Content

Holger Moroff, Converging EU and US International Anti-Corruption Policies in:

Diana Schmidt-Pfister, Sebastian Wolf (Ed.)

International Anti-Corruption Regimes in Europe, page 69 - 84

Between Corruption, Integration, and Culture

1. Edition 2010, ISBN print: 978-3-8329-5846-6, ISBN online: 978-3-8452-2573-9, https://doi.org/10.5771/9783845225739-69

Series: Schriftenreihe des Arbeitskreises Europäische Integration e.V., vol. 70

Bibliographic information
69 Converging EU and US International Anti-Corruption Policies Holger Moroff Domestic anti-corruption laws and policies have been ubiquitous throughout most countries since centuries. International anti-corruption policies are a US invention and were initiated through the Foreign Corrupt Practices Act (FCPA) of 1977 which sanctions the conduct of US companies abroad.1 It is an example of an international policy through the extraterritorial effect of national law which is based on the citizen principle or registration principle for companies. The other three kinds of international anti-corruption policies are conditionality principles of aid providing donor countries or International Financial Institutions (IFIs, e.g. International Monetary Fund / IMF, World Bank, regional development banks), multilateral conventions to sanction corruption abroad and finally international policy advice programmes by governments, international organisations and nongovernmental organisations (NGOs). To understand these policies, their approaches and functioning, one needs to look at both their internal logic and the reasoning behind their justifications. To understand a convergence of anti-corruption policies among various actors, one needs to study how their reasons and justifications have changed over time and how various actors have come to accept a common or similar global anti-corruption norm. For the emergence of a multilateral anti-corruption regime the convergence of perceptions, norms and interests between the US and the European Union (EU) was pivotal. This paper focuses on the historical contexts of the discourses giving rise to US and EU anti-corruption policies in the 1970s and 1990s. Economic aspects of creating a level playing field for international companies in a global market place seem to have dominated the interest driven discourses during both decades. A normdriven discourse became relevant only in the 1990s with developmental and state building concerns at its heart. The skilfully negotiated combination of both discourses through the Organisation for Economic Co-operation and Development (OECD), United Nations (UN) and IFIs with the help of NGOs like Transparency International (TI) made it possible to multilateralise the FCPA under US leadership and firmly establish anti-corruption policies in IFIs and international organisations (IOs) as well as mainstream it into all kinds of development, international investment and anti-crime policies. A facilitating factor has also been that legally binding ‘hard law’ regimes were limited to the technical, economic and legal aspects of clear cut 1 Great Britain had a Commonwealth anti-corruption provision dating back to 1915 and West Germany had 1958 anti-corruption law, sanctioning the bribery of NATO officials as well as some bilateral agreements pertaining to foreign customs officials at border crossings. None of them had the global reach of an international regime (Moroff 2005: 478). 70 quid pro quo corruption. That means corruption was narrowly defined as bribery with a strong focus on the low and mid-level of the executive branch of government that is the administration responsible for implementing laws, regulations and awarding contracts. 1. Definition Political corruption is the illegitimate nexus between money and politics. It is the illegitimate transformation of the economic medium of exchange and authority – money – or its material equivalents into the political medium of exchange and authority – power – understood as the ability to make collectively binding decisions.2 Present day discourse seems to suggest that this transformation is more illegitimate the more its purpose is to further the material enrichment of both parties involved – the economic and the political one – to the detriment of the public coffers. Corruption for moral, political and ideological purposes receives less unequivocal condemnation. To escape a morally wrong situation the concentration camp inmate’s bribing of a guard is likely seen as legitimate.3 Bribing governments in ‘third’ world countries to stay in or to switch to one of the two ideological camps during the East West conflict was not only standard operating procedure but deemed a legitimate Cold War tool of mutual containment.4 In a domestic context also corruption seems to be less abject if at least one party – usually the bribe giver – professes ideological and political rather than pecuniary motives. However, this is also the standard line of defence of politicians who have received money illicitly.5 Political corruption is the illegitimate nexus between money and politics. However, what is deemed illegitimate and what becomes codified as illegal is subject to change over time and can vary substantially from one political system to the next. Opinions on what is illegitimate can vary among groups even within the same society. This is why the perceptions and consequently definitions of corruption by policy 2 This definition of political corruption focuses on the interface between the private regarding economic sphere and the public regarding political sphere. Corruption within both spheres is similar to treason because the publicly stated allegiance or privately agreed contract with the principal – the electorate in the former and a company in the latter case – is broken. Corruption in the private sector is a matter of private and commercial not of public law. It concerns the relationship between owner (most often in the form of stock holders), management and employees. For a more in depth discussions of definitional aspects see Moroff (2005: 472) and Moroff (2002: 701-703). 