Judicial application and perfection of commercial bribery of Transnational Corporations in China

. With the wave of economic globalization, the problem of commercial bribery of multinational companies, who play an important role in the international market, has gradually become a global problem. The commercial bribery of transnational corporations is harmful to the market order of fair competition in China. Therefore, China should severely crack down on the commercial bribery of multinational companies. Judging from the current judicial situation, there are still many shortcomings in anti-commercial bribery of transnational corporations. This paper will use empirical analysis to study these problems. This article will start with the GlaxoSmithKline case, introduce the current judicial interpretation in China, point out the shortcomings of the legal system, the applicable object, the jurisdictional conflict, and the actual situation of law enforcement. Then, the paper will further analyze the reasons for the shortcomings of the applicable object, the jurisdictional conflict, and the intersection of justice and civil justice. Based on this, these measures should be taken including expanding the scope of application and the scope of jurisdiction, adding a civil compensation system, and strengthening international cooperation.


Introduction
As the largest foreign capital importing country in the world, China has a large amount of investment by transnational corporations in China, which is accompanied by many commercial briberies.The bribery is characterized by the responsibility of the bribery subject, the specificity of the bribery object, the diversity of bribery means, and the wide range of cases involved.There are still some deficiencies in China's punishment of transnational corporations' commercial bribery crimes, such as the single and loose legal system, narrow scope of application, conflicts in the scope of jurisdiction, and inadequate implementation of the law enforcement blacklist.The above problems can be effectively solved by expanding the scope of applicable objects and jurisdiction, adding civil compensation system, and strengthening international cooperation.This paper will analyze the following problems including the inadequacy of punishing commercial bribery of multinational companies under the existing judicial system, the analysis of the application and jurisdiction and the intersection of criminal and civil issues, and the improvement of judicial measures to punish commercial bribery of multinational companies.
In view of these problems, many domestic scholars have put forward their own opinions and provided solutions.For example, some scholars argue that China should learn from FCPA's advanced legislative experience to improve relevant bribery clauses, strengthen corporate governance responsibilities, and use diversified sanctions to govern commercial bribery scientifically and effectively.[1] Some scholars believe that many western countries have made great efforts to crack down on transnational corruption, and the investigation and punishment are strict, while the cost of breaking the law in China is too low.Moreover, it is not enough to simply impose monetary penalties.These companies should not be allowed to enter China again or be included in the credit blacklist.[2] Some scholars argue that China should learn from the practices of the United States, the United Kingdom, and other western developed countries to establish a separate law that can specifically deals with transnational commercial bribery.[3] In addition, China should learn from international anticorruption experience to promote and strengthen the "compliant operation" of Chinese enterprises.[4] At the same time, China should strengthen international cooperation and work together to "encircle and suppress" both domestically and internationally.[5] Some scholars analyze the defects of transnational anti-commercial bribery legal system from the perspective of Gresham's law of economics and point out that "it is the urgent matter to clearly define the responsibility of the controller of transnational corporations to improve our anti-commercial bribery legal system".[6] Moreover, some scholars believe that it is important to formulate an anti-transnational commercial bribery bill, but it would be a mockery if they believe that the bottleneck of combating transnational commercial bribery lies in the lack of an anti-transnational commercial bribery law.In fact, most transnational corporations' commercial bribery crimes in China have laws to abide by.The main reason for this is that the judicial organs "hold their ground".In short, the bottleneck of anticommercial bribery is in the judiciary, not legislation.[7] 2. The current situations and deficiencies of judicature

