India is one of 176 countries that is a signatory to the United Nations Convention Against Corruption, 2003 (UNCAC), under which all signatories must enact a law that penalises bribery of foreign public officials as well as officials of public international organisations. However, there is no domestic law at present that addresses this type of bribery. The Prevention of Corruption Act, 1988, penalises the acceptance of bribes by domestic public officials, while the Prevention of Money Laundering Act, 2002, criminalises the illegal flow of money through the attachment and confiscation of property.
There is a proposal to introduce the Prevention of Bribery of Foreign Public Officials and Officials of Public International Organisations Bill, 2015 in Parliament. This Bill is a revised version of an earlier Bill introduced in Parliament in 2011, but which lapsed with the dissolution of the 15th Lok Sabha. The Law Commission of India was requested by the Ministry of Law and Justice to give its views and recommendations on the text of the 2015 Bill.
The 2015 Bill has three key parts, dealing with, firstly, the offences; secondly, the processes for investigation and prosecution of the offences; and thirdly, the inter-relation of the Bill with other laws and miscellaneous matters. In line with other countries, the 2015 Bill criminalises the offence of active bribery, that is, the offence of giving bribes to foreign officials. However, unlike most other jurisdictions, the Indian draft law also criminalises the offence of passive bribery, which deals with the acceptance of bribes by foreign officials. Very few countries have criminalised the offence of passive bribery, including Malaysia and Switzerland.
The Law Commission undertook an analytical cross-sectional study of bribery laws in other countries that are signatory to the UNCAC, as well as Indias obligations under the UNCAC. The Law Commission has suggested certain amendments to the 2015 Bill, in keeping with Indias obligations under the UNCAC as well as existing domestic laws on bribery and money laundering. A comprehensive redrafted version of the 2015 Bill, based on the recommendations of the Law Commission, is included as an annexure to the Report.
Key recommendations include:
1. Scope and Jurisdiction: The Bill must be applicable only to instances of bribery that occur wholly or partly within India or on an Indian aircraft or ship; or where the bribery takes place abroad, to persons who are citizens or permanent residents of India or bodies that are incorporated in India.
2. Offences under the law: The offences of abetment of, and attempt to, commit passove and active bribery must be separate, as the ingredients for these offences differ, and ought to carry different penalties.
3. Defences and exceptions available under the law: The Law Commission recommends that the law must provide a specific provision that details the defences and exceptions available against the offences under the law. This includes an exception for payments made in the course of routine duties or functions of foreign officials, such as for issuing permits or licenses, processing official documents, and similar services. Such defences and exceptions are routinely provided in all other jurisdictions, and it is appropriate that India follows this norm. These defences and exceptions must be available to all persons, including natural persons and companies.
4. Liability of commercial organisations: Commercial organisations that are guilty of bribery must be liable to pay a fine. Further, if the offence takes place with the consent or connivance of a senior officer of the commercial organisation, that officer must be punishable with imprisonment. A commercial organisation would also be liable where a person associated with such commercial organisation has committed the offence. However, in such circumstances, the commercial organisation may not be liable if it is able to show that it had adequate procedures in place to prevent such conduct. This scheme of liability of commercial organisations is comparable to the scheme recommended by the Law Commission in its 254th Report relating to the Prevention of Corruption (Amendment) Bill, 2013.