Costa Rica's New Anti-Corruption Law

/ Global Compliance Solutions Group LLC/

On June 6, 2019 the Costa Rican Legislative Assembly approved a new anti-corruption law(1). The law is the result of efforts(2) by Costa Rica to join the Organization for Economic Cooperation and Development (OECD)(3). To further their efforts, Costa Rica approved the adoption of the OECD “Convention on Combating Bribery of Foreign Public Officials in International Business Transactions” on May 10, 2017(4,5).

Highlights of the new law:

  • Allows for holding domestic (private or state owned) or foreign corporations (conducting business in Costa Rica), trusts, associations, and foundations criminally responsible for domestic or transnational bribery

  • Allows for sanctioning a parent company for the actions of their subsidiaries and affiliates

  • Establishes large potential financial penalties for corporations found guilty of corruption

  • Allows for the potential reduction of penalties (up to 40%) if certain “mitigating circumstances” are met by the corporation

Mitigating Circumstances include:

  • Having in place an effective anti-corruption program

  • Having in place an independent compliance officer

  • Reporting potential non-compliance

  • Cooperation with authorities investigating the potential non-compliance

Costa Rica Corruption Rankings

  • 2018 TRACE Bribery Risk Matrix Rank(6): 48 out of 200 countries (1 Best)

  • 2018 Corruption Perceptions Index Rank(7): 48 out of 180 countries (1 Best)

  • 2019 GCSG Country Compliance “Corruption” Risk Rating(8): Moderate

Contact us to learn more about this development in Costa Rica.

References

  1. Legislative Assembly of the Republic of Costa Rica - “Liability of Legal Persons in Domestic Bribery, Transnational Bribery and Other Crimes” - Legislative Decree No. 9699, Record No. 21,248 | Approved 06/06/2019

  2. OECD - “OECD establishes roadmap for membership with Costa Rica” - 15/07/2015

  3. OECD Home page - “Organization for Economic Cooperation and Development”

  4. FCPAmericas Blog - “Costa Rica Adopts the OECD Anti-Bribery Convention” - 06/06/2017

  5. OECD - “Costa Rica to join the OECD Anti-Bribery Convention” - 31/05/2017

  6. Trace International, Inc. - “2018 TRACE Bribery Risk Matrix”

  7. Transparency International - “2018 Corruption Perceptions Index”

  8. Global Compliance Solutions Group LLC (GCSG) - “Country Risk Ranking - Sources & Methodology”