The World Bank OCTOBER J 0 C T~~~~~~~~~~~~~~~~~~~~~~~~ 0 B E .t v ~~~~~~~~~~~~~2001 I notes NNUMBER 58 PUBLIC SECTOR Writdng an effective anticorruption law "Justice howls when she is dragged about by bribe-devouring men whose verdicts are crooked when they sit in judgment." -Hesiod, Works and Days, circa 8oo BCE When Hesiod discovered that a corrupt Tailoring the law to judge had deprived him of his patrimony, enforcement capacity Anticorruption laws his only recourse was to memorialize his Anticorruption and ethics laws generally loss in verse. But as growing numbers of encompassavarietyofstatutesthatprohibit are a good start- citizens in developing countries have suf- bribery, nepotism, conflicts of interest, and fered at the hands of corrupt officials, favoritism in the award of contracts or the but they should they have started to demand government provision of government benefits. Such laws action. often also require public servants to disclose be tailored to An obvious first step is ensuring that laws their incomes and assets. When drafting such are in place to deter corruption. Deter- acts, the instinct is to list every activity that enforcement rence is not the first, or necessarily the pre- could conceivably be considered corrupt and ferred, method of defense. An informed then write language making each illegal. But capacity and and vigilant citizenry, government employ- people are endlessly creative in finding ways ees imbued with a service ethic, and other to enrich themselves or their friends and fam- bolstered by other measures can be more effective in com- ily at the public's expense. As drafters real- bating corruption. But achieving those ize this, the rules they write become more legal reforms objectives takes time, while enacting an general. The result is often a broadly drawn anticorruption law is a relatively speedy, provision setting out a general standard- inexpensive way to start addressing the such as the provision found in the laws of sev- problem. eral nations making the "abuse of public As a result laws that punish bribery and office for private gain" a crime. other forms of corruption have proliferated Such sweeping language does address throughout the developing world (Ofosu- bribery, nepotism, and conflicts of interest. Amaah, Soopramanien, and Uprety 1999). But bureaucratic and political rivals can Yet while these new statutes represent a also invoke it to question perfectly inno- strong commitment to eradicating corrup- cent actions. If the person responsible for tion, they often do not reflect the limita- investigating an allegation is tainted by per- tions of the institutions that enforce sonal animosity, open to political pressure, them-whether the police and public pros- or fearful of criticism for being weak on ecution service or a noncriminal adminis- corruption, false charges can trigger ajudi- trative agency. Many recent anticorruption cial or administrative proceeding. If the initiatives have also overlooked comple- court or administrative agency is not impar- mentary legal reforms that can prevent or tial or is incompetent, cases driven by expose corrupt acts. extralegal considerations may not be FROM THE DEVELOPMENT ECONOMICS VICE PRESIDENCY AND POVERTY REDUCTION AND ECONOMIC MANAGEMENT NETWORK weeded out. Even if charges are eventually dous leeway in enforcing the law. Suppose dismissed, a prolonged investigation can instead that the law were to prohibit the hir- be a severe punishment. ing of any friend or relative-with no excep- Accordingly, those who draft anticorrup- tions or qualifications. Were this kind of tion legislation should ask several questions: bright-line rule the law, enforcers would What is the capacity of the institutions that have no discretion. will enforce the law? Are the police, prose- Such a rule would make it easier to mon- cutors, courts, and other enforcement agen- itor compliance and enforcement. If hiring cies staffed by honest, technically competent a relative were against the law, and an offi- professionals? Are they independent of the cial's nephew suddenly appeared on the executive in theory? In practice? To whom, payroll, the ethical breach would be obvi- and in what ways, are they accountable? ous. On the other hand, if the law contained Countries with The answers to these questions will often an exception for "qualified" individuals, not be reassuring. In many countries endless arguments about the nephew's qual- weak enforcement enforcement institutions lack skilled pro- ifications could ensue, muddying the ques- inssshould fessionals. Moreover, the employees of such tion. With bright-line rules, citizens, the Institutions should institutions are often easily manipulated for media, and watchdog groups can readily political purposes. Indeed, World Bank sur- determine whether government is serious co nsi d e r i n clud in g veys have found that the poor rate the police about enforcing anticorruption laws. and other enforcement agencies as some