TRACE Releases 2012 Global Enforcement Report

ANNAPOLIS, Md., May 20, 2013 /PRNewswire/ -- TRACE International today released its Global Enforcement Report (GER) 2012, finding that prosecutions against individuals and government or business entities for bribery and corruption trended downward last year. The GER 2012 is the third in an annual series from TRACE that assesses international anti-bribery enforcement trends.

"Although the number of outbound enforcement actions fell last year, the enforcement of bribery laws remained a priority," said Alexandra Wrage, TRACE Founder and President. "Fifteen nations initiated their first ever legal action against inbound or domestic bribery. The addition of over a dozen new countries to worldwide bribery enforcement is a very positive trend and one that the global compliance community can celebrate."

Between 2011 and 2012, foreign bribery enforcement actions (excluding investigations) by the U.S. declined by 52%; such actions by countries other than the U.S. declined by 42%. While foreign bribery enforcement by the U.S. declined in 2012, the absolute number of foreign bribery enforcement actions brought by the U.S. in the ten-year period from 2002 through 2012 exceeds the number of enforcement actions pursued in the rest of the world.

The GER 2012 shows South Korea, Nigeria and China lead the world in enforcing their national prohibitions on inbound bribery, defined as the bribery of a country's government officials by foreign companies.  The report also includes for the first time information about how many times countries declined to take formal enforcement actions or closed official inquiries related to outbound or inbound bribery from 1977 through 2012. The U.S. accounts for nearly 75% of global declinations; six other countries also declined to pursue formal bribery enforcement actions in the period.

"Enforcement ebbs and flows, depending on many complex factors," said Wrage. "Any single year must be looked at in the context of overall trends, which have been overwhelmingly positive over the past five years.  The first quarter information for 2013 shows that enforcement actions are again on upswing. Overall, we believe progress continues to be made on many fronts to improve business transparency worldwide."

The report also reveals that since 1977, 64 countries have pursued enforcement of domestic bribery laws and 25 have pursued enforcement of outbound or foreign bribery laws, with considerable overlap in the countries that have pursued enforcement of both. According to TRACE, the U.S. has pursued 2.5 foreign bribery enforcement actions for every enforcement action pursued by all other countries combined since 2002, with the UK continuing to rank second in enforcing its foreign bribery laws.

One-fourth of outbound bribery enforcement actions and investigations pursued by the U.S. from 1977 through 2012 involved a company headquartered outside of the country or an individual employed or retained by such a company. By the end of 2012, the U.S. had pursued 64% of all global outbound enforcement ever pursued, including eight times as many actions as the UK, the country with the next highest total.

According to the report, extractive industries, which includes mining, have been subject to more inbound and outbound bribery enforcement actions than any other industry sector; however, the manufacturing/service provider sector is an increasingly close second, with the aerospace/defense/security and health care sectors ranking third and fourth.

TRACE's 11-page GER 2012 is available online at www.traceinternational.org.

About TRACE

TRACE International is the world's leading anti-bribery and anti-corruption organization. TRACE's non-profit membership association pool resources to provide practical and cost-effective anti-bribery compliance solutions for multinational companies and their commercial intermediaries (sales agents and representatives, consultants, distributors, suppliers, etc.). TRACE provides several core services and products, including: due diligence reports on commercial intermediaries; model compliance policies; an online Resource Center with foreign local law summaries, including guidelines on gifts and hospitality; in-person and online anti-bribery training; and research on corporate best practices.

For additional information, contact TRACE at [email protected] or visit TRACE at www.TRACEinternational.org

SOURCE TRACE