3 Such an extreme example seems fairly clear cut; however, contriving rationalisations of being wronged in one way or doing well in another is a common human strategy for selfjustification. 4 The focus on ‘third’ world countries and since the end of the East West conflict also on the former ‘second’ world and transformation countries seems to suggest a continuity of international targets – first for corruption and now for anti-corruption by hegemonic powers. 5 Thus Helmut Kohl has stressed repeatedly that the illegal donations he received had benefited exclusively his party, the CDU, and were not used for self-enrichment. 71 relevant actors are of prime importance for the analysis of evolving and converging international anti-corruption norms and policies. What is deemed corrupt, what are perceived causes, consequences and moral implications? How these questions are answered by various actors is the key for understanding and reconstructing a new international policy field. 2. Theory and Method International anti-corruption norms and policy regimes are the historical product of an expert discourse among various relevant actors.6 Reconstructing their reasoning, intentions and perceptions is thus a precondition for understanding the policies that evolved and their functional logic. This is a constructivist approach, assuming that corruption and anti-corruption is what states, international organisations, companies and NGOs make of it.7 These are the actors who seem to have shaped the anticorruption discourse most forcefully. It is thus based on the Thomas theorem which states ‘if man defines a situation as real it is real in its consequences’ (Merton 1995: 401). Analysing actors’ thinking on a problem means analysing their definition of reality. These definitions then have consequences for their actions and thus act upon, change and shape reality - for instance by introducing an international anti-corruption regime. Heuristic methods for such an analysis are first the hermeneutic analysis of actors’ communications in their historical context, including all forms of statements and documents, focusing on their problem perceptions, self descriptions and proposed solutions. Second, to further understand their perceptions and intentions interviews with practitioners and negotiators are taken into consideration. Third, the functioning and internal logic of invented policy instruments themselves can be revealing of the actors’ reasoning as well. There are generally accepted and thus legitimate reasons which are sanctioned by rational discourses with some sort of scientific backing from an epistemic community.8 Of course, not all reasons for a policy enterprise are given in open and public communication and some given reasons might just be pretexts. Both kinds are difficult to identify with certainty. Secondly, the cognitive reasoning that drives actors’ behaviour is based on the expectations of their social groups, interlocutors and on the expected consequences for society – including international or global society – at large and not only on simple self-interest (Kohlberg 1981). Of course, all communication utilises language which itself constitutes a form of social reality, a grammar 6 As such any norm of deviation presupposes or generates an implicit knowledge of what the right norm and behaviour is. It is thus part of a normalisation process (Foucault 1979). Any ‘anti-discourse’ can also be read as delineating the borders of a norm from the outside. 7 To paraphrase and adapt Alexander Wendt’s (1992) dictum, ‘sovereignty is what states make of it’. 8 In Habermas’ terms this could be described as a deliberation process taking place within generally accepted rules of reason giving and rationality (Habermas 1992). 72 and grid of perception, as much as the culture in which the language is embedded provides a store of knowledge that helps define both problems and solutions (Berger/Luckmann 1972). Social interaction through language and reason giving are thus intertwined and form the basis for establishing any international regime. International regimes themselves as well as international communication involve and depend on predictable behaviour defined by widespread actor expectations. This is reflected in Krasner’s definition of a regime as being ‘composed of sets of explicit or implicit principles, norms, rules and decision-making procedures around which actor expectations converge in a given area on international relations’ (Krasner 1983: 186). For the purpose of this study, the definition is expanded by the requirement that regimes should also generate observable behavioural patterns by international actors (Rittberger 1993: 9-10). This reflects the insight that international regimes work and mediate between the domestic order and international anarchy through either hard or soft laws. That is through explicit codes embodied in formal rules and conventions and implicitly which is only evidenced in behaviour (Kratochwil 1989: 12). International markets, for example, are social institutions which highly depend on normative and implicit foundations (Kratochwil 1989: 37). This is quite instructive, given that the first and by now most developed international anti-corruption regimes have focused mainly on market functions. I proceed as follows. First, a brief comparative case study of two major international corruption scandals will serve to illustrate how the focus of attention has shifted since the 1970s. Second, the discourses on anti-corruption in the EU and the US will be compared