of Bright-line rules are not costless. First, they bright-line rules in the most corrupt and least trusted govern- rob the law of flexibility. In the case of an ment agencies. Reformers may believe that antinepotism law, the government may lose their anti corruption anticorruption work cannot proceed until the best person for thejob if that person hap- enforcement agencies are strengthened. pens to be related to someone already work- laws But while capacity building is essential for ing in the relevant department. Second, the long-term sustainability of an anticor- bright-line rules often must be simplified ruption program, it takes time. to the point of arbitrariness-making them In the meantime those writing anticor- harder to accept than broadly worded stan- ruption statutes must take into account the dards, which often conform to intuitive social weaknesses of the agencies that will enforce understandings. But in countries with weak the law they draft. In most cases that means legal traditions, courts may be unable to writing a law that is easy to understand, sim- enforce standards effectively (Hay and ple to apply, and demands little or nojudg- Shleifer 1998). In addition, the costs of ment in determining its applicability. Laws bright-line rules are often more than offset written this way are said to contain "bright-line by their deterrence value and their value in rules" and are contrasted with those contain- facilitating monitoring in countries with weak ing standards that are open to interpretation enforcement agencies (Posner 1998). by enforcement agencies (Kaplow 1992). Countries with weak enforcement insti- Bright-line rutes tutions should consider including the Bright-line rules following bright-line rules in their anti- How do bright-line rules eliminate corruption laws: enforcers' discretion? A recent proposal * No government employee may receive from Argentina provides an example. any gift, payment, or anything of value There, nepotism and favoritism in govern- in excess of a small sum from anyone who ment hiring are perceived as serious prob- is not a member of that person's imme- lems. Draft legislation would have diate family. prohibited goverment employees from hir- * No employee may hold, directly or indi- ing a friend or relative unless he or she was rectly (that is, through family or other "qualified" for the position. But if prose- agents), an interest in a corporation or cutors and courts were left to determine other entity affected by that employee's who was qualified, they would have tremen- decisions. PREMNOTE 58 OCTOBER 2001 * Every year all employees above a certain A freedom of information law is one exam- pay level must publicly disclose all assets ple. Such laws require government to dis- they hold directly or indirectly. close information about its activities at the * No employee may hire a relative (with a request of any citizen and can be used by precise specification on how distant a watchdog groups to monitor government relation must be before he or she is not behavior (Blanton 2001). Similarly, in recent a "relative"). years several countries have adopted whistle- * All employees must disclose any relation- blower protection laws, which encourage ship with people hired and with firms or government employees to reveal-without entities to whom they award a contact or fear of retaliation-corrupt acts uncovered concession. (Since in many countries the in the course of their work (Hall and Davies pool of talented workers and qualified 1999; Pack 2001). firms is small, this rule leaves decisions Libellawreformcanalsobeanimportant Statutes outlawing about "corruption" to public opinion.) part of anticorruption legislation. Some coun- tries' laws make it a crime to publish anything bribery, nepotism, Com p lementary measures that brings the government into disrepute or No statute can avoid some open-textured pro- insults a government official. Under such laws and other corrupt visions. When a section in an anticorruption ajournalist who accuses an officeholder of law must leave something open to question, accepting bribes or otherwise acting corruptly acts should be one way to reduce enforcers' discretion is can be fined andjailed regardless of whether to establish a procedure for obtaining advance the allegation is true or false. complemented by rulings. Employees concerned about doubt- To ensure that fear of prosecution does ful cases can then ask representatives of the not deter the press from exposing corrup- laws that help bring enforcement unit, perhaps located within tion, many industrial nations make it diffi- their agency, for an advance ruling on the cult for government officials to obtain corruption to light legalityofaproposed action. If, based on the redress if they are libeled by the press facts disclosed, the enforcement authority (World Bank 2001; Schwartz 1996). Differ- concludes that the action proposed would ent nations will strike different balances not constitute a violation, the