EXPLANATORY MEMORANDUM: PREVENTION OF CORRUPTION BILL, 2002
1.1 The Bill emanates from a decision of the Government to develop an overall anti-corruption strategy and the enactment of provisions dealing with a comprehensive Prevention of Corruption Bill rather than to amend the present Corruption Act of 1992 on a peace meal basis as suggested by the DA in a Private Members Bill. In this regard the provisions contained in the Bill follow the trend of modern international legislation, namely, the "unbundling" of corruption, in terms of which various specific corrupt actions and corrupt practices are defined and prohibited.
1.2 Since the enactment of the present Act, the Department of Justice, the National Director of Public Prosecutions and the Parliamentary Committees have received various proposals to amend the Corruption Act. I wish to refer you to the following commentary:
(a) The Director of Public Prosecutions: Cape of Good Hope
He recommends that the Act should also provide for the following offences:
A person acts in contravention of section 1 of the Act, but only receives the benefit or gift at a later stage.
Where a public officer misuses his position in a Public Office.
"Indirect corruption", i.e. the donor does not give the gift with any specific corrupt intent, but the public officer received a significant reward.
Nepotism should be criminalised as a specific form of corruption.
(b) The Director of Public Prosecutions: Eastern Cape
Adv L J Roberts believes that the present Corruption Act of 1992 is inadequate. Although he holds the view that the provisions the Private Member's Bill would cure most of the problems of the present legislation in so far as the public service is concerned, he suggests the route of reviving the common law and that the following aspects should also be addressed in order to cover all corrupt acts by public andprivate officials:
The crime of corruption should be widened to cover all agents, public or private.
The legislation should be applicable extra-territorial so that it covers any gifts given or received outside our borders.
(c) The Director of Public Prosecutions: Witwatersrand Local Division
He also recommends the reinstatement of the common law crime of bribery.
(d) Ms R Taljaard, MP, Private Member's Bill
In the above Bill Ms Taljaard proposes the amendment of the Corruption Act, 1992, so as to provide for the explicit criminalisation of misuse of public office(See pages 162 to 165 of the Combined Document).
(e) Prof M Rwelamira, Head of the Policy Unit, Department of Justice
He proposes the following:
The legislation proposed by Ms Taljaard, as well as certain broad policy issues need to be addressed in a comprehensive legislative attempt to combat corruption.
Accomplices and associates should also be included in the corrupt transactions.
The word "advantage" needs to be prescribed to accommodate a variety of forms of corruption. One option would be to substitute "gratification" for "advantage" and to define "gratification".
It may be useful to include a provision which targets the misuse of official powers and also to cover persons working for public institutions which are not in the public service.
Consider including a provision which would provide a basis for banning a public official from holding office.
Consider including a presumption to provide for a reverse onus where it is proved that any advantage was secured with the knowledge or consent of the public official.
2. Initiatives against corruption
2.1. Corruption is internationally recognized as a major problem in society, capable of endangering the stability and security of societies, threatening social, economic and political development and undermining the values of democracy and morality. With the growing globalization of markets and services, goods and people, accompanied by the internationalization of illegal activities, the international dimension of corruption gains in significance. As a result, reducing and preventing corruption has become a priority at both national and international levels. International cooperation is indispensable to combat corruption and promote accountability, transparency and the rule of law.
2.2 In considering the development of an overall anti-corruption strategy and the enactment of new provisions dealing with the prevention of corruption, it is important to study the current international initiatives against corruption.
2.2.1 Global initiatives
(a) United Nations
In 1996 the UN General Assembly adopted a Declaration against Corruption and Bribery in International Commercial Transactions, calling for the criminalization of foreign bribery. In 1998 the Assembly adopted a resolution urging Member States to criminalize the bribery of public office holders of other states in international commercial transactions.
(b) United Nations Centre for International Crime Prevention and UNICRI have jointly elaborated a global programme against corruption. The purpose of this Programme is to provide reliable and timely information on trends in corruption as well as on policy strategies to reduce and control corruption and provide technical cooperation to developing countries and countries in transition to prevent, detect and fight corruption.
(c) United Nations Development Programme
The UN Programme has programmes to assist policy makers in the fight against corruption.
(d) The World Bank
The World Bank addresses corruption as an economic concern. The World Bank helps countries in their efforts to reduce corruption by advising on economic policy reform and strengthening institutional capability.
(e) The International Monetary Fund (IMF)
The IMF has adopted a policy that denies financial assistance to countries where bribery and corruption threaten to undermine economic recovery programmes.
2.2.2 Regional Initiatives
(a) Council of Europe
The Council of Europe adopted the Criminal Convention on Corruption in 1999. The Convention adopts a very broad concept of corruption to include trafficking in influence, as well as all passive and active forms of domestic and foreign bribery in both the public and private sector.