in order to show how their partial convergence led to the establishment of the first multilateral anti-corruption regime – the 1999 OECD convention against bribery abroad. In a third step, the functional logic of various international anti-corruption instruments are analysed, pointing to and revealing the thinking on corruption that lies behind them. 3. Similar Cases in Different Times This succinct diachronic comparison of two large scale corruption cases aims at showing – in an exemplary way – how a channelling of the focus on the output side of corruption and the bribe payer has facilitated an international norm convergence and norm diffusion which were in turn a precondition for the multilateral internationalisation of anti-corruption regimes. Such legally binding ‘hard law’ conventions have been limited to the technical, economic and legal aspects of clear cut quid pro quo corruption – that is bribery – mainly at the low and mid-level of the executive branch of government responsible for implementing laws, regulations and awarding contracts. The first international anti-corruption policy was put in place by the USA in 1977. It was international through the extraterritorial reach of the Foreign Corrupt Practices Act as it punishes US companies (and those foreign ones listed at US stock exchanges) for corrupt actions undertaken in foreign countries. This was a response to 73 the discoveries of massive corruption by more than 600 US companies abroad in the wake of the Watergate investigations (Rosenthal 1989: 704). The case that received the greatest media attention was the Lockheed scandal. Lockheed had bribed numerous high ranking politicians in Japan, Italy, Belgium, Australia, and the Netherlands and in West Germany among other things also in order to sell its overpriced and faulty aircraft – the Starfighter. Many of the politicians involved had to step down like the Japanese Prime Minister Kakuei Tanaka.9 The media and judicial focus rested almost exclusively on the implicated politicians. Home grown scandalisations and judicial proceedings in the targeted countries ensued. This focus has changed considerably with the largest known case of bribery abroad in the first decade of the 21st century – the Siemens scandal (Graeff/Schröder/ Wolf 2009). Even though more than 1.8 billion Euro were paid in bribes to foreign officials most of the media coverage and legal action has focused not on the recipients of these bribes but on the company who doled them out. No case of high level political casualties concerning current office holders has been recorded yet.10 Whereas the Lockheed scandalisation focused almost exclusively on bribes paid to democratic governments of the advanced industrialised West, the Siemens scandalisation has focused on developing and transition countries.11 The reasoning, justification of prosecution and scandalisation has changed considerably from 1970s to 2009. Whereas Watergate sparked a deep domestic legitimacy crisis, Lockheed was mainly seen as having strong political implications for international relations and the reputation of the political, economic, military and moral leader of the Western world. These considerations play virtually no role in the scandalisation of the Siemens case. It is almost exclusively discussed under market, development and good governance aspects by pointing out that bribery distorts the level playing field of fair market competition, hindering the development of targeted societies through inefficient resource allocations, and fostering bad governance. None of these issues were ever of great concern during the Lockheed scandalisation. What has changed? Then the politicians and recipients of bribes were in the limelight, now the company that paid the politicians is scandalised and prosecuted in its home country Germany and by the US Department of Justice which can claim jurisdiction since Siemens lists its stocks also in the US.12 We thus see a transatlantic prosecution of Siemens for bribery it committed throughout the world but not inside Germany or the US. 9 He died just before the court could hand down a four year prison sentence. 10 The fact that the late Nigerian dictator Sani Abacha and the former Argentinean President Carlos Menem are implicated in the Siemens bribery scheme underlines that it does not affect current power holders and especially none in any country that could be considered a great or middle power in international relations. 11 Even though some of the ‘less developed’ EU members like Greece, Portugal and Bulgaria were also targeted. 12 Siemens cooperated extensively with the German authorities mainly in order to limit the heavy fines and penalties as well as potential criminal liability that were to be expected from the US side (Cohen et al. 2008: 1264). 74 Whereas Lockheed and many other foreign bribery scandals of the 1970s and 1980s were covered in the political section of the quality press, Siemens and most other corruption scandals since the mid-1990s are treated in the business section of the broad sheets. Are these signs that despite the heightened media, judicial and scientific interest in corruption, the phenomenon and its scandalisation has become depoliticised? Treating corruption as merely a technical problem of good governance and trying to counter it through national integrity systems and international conventions might seem a convenient fix for the political elite that is participating in the first and buttressing the second approach. Both have spawned an ‘awareness industry’ of NGOs and advocacy scholarship sponsored greatly by international financial institutions and the OECD. How can this possibly contribute to depoliticising the discourse on political corruption? This discourse is conducted and shaped by experts with the aim of teaching society (with