Introduction of specific case and judicial interpretations
On July 11, 2013, some senior executives of GlaxoSmithKline (China) Investment Co. were placed on file for investigation for being suspected of serious commercial bribery and other economic crimes.On September 19, 2014, the Changsha Intermediate People's Court, Hunan Province, determined that GlaxoSmithKline China had paid bribes to several medical institutions and medical staff in various forms to expand sales channels and increase sales.GlaxoSmithKline (China) was fined 3 billion yuan, the largest Chinese fine so far, and was sentenced to Ma Kelui, Zhang Guowei, Liang Hong, Zhao Hongyan and Huang Hong for crime of offering bribes to non-state functionaries.[8] At the same time, the court ruled that the defendant, William Mark Riley, had voluntarily returned to China from Britain to investigate, and had truthfully explained the facts of the crime that the unit had voluntarily surrendered.The other defendants also truthfully admit the facts of the crime and voluntarily surrender, they may be given a mitigated punishment according to law.The prosecution also suggested a mitigated punishment in court.
Thereafter, the National Health and Family Planning Commission has issued regulations on establishing bad records of commercial bribery in the field of drug sales.For enterprises listed on the "blacklist" more than twice in five years, all public medical institutions nationwide are not allowed to purchase their drugs, medical equipment and medical consumables within two years.
The Anti-Unfair Competition Law of the People's Republic of China, as amended in 2019, stipulates in article 7 related to "bribery", that is, related acts of commercial bribery and related situations.However, the word "commercial bribery" is not explicitly used in the law, let alone give a complete concept of commercial bribery.The first laws and regulations of the term "commercial bribery" in China is in article 8 of the Anti-Unfair Competition Law of the People's Republic of China in 1993.The first definition of "commercial bribery" is defined in Article 2 and paragraph 2 of the Interim Provisions on the Prohibition of Commercial Bribery of the State Administration for Industry and Commerce, and the means of bribery (property and other means) is defined in other provisions.In the opinion of the two supreme courts, the commercial bribery crime involving the criminal law charges and the specific judicial circumstances are explained and explained.However, in these laws and regulations and judicial interpretations, there are no special provisions for commercial bribery by multinational companies.
In the case of GlaxoSmithKline, the Changsha Intermediate People's Court in Hunan Province made a judgment in accordance with the Criminal Law of the People's Republic of China and the above-mentioned laws, regulations, and judicial interpretations.The legal issues reflected in this case will be specifically introduced in the following sections.

The deficiency of punishing commercial bribery of multinational corporations under the existing judicial system
In the legal system, the laws on punishing the commercial bribery of multinational corporations are relatively dispersed.It is mainly reflected in the Anti-Unfair Competition Law of the People's Republic of China and the Criminal Law of the People's Republic of China.There are also many civil, criminal, and administrative ways to prevent and sanction commercial bribery, but there are very few provisions on punishing the commercial bribery of multinational corporations.
The applicable object is narrow.In the Foreign Corrupt Practices Act of the United States, the subject is very broad.No matter what the nature of the company is, whether it is of American nationality, or whether its business is in the United States, it is regulated under the FCPA, if the bribery is related to the United States.Chinese Criminal Law amendment (6) expands the subject in articles 163 and 164 of the original criminal law to include the staff of companies, enterprises, and other units.Although it has been further expanded, compared with the subject specified in the criminal law bribery crime, it still does not include companies, enterprises, or other units themselves in the subject of commercial bribery crime.
The second point is conflict of applicable jurisdiction.When punishing transnational crimes, they often encounter the problem of the scope of application of domestic criminal law because of exceeding jurisdiction.According to the provisions of the UN Convention Against Corruption of 2003, the States parties with criminal jurisdiction mainly include five categories, involving the place where the crime occurred, the subject of the crime, and the object of the crime.In these five circumstances, the State party "may" establish jurisdiction.Although China has signed the Convention, but it does not mean that our judicial organs can exercise the jurisdiction in accordance with the provisions of the Convention.The current situation in China is that the parent country of multinational corporations has prosecuted the transnational bribery of multinational corporations, but there is no judicial punishment in China, where the bribery occurs.It is worth noting that some multinational companies deliberately evade the law and engage in transnational bribery through their subsidiaries or representative offices set up overseas.As a result, even when they are prosecuted and judged to be responsible, these subsidiaries or representative offices in China do not have sufficient funds for compensation.[9] In law enforcement agencies, although Chinese procuratorial organs have established the "blacklist" system, in practice, the local government's laissez faire and lenient punishment of illegal behaviors of multinational companies based on tax, employment and other factors are also one of the important reasons for the growing trend of bribery by multinational companies.In fact, the "blacklist" itself has major defects.The "blacklist" is limited to the scope of "effective guilty judgment and ruling made by the court".Then, many companies that have committed bribery but have not committed bribery crimes and those that have committed bribery crimes but have not been transferred to the judicial trial will not be included in the "blacklist" and will not be punished by the industry's prohibition of access.This undoubtedly makes multinational companies that pay bribes reap large profits but small risks.[10]

