Many multinational companies are familiar with the provisions of the US Foreign Corrupt Practices Act and take measures to comply, however, this does not protect a company from prosecution for offenses committed under local laws (in this case, South African legislation). This Emerging Issues Analysis, discusses the applicable legal and legislative framework in place in South Africa to combat corruption.
The author writes: Corruption is a global problem that affects both the developed and the developing world, though its effect in developing countries is arguably far more pervasive and destructive. Insofar as corruption is concerned, businesses now compete in an increasingly complicated and regulated environment, driven in part by globalisation and expansion into new markets and in part by the general trend of increasingly proactive enforcement of corruption laws across the globe. Recent high-profile examples of such enforcement include the $560 million (including fines, penalties and disgorgement) levied on Halliburton Corporation in connection with bribery in Nigeria and the estimated $800 Million settlement reached with Siemens arising from bribes paid in inter alia in China, South America and Africa.
An act of corruption in one jurisdiction may attract legal consequences halfway around the world. Now more than ever, companies must familiarise themselves with the local legislative and framework governing corruption in the jurisdictions in which they operate and must take steps to ensure compliance.
South Africa acceded to the Organisation for Economic Co-operation and Development (OECD) Convention in June 2007 and became the thirty-seventh signatory and the first African country to join the Working Group on Bribery in International Transactions. South Africa had also previously ratified the United Nations Convention against Corruption in November 2004 and the African Union Convention on Preventing and Combating Corruption in November 2005.