Corruption: The fight against it seems to be going on!

Corruption: The fight against it seems to be going on!

On November 21, 1997, the OECD, an economic organization that covers developed countries, approved the "Convention to Combat Bribery of Public Officials in International Business." By the end of 1998, it is expected that the majority of subscribing countries will have ratified its validity and that it will enter into force in early 1999.

The normal reaction to this type of decree is usually to question its sincerity or its applicability. That is, consider it as "another hypocritical manipulation aimed at calming the conscience of the developed world" or, simply, "another useless legaloid effort to alter the realities of the world."

When we read, in the comments that have been made on the aforementioned Convention, that the prohibited bribes do not include "small "facilitating" payments..., which in some countries are made to induce public officials to fulfill their functions", and it is argues that these "small payments" must be fought by each individual Nation, since criminalization by other countries does not seem like an effective action; It is logical that we feel a certain hopelessness.

However, as citizens interested in fighting corruption, I believe that we should not ignore this Convention. In fact, if we read it carefully, we can observe the existence of some elements that, well handled, could be very relevant. These are: accounting for bribery expenditure and its deductibility for tax purposes.

Regarding accounting, the Convention establishes that "extra-book accounting, ... the recording of non-existent expenses, the recording of liabilities without correct identification of their object, and the use of false documentation, ... for the purpose of of bribing foreign public officials or concealing such bribes.” The signatory countries, for their part, undertake to effectively establish civil, administrative and criminal penalties that, in a rational and proportional manner, help deter such activities.

From the above, we could deduce that, in a certain way, accountants and auditors are being constituted as guarantors of the fight against corruption. If this is so, and if the belief is true that public accountants, in general, are not distinguished by being risk-friendly, then and since, by failing to comply with the rules, they could be considered as accomplices to bribery, it is expect that this measure, well implemented, will have a significant effect.

The other aspect refers to the deductibility of the bribery expense. It is surprising that it is necessary to regulate the matter, but it turns out that in many countries, even among those that beat their chests and are considered examples of neatness, bribes paid to foreign public officials are deductible expenses from Income Tax. The OECD reports that in a European country, between 1988 and 1992, the Treasury received 109 applications requesting the deductibility of bribes.

It is also indicated that, sometimes, deductibility is subject to the payment of the bribe being recognized, as a common practice in the country of payment, that is, as a normal and necessary expense. Transparency International is the name of a foundation dedicated to the development of elements that can be useful to combat corruption and one of its products is the well-known Corruption Perception Index. The above makes us think about the horrible possibility that someone is using the aforementioned Index to justify the "normality" of their spending and thus achieve tax deductibility of the bribe.

The OECD convention includes an agreement to prohibit the tax deductibility of bribery. By implementing this, not only will the cost of bribery increase, but it will also establish a direct relationship between Tax Legislation and the payment of bribes. Both facts will discourage both the commission of the crime and its concealment.

In conclusion, I believe that, by declaring bribery of a public official as a crime and expanding the necessary network of accomplices, by including accountants and auditors and, in addition, implying that the factual assumption that constitutes a bribe could also have consequences. legal provisions of a fiscal nature, gives us hope that a certain possibility of dealing a strong blow to corruption is emerging. We hope it is.

Maybe I'm delusional. The truth is that before, many businessmen could come to a country and bribe its officials and if they were discovered, nothing would happen to the businessman in his country. Tomorrow, in 1999, he can go to jail. As a citizen I must, at the very least, thank the OECD for this gesture of respect.

Venezuela must provide all its support to this Agreement and I would say, to the point of considering it mandatory for those countries that wish to do business with the Venezuelan State. At a minimum, we should also sign the Convention, as Argentina, Brazil and Chile have already done, despite not being members of the OECD.

https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-0293