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Wellington, February 14, 2015
New Zealand has made progress in reforming its legislative framework to combat bribery of foreign public officials over the past decade, but there has still never been a prosecution of a foreign bribery case, and detection levels are low.
The latest Report from the OECD Working Group on Bribery in International Business Transactions expresses concern that there is a lack of awareness in New Zealand concerning its companies’ exposure to significant foreign bribery risks.
Uncertainties persist concerning the interpretation of the foreign bribery offence, and deficiencies with the new mechanism for attributing corporate liability have the potential to undermine its effectiveness in holding companies to account.
The Working Group is also concerned that challenges in meeting the legislative threshold for requesting evidence overseas are preventing the Serious Fraud Office from fully investigating foreign bribery allegations.
The 46-country Working Group has just completed its Phase 4 evaluation of New Zealand’s implementation of the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions and related instruments.
Areas for improvements
In addition to the aspects highlighted above, the Report details further areas for improvement of New Zealand’s effectiveness in preventing, detecting, and enforcing foreign bribery offences.
The Working Group has accordingly recommended that, among other things, New Zealand: (a) Develop and implement a strategy to improve public and private sector awareness of foreign bribery risk, as well as combat foreign bribery (b) Address deficiencies with the new mechanism for attributing corporate liability and increase sanctions for legal persons that engage in foreign bribery (c) Incentivise self-Reporting of foreign bribery by New Zealand companies (d) Move forward with previously proposed reforms to modernise its mutual legal assistance regime, specifically to address barriers to requesting overseas evidence.
The Report also notes several positive developments in New Zealand that may contribute to combating foreign bribery.
New Zealand demonstrated efforts to strengthen cooperation with international partners.
Whistleblower Protection
The introduction of a new whistleblower protection regime was among New Zealand’s most important reforms in recent years and increased the potential to detect foreign bribery.
New Zealand also took steps to improve company and foreign trust transparency requirements.
The Working Group adopted the Report on New Zealand on 12 December 2024. It is a part of the Working Group’s fourth phase of monitoring, launched in 2016.
Phase 4 looks at the evaluated country’s particular challenges and positive achievements.
It also explores issues such as detection, enforcement, corporate liability, and international cooperation, as well as unresolved issues from prior Reports. New Zealand will Report to the Working Group in two years (i.e., December 2026) on its implementation of all recommendations and its enforcement efforts.
Transparency International New Zealand (TINZ) Chief Executive Julie Haggie described the OECD evaluation as ‘an important tool to help us strengthen our integrity systems.’
“This is a manual with practical recommendations on implementation and enforcement. Those include reducing ambiguity in law and thresholds for accessing information, as well as increasing penalties. Our public and private sectors need much more awareness and guidance on bribery risks, and we need to do more to support our Pacific neighbours. There is also no national strategy on bribery prevention,” she said.
Ms Haggie said that population surveys show that New Zealanders have a very low tolerance for bribery.
“But New Zealanders also have low confidence that those committing bribes will face consequences of their actions. This Report reflects that gap in our dealings overseas, and it shows that legislators, the public sector and businesses need to ‘walk the talk’. The Report and its recommendations reflect the conclusion of experts from Ireland and Israel, based on information provided by New Zealand, research by the evaluation team and a New Zealand visit in May 2024 which included consultation with public, private, judiciary, media and civil society including TINZ,” she said.