Analysis of the problems of applicable object
The current Criminal Law stipulates that the subject scope of the crime of commercial bribery is too narrow and cannot meet the requirements of cracking down on transnational commercial bribery crimes.The subjects listed in Article 163 of the Chinese Criminal Law must be staff members of a company, enterprise or other units, and the subjects listed in Chapter 8 shall be state functionaries.From the scope of the subject of the subject of the bribery crime in the above Criminal Law, it is worth noting that it does not contain and can become all the subjects in the crime of commercial bribery.In Chinese criminal law, the concept of "company, enterprise" obviously cannot cover all social organizations except state organs, state-owned companies, enterprises and institutions, and people's organizations.In addition, the commercial bribery implemented by multinational companies in China is mainly aimed at companies, enterprises, and individuals in China.However, there will also be multinational companies in China bribery to companies, enterprises, other organizations, and individuals outside China.China's Criminal Law lacks corresponding provisions in this respect.
There are loopholes in the current Chinese Criminal Law on the content of commercial bribery.According to the provisions of Article 163 of the Criminal Law, the behavior content of the objective constituent elements of the crime of accepting bribes by non-state functionaries must meet the requirements of illegally collecting other people's property, at least in a large amount, and at the same time seeking benefits for others.Such provisions have the following defects in the process of combating transnational commercial bribery crimes.Firstly, they must meet the requirements of asking for or illegally collecting other people's property.Now, bribery methods are diverse, and acts are hidden.The criminal law stipulates that bribery is limited to "property".However, from our social life practice, some bribes implemented through property interests and non-property interests that are inconvenient to calculate the value have become an important means of bribery, and the harm is quite serious.Secondly, how to define the "larger amount", based on what, what the boundaries between crime and non-crime is, and how to use the reference basis when sentencing, are not strictly defined, which will undoubtedly increase the dilemma of criminal prosecution.[9]

Analysis of the problems of jurisdiction scope
Transnational corporations are engaged in activities in many countries.The inconsistency of the legal provisions and scope of application of transnational corporations in various countries has led to the conflict and confusion of the legal jurisdiction of transnational corporations.Due to the different social and political systems and economic, cultural, and historical traditions, various countries have successively adopted the principle of dependency, subordination, and protection in resolving their criminal jurisdiction.However, in modern times, the criminal law of most countries in the world did not adopt one principle to solve and determine its criminal jurisdiction in isolation, but usually adopt the comprehensive principle of dependency principle and supplemented by other principles.This inevitably raises the question of extraterritorial jurisdiction of criminal law.The form of law adopted by multinational entities in the host country will cause conflict of jurisdiction.
Commercial bribery for multinational corporations should be under the jurisdiction of the court of the host country where the bribery takes place.At present, most of the commercial bribery of multinational companies occurs in the host country.According to the principle of preferential jurisdiction, the host court can certainly have jurisdiction over these cases.However, there is a premise that the host country law must first confirm the criminality of such acts.In practice, the commercial bribery of multinational corporations often occurs in developing countries or in transition countries.These countries urgently require the introduction of foreign funds.In order to retain foreign funds, they are generally reluctant to punish the bribery of multinational corporations.As a result, the parent country of the multinational company may prosecute the multinational bribery, but the host country where the bribery occurred has no punishment.If the host court exercises jurisdiction over the multinational company and, criminal prosecution requires extradition between countries, extradition is an important aspect of judicial assistance between countries, which must be based on concluding or participating in extradition treaties, subject by the principle of extradition in traditional international law, such as double crime, directors, and senior managers.
If the host court pursues and holds liability for the subsidiaries or representative bodies of multinational corporations within its territory, and the subsidiaries or representative bodies do not have sufficient funds to use for compensation, the judgment will be unenforceable.Nor can it avoid some certain situations where multinational companies intentionally circumvent the law and exempt or reduce their responsibilities by maliciously authorize or secretly manipulating, setting up subsidiaries or representative agencies overseas for transnational bribery.

