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Corruption Decreases in France Thanks to the Americans

A French aircraft manufacturer based in the United States once drew my attention to the fact that corruption is decreasing all over the world, including in France, thanks to the American justice system.

Some 50 years ago, the sale of a French aircraft in India would have implied the payment of obscure commissions and various bribes, costing Indian officials up to 20% more on the original price. This practice has since died out, much to the delight of the French company. But is it because Indian business leaders have suddenly become more virtuous?

In reality, the moral purification that has made for fairer competition is due to an international fear of American magistrates. The Foreign Corrupt Practices Act — a 1977 American law against corruption which inspired the recent Sapin 2 law in France — is applied with increasing severity. Corrupt business leaders now risk spending time in prison, or paying fines that can reach one third of their company’s turnover. For example, the French group Total shelled out 400 million dollars to the U.S. Department of Justice in 2013 for having paid under-the-table commissions to Iranian CEOs in exchange for oil mining rights.

But how can an American prosecutor charge a French businessperson for an act committed on Iranian soil? In fact, any transaction carried out from American territory — even a phone call — can bring you under the jurisdiction of U.S. law. Or as is most often the case, any transaction made in dollars can be punished by American prosecutors. This makes things particularly complicated, as how many transactions across the world are not made in dollars? The American norm has become a global one, and it’s all the better, as corruption is the leading cause of economic stagnation in poor countries, and of inequality in rich ones.

The only risk today is that Donald Trump, influenced by American oil barons in particular, takes a hatchet to the 1977 law and heralds corruption as a marketing tool. That being said, this law has since been integrated into a number of international conventions, and I doubt the Senate will touch it.

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