modernising overtones of universal rationalism) what should be normal, good governance and by implication what is bad governance. Foucault (1979) termed this a normalisation process and the anti-corruption discourse resembles very much the physician’s admonition against smoking. In the same way that smoking is bad for our and our surroundings’ health and pollution bad for the environment so is corruption bad for the health of the body politique, the free market and the moral fabric of society. This is a technical discourse of mechanical consequentialism. In other words, it now belongs to the group of anti-policies that try to prevent bad things like anti-poverty, anti-drug, anti-crime, anti-terrorism, anti-trafficking, antiracism and anti-pollution policies.13 Besides insulating their protagonists from any open antagonists – since no one wants to play the advocatus diaboli on a morally clear cut issue – these anti-policies follow logic of their own and are far from being disinterested ‘pure’ policies with just ‘the common good’ in mind. They also – like any other policies – have and create interested parties with their own political forces of bureaucratic, NGO and business interests at work (Walters 2008). Despite all technical, legal and methodological sophistication no common answer as to what constitutes a legitimate nexus between money and politics has yet been found. Though international anti-corruption regimes pretend they have by focusing only on the illegitimate direct quid pro quo of bribery and thus almost exclusively on the output or implementing (executive/administrative) side of politics. 13 With a slightly different take one could also include anti-ideology policies such as antifascism, anti-communism, and anti-capitalism. Like the other anti-policies they have characteristics of a movement but seem to be more closely linked to governments’ self legitimisation strategy, e.g. anti-fascism and anti-capitalism in the former East bloc and anti-communism in the West with a strong international component. Anti-racism is, of course, also an antiideology policy but it lacks this central state legitimisation aspect and is first and foremost directed inwards, it is usually more of a domestic than an international policy. 75 4. US – EU Converging Norms for Different Reasons The focus on the topic of output corruption – that is on payments for bending the implementation of rules, laws and guidelines – means that issues concerning payments for influencing the rule, law and guideline making – that is the input side of politics – are carefully avoided by international anti-corruption regimes and for the most part also by anti-corruption NGOs and the media. That has meant ignoring all expenses for lobbying, including party and campaign finance, political action committees, revolving door practices, influence peddling, parachuting business experts into ministries and everything that became known as cultivating the political landscape14. The input side is not really addressed because it cannot be regulated by technical, hard and fast rules that lend itself to normalisation. And this is because there is no unified theory of democracy that could tell the experts what the common good is and how it is generated. Is it the sum of all forces of self-interested individuals and collectivities in society on whose behalf politicians act like lawyers and delegates; and if so, how could this sum of forces be objectively measured?15 Or are politician’s fiduciaries who – with the help of experts and the epistemic community – understand what is best for all and thus act as trustees of the common good?16 Since the vast subject of how to regulate corruption on the input side of politics is quite controversial within and among Western democracies, a common norm could not and likely never will emerge. This norm should clearly state where legitimate lobbying stops and corruption starts. Historically, the anti-corruption discourse in Western Europe has indeed mostly focused on the technical and narrow output side of politics, on the bribery of judges, civil servants and the public administration (Moroff 2004: 89). Also in communist Eastern Europe, corruption was never thought of as systemic but rather as deviant behaviour of single individuals inside the bureaucracy. Low- to mid-level apparatchiks were targets of anti-corruption crack downs with the occasional high level leader for whose disposition a good pretext was needed. Thus it seems that focusing on the technical output side of corruption within the new international anti-cor- 14 ‘Kultivierung der politischen Landschaft’ (cultivating the political landscape) was the description used by Eberhardt von Brauchitsch who sponsored all parties in the German parliament on behalf of the Flick concern (von Brauchitsch 2001). 15 The pluralists would argue that the common good is the resultant of all interest vectors in society (Fraenkel 1960). Then the only ‘social responsibility’ of individuals, companies and political parties is to seek their self interest of maximising profits or votes (Friedman 1970). The ‘common good’ then is the equilibrium of all those forces, one of which is economic power expressed through the medium of money. 16 One particularly well developed theory of generating the volonté générale versus volonté de tous can be seen in Habermas’ concept of deliberative democracy. This process involves all concerned with and affected by a political decision, presupposing some common norms and a common standard of rationality a consensus can be reached on the basis of the ‘better arguments’ (Habermas 1992). 