India ranks second in probes on foreign bribery, enforcement drags globally

Enforcement actions globally slowed down in 2019 against trans-national bribery cases, but India is at the second place after Brazil in terms of the number of investigations concerning alleged bribery of domestic officials by foreign firms, a report said on Thursday.

China showed the highest prevalence of alleged bribery by foreign firms, followed by Iraq, Brazil, Nigeria and India, as per the 10th Annual Global Enforcement Report of TRACE International, a non-profit business association that tracks trends in global anti-bribery investigations and enforcement.

The report said 2019 was a relatively slow year for enforcement actions in transnational bribery cases.

Both global and US enforcement numbers in cases involving bribery of foreign officials dropped, with a 19 per cent decrease in US enforcement actions and a 45 per cent dip in non-US enforcement actions, the data showed.

While the financial services industry remained a focus for US anti-bribery enforcement authorities, companies in the extractive industries faced the most US investigations in 2019.

There was also an increase in US investigations into bribery of foreign officials in the aerospace, defense and security industries. In non-US investigations, extractives remained the most investigated industry, followed by engineering/construction and aerospace/defense/ security.

As of the end of 2019, Brazil was conducting the most investigations concerning alleged bribery of domestic officials by foreign companies, followed by India and China, TRACE said.

China again had the highest prevalence of alleged bribery by foreign companies, with Chinese officials being the alleged recipients of bribes in more than 110 enforcement events since 1977. Iraq has the next-highest number of enforcement events, followed by Brazil, Nigeria and India.

"Officials in Asia Pacific were the alleged recipients of bribes in approximately 27 per cent of enforcement events, followed by Africa with 21 per cent, the Americas with 17 per cent, Europe with 16 per cent, and the Middle East with 13 per cent," it said.

As per the report, 13 countries had more than 20 enforcement events, with five in Asia Pacific, three in Africa, two each in the Middle East and the Americas, and one in Europe.

Of the 89 countries conducting investigations concerning alleged bribery of domestic officials as of December 31, 2019, Brazil was conducting the most (32), followed by India (17), China (14) and Nigeria (13).

At the end of 2019, there were more than twice as many investigations (269) as there have been enforcement actions (106) concerning alleged bribery of domestic officials from 1977 to 2019.

Algeria (10) and China (10) have brought the most enforcement actions concerning alleged bribery of domestic officials, followed by Brazil (8), Nigeria (7), Germany (6) and South Korea (6), while India was lower at 12th place with three such actions.

The study found 44 countries where US-based companies under investigation as on 2019-end have allegedly paid bribes. Chinese officials are the alleged recipients of bribes in 27 investigations, followed by Brazil (19), India (11) and Russia (10).

It further said there are 100 countries where US-based companies, who have been subject to an enforcement action between 1977 and 2019, allegedly paid bribes.

Chinese officials are the alleged recipients of bribes in 52 enforcement actions, followed by Nigeria (18), India (17), Indonesia (17) and Iraq (17), the report said.