(b) European Union
In May 1997 the European Commission adopted a Communication to the Council of Europe on a Union Policy against Corruption. The Communication deals with, amongst others, the ratification of conventions criminalizing the active and passive corruption of EC officials and officials of member countries, eliminating the tax deductibility of bribes and reforming public procurement and auditing systems. For non-member countries, the European Union’s policy aims at establishing anti-corruption programmes with countries that have concluded cooperation assistance agreements with the European Commission.
(c) The Organisation of American States (OAS)
On 1 March 1997 the Inter-American Convention Against Corruption entered into force. This Convention represents the first international treaty dealing with the issue of transnational bribery and is the leading example of regional action in the developing world.
(d) International Chamber of Commerce (ICC) (Private Sector)
In 1996 the ICC issued revised Rules of Conduct to Combat Extortion and Bribery in International Business Transactions.
(e) The Organisation for Economic Cooperation and Development(OECD)
On 21 November 1997 the OECD member countries and five non-member countries adopted the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. This Convention represents an important step in the concerted international effort to criminalize bribery and reduce the rampant corruption in world economies. It aims to stop the flow of bribe money for the purpose of obtaining international business deals and to strengthen domestic anti-corruption efforts aimed at raising standards of governance and increasing civil society participation.
2.3 In scrutinizing the abovementioned initiatives it becomes clear that South Africa lacks an overall anti-corruption strategy and the South African Legislation relating to corruption and bribery, although only enacted in 1992, is far behind the legislation of the major international countries.
2.4 DEVELOPMENT OF AN OVERALL ANTI-CORRUPTION STRATEGY
2.4.1 In considering the development of an overall anti-corruption strategy, Robert Klitgaard, in an article titled Strategies against Corruption remarks as follows:
"The secret of successful reform is changing policies and systems, rather than hunting for isolated culprits, adding new laws and regulations, or calling for a moral renovation.".
2.4.2 Regarding the changing of policies and systems, Klitgaard refers, inter alia, to the following relevant categories for consideration:
(1) Penalise corrupt behavior. The following actions should be considered:
Raise the severity of formal penalties.
Increase the principals’ authority to punish.
Calibrate penalties in terms of deterrent effects.
(b) Improve auditing and management information systems.
(c) Gather evidence about possible corruption.
(d) Strengthen the position and powers of information agents. For example by creating new units, anti-corruption agencies or commissions, and the establishment of inquiring commissions and ombudsmen.
(e) Change the burden of proof so as to compel the potentially corrupt to demonstrate their innocence.
(f) Restructure the principal-agent-client relationship to leaven monopoly power, circumscribe discretion, and enhance accountability. Clear standards of conduct and rules of the game should be set.
(g) Enhance transparency.
3. Contents of Bill
As mentioned above, we have followed the modern trend to "unbundle" corruption by providing for the creation of offences in respect of specific corrupt practices. In this regard the provisions of the Bill are to a large extend based on the provisions of the Nigerian Corruption Practices and Other Related Offences Act of 2000(See pages 9 to 26 of Combined Document). The Nigerian Act was prepared by international experts with the assistance of Transparency International. The Nigerian legislation was drafted upon existing legislation in other parts of the world. From a comparative study, it is clear that the Nigerian drafters relied to a large extend on similar legislation enacted in Malaysia, Singapore, Hong Kong, India and Lesotho. Most recent legislation enacted in Kenya, follows the same trend(See pages 117 to 122 of Combined Document).
The opinion is held that a preamble is desirable in order to emphasise the danger of corrupt practices nationally and internationally and the need for the proposed legislation. Furthermore, the preamble points out that the Constitution places a duty on the State and Parliament to protect all the people in South Africa against corrupt practices and related offences.
3.3 Clause 1: Definitions
Specific definitions will be discussed as we deal with the specific offences.
3.4 Clause 2: Interpretation
3.4.1 Clause 2(1) provides as follows:
"(1) For purposes of this Act a person is regarded as having knowledge of a fact if— (a) the person has actual knowledge of the fact; or (b) the court is satisfied that—
(i) the person believes that there is a reasonable possibility of the existence of that fact; and
(ii) the person fails to obtain information to confirm the existence of that fact.".
This provision is in line with section 1(2) of the Prevention of Organised Crime Act, 1998,(Act 21 of 1998). The provision intends dealing with the mens rea element of the offences set out in clauses 5(3) and 6(1). The intention of paragraph (b) is to make it clear that dolus eventualis is a sufficient form of mens rea. In this regard see S v Ushewokunze 1971 (2) SA 360 (RA) where the former Rhodesian Appellate Division (per Beadle CJ at 363H) held that in regard to dolus eventualis "(w)hat must be foreseen, therefore, is nothing more than a reasonable possibility of the harm or wrong eventuating". In S v Van Wyk 1992(1) SACR 147 (NM), on page 161 Ackerman AJA held:
"It does not seem that the test of a 'reasonable possibility' in the context of foresight of the occurrence of a consequence is more difficult to apply than that of a 'concrete possibility'. Inasmuch, moreover, as 'reasonable possibility' is the test used in S v Beukes and S v Ushewokunze (supra), I am accordingly of the view that the subjective foresight required for dolus eventualis is the subjective appreciation that there is a reasonable possibility that the proscribed consequence will ensue. In casu, the State must prove that accused No 1 subjectively foresaw the reasonable possibility that his attack on the deceased would cause his death.".