76 ruption regimes would take up historically rooted norms, perceptions and approaches of European countries. One can trace these perceptions not only to European absolutism but to its etatism at large, which was mainly a response to bloody religious and ethnic wars, to popular upheavals, revolutions and also to nationalism especially after World War II. All have contributed to an etatist society-state relationship in which the government and the state sustaining elites usually mistrust ‘the people’. The raison d’état claims a higher cause (the stability of a country and foreign threats) which then might also justify lower means such as corruption abroad or at home. This contrasts sharply with the domestic US discourse on corruption and anticorruption. The general mistrust of (big) government17 is a pervasive and deeply rooted phenomenon of American political culture, which can be traced back to its constitutional debates that focused to a large extent on questions of how to avoid input corruption and the abuse of power. Many of the Federalist Papers are dedicated to the question of how to protect ‘the people’ from an arbitrary government and not how to protect the government from an erratic and arbitrary people. Hence awareness of political corruption is also historically focused on the input side and might explain the long standing debates on lobbying, party and campaign finance and the very detailed system of rules and regulations as well as the extensive public monitoring of lobbying activities.18 Such an attitude spills also over into the political campaigns where virtually all candidates who run for public office run an anti-Washington campaign, claiming to root out insider ways of influence peddling, pork barrelling and log rolling. Analogous anti-Paris, anti-London or anti-Berlin campaigns seem rather unthinkable and somewhat ridiculous for France, Britain or Germany. However, in the USA’s efforts to multilateralise the FCPA, issues of input side corruption and lobbying that are so hotly debated inside the US19 were carefully avoided. This further underlines that only around a narrow, business oriented approach a consensus could be build. It might also hint at the strong lobbying of American business to be put on equal footing with their foreign competitors. Nevertheless, the discourse on international anti-corruption regimes in the US and the EU converged during the 1990s even though each side had different reasons to arrive at such a common norm. Since the discourse on international anti-corruption started a decade earlier in the US than in Europe and the US was the main governmental driving force behind the push for internationalisation more space has to be given to the US side in a comparative analyses. 17 Even though it is much smaller than in most EU member states measured by the public share of BIP. 18 This does not mean that there is necessarily less input side corruption in the US maybe even on the contrary. It just sketches the different focus of domestic corruption discourses. 19 Senator McCain’s bid for the presidential nomination in 2000 was lost by a slight margin to George W. Bush with one of McCain’s main themes being campaign finance reform, lobbying and corruption as symbolized in the McCain-Feingold bill (Moroff 2002). 77 4.1 The US Side In the 1970s both the economic crises in the wake of the Vietnam war, the end of the Breton Woods system and the oil price shocks as well as the numerous corruption cases at home and abroad weakened the US political and economic leadership of the West. The Lockheed scandal damaged the US image significantly as it was a case of grand systematic corruption on the highest political levels in allied countries. To restore its reputation, the US came up with a symbolically strong international anticorruption measure – the FCPA. It was adopted unanimously by Congress and was neither conceived of as a complementary development policy which would indirectly strengthen good governance and the rule of law abroad nor was it seen as a measure to foster fair market competition as military contracts were rarely put out to open and transparent tender. The FCPA’s rationale was indeed one of avoiding market distortions and misleading information about a companies’ competitiveness for potential investors i.e. stock holders. This is also the reason why the Security and Exchange Commission (SEC) was charged with overseeing the FCPA and given investigatory power as well as the right to levy substantial fines on violators. In 1988, the provisions were weakened somewhat (Sheffet 1995) and during the first two decades of its existence there were only a handful of successful prosecutions with minor financial fines (Cohen 2008: 1248-1253, Windsor/Getz 1999: 432). Everything changed with the end of the Cold War and its anticipated consequences in the early 1990s. Usually it is pointed out that meddling in internal political affairs was off limits for international institutions like the UN but also IFIs such as the World Bank and the IMF. Only since the mid-1990s could they discuss issues of corruption or good governance and introduce new forms of conditionality and sanctions in the late 1990s (Marquette 2004). They were conceived of as supporting development and transition countries in setting up functioning market economies and democracies as well as preventing failed states from turning into hotbeds of organised international crime. The World Bank’s definition of ‘state capture’ as the highest level of pervasive corruption coincides with many features of failed states. However, this discourse was predated by another often neglected discourse in the US. Three factors played a prominent role here. First, the importance of private direct foreign investments grew rapidly worldwide and in 1993 for the first time they were greater than the combined governmental development aid in third world and transformation countries (Elliott 1997: 204).20 Second, the new transformation countries in Eastern Europe, China and various countries on the threshold of industrialisation were viewed as the ‘big emerging markets’ (US Department of Commerce 1995). Third, the greatest need and opportunity for foreign investments was expected in the infrastructure sectors of these countries. They were called the ‘big emerging sectors’. Those were highly regulated and contracts were usually awarded by the governments or its agencies. Many of these countries were also viewed as corruption-prone, and 20 Since development aid was also part of the bloc competition during the Cold War which explains its relative decline afterwards. 