ABSTRACT

The best known national measure against international corruption (3) is the US Foreign Corrupt Practices Act of 1977. It imposes criminal penalties on US-based corporations bribing foreign officials to obtain contracts abroad. If the US FCPA is aimed at the bribery of their corporations abroad, Singapore has a mechanism to protect itself against being bribed. In 1996 Singapore barred five transnational manufacturing and engineering corporations from government contracts for five years in the wake of a corruption scandal [McDermott, 1997; Taylor, 1996]. The US FCPA and Singapore's blacklisting are the exceptions, however, since few countries are willing or able to take such unilateral action for fear that they might incur a commercial competitive disadvantage. This has led to allegations by US companies that they lose numerous international contracts to less scrupulous competitors - over $20 billion worth in 1996 alone [FAZ, 1996]. To some extent, this contradicts Wei's [1997] analysis of the propensity of major exporting countries to bribe abroad since he shows that the FCPA has a minimal impact on US export behaviour. TI's Integrity Pact is one of the few attempts to introduce a mechanism against international grand corruption using national mechanisms (4). The World Bank [1997] is now also supportive of this approach, but it remains to be seen how effective this mechanism wil l be.