Title

INDO-PACIFIC ECONOMIC FRAMEWORK FOR PROSPERITY AGREEMENT RELATING TO A FAIR ECONOMY

Preamble

The Parties to this Agreement:

ACKNOWLEDGING that:

corruption including bribery, offenses such as money laundering, and inequitable and inefficient tax systems erode the foundations of a prosperous, inclusive, and stable economic order across the Indo-Pacific region, by degrading public and private institutions and compromising their independence and integrity; exacerbating wealth gaps and disparities; eroding the investment climate; disrupting international commerce, trade, and investment; undermining labor rights; and ultimately, weakening democracy and the tule of law; and

fairness, inclusiveness, transparency, the rule of law, and accountability are essential to:

improving the investment climate, ensuring shared prosperity, and promoting labor rights based on the ILO Declaration;

leveling the playing field for enterprises and workers; and

ensuring that the benefits of economic growth, free trade, and investment are broadly shared, by preventing and combating corruption; by improving both tax compliance and domestic resource mobilization including through capacity building on tax administration; by preventing corruption that undermines labor rights; and by removing obstacles to robust participation by individuals and groups outside the public sector, such as enterprises, especially MSMEs, workers, women, Indigenous Peoples, persons with disabilities, rural and remote populations, minorities, and local communities; and

SEEKING to:

effectively implement, enforce, and accelerate progress on anti-corruption measures and tax initiatives to advance transparency and level the playing field for enterprises and workers, consistent with international agreements and standards applicable to each Party; and

support capacity building, technical assistance, and innovative implementation approaches, including sharing of expertise and best practices, deployment of technologies, and strengthening of international cooperation, recognizing the different levels of development and capacity needs of each Party, as well as engagement, inclusion, and accountability measures of the Parties with respect to individuals and groups outside the public sector, such as civil society, enterprises, especially MSMEs, workers, women, Indigenous Peoples, persons with disabilities, rural and remote populations, minorities, and local communities,

HAVE AGREED as follows:

Body

Section A. Scope and Definitions

Article 1. Scope

1. This Agreement concerns measures to prevent and combat corruption, including bribery, improve tax administration and compliance, and increase cooperation, information sharing, and capacity building on these topics in the Indo-Pacific region.

2. The Parties recognize that the description of the offenses adopted or maintained in accordance with this Agreement, and of the applicable legal defenses or legal principles controlling the lawfulness of conduct, is reserved to each Party's domestic law, and that those offenses shall be prosecuted and punished in accordance with its domestic law.

3. The Parties recognize that obligations under this Agreement shall be carried out in a manner consistent with the principles of sovereign equality and territorial integrity.

4. Nothing in this Agreement shall entitle a Party to undertake in the territory of another Party the exercise of jurisdiction and performance of functions that are reserved exclusively for the authorities of that other Party by its domestic law.

Article 2. Definitions

For the purposes of this Agreement:

Agreement means the Indo-Pacific Economic Framework for Prosperity Agreement Relating to a Fair Economy;

Anti-bribery Convention means the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, done at Paris, December 17, 1997, under the auspices of the OECD;

APEC means Asia-Pacific Economic Cooperation;

CBF means the Capacity Building Framework set out in Annex I;

days means calendar days;

enterprise means an entity constituted or organized under applicable law, whether or not for profit, and whether privately owned or governmentally owned or controlled, including any corporation, trust, partnership, sole proprietorship, joint venture, association, or similar organization; (1)

FATF means the Financial Action Task Force;

foreign public official means an individual holding a legislative, executive, administrative, or judicial office of a foreign country, at any level of government, whether appointed or elected, permanent or temporary, paid or unpaid, and irrespective of that individual's seniority; and an individual exercising a public function for a foreign country, at any level of government, including for a public agency or public enterprise;

government procurement means the process by which a government obtains the use of or acquires goods or services, or any combination thereof, for governmental purposes and not with a view to commercial sale or resale or use in the production or supply of goods or services for commercial sale or resale;

ILO means the International Labour Organization;

ILO Declaration means the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up (1998), as amended in 2022;

individual means a natural person;

issuer means:

(a) for Australia, a regulated entity under paragraphs (a) and (b) of Section 1317AAB of the Corporations Act 2001 (Cth);

(b) for Brunei Darussalam, an issuer as defined under Section 2 of the Securities Markets Order, 2013;