78 US business feared that they might lose out to their European and Japanese competitors for these contracts since they were legally prohibited from paying bribes abroad. However, whether it truly prevented them from doing so is difficult to ascertain. They thus lobbied the US administration to push for an internationalisation of the FCPA and the US trade secretary recommended that the government should work towards establishing a level playing field for all globally active companies. In 1995, he presented a report to the US Senate in which the CIA estimated that US companies lost contracts worth some 50 billion dollars to competitors from other industrialised countries because they had bribed decision makers in the ‘big emerging markets’ (Elliott 2001: 935). This report introduces another group of actors in the quest for establishing an international anti-corruption norm – the intelligence services. They could hope to employ their formidable ‘monitoring’ and maybe also their investigatory tools. Their tool box needed to find new problems to solve since the Soviet threat had disappeared.21 Robert Gates, then director of the CIA, stated that ‘the most senior policymakers of the government clearly see that many of the most important challenges and opportunities through and beyond the end of this decade are in the international economic arena’ (Gates in Kober 1992: 1). Although Gates said that the CIA would ‘not do commercial spying’, the agency could ‘be helpful on economic intelligence, by identifying foreign governments that are involved in unfair practices […] where they are colluding with businesses in their country to the disadvantage of the U.S.’ (Gates in Kober 1992: 2). During a meeting of the Senate Select Intelligence Committee in 1992 discussing the issue with top U S corporate executives and intelligence experts the former CIA director Stansfield Turner said: ‘If we spy for military security, why shouldn’t we spy for economic security?’ (Turner in Kober 1992: 1) But it was only later that decade that the long serving CIA director James Woolsey admitted freely that the US services have used the Echelon surveillance system to ‘spy on friends and allies’ because their companies had been involved in corrupt and unfair business practices abroad to the detriment of US companies (Woolsey 2000: 10). The first US attempt at internationalising the FCPA was undertaken within its own western hemisphere of influence. In 1996, the Organization of American States adopted the first international anti-corruption convention (Manfroni 1997). At the same time the topic was put onto the active agenda of the OECD by the Clinton administration. 21 This is in full accordance with the garbage can model (Seibel 1992: 135) in which solutions search for problems as well as with the model of bureaucratic politics in international relations (Allison/Zelikow 1999). 79 4.2 The EU Side The discourse of creating a level playing field was nothing new on the other side of the Atlantic but it focused first on the inside of the EU area and only later on the EU neighbourhood and the outside further afield. Since the Single European Act of 1985 creating and extending such a level playing field inside the EU was called the common market project. A free internal market for goods, businesses, capital and labour was to be completed during the 1990s with the introduction of a common monetary market for the Euro zone in 1999. Deepening the EU’s internal market brought with it more cross border investments and capital movement. Fear that cross border crime could also increase triggered three response patterns that became linked to the international fight against corruption. In 1991, the EU put in place its first laws against money laundering (EU Council Directive 1991) which is not only important in fighting organised crime but also the system of slush funds and black money used for corruption purposes. It is also no coincidence that the OECD Task Force on Money Laundering was the precursor to the OECD Financial Action Task Force that negotiated and now monitors its anti-bribery convention (Heidenheimer/Moroff 2002: 956 and Moroff 2005: 455). A further measure was to protect the financial interests of the EU, protecting it against fraught and corruption (EU Council Regulation 1995). Finally the cross border bribery inside the EU was made a criminal offence (EU Convention 1997). Such was the spectrum of the EU’s new internal anti-corruption discourse. On the outside, the EU’s assistance programmes for the Eastern transformation countries and especially the post-communist candidate countries also focused on internal anti-corruption and good governance efforts inside those countries (Frisch 1999). The anti-corruption and money laundering policies for the whole of Europe were mainly shaped by the Council of Europe through its 1996 action programme and its civil and criminal law convention of 1999. Of course, if the EU demands good governance in its neighbourhood and for its candidate countries this triggers an echo effect. The outsiders will ask whether the insiders comply with their own demands. If the EU and its member states didn’t want to be accused of hypocrisy and double standards, they also had to