33 ASIAN LEGAL BUSINESS – JUNE 2023 WWW.LEGALBUSINESSONLINE.COM ANTI-CORRUPTION offences and provides for severe penalties, including imprisonment and fines. The law also establishes a corruption investigation and prosecution agency and empowers it to investigate and prosecute corruption cases. Vietnam has been cracking down on corruption in recent years, and its legal framework is designed to prevent and punish corruption at all levels. The Penal Code imposes severe penalties for corruption, including imprisonment of up to 20 years or even life imprisonment in some cases. Malaysia has also tried to combat corruption with the Malaysian Anti-corruption Commission (Amendment) Act 2018. This law strengthens the powers of the Malaysian Anti-corruption Commission, including the ability to investigate and prosecute corruption cases. It also introduces new offences, such as giving and receiving bribes in the private sector, and imposes stricter penalties for corruption offences. Indonesia has taken a multi-faceted approach to addressing corruption. The Supreme Court Regulation outlines the procedures for handling corporate crime cases. The Indonesian Anti-Bribery Law and Anti-corruption Law also criminalise various forms of corruption and set out punishments for offenders, including imprisonment and fines. Thailand has also implemented anti-corruption measures, including the Penal Code, which criminalises various forms of corruption. The Philippines has had a longstanding problem with corruption, and the Penal Code and Republic Act No. 3019 (The Anti-Graft and Corrupt Practices Act) are designed to combat it. The Anti-Graft and Corrupt Practices Act criminalises various forms of corruption, including bribery, and provides for severe penalties, including imprisonment and fines. The law also empowers the Ombudsman to investigate and prosecute corruption cases involving public officials. Jeremy Tan, managing director, risk and investigations at FTI Consulting, says that in a recent OECD Foreign Bribery Report, companies that reported cases of foreign bribery highlighted that the two primary sources of detection were internal audits and due diligence in the context of mergers and acquisitions. “The Foreign Bribery Report also suggests the need for clear reporting mechanisms that enable the company to elicit early information of suspected bribery,” he notes. “In addition to the above, companies should also consider the U.S. Foreign Corrupt Practices Act 1977 (FCPA) and UK Bribery Act 2010 due to the extraterritorial scope of these acts. A robust anti-bribery compliance policy and procedures will assist companies in meeting compliance requirements. However, consideration must be given towards tailoring these procedures to meet the requirements for both specific countries and extraterritorial jurisdictions. An assessment of robust antibribery compliance procedures will be covered below,” says Tan. Levison notes that it is still difficult to name any country that does not prohibit bribery of public officials, and most companies with cross-border business will likely need to comply with the FCPA or UK Bribery Act at some point. “That is because, even if not subject to the broad jurisdiction of the FCPA or UKBA, most companies with cross-border business operations will be expected to comply with those laws by some portion of their customers and other partners. While there is no one-size-fits-all compliance approach to the region and regulator expectations are not static, companies that adopt best practices that have developed over recent years to comply with these expectations will be best prepared to minimise anti-corruption risk no matter where in the region they do business,” he says. CHALLENGES AHEAD The region faces several challenges and risks associated with anti-bribery compliance, and experts say there are some distinctive risk factors in Southeast Asia. The first is the scope and flavour of the state sector, says Bush. “Doing business with the government or stateowned companies entails heightened anti-bribery risks. Official corruption generally carries higher penalties that commercial bribery or civil fraud, and government personnel are often subject to strict standards of conduct for the acceptance of gifts and hospitality by government personnel into play. These local laws and standards vary across Southeast Asia, particularly in the coverage of indirect benefits channelled through friends and relatives, the allowance for minimal or customary gifts and courtesies, and the universe of potentially prohibited tangible and intangible benefits,” he says. One of the main challenges companies face in Southeast Asia is the prevalence of bribery and corruption in the region. This can make it challenging to find trustworthy business partners and agents, and there is a risk that employees may engage in corrupt practices, knowingly or unknowingly. “Companies may not provide sufficient attention to the documentation of internal procedures, controls, risk assessments, communications and training. This leads to inefficient compliance assessments performed by regulatory bodies or internal audit functions. This is connected to another challenge companies may face, that of resource allocation. The creation and maintenance of an Anti-Bribery and Compliance (ABAC) framework will require both manpower and hours to be allocated, especially if the company is operating across multiple geographical locations. Furthermore, the growing complexity of company departments and their operations creates obstacles for the ABAC function to ensure compliance,” says Tan. Another major challenge associated with anti-bribery compliance in the region has to do with culture – both in terms of perception of bribery and corruption risks and the likelihood that employees will raise concerns about actual or potential misconduct. “Cultural perceptions towards bribery and corruption are extremely varied across the region. In some countries, despite being illegal, bribery and corruption are viewed as a cost of doing business, and employees and business partners may not be as attuned to corruption risks. Companies operating in such an environment should keep in