See also S v Manamela and Others 2000(1) SACR 414 )CC).
3.4.2 Clause 2(2) provides as follows:
"(2) Nothing in Chapter 2 may be construed so as to limit prosecution under any other law.".
This provision is identical to section 1(4) of the Prevention of Organised Crime Act, 1998, and makes it possible to charge persons in respect of the statutory corruption provisions contained in amongst others, the Electoral Act of 1993.
3.5 Clause 3: Offence of corruptly accepting gratification
3.5.1 Subclause (1) creates the offence of corruptly accepting gratification. The offence is created in respect of any person, which will include a public officer, who corruptly accepts or agrees to accept any undue gratification as an inducement to or reward for, among others, doing or not doing anything in the performance of his her or her functions.
3.5.2 Comparative legislation
For similar provisions see the legislation of Nigeria(sections 8 and 10 on page 14 and 17 of Document); Malaysia(section 10 on page 32); Singapore(section 5(a) on page 42); Hong Kong(section 3 on page 52); Canada(section 120 on page 69); India(sections 8 and 9 on page 84); Lesotho(section 21(1) on page 112); and Kenya(section 38(1)(a) on page 118).
3.5.3 Definition of "corruptly"
In clause 1 the word "corruptly" is defined to mean "in contravention of or against the spirit of any law, provision, rule, procedure, process, system, policy, practice, directive, order or any other term or condition pertaining to any— (a) employment relationship; (b) sporting event; (c) agreement; or (d) the performance of any function in whatever capacity;".
This is an important definition in the Bill and the definition is also applicable to clauses 4(1), 5(1) and (2), 7(1), 10(1), 11(1), 12(1), (3) to (6), 13(1), 14(1) 16 and 19. From the above definition it is clear that the word "corruptly" does not relate to the element of intention. The words "as an inducement" relate to the intention element. The word "corruptly" therefore refers to the requirement of unlawfulness.(For a discussion of the word "corruptly", see pages 5 to 7 of the Document)
3.5.4 Definition of "gratification"
The word "gratification" has been defined to include a wide range of benefits and avoidance of losses. Some countries make use of other descriptions to define the element of "gratification". For example in the USA the legislation refers to "anything of value"; Canada refers to "money or valuable consideration"; Australia refers to "property or benefit of any kind"; Germany and Lesotho refer to "benefit"; and Kenya refers to "any advantage". However, most of the other countries refer to "gratification". In this regard see the definition of "gratification" on pages 11(Nigeria); 29(Malaysia); and 42(Singapore) of the document. See also the comments of Prof Rwelamira on page 159, paragraph B, of the document.
Clause 3(2) provides as follows:
"(2) A person convicted of an offence in terms of subsection (1), is liable to a fine or to imprisonment for a period not exceeding 15 years, or to both a fine and such imprisonment.".
Internationally the sentence for this type of crime varies from 5 to 30 years imprisonment. We agree with Klitgaard in paragraph 2.4.2 supra regarding the penal policy in respect of corrupt related offences, namely, that one of the actions which should be considered to combat corruption is to raise the severity of formal penalties.
At present section 3 of the Corruption Act of 1992 provides that any person who is convicted of an offence referred to in section 1, shall be liable to any penalty within the punitive jurisdiction of the court concerned(See page 2 of Document). The effect of this provision is that a magistrate's court may only impose 3 years imprisonment, a regional court 10 years imprisonment and the High Court has an unlimited jurisdiction. The opinion is held that our courts are not regarding the offence of corruption in a very serious light. For example, the Chief Prosecutor within the WLD jurisdiction, indicated that all the corruption cases within the area of the WLD are heard in Johannesburg and the sentences varies between 2 to 5 years imprisonment. We are of the view that the proposed sentence of "a fine or to imprisonment for a period not exceeding 15 years, or to both a fine and such imprisonment" will clearly send out a signal to the prosecuting authority, the courts and the public that the legislature regards the offence of corruption in a very serious light and that they must act in accordance with that intention of the Legislature.
3.5.6 Clause 3(3): Presumption
Clause 3(3) provides for the application of a presumption, subject to strict requirements. The provisions of this presumption, as is the case in respect of the other presumptions in the Bill, are in line with the guidelines laid down by the Constitutional Court in recent decisions. A similar presumption has also been included in the Firearms Control Act, 2000(Act 60 of 2000). Section 117(2) provides, inter alia, as follows:
"Whenever a person is charged in terms of this Act with an offence of which the possession of a firearm or ammunition is an element, and the State can show that despite the taking of reasonable steps it was not able with reasonable certainty to link the possession of the firearm or ammunition to any other person, the following circumstances will, in the absence of evidence to the contrary which raises reasonable doubt, be sufficient evidence of possession by that person of the firearm or ammunition where it is proved that the firearm or ammunition was found...".
