How Multinational Investors Evade Developed Country Laws
AbstractHow effective are G-8 and OECD efforts to combat bribery and corrupt payments when multinational companies bid on concessions in the developing world? Have the rich countries – and the United States, in particular – done what is necessary to restrain multinational investors from paying off daughters of Presidents and cronies of Ministers to secure favors for their activities? This paper argues that the answer is no. Multinational corporations from the US, Europe, and Japan have devised sophisticated payment mechanisms, as documented and described here, to evade home country anti-corruption laws, including the US Foreign Corrupt Practices Act, with impunity. According to this paper, some US companies have laid these payment arrangements out before the US Department of Justice, the Securities and Exchange Commission, and other US agencies, without arousing any objection whatsoever. Without reforms of the kind spelled out here, the OECD and G-8 campaign to prevent corrupt payments will turn out to be a sham. This working paper provides a preview of research included in a much broader forthcoming CGD monograph entitled Harnessing Foreign Direct Investment for Development: Policies for Developed and Developing Countries.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Center for Global Development in its series Working Papers with number 79.
Length: 12 pages
Date of creation: Feb 2006
Date of revision:
Contact details of provider:
Web page: http://www.cgdev.org
G-8; OECD; corruption; concessions; multinational companies;
Find related papers by JEL classification:
- E0 - Macroeconomics and Monetary Economics - - General
- O0 - Economic Development, Technological Change, and Growth - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-08-19 (All new papers)
- NEP-REG-2006-08-19 (Regulation)
- NEP-SEA-2006-08-19 (South East Asia)
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Joseph McKinney & Carlos Moore, 2008. "International Bribery: Does a Written Code of Ethics Make a Difference in Perceptions of Business Professionals," Journal of Business Ethics, Springer, vol. 79(1), pages 103-111, April.
- Gabriel Donleavy & Kit-Chun Lam & Simon Ho, 2008. "Does East Meet West in Business Ethics: An Introduction to the Special Issue," Journal of Business Ethics, Springer, vol. 79(1), pages 1-8, April.
- Ananya Reed & Darryl Reed, 2009. "Partnerships for Development: Four Models of Business Involvement," Journal of Business Ethics, Springer, vol. 90(1), pages 3-37, May.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David Roodman).
If references are entirely missing, you can add them using this form.