financial penalties and/or imprisonment for failure to comply with a number of foreign laws. Non-compliance with the US Foreign Corrupt Practices Act, for example, has resulted in heavy penalties for both US and non-US based companies and organsiations. The UK Bribery Act covers any New Zealand companies with offices or operations in the UK. Both Acts cover foreign bribery acts committed in third-world countries.
International enforcement is gearing up as well. For example, China is taking a harder stance on corruption. The New Zealand Serious Fraud Office is pursuing foreign corruption cases—at present there are four ongoing investigations of New Zealand companies.
Organisations that develop a compliance system to prevent corrupt practice may use it as a defence if an incident does occur. This applies to New Zealand and international legislation.
Even robust compliance programmes may fail to eliminate all risks. Having a robust system in place, rather than feigning ignorance of potential risks, provides evidence of corruption prevention to a court of law.
Building a compliance system doesn’t need to be complicated but it should:
TI has been working with various players, including the business sector, over the years to develop tools and best practice for combating bribery and corruption. An excellent tool is the Corruption Assessment toolbox. TINZ has developed a free e-learning Anti-Corruption Training course in cooperation with Business New Zealand and the Serious Fraud Office.
Transparency International New Zealand