3.5.7 Prosecution of members of law enforcement agencies, prosecuting authority, judiciary, etc
In view of the specific knowledge the above officials have, this provision provides that where such officials are "charged with the offence referred to in subsection (1) arising from— (a) the arrest, detention or prosecution of any person for an alleged offence; (b) the omission to arrest, detain or prosecute any person for an alleged offence; or (c) the investigation of an alleged offence,
it is not necessary to prove that the accused person believed that an offence contemplated in paragraphs (a) to (c) had been committed.".
3.6 Clause 4: Offence of corruptly giving gratification
3.6.1 Clause 4(1)
Clause 4(1) creates an offence in respect of any person who corruptly gives or agrees to give to any person any undue gratification as an inducement to or as a reward for, amongst others, doing or not doing anything in the carrying out or performance of his or her duties or functions.
3.6.2 Comparative legislation
For similar provisions see the legislation of Nigeria(section 9 on page 16 of Document); Malaysia(section 11 on page 32); Singapore(section 5(b) on pages 42 and 43); Hong Kong(section 4 on page 53); Canada(section 121 on page 69); Lesotho(section 23 on page 112); and Kenya(section 38(1)(b) on page 118).
In clause 4(2) the same sentence is proposed for corruptly giving a gratification as for corruptly accepting a gratification, namely, a fine or imprisonment for a period not exceeding 15 years or to both a fine and such imprisonment . See paragraph 2.5.5 supra.
3.6.4 Clause 4(3): Presumption
In respect of the offence created in clause 4(1), clause 4(3) provides for a presumption identical to that in clause 3(3). See paragraph 2.5.6 supra.
3.7 Clause 5: Offence of corruptly accepting by or giving gratification to an agent
3.7.1 Clause 5(1)
Clause 5(1) specifically deals with corrupt practices performed by an agent. Subclause (1) creates an offence where an agent corruptly accepts or agrees to accept from any person, for himself or herself or for any other person, any undue gratification as an inducement to or as a reward for, among others, doing or not doing anything.
3.7.2 Clause 5(2)
Clause 5(2) on the other hand deals with commission of corrupt practices through an agent. Clause 5(2) creates an offence where any person corruptly gives or agrees to give any gratification to any agent, as an inducement to or as a reward for doing or not doing anything.
3.7.3 Comparative legislation
For similar provisions see the legislation of Nigeria(sections 17 on page 20 of Document); Malaysia(section 11 on page 32); Singapore(section 6 on page 43); Hong Kong(section 9 on page 59); Canada(section 120 on page 69); and Lesotho(section 25(1) and (2) on page 113).
3.7.4 Definition of agent
In terms of clause 1 an "agent"includes "any person employed by or acting for another, any trustee of an insolvent estate, the assignee of an estate assigned for the benefit or with the consent of creditors, the liquidator of a company which is being wound up, the executor of the estate of a deceased person, the legal representative of any person who is of unsound mind or is a minor or is otherwise under disability, any public officer or an officer serving in or under or acting for any public body, a trustee, an administrator or a subcontractor, and any person appointed as an agent in terms of any law;".
This definition is based on section 1 of the Prevention of Corruption Act 1958(Act 6 of 1958).
For the definition of "agent" see also the legislation of Nigeria(section 2 on page 10 of Document); Malaysia(section 2 on page 28); Singapore(section 2 on page 41); and Lesotho(section 2 on page 109).
3.7.5 Clause 5(3): Presumption
Clause 5(3) provides for a presumption identical to that in clauses 3(3) and 4(3).See paragraph 2.5.6 supra.
3.7.6 Clause 5(4)
Clause 5(4) provides for a maximum penalty of 15 years' imprisonment for a contravention. See paragraph 2.5.5 supra.
3.8 Clause 6: Offence of fraudulent acquisition of private interest
3.8.1 Clause 6(1)
This subclause deals with the fraudulent acquisition of private interest by a public servant. Subclause (1) provides that any "person employed in the public service, who knowingly acquires or holds, directly or indirectly, otherwise than as a member of a registered joint stock company consisting of more than 20 persons, a private interest in any contract, agreement or investment emanating from or connected with the department, component or office in which he or she is employed or which is made on account of the public service, is guilty of an offence.".
This provision is based on section 14 of the Nigerian legislation(See page 19 of Document)
3.8.2 Clause 6(2)
Subclause (2) provides that a person convicted of an offence in terms of subsection (1), is liable to a fine or to imprisonment for a period not exceeding 10 years, or to both a fine and such imprisonment.The Nigerian legislation provides for 7 years imprisonment.
