Logistics and Corruption

Logistics and Corruption - a constant danger. In the field of logistics too, there is the need for public awareness about corruption.


Whether it concerns an import license, a mandatory inspection of export goods, or customs clearance, the risk that foreign public officials might “request a token of appreciation” is ubiquitous. There are also several situations that can arise between companies or their representatives. When a lucrative supply contract is at stake, it could be tempting to win the race against a competitor by "motivating" the customer’s purchase manager.


How does one cope with such situations? The temptation to pay up may be great, precisely because of the time pressure prevailing in the transport sector, where rapid problem solving makes it inevitable. However, such behaviour entails significant risks which in serious cases could even lead to insolvency: penal prosecution within the country and abroad, sometimes with truly draconian penalties. In addition, there is the danger that claims from contracts which came into existence due to corruption payments would not be enforceable. Moreover there could be loss of orders, damage to reputation, revocation of commercial licenses and much more.


Fines running into millions of dollars imposed on some freight forwarding companies recently, and cases presently being adjudicated show that the risks mentioned above do not merely exist on paper.


A frequent complaint is that setting up a compliance programme is expensive, and for small businesses can even be unaffordable. This is not necessarily correct. There are already numerous assistance centres, for example Chambers of Commerce, associations (such as Economiesuisse – The Swiss Business Federation, ICC Switzerland) and state agencies (SECO, S-GE). With the publication of the ICC Rules on Combating Corruption, the International Chamber of Commerce offers a full suite of tools, which enables the creation of a highly effective Compliance Programme. Part III of the rules specifies detailed recommendations for the content of the programme, while Part II contains recommendations on actions to be taken by the company for its business operations. Part I consists of rules that could be appropriately integrated into contracts, either by means of unabridged inclusion in the text of the contract or by references being made to the ICC Rules. With the ICC Anti-corruption clause, the ICC offers a concrete draft proposal for the specific formulation of the contract. All the texts are accessible free of charge via the ICC homepage: www.iccwbo.org .


Additionally, a mention should be made of a research project of the University of Applied Sciences, Chur, in the context of which the guide "Fight Corruption Risks Successfully" has been developed. It is available in German, French and Italian and is downloadable free of charge via the following link: http://www.htwchur.ch/index.php?id=489. The guide correctly emphasizes the fact that the best compliance strategy means nothing if it remains just a dusty piece of paper: it must be actively experienced in everyday operations!


#supplychainlaw #corruption #riskmanagement #icc

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