undertake credible anti-corruption measures. One can think of it as a special case of rhetorical action by rhetorical entrapment (Schimmelfennig 2001).22 Beyond that, many highly scandalised corruption cases in the wake of the privatisation processes in Eastern Europe but also the repercussions of the mani pulite scandal in Italy – that transformed a whole party landscape during the early 1990s (Dellaporta/Vannucci 1999) – and the threat thereof by the CDU party finance scandal in Germany at the end of decade did not only heighten the attention on corruption 22 Eva Heidbreder (2004) shows a rather weak echo effect for the political Copenhagen criteria for EU candidate countries. This is especially true for minority rights where some old members like France and Greece have never signed the relevant Council of Europe conventions but required all candidate countries to do so. 80 of Europeans and their media, but what is more – they also changed the formerly hesitant stances of European governments on international anti-corruption measures (Heidenheimer/Moroff 2002: 950). 4.3 Negotiated Norm Convergence The mid-1990s saw a new rapprochement between the EU and the US that resulted in the New Transatlantic Agenda (NTA) in 1995. Trade integration was deepest between these two blocs worldwide (Windsor/Getz 1999: 422) and much talk focused on working towards a Transatlantic Free Trade Area comprised of NAFTA and the EU. Among the 150 policy items of the NTA a special emphasis on fair business practices can be made out easily: ‘We will combat corruption and bribery by implementing the 1994 OECD Recommendations on Bribery in International Transactions’ (US-EU joint action plan Dec. 3 1995). The Transatlantic Business Dialogue issued a statement in 1998 in which it ‘stresses the urgent need for early ratification of the OECD Convention on Criminalizing Bribery of Foreign Officials’ (TABD 1998: 15). At the May 1998 US-EU summit, a Transatlantic Economic Partnership was established that aimed at both multilateral action through the WTO and bilateral action to reduce trade, investment and non-tariff market barriers (Windsor/Getz 1999: 417). This provides the backdrop of the spectrum of topics for joint transatlantic deliberations and it revolved much more around business questions than around those of development and economic assistance. EU-US cooperation to suppress business bribery of public officials mainly targeted the development countries and ‘big emerging markets’ outside the transatlantic community thus mainly aiming for establishing a level playing field among themselves and their companies. Both EU (and its member states’) as well as US thinking on the importance of anti-corruption policies for economic and political purposes changed and converged for different reasons during the 1990s. That is why US efforts in the OECD fell on fertile grounds on the other side of the Atlantic and suspicions that the US might want to gain a trade advantage by using its unrivalled intelligence power were no longer harboured openly. Even though, during the negotiation of the OECD convention some delegates of small countries stressed that large countries and especially those with lots of political and military clout like the US had other means to pressure foreign governments into awarding contracts to their companies (Heidenheimer/ Moroff 2002). 5. Instrumental Logics Only a legal ‘technicalisation’ and focus on output-side corruption could bring about some convergence towards a common hard and fast anti-corruption norm. The functional logic of various anti-corruption policy instruments is revealing of the actors’ reasonings and justifications. 81 One logic deserves closer attention because of its stage setting role since the 1970s and great financial impact today. That is the way in which the SEC administers the FCPA. Its official raison d’être is to protect the share holders and stock market investors. The reason for it lies in the historically much greater importance of the stock market for company capitalisations in US capitalism in comparison to a much stronger reliance on banks for this purpose in continental Europe. In the US, the importance of maximum transparency and high accounting standards is stressed so that stockholders and buyers can evaluate a company’s performance more accurately before making their investment decisions.23 This explains why the SEC could investigate an Italian company for bribing Italian officials. From the Italian company’s point of view, this is bribing domestic public office holders, but since their stock is listed in the US, its authorities consider it bribing of foreign officials. It distorted the books and had the company look more profitable without disclosing the higher risks of losing business and profits which were gained only by bribery. The correct assessment of the company’s performance and future prospects was thus distorted. All those legally binding conventions and changes in development aid policies during the 1990s are predicated on the newly found consensus between the US and the major powers of Western Europe, with Japan being a reluctant follower (Heidenheimer/Moroff 2002). However, none of the large emerging economies have signed on to or followed through on any of the hard law conventions against bribery abroad. Whereas the FCPA and the OECD convention can be viewed as mainly US inspired, the Council of Europe conventions and the EU’s legal acts mentioned in section 4.2 are more genuine European efforts, reflecting its concerns about the integrity of the EU budget, distortions in the common market and stable politico-economic systems the Eastern transformation countries. Especially the latter focus turned the Council of Europe convention into more far reaching documents that somewhat widen the narrow, bribery focused approach of the other instruments. The organisations, their instruments and targets demonstrate that an international consensus on what constitutes corruption could only be found by defining it very narrowly as the as bribery of public officials. Who is considered a public official still remains controversial (officials of political parties, candidates for elected public offices etc.) as well as everything that is connected to influencing the input side of governance, law and rule making, ‘legitimate’ lobbying, and party/campaign finance. 