3.9 Clause 7: Offences in respect of tenders
3.9.1 Clause 7(1)
Clause 7(1) creates an offence in respect ofcorrupt practices relating to tenders. Subsection (1) provides as follows:
"(1) A person is guilty of an offence if that person corruptly, directly or indirectly— (a) with intent to obtain from any public body, private organisation, corporate body or other organisation or institution a contract for performing any work, providing any service, supplying any article, material or substance or performing any other act, offers any gratification to any person who has made a tender for the contract, as an inducement or a reward for his or her withdrawing the tender; (b) accepts or agrees to accept any gratification for withdrawing a tender made by him or her for a contract contemplated in paragraph (a); or (c) upon an invitation to tender for a contract contemplated in paragraph (a), makes an offer which has as its aim to cause the tenderer or person organising the tender, to accept a particular offer.".
3.9.2 Comparative legislation
For similar provisions see the legislation of Malaysia(section 13 on page 33); Singapore(section 10 on page 44); Hong Kong(section 6 on page 56); Canada(section 121(1)(f) on page 71); Lesotho(section 27 on page 113; and Kenya(section 38(1)(j).
3.9.3 Definition of "public body"
This definition is also applicable to various other provisions of the Bill. See, amongst others, clauses 8(1), 12(1) and 13(1). In terms of clause 1 of the Bill a "public body" includes—
"(a) the National Government; (b) any provincial government; (c) any municipality; (d) any constitutional institution and any other statutory authority; (e) any company over which a public body referred to in paragraphs (a) to (d) has a controlling power; (f) any society, union, institution, organisation or body which the President may from time to time determine by proclamation in the Gazette;".
The State Law Advisers have affected changes to the original definition proposed by us. The opinion is held that the amended definition may not cover all public bodies. In particular in respect of paragraphs (b) and (c). Nothing will prevent a municipality to establish committees to perform certain functions. They may do so under the common law and not in terms of a "statutory provision". It is recommended that we rather follow the definition of "public body" as defined in section 1 of the Promotion of Access to Information Act, 2000(Act 2 of 2000). In terms of that section "public body" means-
"(a) any department of state or administration in the national or provincial sphere of government or any municipality in the local sphere of government; or
(b) any other functionary or institution when-
(i) exercising a power or performing a duty in terms of the Constitution or a provincial constitution; or
(ii) exercising a public power or performing a public function in terms of any legislation;".
3.9.4 Clause 7(2)
Clause 7(4) provides for a maximum penalty of 15 years' imprisonment for a contravention.
3.10 Clause 8: Bribery of public officers
3.10.1 Clause 8(1)
Clause 8(1) creates the offence of bribery of public officers.It is an offence for any person to give or agree to give to any public officer, or being a public officer, to accept or agree to accept any gratification as an inducement to or as a reward for that public officer performing or not performing certain acts prescribed in paragraphs (a) to (f).
3.10.2 Comparative legislation
A similar provision was proposed by Ms R Taljaard in the Private Members Bill. See pages 162 to 165 of Document. On page 164 of the Document Ms Taljaard refers to various pieces of comparative legislation. See the legislation of Nigeria(section 18 on page 20 of Document); Malaysia(section 14 on page 34); Singapore(section 12 on page 44); Hong Kong(section 4 on page 53); Canada(section 123 on pages 71 and 72); Western Australia(section 82 on page 80); and Lesotho(section 21 on page 112).
3.10.3 Overlapping with clause 4?
Some members may hold the view that clause 8(1) overlaps with clause 4(1). I agree that the provisions of clause 4 may cover the provisions of clause 8. However, we must keep in mind that one of our objectives with the provisions of the Bill is to "unbundle" the offence of corruption and one of the main objectives is, inter alia, to emphasise and combat corrupt practices committed by public officials. As indicated in paragraph 2.10.2 above, there are various countries whose corruption legislation contains a general corruption offence as well as a specific offence relating to bribery committed by public officers.
3.10.4 Definition of "public officer"
This definition is also applicable in respect of clauses 12(4) to (6), 13, 19 and 20. In terms of clause 1 "public officer" means "any person who is a member, an officer, an employee or a servant of a public body, and includes— (a) a public servant; (b) a member of Parliament, a provincial legislature or a municipal council; (c) a member of the national or provincial executive authority; (d) any member of the judicial authority or the prosecuting authority; (e) any person receiving any remuneration from public funds; (f) where the public body is a corporation, the person who is incorporated as such;".
Read with the proposed definition of "public body", this is a very wide definition and will cover employees of any constitutional or statutory institution and any other employee receiving any remuneration from public funds.
3.10.5 Clause 8(3): Sentence
Clause 8(3) provides for a maximum penalty of 15 years' imprisonment for a contravention.
