Finland: Finland asked to do more to combat foreign bribery

By Jaya Ramachandran

Courtesy of IDN-InDepth NewsAnalysis

PARIS (IDN) - While highlighting some positive aspects of Finland's efforts to fight foreign bribery, the prestigious OECD has asked the Nordic country to take critical steps to raise awareness among the country's companies that they are "criminally liable under Finnish law".

"Finland needs to take urgent steps to raise awareness among Finnish companies that they are criminally liable under Finnish law if they, or their local agents or subsidiaries on their behalf, bribe public officials when doing business abroad," says a new report by the 38-country OECD (Organisation for Economic and Cooperation and Development) Working Group on Bribery.

The group -- comprising lead examiners from the Czech Republic and Luxembourg as well as members of the OECD Secretariat has just completed in its regular cycle a review of Finland’s enforcement of the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions and related instruments.

It calls upon Finland to amend the Criminal Code definition of foreign public official to include a person holding a legislative office in a foreign country, and establish corporate liability for accounting and auditing offences.

Further the OECD group wants Finland to introduce measures to facilitate reporting by public officials to law enforcement authorities of suspected acts of foreign bribery. Finland should also address the lack of whistleblower protection by introducing mechanisms to ensure that public and private sector employees who report in good faith and on reasonable grounds are protected from discriminatory or disciplinary action.

The Working Group also highlights positive aspects of Finland’s efforts to fight foreign bribery. These include: promising enforcement efforts, with six cases of suspected foreign bribery currently under investigation in Finland; a proactive approach to obtaining the cooperation of relevant foreign authorities in asset recovery; and bilateral anti-corruption work with China and the Russia.

The group points out in particular that reports of suspected offences may be made freely to the police in Finland, either in person, by telephone or over the internet. All members of the police in Finland have a general duty to report suspicions of offending.

However, except in the case of very serious offences such as homicide, there are no specific obligations or instructions requiring or calling on public officials in relevant agencies in Finland to report suspicions of offending, including suspicions of foreign bribery.

The Working Group's lead examiners heard, for example, that tax authorities have no such instructions. While some agencies, such as Finnish missions abroad, can and do agree on an annual basis about their "reporting profile", the lack of established reporting obligations and procedures for relaying allegations of foreign bribery to capital is of considerable concern, say the OECD group.

WHISTLEBLOWER PROTECTION

Furthermore, there is no specific whistleblower protection system in Finland to shelter from discriminatory or disciplinary action public or private sector employees who report in good faith and on reasonable grounds suspected acts of foreign bribery to competent authorities.

Finnish authorities rely on the existence of some limited levels of witness protection, and the ability of employees who are dismissed without cause from employment to bring action against employers under labour laws in Finland and as a result of the strong union movement in Finland.

Authorities further stated that corporate codes of conduct usually contain some form of accommodation for whistleblowers. The OECD lead examiners also heard from civil society representatives that there is not a strong culture of blowing the whistle in Finland, and that there is instead a preference for the internal resolution of issues.

Despite these explanations, the Working Group is concerned that Finland's position is out-of-step with that of other member states. The 2009 Recommendation, which reflects the development of standards by the Parties in this regard, calls on Parties to ensure that appropriate measures are in place to protect from discriminatory or disciplinary action public or private sector employees who report in good faith and on reasonable grounds to the competent authorities suspected acts of bribery of foreign public officials in international business transactions.

Witness protection provides limited protection in the context of judicial proceedings only. Labour laws only protected against dismissal and do not cover other forms of discrimination that may follow a whistleblower report.

Civil society representatives referred, in this regard, to a high-profile case in which a company sought to sue an employee who leaked classified information which related to foreign bribery allegations. Corporate codes of conduct may assist, but this involves a deferral of responsibility by Finnish authorities which cannot guarantee a uniform and adequate level of protection.

Furthermore, corporate codes of conduct do not cover the protection of public sector whistleblowers. Given the difficulties in detecting foreign bribery cases, the Working Group considers this to be a significant deficiency in Finland‟s fight against foreign bribery.

A system known as HILMA established and maintained by the Ministry of Employment and Economy (MEE), provides a cost-free electronic channel through which procurement units in Finland must give notice of their public tenders for all procurements that exceed the national and EU threshold value.

Companies, in turn, obtain real-time information on current tenders as well as advance information on future procurements. While this system enhances transparency, the evaluation team noted that it does not cover tenders below thresholds of 30 000 Euro for supplies and services, and 150 000 Euro in the case of construction projects. A representative from the MEE explained that this is the case due to complaints that tenders through the HILMA system were too complicated for small and medium enterprises.