23 For that reason the 2002 Sarbanes-Oxley Act also focuses on higher accounting standards for companies after Enron and WorldCom were brought down by undetected fraught. This is another example of the ‘Americanisation’ of international commercial law since all major European and Japanese companies trading their stocks in the US have to comply with this Act as well as with the FCPA. 82 6. Conclusions It was the aim of this study to treat anti-corruption policy like any other public policy by reconstructing the various interests, reasonings and justifications that lay behind it and were created by it. This is not the most common approach for analysing ‘antipolicies’ – that is, policies against ‘bad’ things. They are mostly studied by evaluating their goal attainment through measuring the effectiveness of their policy instruments. Or the degree of harm is assessed by establishing correlations with other ‘bad’ things and the object of the anti-policy in question. Instead, I tried to take those studies into account as examples of how actors and scholars came to think about corruption and anti-corruption and thus identifying an expert discourse that focused mainly on corruption in international business transactions, on the output side of politics, using technical skills (legal, economic, political) in constructing a new mechanics of anti-corruption policies. The following hypotheses for the policy formation and transformation can be developed from the above discussion: First, a necessary precondition for establishing this international regime is broad consensus on norms between the US and the EU (including its most significant member states) which is supported by a dominant epistemic community (that agrees on the harmfulness/dysfunctionality of corruption) and disseminated by norm entrepreneurs who are not suspected of serving other interests (NGOs like TI). In a second step platform organisations of the international state system (IFIs, OECD, UN) have to take on board this new consensus and push for policy responses. Thirdly, a hegemonic national actor like the US can serve as a driving force and use the catalyst functions of international organisations as well as the blaming and shaming power of NGOs such as TI in order to bring other more reluctant states in line, thus bringing about a new regime. As soon as the new norms are supported and actively advocated by NGOs, IOs and several powerful countries a domino effect sets in which continually raises the pressure for those countries that want to stay out of this consensus and its policy regime.24 The goal convergence of establishing an international anti-corruption regime has been based on a convergence of perceptions and interests on both side of the Atlantic. Whereas the US pushed for an internationalisation of its FCPA because it expected large contracts in the ‘big emerging sectors’ of the ‘big emerging markets’ in the 1990s, the EU’s deepening common market and its Eastern enlargement fostered anti-corruption policies that straddled the borders of EU member states, candidate and neighbourhood countries. These converging perceptions and interests were then taken up and initially woven together by the OECD. A clear cut causal relationship that triggered the internationalisation cannot be established because three potential driving forces changed in parallel. First, values and 24 Finnemore/Sikking (1998: 895) refers to this process as a norm cascade, a concept developed by Cass Sunstein. Of course, important countries like India and China have not joined the binding regimes yet but they do not seem to object its underlying norms, as signified by their ratification of the UN convention 83 norms changed through a new focus of the epistemic community and NGOs on the harmful consequences of corruption. Second, international organisations changed in the wake of the end of the Cold War so that they could now address matters of good governance and countries’ internal affairs that were off limits before. Third, the international system changed from a bi-polar to a multi-polar one with a single hegemonic actor in which a new consensus on both political and economic models became dominant. 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Zusammenfassung

In dieser aktuellen und interdisziplinären Analyse der internationalen Antikorruptionsregime werden mit Schwerpunkt Europa ausgewählte staatenübergreifende Bemühungen der letzten Jahre zur Eindämmung der Korruption einer kritischen Bestandsaufnahme unterzogen. Die Beiträge stammen aus der Politikwissenschaft, Rechtswissenschaft, Soziologie, Wirtschaftswissenschaft und von PraktikerInnen.

Der Band vereinigt sowohl qualitative als auch quantitative Analysen und berücksichtigt darüber hinaus kulturwissenschaftliche Fragestellungen im Rahmen seiner vier Teile: „The European Dimension“, „Political and Legal Instruments“, „Culture, Perceptions, and Experiences” sowie „Practitioners’ Perspectives”.

Mit Beiträgen von: Tanja A. Börzel, Donald Bowser, Ben Elers, Angelos Giannakopoulos, Åse B. Grødeland, Leslie Holmes, Georg Huber-Grabenwarter, Anja P. Jakobi, Anne Lugon-Moulin, Bryane Michael, Holger Moroff, Yasemin Pamuk, Diana Schmidt-Pfister, Gefion Schuler, Andreas Stahn, Dirk Tänzler, Michael H. Wiehen und Sebastian Wolf.