When German engineering firm Siemens paid $1.6 billion to U.S. and German regulators in 2008 for bribery violations, it was the largest fine for bribery in modern history. According to law professor Andy Spalding, the case opened Germany's eyes to the need to address international bribery, ultimately leading to the country’s status today as a leader among European nations in anti-bribery enforcement.
The case also proved to be a key example when Spalding traveled to Germany in March to teach an anti-bribery seminar at Mannheim Law School, a University of Richmond partner institution.
“The professors were generally aware of this trend, but the students were not,” Spalding says. “In teaching them about anti-bribery law, I had the unique opportunity to pique their interest in this rapidly emerging area of practice.”
The most dynamic area of anti-bribery law — and the focus of Spalding’s seminar — involves the interplay between the private and public sectors, where private companies pay bribes to foreign governments to advance their business purposes.
“Bribing foreign officials can impair the formation of legal and economic institutions in developing countries, and jeopardize crucial international alliances,” he says. “All multinational companies entering developing countries will face the opportunity — and the temptation — to pay bribes.”
Companies facing this temptation originate not just from the developed countries in Europe or North America, but also across Asia and Latin America. Not all of these countries enforce prohibitions on paying bribes to foreign governments, adding to the complexities of instituting and enforcing anti-bribery laws across international lines.
“These multinational companies are all competing for business across the developing world, but are playing by different rules,” he says.
As the playing field widens, the study of international bribery brings to the surface cultural differences concerning how companies and governments can and should operate. Spalding says cross-cultural conversations on the purpose and impact of anti-bribery law are invariably interesting and useful.
While there are many questions about how to pursue anti-bribery efforts, some progress has been demonstrated. After major corporate accounting fraud scandals in the late 1990s, the U.S. resolved to require greater transparency from large corporations. The U.S. lobbied other capital-exporting countries to do the same, and as U.S.-led enforcement actions cut across national boundaries, other governments slowly responded.
“There can be little doubt that anti-bribery enforcement has led to a sea change in attitudes toward bribery,” he says. “Companies subject to U.S. jurisdiction now take anti-bribery laws very seriously, paying big law firms top dollar to assist with compliance. And governments around the world are at least talking about the need to reduce domestic corruption.”
The Mannheim seminar isn’t Spalding’s only effort to continue the conversation around anti-bribery law. He also is a senior editor for the Foreign Corrupt Practices Act (FCPA) blog, an international website for commentary and news about anti-corruption compliance and enforcement.
“Writing on the blog enables me to share my academic research idea with a broader international community of academics, practitioners, and government officials,” he says. “I take the ideas I've developed in my research and repackage them for a larger audience. This keeps me honest — it helps me ensure that my ideas have actual relevance to the world.”