[Congressional Record Volume 142, Number 63 (Wednesday, May 8, 1996)]
[Senate]
[Page S4833]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    INTERNATIONAL TRADE AND BRIBERY

  Mr. FEINGOLD. Mr. President, on another matter, international trade 
is a high priority in almost every country today. We are negotiating 
all sorts of agreements to bring down barriers and protect our workers 
and promote economic development worldwide.
  One issue, Mr. President, that I have tried to identify as a barrier 
for competition for American businesses is the issue of bribery. 
American businesses live in accordance with the Foreign Corrupt 
Practices Act. This was a bill offered by my predecessor from 
Wisconsin, Senator William Proxmire. Most businesspeople praise it as a 
way of maintaining honesty, and thus stability, in their business 
relationships. But, unfortunately, other countries--and one example is 
Germany--actually give their businesses the opportunity to write off a 
bribe in a foreign country as a tax deduction at the end of the year. 
So it is illegal for one German to bribe another German, but if they 
were to offer that bribe to somebody in another country, they can use 
it as a tax deduction. This produces some pretty unhappy faces when 
American businesspeople find this out.
  Some say that bribes are the cost of doing business overseas, 
particularly in some developing countries. I believe, however, it is a 
barrier to doing business in the long run, particularly overseas, since 
it can only retard economic growth in some of the developing countries.
  As a result, Mr. President, I have introduced legislation to try to 
get at this problem. In the State Department authorization bill for 
this year, I offered an amendment requiring an interagency study on 
bribery and corruption and the impact it causes on American businesses. 
I was disappointed that the majority dropped it in conference 
committee, but I am pleased that the Commerce Department is going ahead 
and pursuing a study of its own on this study anyway. I appreciate 
that.
  I have also raised the issue of international bribery consistently in 
the Senate Foreign Affairs Committee, not only as we examine how to 
promote U.S. products, but in my role as the ranking member of the 
Subcommittee on African Affairs, to try to raise the issue of bribery 
with the African heads of States and other officials when we have 
confirmation hearings for ambassadors headed to the region. I believe 
that the ambassadors should be intimately involved in this issue as we 
seek to promote American products overseas.
  I also want to praise Ambassador Kantor's very direct and public 
efforts on this issue and to say that I think his recent efforts have 
been critical in making headway on a universal acceptance of the 
principles that underlie the American Foreign Corrupt Practices Act. I 
am particularly encouraged that the administration seems to want the 
WTO to consider sanctions against bribers when Government contracts are 
under consideration.
  Mr. President, it is important that even though we have this tough 
law and our businesses have to abide by it, we are not alone in this 
campaign. There have been many significant accomplishments. The 
Organization of Economic Cooperation and Development, OECD, took a 
landmark step 2 years ago in recognizing that bribery is a 
destabilizing factor in international trade, and they recommended that 
the member states cooperate on revisions of their domestic laws about 
bribery.
  Several weeks ago, OECD tried to eliminate tax writeoffs on the laws 
of the member States of the kind that exist in Germany. Latin America 
has also taken this issue on. In March of this year, the Inter-America 
Convention Against Corruption, known as the Caracas Convention, 
identifies corruption as a main obstacle to democratic development in 
public trust in government institutions, and it also calls and provides 
for the prohibition on transnational bribery.

  Mr. President, perhaps some might see this document from the Inter-
America Convention as a utopian document that cannot be enforced, but 
what it does do is begin the process, in Latin America, as has been 
done in the rest of the world, to commit the parties--in theory, at 
least--to the notion that bribery is a destructive force in democratic 
development and international business.
  Given the developments with the OECD, the United States and Latin 
America, one would have thought it was a trend for the future, but we 
are really making progress. Unfortunately, however, at the end of 
April, the seven-member Association of Southeast Asian Nations spoke 
out for the first time on the issue of bribery and unfortunately 
opposed any attempt by the United States to stamp out corruption, 
saying they would not talk about it in the context of the World Trade 
Organization.
  Deputy United States Trade Representative Jeff Lang tried to raise 
the issue and was criticized by Malaysia and Indonesia officials for 
plotting against the developing nations. This reaction to the seven 
countries is a very counterproductive reaction. We focus on bribery to 
engage more in business, not to discriminate. I hope that Malaysia and 
Indonesia and others think of this as an area of cooperation, of mutual 
interest, rather than an area for polarizing, as has been done in this 
case.
  Mr. President, to conclude, if international markets are indeed to 
connect nations around the globe, somehow we have to be able to conduct 
business in a transparent and responsible manner. Bribery has to be 
discouraged, not rewarded, by all governments.
  I hope that the ASEAN countries will reconsider this issue and join 
governments from every continent in seeking to end the corruption that 
does exist in international markets.
  I yield the floor. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll. The assistant 
legislative clerk proceeded to call the roll.
  Mr. FAIRCLOTH. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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