employee would between protecting the reputation of gov- be free from later prosecution. To prevent ernment and its employees and allowing the process from unduly slowing government journalists to write about corrupt behavior. action, agency representatives can be required But reformers concerned about suppress- to rule on the request within a set period. If ing corruption will want to review whether they do not, thle law can provide that the the balance their nation strikes reflects the action in question is legal. public interest in combating corruption. At first the agency may be deluged with Finally, national legislation alone is not a petitions for assistance. Gradually, however, panacea-international cooperation is also its accumulated opinions will develop into a required. In cases involving large sums of body of law to guide both the courts and those money, recouping stolen funds is often prob- subject to ethics guidelines. An advance rul- lematic because corrupt officials can stash ing procedure can also turn what could be assets abroad. Treaties should be considered an adversarial relationship into a cooperative thatwould permit the requesting country to one as civil servants work with ethics offi- overcome bank secrecy laws and other obsta- cers to structure transactions in ways consis- cles to recovery. Transparency International's tentwith the law. In addition, if a questionable Source Book (2000) lists dozens of other sys- action is later discovered thatwas not blessed temic reforms needed to root out corrup- with an advance ruling, it is one sign that an tion. And as study in the field grows, the intent to evade the law was present. number of needed reforms only increases. Statutes outlawing bribery, nepotism, and Over the past 10 years a number of fac- other corrupt acts should be complemented tors have combined to place corruption by laws that help bring corruption to light. firmly on the global agenda. Under pres- PREMNOTE 58 OCTOBER 2001 sure from civil society and fueled by a grow- Ofosu-Amaah, W. Paatii, Raj Soopramanien, ing body of literature detailing the delete- and Kishor Uprety. 1999. Combating Cor- rious effects of corruption on development, ruption: A Comparative Review of Selected policymakers have come to realize the truth Legal Aspects of State Practice and Major of Hesiod's ancient observation: International Initiatives. Washington, D.C.: World Bank. obey justice and restrain reckless Pack, Robert. 2001. "Whistleblowers and the wrongdoing, for such wrongdoing Law." The Washington Lawyer 15 (10): harms the poor, and even the noble find 20-30. it an unwelcome burden that weighs Posner, Richard A. 1998. "On Creating a them down and brings them ruin. Legal Framework for Economic Devel- opment." The World Bank Research Observer Ridding government Ridding government of corruption may 13 (1): 1-12. require deep, systemic reform. But the legal Schwartz, Herman. 1996. "Defamation and of corruption may reforms detailed above offer a straightfor- Democracy." The Parker SchoolJournal of ward, inexpensive way to take the first step East European Law 3 (2): 217-26. require deep, toward reducing the endemic corruption Transparency International. 2000. that plagues so many countries. "Confronting Corruption: The Ele- systemic reform- ments of a National Integrity System." Further reading Transparency International Source Book. but even small Blanton, Thomas. 2001. "Freedom of Infor- [www.transparency.org/sourcebook/ mation Laws: Emerging Trends and Lessons index.html] steps can help Learned." National Security Archive, World Bank. 2001. "Media." Chapter 10 in George Washington University, Washing- World Development Report 2002: Building ton, D.C. [wwwl .worldbank.org/public Institutionsfor Markets. New York: Oxford sector/legal/reforminglaws.htm] University Press. Hall, David, and Steve Davies. 1999. "Cor- ruption and Whistle-Blowing-A Back- This note was written by Richard E. Messick ground Note for TUAC." Public Services (Senior Public Sector Specialist, Public Sector, International Research Unit, London. PREM Network) and Rachel Kleinfeld (Con- [www.psiru.org/reportsindex.htm] sultant, Public Sector, PREM Network). Hay,Jonathan R., and Andrei Shleifer. 1998. Ifyou are interested in similar topics, consider "Private Enforcement of Public Laws: A joining the Legal Institutions Thematic Group Theory of Legal Reform." American Eco- (contact Richard Messick, x87942) or the Anti- nomic Review 88 (2): 398-403. corruption Thematic Group (contact Helen Sutch, Kaplow, Louis. 1992. "Rules Versus Stan- x35438). For more information, click on The- dards: An Economic Analysis. " Duke Law matic Groups on PREMnet. Journal 42 (3): 557-629. This note series is intended to summarize good practice and key policy find- ings on PREM-related topics. The views expressed in these notes are those of the authors and do not necessarily reflect the views of the World Bank. 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