3.11 Clause 9: Corruption of witnesses
3.11.1 Clause 9(1)
Clause 9 creates offences in respect of corrupt practices relating to witnesses. Clause 9(1) provides that it is an offence for any person to give or agree to give any gratification to any person with the intent to influence the testimony of a witness in a trial, hearing, or other proceeding, or to influence any person to absent himself or herself therefrom or to withhold true testimony.
3.11.2 Clause 9(2)
Clause 9(2) provides that it is an offence for any person to accept or agree to accept any gratification in return for being influenced in testimony in a trial, hearing, or other proceeding, or in return for being influenced to absent himself or herself therefrom or to withholding true testimony.
3.11.3 Comparative legislation
For similar provisions see the legislation of Australia(section 37 on page 77); and the USA(section 201 on pages 88 and 89).
Clause 9(3) provides for a maximum penalty of 10 years' imprisonment for a contravention of this offence.
3.12 Clause 10: Bribery of foreign officials
3.12.1 Clause 10(1)
Clause 10(1) creates an offence in respect of the bribery of foreign officials and provides as follows:
"(1) A person is guilty of an offence if he or she, in order to obtain or retain business or an improper advantage in the course of business, corruptly gives or agrees to give a gratification, whether directly or indirectly, to a foreign public official— (a) as consideration for such official performing or failing to perform any of his or her public functions; or (b) to induce that official to use his or her position to influence any acts or decisions of the foreign state or public international organisation concerned.".
3.12.2 This clause emanates from the Convention on Combatting Bribery of Foreign Public Officials in International Business Transactions adopted by the OECD Member countries on 21 November 1997. See pages 143 to 147 for a copy of the Convention.
A penalty of imprisonment not exceeding 15 years is prescribed.
3.13 Bribery in relation to auctions
3.13.1 Clause 11(1)
Clause 11(1) creates the offence of bribery in relation to auctions. It is an offence if a person corruptly gives or agrees to give any gratification to any other person as an inducement to refrain, or as a reward for having refrained, from bidding at any auction or accepts or agrees to accept any gratification as an inducement to refrain, or as a reward for having refrained from bidding at any auction.
3.13.2 Comparative legislation
See the legislation of Nigeria(section 21 on page 21); Hong Kong(section 7 on page 57); Lesotho(section 29 on page 114); and Kenya(section 38(1)(k) on page 119.
A maximum penalty of 10 years' imprisonment is prescribed.
3.14. Bribery for giving assistance in regard to contracts
3.14.1 Clause 12(1)
In termsof clause 12(1) a person, inter alia, commits an offence if he or she corruptly gives or agrees to give any gratification to any other person as an inducement to or reward for giving or having given assistance or using or having used influence in, amongst others, the procuring of any contract with a public body, private organisation, corporate body or other organisation or institution. See also clause 12(3) for the offence of accepting gratification for giving assistance in regard to contracts.
A maximum penalty of 10 years' imprisonment is prescribed.
3.14.3 Comparative legislation
See the legislation of Nigeria(section 22 on page 22); Singapore(section 7 on page 43); Hong Kong(section 5 on page 55); Canada(section 121(2) on page 71); Lesotho(section 26 on page 113); and Kenya(section 38(1)(i).
3.14.4 Clause 12(4)
Clause (4) creates an offence for a person who, in the performance of his or her official functions, corruptly inflates the price of any goods or service above the prevailing market price or professional standards. A maximum penalty of 7 years' imprisonment is prescribed.
This provision is based on section 22(3) of the Nigerian legislation(on page 22 of Document)
3.14.5 Clause 12(5)
In terms of clause 12(5) it is an offence for any public officer to corruptly award or sign any contract which has not been budgeted for or which has not been officially approved or in respect of which there are insufficient funds to meet the financial obligation arising from the contract. A maximum penalty of 3 years' imprisonment is prescribed. This provision is based on section 22(4) of the Nigerian legislation(on page 22 of Document).
3.14.6 Clause 12(6)
Clause 12(6) provides that it is an offence for a public officer to corruptly transfer or spend any sum allocated for a particular project or service, to another project or service. A maximum penalty of 3 years' imprisonment is prescribed. This provision is based on section 22(5) of the Nigerian legislation(on page 23 of Document).
3.14.7 Statutory position in South Africa regarding clauses 12(5) and (6)
The offences proposed in clauses 12(5) and (6) are also offences in terms of section 86 of the Public Finance Management Act, 1999(Act 1 of 1999), if committed by an accounting officer, a CEO or a person authorised in terms of that Act to perform the duties of an accounting officer. Furthermore, in terms of sections 81 to 83 of that Act, similar contraventions committed by other officials are regarded as financial misconduct and disciplinary proceedings may be instituted against such officials.
The opinion is held that these actions should also be criminalised in terms of the proposed Act.
3.15 Clause 13: Offence of using office or position for undue gratification
3.15.1 Clause 13(1)
Clause 13(1) creates an offence in respect of a public officer who corruptly uses his or her office or position in a public body in order to obtain any gratification for himself, herself or any other person. A maximum penalty of 7 years' imprisonment is prescribed.