(c) for the Republic of Fiji, a listed company incorporated under the Companies Act 2015;

(d) for the Republic of India, a body corporate that issues or proposes to issue a security, or any person performing the act and assuming the duties of an issuer, depositor, or manager pursuant to the relevant documentation and instrument under the Securities Contracts (Regulation) Act, 1956 and the Securities and Exchange Board of India Act, 1992;

(e) for the Republic of Indonesia, a party that makes a Public Offering, as defined under Article 1(6) of Law No. 8 Year 1995 on Capital Market as amended by Article 22(1) of Law No. 4 Year 2023 on Financial Sector Development and Reinforcement;

(f) for Japan, a company issuing securities listed on a financial instruments exchange or any other person specified by Cabinet Order, under paragraph 1 of Article 193- 2 of the Financial Instruments and Exchange Act;

(g) for the Republic of Korea, an entity that has issued or intends to issue securities; provided, that this term means an entity that has issued or intends to issue the securities that underlie depositary receipts in the context of issuing depositary receipts pursuant to the Financial Investment Services and Capital Market Acts 2022;

(h) for Malaysia, an issuer as defined in Section 2 of the Capital Markets and Services Act 2007 [Act 671];

(i) for New Zealand, an FMC reporting entity considered to have higher level of public accountability under paragraphs (a) and (c) of section 461K(1) of the Financial Markets Conduct Act 2013;

(j) for the Republic of the Philippines, the originator, maker, obligor, or creator of the security as defined under Section 3.2 of Republic Act No. 8799 or the Securities Regulation Code, in relation to Section 3.1 of the same Code;

(k) for the Republic of Singapore, a company incorporated under the Companies Act 1967 or under any corresponding previous written law, that has been admitted to the official list of Singapore Exchange Securities Trading Limited and has not been removed from that official list;

(l) for the Kingdom of Thailand, a company under Article 89/1 of the Securities and Exchanges Act B.E. 2535 (1992);

(m) for the United States of America, an issuer that has a class of securities registered pursuant to 15 U.S.C. 78] or that is otherwise required to file reports pursuant to 15 U.S.C. 780(d); and

(n) for the Socialist Republic of Viet Nam, any organization conducting an offer, issuance of securities, in accordance with Law on Securities No. 54/2019/QH14;

labor rights means:

(a) the following rights, set out in the ILO Declaration: (2)

(i) freedom of association and the effective recognition of the right to collective bargaining;

(ii) the elimination of all forms of forced or compulsory labor;

(iii) the effective abolition of child labor and, for the purposes of this Agreement, a prohibition on the worst forms of child labor;

(iv) the elimination of discrimination in respect of employment and occupation; and

(v) a safe and healthy working environment; and

(b) acceptable conditions of work with respect to minimum wages and hours of work; (3)

measure includes any law, regulation, procedure, requirement, or practice; MSMEs means micro, small, and medium-sized enterprises; OECD means the Organisation for Economic Co-operation and Development;

official of a public international organization means a civil servant of a public international organization or an individual authorized by a public international organization to act on its behalf

Party means any State or separate customs territory for which this Agreement is in force; person means an individual or an enterprise; public official means:

(a) any individual holding a legislative, executive, administrative, or judicial office of a Party, whether appointed or elected, permanent or temporary, paid or unpaid, and irrespective of that individual's seniority;

(b) any other individual who performs a public function for a Party, including for a public agency or a public enterprise, or provides a public service as defined under that Party's domestic law and as applied in the pertinent area of law in that Party; and

(c) any other individual of a Party defined as a "public official" under that Party's domestic law;

publish means to disseminate information through paper or electronic means that is readily accessible to the general public;

TACB means technical assistance and capacity building;

TACBCG means the Technical Assistance and Capacity Building Coordination Group established under paragraph 5 of Annex J; and

UNCAC means the United Nations Convention against Corruption, done at New York, October 31, 2003.

Section B. Anti-Corruption

Article 3. Scope and General Provisions

1. This Section applies to measures to prevent and combat corruption, including bribery. (4)

2. The Parties recognize the need to build integrity within both the public and private sectors and that each sector has complementary responsibilities in this regard.

3. The Parties recognize the importance of regional and multilateral initiatives to prevent and combat corruption, including bribery, and are committed to working with each other to encourage and support appropriate initiatives to reach these goals.

