This year, overseas bribery of Japanese companies was discovered one after the other but the punishment of Japan and the United States had contrasting results.
In May, Panasonic Avionics-a US subsidiary of Panasonic and the world’s largest entertainment system for in-flight entertainment system, received investigations by the US Securities and Exchange Commission and the US Department of Justice as bribing a staff member of a state-owned airline company in the Middle East. It was settled by paying a penalty of about 30.5 billion yen or about 280 million dollars. In July, Mitsubishi Hitachi Power Systems Co., Ltd. – a major generator manufacturer cooperated in the investigation of the prosecution saying that Mitsubishi Hitachi Power Systems Co., Ltd. paid bribes equivalent to 39 million yen to Thai public officials resulting in Japan’s first judicial deal.
In developed countries there is an international treaty “Let’s stop each other in giving bribes to foreign civil servants in international commerce in order to gain unfair profit on business.” It is called OECD foreign bureaucracy anti-bribery convention. It was adopted by OECD (Economic Cooperation Development Organization) in 1997. This treaty is open to non-OECD member countries, which are clubs of developed countries and emerging powers such as Russia and Brazil are also concluded. Of course, Japan has also been concluded, amending the Unfair Competition Prevention Law in 1998 and incorporating the provisions of its purpose.
In Japan, there was only one case where punishment has been made, but there are some cases other than Panasonic at the beginning where Japanese companies are punished abroad and paid a large fine.
In Japan, in 2015, JR-based railway consultancy company, Nippon Traffic Engineering gave bribes to government officials in Vietnam, Indonesia and Uzbekistan for Official Development Assistance (ODA) projects, and the Tokyo District Court imposed a fine of 90 million yen.
Among the conclusion of the US in 2014, Marubeni did bribes in Indonesia. In 2015, Hitachi did bribes in South Africa and in 2016, Olympus did bribes in Latin America.
When a Japanese company or person goes abroad for bribery of foreign public officials, the local law is applied in addition to Japanese law. In addition, if companies are based in the US or the UK, the British and American law also applies. However, the principle of prohibition against double jeopardy is respected and it will not be judged in duplicate in other countries if tried in Japan. Therefore, in the case of Marubeni, Hitachi and Olympus had been tried first in Japan. There would have been no penalty in the US. Less Japanese law enforcement seems to pamper Japanese companies, instead of facing massive damages.