Japan is still not actively detecting and investigating foreign bribery cases and, as a result, the enforcement of Japan’s anti-bribery law remains low, according to a new OECD report.
The OECD Working Group on Bribery has just completed its report on Japan’s application of the Convention of Combating Bribery of Foreign Public Officials in International Business Transactions and related instruments.
To date, the OECD’s second-largest economy has concluded two cases since Japan’s foreign bribery offence entered into force in 1999.
Recommendations made by the Working Group include that Japan:
- Step up efforts to detect, investigate and prosecute foreign bribery cases;
- Urgently establish a legal basis for confiscating the proceeds of bribing foreign public officials;
- Amend legislation so that it is a crime to launder the proceeds of foreign bribery;
- Ensure that the Ministry of Economy, Trade and Industry (METI)—which has responsibility for Japan’s foreign bribery offence—takes a stronger role in ensuring the effective implementation of the Anti-Bribery Convention by Japan; and
- Review its whistleblower protection legislation.
The Working Group has a clear expectation that, to strengthen enforcement, Japan will give serious consideration to using new investigative techniques, such as wire-tapping and grants of immunity from prosecution.
The Working Group also noted positive aspects of Japan’s implementation of the Convention. These include raising awareness of Japan’s foreign bribery offence—the Unfair Competition Prevention Law (UCPL)—among the legal profession and providing clearer information on the UCPL to business. It also appears that the police and prosecutors, and other agencies such as the National Tax Agency and Financial Service Agency’s Securities and Exchange Surveillance Commission, are beginning to more closely coordinate and share information. These developments have the potential for facilitating the more active detection, investigation and prosecution of foreign bribery cases.
The Working Group—made up of the 34 OECD Member countries plus Argentina, Brazil, Bulgaria, Colombia, Russia and South Africa—adopted Japan’s report under its third phase of monitoring. The Report, available at www.oecd.org/daf/nocorruption, lists all the recommendations of the Working Group on pages 41-44, and includes an overview of Japan’s legal and policy framework for combating the bribery of foreign public officials. Japan will report to the Working Group on progress in June 2012. Following the usual process, Japan will also make an oral report in December 2012 and a further written report within two years (December 2013), which will be the basis of a publicly-available Working Group evaluation of Japan’s implementation of the Phase 3 recommendations.