3.15.2 Comparative legislation
See the legislation of Nigeria(section 19 on page 21); Malaysia(section 15 on page 34); Canada(section 122); Lesotho(section 22 on page 112); and Kenya(section 38(1)(f)(iii).
Clause 13(3) contains a presumption in terms of which proof that a public officer has made a decision or taken any action in relation to any matter in which he or she, or any relative or associate of his or her, has an interest, whether directly or indirectly, is, in the absence of evidence to the contrary which raises reasonable doubt, sufficient evidence that the public officer has corruptly used his or her office or position in the public body in order to obtain a gratification.
A further requirement for the presumption to come into operation is that the State must show that despite having taken reasonable steps, it was not able to link the acceptance of or agreement to accept the gratification to any lawful motive on the part of the public official.
3.16 Clause 14: Corruption in relation to sporting events
3.16.1 Clause 14(1)
Clause 14 creates the offence of corruption in relation to sporting events. In terms of clause 14(1) a person is guilty of an offence if he or she, directly or indirectly, corruptly- (a)accepts or agrees to accept any gratification as an inducement to or reward for, influencing or having influenced the run of play or the outcome of a sporting event; (b)gives or agrees to give to any other person any gratification as an inducement to or reward for, influencing or having influenced the run of play or the outcome of a sporting event; or (c) carries into effect any scheme in commerce to influence the run of play or outcome of a sporting event.
The object of this provision is to combat corrupt practices, for example, the fixing of sport events recently experienced in cricket.
3.16.2 Comparative legislation
See section 224 of the USA legislation on page 99.
3.16.3 Definition of "sporting event"
In terms of clause 1 a "sporting event" includes—
"(a) any event or contest in any sport, between individuals or teams, or in which animals or birds compete, and which is usually attended by the public and is governed by rules; (b) any gambling game as defined in section 1 of the National Gambling Act, 1996 (Act No. 33 of 1996); or (c) any other game of chance which includes a lottery, lotto, numbers game, scratch game, sweepstake, or sports pool;".
A maximum penalty of 10 years' imprisonment is prescribed.
3.17 Clause 15: Offence of dealing with, using, holding, receiving or concealing gratification in relation to any offence
3.17.1 Clause 15(1)
Clause 15(1) creates an offence in respect of a person who, whether on behalf of himself or herself, or on behalf of any other person enters into or causes to be entered into, any dealing in relation to any property or who uses or causes to be used, or holds, receives, or conceals any property or any part thereof, which forms part of any gratification which was the subject-matter of an offence in terms of this Chapter.
A maximum penalty of 7 years' imprisonment is prescribed.
3.17.3 Comparative legislation
See the legislation of Nigeria(section 24 on page 24); and Malaysia(section 18 on page 35).
3.18 Clause 16: Offences relating to corrupt acceptance and giving of gratification
Clause 16(1) provides for the creation of other offences relating to the corrupt acceptance and giving of gratification. A person who, for example, corruptly demands, receives, obtains, or offers the gratification also commits the offences referred to in the mentioned clauses.
3.19 Clause 17: Additional offences
Clause 17 creates offences in respect of, inter alia, an attempt or conspiracy to commit an offence under Chapter 2 of the Bill. See also the legislation of Nigeria(section 26 on page 26); Malaysia(section 20 on page 37); Hong Kong(section 12A on page 65); and India(section 10 on page 84).
3.20 Clause 18: Intentional obstruction of investigation of offence
Clause 18(1) deals with the intentional obstruction of an investigation in terms of the Act. A maximum penalty of 10 years' imprisonment is prescribed.
3.21 Clause 19: Possession or control of property corruptly acquired
3.21.1 Clause 19(1)
Clause 19(1) provides for the offence of the possession of property suspected to have been acquired corruptly and in respect of which the person concerned is unable to give a satisfactorily account. The State Law Advisers have amended the original provision drastically, because they are of the opinion that it is unconstitutional. The original provision creates an offence in respect of the possession of unexplained property, whereas the provision proposed in the Bill places the emphasis on the control of resources and property disproportionate to the suspect's present or past lawful sources of income, and where– (i)a reasonable suspicion exists that such standard of living or disproportionality can be ascribed to the corrupt acquisition of property or resources, and (ii) the public officer is unable to give a satisfactory account of that standard of living or disproportionality. The last-mentioned provision is in line with section 13.5 of the Indian legislation(on page 85 of Document)
3.21.2 Comparative legislation
See also the legislation of Hong Kong(section 10 on page 61); Lesotho(section 31 on page 115). During March 1999 the Law Commission of India proposed the passing of a Corrupt Public Servants(Forfeiture of Property) Act. The proposed legislation creates the offence of "illegalacquired property". This includes property disproportionate to the suspect’s known income and places the burden of proof upon the person concerned. The proposed law would also cover property held in the names of relatives and associates, but protect purchasers who acted "in good faith and for adequate consideration".
