Private remedies for corruption - tackling corrupt contracts

Private remedies for corruption - tackling corrupt contracts 12 March 2013

Bribery is a means to an end and not an end in itself. The bribe and the transaction that results from it are inextricably linked in their genesis. A failing of the criminal law approach is that it insufficiently addresses the transactions that result from acts of bribery.

Two important transactions are tainted by corruption.

The first is the agreement to give and receive a bribe that occurs between the bribe-giver and the bribe-taker. We can refer to this as the primary contract. However, the whole point of the primary contract is to bring another contract into existence. For example, a contract to build a telecommunications network, to supply arms, to exploit natural resources, to build infrastructure may have as its genesis an act of collusion between a bribe-giver and a bribe-taker.

We can call such contracts, secondary contracts to emphasize their relationship to the originating act of bribery.

The primary and secondary contracts that emerge from acts of bribery must be treated in a manner consistent with the goals of criminalization. Only at this point can we speak of effective deterrence. For as long as consequential contracts remain outside the remit of criminal law punishment the incentive to engage in acts of corruption remains unchecked.

This is an extract from a blog by Abiola Makinwa - read more