Anti-corruption drive showing its teeth

When Xi Jinping, then still president-in-waiting, vowed to fight both “flies and tigers” in his anti-corruption campaign back in January 2013, few anticipated the scale, duration and depth of his determination

The seriousness of Xi’s campaign has been proved by the sacking of 33 provincial/ministry leaders since the National Congress of the Communist Party of China in November 2012.

The effort has extended to the private sector and foreign business, especially after the GlaxoSmithKline (GSK) China bribery scandal burst out last July, resulting in investigations of executives from the company’s China operations.

On Monday, new leads were revealed as state media reported British investigator Peter Humphrey and his American wife, Yu Yingzeng, were being charged in Shanghai. The couple was hired by GSK.

The GSK case has triggered a national probe of multinational health companies in China, an industry where bribery is commonplace. The investigation is expected to reach other industries soon.

“Much of the ongoing enforcement (of commercial bribery) is targeting multinational companies,” says Benjamin Miao, a litigation partner with Fangda Partners. “The pharmaceutical industry, of course, and there are two others, the petrochemical industry, where over 20 officials were sacked, and the investigations of leading investment banks and private funds for hiring princelings.”

Miao was invited by the Canadian Chamber of Commerce to speak at a recent anti-corruption and compliance seminar titled “Gift or Bribe?” Since last year, similar seminars have been organized by foreign embassies, consulates and chambers of commerce, as well as companies of different sizes. Internal and external investigations have also been carried out in many foreign companies to ensure they are in compliance.

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Shanghai Daily,上海日报