Analysis of the intersection problem of criminal justice and civil justice
The problem of criminal and civil law application seriously perplexes the judicial practice of transnational corporations' commercial bribery cases, which cannot but arouse our concern.The problem is urgent and must be reasonably solved.Chinese scholars once defined the criminal and civil cross cases as follows.The so-called criminal and civil cross cases, also known as criminal and civil interwoven cases, refer to cases involving both criminal legal relations and civil legal relations, and directly cross, involve and influence each other.[11] If the act of the criminal actor constitutes a crime and causes personal and property losses to others, the actor shall bear both criminal responsibility and civil liability for compensation.Article 43, paragraph 1, of the UN Convention Against Corruption also stipulates that States parties shall consider mutual assistance in the investigation and litigation of civil and administrative cases related to corruption.However, there are still some problems in China's handling of cross criminal and civil cases in the judicial practice of transnational corporations' commercial bribery.
Although China has set up a civil litigation system incidental to criminal cases, its intention is to give the victims of criminal acts the right to Sue and solve the problem of compensation for material damage suffered by criminal acts.However, in judicial practice, due to the long-term absconding of the criminal suspect, the lack of the ability to compensate and other reasons, the legitimate rights and interests of the civil victims cannot be repaired in time, resulting in more serious consequences, the system has caused a lot of doubts.At the same time, in the judicial practice, there is basically no socalled victims including the state, legal persons and natural persons for corruption, bribery and other corruption crimes and filed compensation lawsuits.That is to say, the investigation of corruption crimes in China is basically limited to criminal investigation, rarely filed incidental civil litigation, and there is no separate civil litigation without criminal investigation.[12]

The perfection of judicial application 4.1 Expand the scope of the targets of punishment
The crime of bribery of foreign public officials and the bribery of officials of international organizations shall be added.Corresponding provisions can be added to the relevant provisions of the criminal law to bring the bribery of them into the scope of punishment.However, in this process, the following problems must be properly addressed.
Firstly, to combat transnational bribery, it is necessary for China's law to clearly define the subject of the crime of bribery against these officials.The advantages of various anti-corruption conventions and other national legislation should be absorbed, including not only personnel in legislative, administrative, and judicial positions, personnel in public institutions or public enterprises, but also foreign political party staff and candidates.At the same time, it should be defined that "officials of public international organizations" not only include "international civil servants or any person authorized by such organizations to act on behalf of such organizations" mentioned in the UN Convention Against Corruption.In addition, Reference can be made to the Criminal Law Convention against Corruption of the Council of Europe, including not only officials of international organizations, but also members of foreign public parliaments, members of international parliamentary meetings, judges, and officials of international tribunals.
Secondly, to combat transnational bribery, it is necessary for China's laws to accurately handle the nature of transnational bribery.Although there is a "bribery crime" of punishing the bribery of domestic officials in the first domestic law of China, the regulation is full of loopholes and has been plagued by the criminal law circle.In the future, the legislation of the crime of bribery will be changed according to the relevant conventions and international experience, and the nature of bribery of the officials will also be modified.At present, according to the UN Convention against Corruption, the opinions of scholars on revising the "crime of bribery" in China mainly include appropriately expanding the legal meaning of bribery and canceling the provisions on the amount of bribery.The content of bribery, which is the constituent element of "seeking benefits for others", should be replaced by "illegitimate benefits" to replace the provisions of "property" in China.Some scholars also believe that the identification of bribery means should be expanded in terms of bribery behavior at least by reference to the relevant regulations in China.[13] It should at least include the acts of "promise to give", "offer to give" and "actual giving" mentioned in the UN Convention against Corruption to unify the criminal object of bribery crime and consider the same punishment for bribery.
Although these amendments represent that China should fulfill the corresponding international obligations, the UN Convention against Corruption itself is also imperfect.In view of "bribing foreign public officials", the corresponding legislation can also be further improved by referring to other international conventions and the legislative experience of other countries.This expansion does not violate international obligations.Bribery can also refer to American legislation, in addition to the above three, but also to add "authorization".At the same time, the UN Convention against Corruption requires the purpose of bribery, namely "to obtain or retain commercial or other improper benefits related to international business".The purpose of bribery should go beyond "commercial practices".Many bribes can benefit not only in business acts, but sometimes in certain government acts and expenses.At the same time, it may also refer to the legislation of the United States, that is, any act or decision causing or inducing public officials to perform within the scope of their authority, and any act or decision affecting or affecting the government or its affiliates, are within the scope of attack.
At the same time, consider the addition of bribery of the foreign private sector where future conditions are appropriate.Although the current international conventions and national legislation do not cover this aspect for the time being, as mentioned in the fourth chapter of the private sector, the crime of bribery foreign private sector has become one of the key concerns of the international community.The author believes that no effort should be spared to crack down on bribery, and different legislative attitudes should not be adopted because of the different bribery objects.It is therefore imperative to increase the fight against foreign private sector bribery in the future.

