Corruption and lawyers

is the subject of my Trade Tripper column this Friday-Saturday issue of BusinessWorld:

Obviously, with a title like that, loads of lawyer jokes inevitably come to mind Here’s one: why is it that sharks won’t eat lawyers? Professional courtesy. But seriously folks ... I brought up the subject of lawyers in relation to corruption because of a quote I once came across: "who will watch the watchmen?" Really, when you think about it, the capability of a country to fight against corruption is only as good as its lawyers’ ability to comprehend it.

That truism came into display at the early part of President Arroyo’s administration, when the latter’s finance officials launched an anti-corruption drive that, despite all the macho talk displayed before the media, resulted in nothing except drive the foreign consultant they hired to leave the country in sheer exasperation.

A primary reason could be taken from the fact that not many people actually understand or even take the effort to understand the actual concept, nature, causes and effects, and the varied array of methodologies of corruption. The campaign slogan (its success and the fact that it resonated so well with some people) "kung walang corrupt, walang mahirap" betrays the simplistic thinking and lack of seriousness with which corruption is addressed in this country. The fact that nobody of significance engaged in corruption has been imprisoned as of now also shows the level of focus of this administration regarding that issue.

Interestingly enough, the International Bar Association came up with a survey last year on corruption and the legal profession. Depressingly, "Forty percent of lawyers surveyed have never heard of international anti-corruption instruments." Furthermore, "the IBA survey also found that in many jurisdictions well over half of the lawyers surveyed identified corruption as an issue in the legal profession in their own country. More than one in five said they had been approached to take part in what they believed could be a corrupt transaction. And, one in three said they had lost business to corrupt law firms or individuals."

Those figures could actually be quite higher as far as this country is concerned. It has to be when you consider that there are still law deans out there who would be complaining about Bar examination questions that contain "too many" public international law questions. The actual problem is not that there are too many international law questions but rather that there are too few. Considering the inter-connectedness of the world’s economies and politics, it is actually possible to make every question in the Bar exam contain a foreign element without necessarily referring to international law concepts. That goes for every subject, whether it be political law or commercial. Taxation, which normally should be completely within the domestic jurisdiction of a state, now finds itself relating to international law precepts when one considers the WTO and free trade agreements, as well as bilateral tax treaties, on areas not necessarily restricted to tariffs but to all types of taxes. Our present cases before the WTO, for example, on distilled liquor, is not essentially a tariff issue but an excise tax one.

So it wouldn’t be a surprise if a majority of the lawyers here would not be familiar with vital anti-corruption instruments such as the United Nations Convention against Corruption (UNCAC) and the OECD Anti-Bribery Convention. These are important tools against corruption for at least two reasons: 1) because to rely solely on our penal laws would be incredibly unintelligent considering that a great degree of true corruption, not the petty "facilitation" stuff but the ones that really funnel a significant amount of money from the public coffers, uses a vast array of (or proof which can be found in) economic and accounting methodologies that our archaic criminal system is simply unequipped to handle; and 2) because these instruments form part of the laws of the Philippines by operation of the incorporation doctrine prescribed in the Constitution.

Finally, there’s also the inability (or refusal) of policymakers (and lawyers) with regard to this fact, that law professors David Trubek and Alvaro Santos wrote upon: "the connection between eliminating corruption and ‘development’ remains obscure. Even if the move from a ‘corrupt’ legal regime to a ‘not corrupt’ regime produces a one-time efficiency gain, there is no good economic theory predicting that this will lead to growth or development, rather than simply another stable low-level equilibrium."

Clearly, corruption is not a victimless crime. Vast amounts of money that could have been used for education or health have instead been diverted to less altruistic enterprises. It may have even diverted potential investments away from the country. Deloitte’s 4th annual "Look Before You Leap" found that "63 percent of respondents reported that the FCPA and anti-corruption issues caused their companies to renegotiate or pull out of planned business relationships, mergers or acquisitions over the last three years."

Indeed, more than mere slogans are needed to fight corruption. Better trained lawyers would be a good start.