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Slide 1 - 1 AMCHAM ANTI CORRUPTION COMMITEE Anand Dayal, Chairman New Delhi, 18 November 2009
Slide 2 - 2 MEETING AGENDA Introduction Of Committee Members Anti Corruption Landscape In India Committee Goals Short Term Long Term Plan Of Action Logistics For Conducting Meeting
Slide 3 - 3 ANTI CORRUPTION LANDSCAPE IN INDIA Nature and causes of corruption in India Areas of risk for US companies FCPA proceedings involving bribery in India Trends in India Anti-corruption laws Investigation agencies dealing with corruption Efforts to curb corruption Dealing with extortionist government officials
Slide 4 - 4 NATURE OF CORRUPTION IN INDIA Encountered by public in day to day dealings Reported demands: 50% (under $ 100) 84% (under $ 5000) General Mindset: bribe giver is victim Motivation: avoid harm or disadvantage, rather than for gaining an advantage
Slide 5 - 5 CAUSES OF CORRUPTION IN INDIA Administrative delays Excessive burden of regulatory functions on government Government officials vested with personal discretion Complex procedures in matters of importance to citizens As identified by Santhanam Committee
Slide 6 - 6 CAUSES contd… Political patronage. Corruption in the political leadership Administrative labyrinth. Cumbersome and dilatory administrative procedures Lack of punishment. Corruption cases handled in a casual and clumsy manner Social environment. Corruption accepted in the social psyche and behavior As identified by Scholarly Literature
Slide 7 - 7 AREAS OF RISK FOR U S COMPANIES Culture of acceptance of corruption Excessive discretion in exercise of governmental authority Pervasiveness of public sector in commerce Compliance challenges due to legal and regulatory ambiguity and inconsistencies Cash oriented economy
Slide 8 - 8 FCPA PROCEEDINGS IN INDIA Ten cases involving bribery in India 4 by DOJ Fraud Section 6 by the SEC Many involve conduct of an Indian subsidiary Highest monetary penalty, $ 10 million Disgorgement of profits and interest Imprisonment (5 yrs) sought in one case 8
Slide 9 - 9 TRENDS IN INDIA Transparency in government Increased public awareness of rights Emphasis on legal and regulatory compliance Movement away from business model relying on undue influence Increased use of technology in dealing with government (e-governance) Contract focus vs. relationship focus in business Implementation of global best practices 9
Slide 10 - 10 ANTI CORRUPTION LAWS Prevention of Corruption Act, 1988 Prohibits the taking of a bribe or other gratification by a “public servant” “public servant” expansively defined Central Vigilance Commission (CVC) charged with inquiring into and investigating offenses Prosecution requires prior government approval Imprisonment and monetary fines State Lokayukta Acts and Rules
Slide 11 - 11 INVESTIGATION AGENCIES Central Vigilance Commission (CVC) Central Vigilance Officer (CVO) at undertaking level Central Bureau of Investigation (CBI) Enforcement Directorate 11
Slide 12 - 12 INITIATIVES TO CURB CORRUPTION Right to Information Act, 2005 Government Whistleblower Resolution National e-Governance Plan, May 2006 Transparency Efforts in Public Procurement Integrity pact between government department and each bidder E-procurement, listed as initiatives under National e–Governance Plan CVC guidelines Preventive Vigilance in Public Procurement Defence Procurement Policy
Slide 13 - 13 DEALING WITH EXTORTIONIST DEMAND Positive Deviance Approach Have the courage to say NO and stand by it Written policy not to engage in bribery Strict compliance with legal and regulatory requirements Make representation to higher authorities Encourage and implement E-governance Reward ethical behavior within government
Slide 14 - 14 GOALS TO ACHIEVE Help US companies manage legal compliance challenges Create a level playing field vis-à-vis local (domestic) companies & other foreign MNC’s
Slide 15 - 15 THANK YOU Anand S. Dayal Koura & Co, Advocates
 

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