Expand the scope of the jurisdiction
The expansion of jurisdiction should be divided into two aspects.Firstly, it should consider the expansion of jurisdiction of foreign public officials or international organizations and the resolution of jurisdiction conflicts.Secondly, the jurisdiction over the bribery of foreign public officials or international organizations should be established.
Firstly, the issue of jurisdiction over the crime of bribery of international official should be discussed.Because the crime is often in a foreign country, it cannot be based on the theory of territorial jurisdiction.The theory of criminal law in China can exercise jurisdiction through the provisions of personal jurisdiction and protective jurisdiction.However, compared with the Israeli legislation of the United States, the jurisdiction provisions of our country are too narrow, and at least it is difficult to govern the bribery acts performed by the subsidiaries established in our country in the host country.Therefore, China should establish a legal system, requiring the jurisdiction when the domestic parent company in China is legally responsible for the subsidiary company in the overseas bribery behavior and when the bribery affects the interests of our country.Of course, since multiple countries may have jurisdiction over the same bribery act, our country can follow the priority order of jurisdiction discussed in the fourth chapter of "dependency-person-negotiation" in the case of the conflict of jurisdiction.
Secondly, whether the crime of bribery of the officials should be governed should be discussed.Professor Zhao bingzhi believed that China should not set up the officials to take bribes.[14] Firstly, foreign public officials, international public organizations officials' bribery does not infringe on the criminal law protects.Secondly, the addition of this crime lacks operability in practice.If the domestic law investigates the crimes committed by the public officials of other countries or the officials of the International Common Notice Organization, it is contrary to the principle of national sovereignty and may cause more political problems.Thirdly, from the current world and the legislation of other countries, the bribery of the officials is only made a crime, while the bribery of the officials is not stipulated, such as the United States, Spain, Switzerland.
The author has different views on this, believing that it is necessary to add the corresponding charges and at least to determine our jurisdiction over this crime.Firstly, this crime may infringe on our legal interests.China's economic development has become more and more perfect, and its foreign investment is also developing day by day.If a certain company adopts bribery means, it may infringe on the interests of potentially competitive Chinese companies.Even such bribery may be done in our country.Secondly, although the investigation of the officials lacks operability in practice, it does not mean that there is no possibility.Only when our country first stipulated the jurisdiction over such crimes, there is the possibility of sanctions, otherwise it is to waive our sovereignty.Thirdly, some countries, such as Finland and Germany, stipulate the fact that bribery and bribery should be punished together.
Therefore, considering the further improvement of international anti-corruption documents and the coordination and unity between various international conventions, to better combat transnational corruption, the interpretation of relevant definitions should be expanded and expand our jurisdiction.

Add up the civil compensation system
The UN Convention against Corruption requires States parties to eliminate the consequences of acts of corruption and may consider corruption in legal proceedings as a relevant factor in voiding or revoking contracts, cancelling concessions or other similar instruments, or taking any other remedial action.This can effectively ensure that entities or persons who have suffered damage because of corruption have the right to institute legal proceedings against those responsible for the damage to obtain compensation.
China should set up a legal mechanism to seek compensation because of corruption.More importantly, this compensation can not only be submitted to the criminal suspect, but in the case that the criminal suspect cannot make compensation, the state compensation should serve as a supplement to the civil compensation.[15] The Civil Law Convention against Corruption of the Council of Europe has set a good precedent in establishing a civil compensation mechanism and proposed the conditions that civil compensation should meet in the aspects of defendant, plaintiff and causality.
At the same time, in China's Contract Law, a system should be established that the contract is invalid due to corruption.Of course, not all contracts are invalid.Under the premise of considering the interests of the bona fide third party, the victim is given the right to request the court to declare the contract invalid.[15] The purpose of punishing corruption is to eradicate corruption.In this process, the role of the company who is the main actor of bribery, cannot be ignored.In recent years, the United States has forced the company to take a more active responsibility in fulfilling its social responsibilities, especially combating corruption, and focusing on the misconduct of its subsidiaries and agents through the "no charge agreement".At the same time, the company is required to take the initiative to report the bribery of overseas institutions, otherwise it will be severely punished.China can also absorb a similar approach and require multinational companies to actively fulfill their anti-corruption responsibilities.[15]