On 23 July 1999 the Indonesian Parliament adopted a new Anti-graft Bill. The Bill provides law enforcers with extended authority in their investigations, prosecutions and dispensing of punishment. The law allows law enforcers to receive information on corruption from various institutions. Suspects must explain how they obtained wealth and that of their family. In the banking sector, the central bank can be made to reveal and to freeze a suspect’s bank account.
See also the legal opinion obtained from Adv Milton Seligson, S.C., on pages 124 to 141 regarding the constitutionality of such a "reverse onus". He comes to the conclusion that "(I)t may well be, however, that a carefully crafted statutory provision making it a criminal offence for a public servant to possess wealth in excess of his official salary, if he is unable to give a satisfactorily explanation for the possession of such wealth, would pass constitutional muster.". In referring to Osman and Another v Attorney - General Transvaal 1998 (4) SA 1224 (CC), where the Constitutional Court upheld the constitutionality of the statutory offence of the possession of goods reasonably suspected of being stolen, while being unable to provide a satisfactorily account of such possession, he holds the view that that case could serve as a useful precedent in support of the validity of the proposed offence.
3.22 Clause 20: Duty to report corrupt transactions
3.22.1 Clause 20(1)
This clause places a duty on a public any public officer to whom any gratification is promised, offered, given or lent, in contravention of any provision of this Chapter, to report such fact, as soon as possible, to his or her supervisor or at his or her nearest police station.
3.22.2 Clause 20(2)
This provision places a duty on any person from whom any gratification has been demanded, solicited, accepted, received or obtained in contravention of any provision of this Chapter, to, as soon as possible, report such fact at his or her nearest police station.
In case of failure to comply with clause 20(1) or (2), a maximum penalty of 3 years' imprisonment is prescribed.
3.22.4 Comparative legislation
See the legislation of Nigeria(section 23 on page 24); and Malaysia(section 17 on page 35).
3.23 Clause 21: Extra-territorial application of Act
3.23.1 Clause 21 provides for the Extra-territorial application of the proposed Act.
This provision has been amended by the State Law Advisers. The original intention was that paragraph (a) should deal with corrupt practices committed outside the Republic against a South African citizen or a person domiciled in the Republic, whereas paragraph (b) should deal with corrupt practices committed outside the Republic by a South African citizen or a person domiciled in the Republic. This is not what the provision provides at present and we will have to reconsider the clause. The original provision was based on the German law which provides as follows:
"Section 7 Applicability to Acts Abroad in Other Cases
7(1) German criminal law shall apply to acts, which were committed abroad against a German, if the act is punishable at the place of its commission or the place of its commission is subject to no criminal law enforcement.
(2) German criminal law shall apply to other acts, which were committed abroad if the act is punishable at the place of its commission or the place of its commission is subject to no criminal law enforcement and if the perpetrator:
(a) was a German at the time of the act or became one after the act; or
(b) was a foreigner at the time of the act, was found to be in Germany and, although the Extradition Act would permit extradition for such an act, is not extradited, because a request for extradition is not made, is rejected, or the extradition is not practicable.".(My emphasis)
3.24 Clause 22: Regulations
Clause 22 empowers the Minister to may make regulations prescribing matters required or permitted by this Act to be prescribed or generally, all matters which it is necessary or expedient to prescribe in order to achieve the objects of this Act.
3.25 Clause 23: Jurisdiction of magistrates' courts
Clause 23 empowers any magistrate's court to impose any penalty mentioned in the proposed Act.
3.26 Clause 24: Repeal and amendment of laws
Clause 24 repeals the Corruption Act, 1992 (Act No. 94 of 1992), and amends the Criminal Procedure Act, 1977 (Act No. 51 of 1977), by the insertion of a new section 269A providing for a competent verdict on charges of common law bribery and statutory bribery.
3.27 Clause 25: Reinstatement of common law crime of bribery
Clause 25 provides for the reinstatement of the common law crime of bribery, which was repealed by section 4 of the Corruption Act, 1992 (Act No. 94 of 1992).
Various commentators requested the reinstatement of the common law crime of bribery.
3.28 Clause 26: Jurisdiction of Directorate of Special Operations in respect of offences committed under Chapter 2
Clause 26 empowers the Directorate of Special Operations to exercise the powers and carry out the duties contemplated in section 7(1)(a) of the National ProsecutingAuthority Act, 1998 (Act No. 32 of 1998), in respect of any of the offences referred to in Chapter 2 of the proposed Act. All the special investigation powers of the Scorpions are therefore applicable to corruption offences in terms of the proposed Act and it would not be necessary for the President to proclaim such offences in terms of section 7(1)(a)(iii)(bb) of the said Act.
3.29 Clauses 27 and 28 provide for the interpretation of certain references and the short title and commencement, respectively.