Luxembourg urgently needs to establish liability against legal persons for foreign bribery and put in place sanctions that are effective, proportionate and dissuasive, according to a report by the OECD’s Working Group on Bribery. The bill currently before Parliament, designed to introduce this responsibility in Luxembourg law, should be amended to ensure that it meets the requirements of the OECD Anti-bribery Convention.
The 37-country OECD Working Group on Bribery has just completed a further review of Luxembourg’s enforcement of the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, following a special decision taken by the Group in June 2006: previous reviews had concluded that Luxembourg had not done enough to meet all the requirements of the Convention. While the Working Group notes that Luxembourg has recently engaged in efforts to implement the Convention, it is seriously concerned that Luxembourg has not responded to some key recommendations issued by the Working Group since 2001. The Working Group has exceptionally decided to conduct a review of measures taken by Luxembourg to fulfill the recommendations of the Group again one year from now and reserves the right to take further steps in the event of continued failure to implement the Convention.
The main recommendations of the Working Group are that Luxembourg should:
- introduce promptly liability of legal persons for foreign bribery. Currently, prosecution and thus conviction of companies that engage in bribery remains impossible because legal persons cannot be held liable for criminal offences
- reinforce its mechanisms for combating bribery by making it easier for its judicial authorities to obtain information held by banking institutions in the Grand Duchy.
- introduce effective, dissuasive and proportionate sanctions for companies and guarantee the jurisdiction of the Luxembourg courts over acts of bribery committed abroad by Luxembourg companies.
- step up its efforts to make SMEs aware of the crime of bribing foreign public officials, and introduce a whistleblower protection system.
Among the steps that Luxembourg has taken, the Working Group highlighted the creation of a Corruption Prevention Committee, which is expected to do much in raising bribery awareness among the players concerned and to improve interagency coordination, and the introduction of anti-bribery mechanisms in agencies responsible for export credit insurance and development cooperation. The Group also welcomed the draft law on interagency and judicial cooperation, which should enhance the capacity of the Luxembourg tax authorities to detect bribes and to provide the judicial authorities, at all stages of criminal proceedings, with the information needed to establish the offence of bribery.
The report lists in its final part all the recommendations of the Working Group and includes an overview of recent actions taken by Luxembourg to combat the bribery of foreign public officials. Within one year, Luxembourg will report in writing to the Working Group on its actions to implement the Working Group's which will give rise to a publicly available evaluation by the Group of Luxembourg’s implementation of the recommendations.