Strengthen international cooperation
In view of the increasing intensity and seriousness of transnational commercial bribery crimes in China, it is an urgent need for China to deepen cooperation with foreign governments and international organizations, establish effective cooperation mechanisms to jointly investigate and deal with transnational commercial bribery, and strengthen global governance.Only in this way can the spread and rampant behavior of such bribery be completely and effectively curbed.
To this, firstly, special agencies can be set up to link up with international cooperation.At present, the confusion of law enforcement systems in many countries has brought great uncertainty and obstacles to the docking and coordination of international cooperation and has failed to make international treaties such as the UN Convention against Corruption play its due role.In China, for commercial bribery cases, procuratorial, public security, industrial and commercial taxation and other departments have the right to investigate, which inevitably leads to the problem of overlapping functions and shifting blame among institutions.It is difficult to unite the fight against commercial bribery.The special prosecutor of the United States, the Anti-Corruption Investigation Bureau of Singapore and other institutions have strong independence and can eliminate interference to combat commercial bribery and other corruption.China can learn from international organizations to establish special anti-corruption or anti-commercial bribery committees and working groups, and from relevant countries to establish special law enforcement agencies.Moreover, China can try to set up special organizations to prevent and control corporate corruption in industrial and commercial administrative agencies or other competent organizations of enterprises to promote the practical application of special anti-commercial bribery laws and regulations.For illegal enterprises, they should be punished legally in a timely manner, and actively promote the international cooperation against enterprise corruption between China and other countries or international organizations, to make the domestic and foreign anti enterprise corruption work effective.[16] Secondly, strengthening international judicial cooperation and information resource sharing.Corruption in multinational corporations is a transnational phenomenon that has a significant impact on the world economy and global development.It is difficult to effectively combat it by relying solely on the power of the home or host country.Based on this, international law enforcement cooperation between countries and international organizations should be developed to prevent and detect transnational corruption.Strengthening international judicial assistance mainly involves three aspects including investigation and evidence collection of criminal cases, arrest and extradition of criminal suspects, tracking, freezing, seizure, confiscation and return of illegal gains.In terms of investigation and evidence collection, countries should give full play to the role of the joint investigation mechanism and jointly carry out the investigation and evidence collection of commercial bribery of transnational corporations.For the exchange of information, materials and other information on the investigation and handling of transnational crimes, countries should take the initiative.If they believe that the relevant case materials discovered or mastered by their countries may help other countries to carry out criminal proceedings against transnational commercial bribery, they can provide this information to the competent authorities of relevant countries.In terms of extradition cooperation, the UN Convention against Corruption requires States parties to identify transnational commercial bribery as an extraditable crime in extradition treaties.In the absence of extradition treaty relations, states should consider the UN Convention against Corruption as the legal basis for extradition cooperation.In terms of the recovery of illegal assets, Articles 52 to 57 of the UN Convention against Corruption specify various mechanisms and rules for the recovery of corrupt assets, which are applicable to the recovery of the proceeds of transnational commercial bribery.[17]

Conclusion
In the context of economic globalization, driven by the profit seeking nature of capital, more and more multinational companies choose to engage in commercial bribery in China to earn more profits.However, there are still many deficiencies in the judicial application of China in combating such acts.This paper mainly analyzes and expounds the narrow scope of application, the conflict of jurisdiction and the intersection of criminal and civil issues in the current judicial process in China.In view of these problems, this paper proposes solutions and solutions such as expanding the scope of application, expanding the scope of jurisdiction, adding a civil compensation system, and learning from foreign experience.
In this paper, for the first time, the commercial bribery of transnational corporations is analyzed from the perspective of criminal and civil law, which is helpful for Chinese scholars to conduct more research and discussion on the issue of commercial bribery of transnational corporations.This study is expected to gain more attention from domestic and foreign scholars on the commercial bribery of transnational corporations in China.In the future, it is hoped that the research on this topic can break through the existing paper and have a broader and deeper study on it.