4. Each Party affirms its obligations under the UNCAC and, as applicable, the Anti-bribery Convention.

5. The Parties support effective follow-through on the political declaration entitled "Our common commitment to effectively addressing challenges and implementing measures to prevent and combat corruption and strengthen international cooperation", which the United Nations (UN) General Assembly adopted at its 32nd Special Session, June 2, 2021.

Article 4. Relation to other Agreements

This Agreement shall not affect the rights or obligations of a Party under any other agreement to which it is a party. In particular, nothing in this Agreement shall affect the rights and obligations of a Party under the UNCAC, the United Nations Convention against Transnational Organized Crime, done at New York, November 15, 2000, and its three Protocols, or the Anti-bribery Convention, as applicable.

Article 5. Application and Enforcement of Measures to Prevent and Combat Corruption, Including Bribery

1. To prevent and combat corruption, including bribery, each Party shall enhance its efforts to effectively prevent, detect, investigate, prosecute, and sanction corruption offenses, including bribery offenses.

2. Each Party affirms its obligations under the following articles of the UNCAC:

(a) Articles 7 (Public sector) and 8 (Codes of conduct for public officials);

(b) Article 12 (Private sector);

(c) Article 15 (Bribery of national public officials);

(d) Article 16 (Bribery of foreign public officials and officials of public international organizations) and, as applicable, the Anti-bribery Convention;

(e) Article 17 (Embezzlement, misappropriation or other diversion of property by a public official);

(f) Articles 14 (Measures to prevent money-laundering) and 23 (Laundering of proceeds of crime); and

(g) Article 30 (Prosecution, adjudication and sanctions).

3. To prevent and combat corruption, including bribery, each Party shall adopt or maintain legislative and other measures as may be necessary to establish as criminal offenses under its domestic law, when committed intentionally, by any person subject to its jurisdiction:

(a) the promise, offering, or giving, to a public official, directly or indirectly, of an undue advantage for the official or another person, in order that the official act or refrain from acting in relation to the performance of or the exercise of official duties;

(b) the solicitation or acceptance by a public official, directly or indirectly, of an undue advantage for the official or another person, in order that the official act or refrain from acting in relation to the performance of or the exercise of official duties;

(c) the promise, offering, or giving, to a foreign public official or an official of a public international organization, directly or indirectly, of an undue advantage for the official or another person, in order that the official act or refrain from acting in relation to the performance of or the exercise of official duties, in order to obtain or retain business or other undue advantage in relation to the conduct of international business; (5) and

(d) the aiding and abetting, or conspiracy in the commission of any of the offenses described in subparagraphs (a) through (c). (6)

4. To prevent and combat corruption, including bribery, each Party shall adopt or maintain measures as may be necessary, in accordance with its domestic laws and regulations regarding the maintenance of books and records and internal controls, financial statement disclosures, and accounting and auditing standards, to prohibit or prevent the following acts carried out for the purpose of committing any of the offenses described in this Article:

(a) the establishment of off-the-books accounts;

(b) the making of off-the-books or inadequately identified transactions;

(c) the recording of non-existent expenditure;

(d) the entry of liabilities with incorrect identification of their objects;

(e) the use of false documents; and

(f) the intentional destruction of bookkeeping documents earlier than foreseen by the law. (7)

5. To prevent and combat corruption, including bribery, each Party shall adopt or maintain, consistent with the UNCAC, legislative and other measures as may be necessary to establish as criminal offenses under its domestic law, when committed intentionally, by any person subject to its jurisdiction:

(a) the embezzlement, misappropriation, or other diversion by a public official for the benefit of the public official or for the benefit of another person, of any property, public or private funds or securities, or any other thing of value entrusted to the public official by virtue of the public official's position;

(b) the conversion or transfer of property, knowing that such property is the proceeds of crime, for the purpose of concealing or disguising the illegal origin of the property or of helping any person who is involved in the commission of the predicate offense to evade the legal consequences of that person's action;

(c) the concealment or disguise of the true nature, source, location, disposition, movement, or ownership of or rights with respect to property, knowing that such property is the proceeds of crime;

(d) subject to the basic concepts of its legal system, the acquisition, possession, or use of property, knowing, at the time of receipt, that such property is the proceeds of crime; and

(e) subject to the basic concepts of its legal system, participation in, association with or conspiracy to commit, attempts to commit and aiding, abetting, facilitating, and counseling the commission of any of the offenses established in accordance with subparagraphs (a) through (d).

6. Each Party shall adopt or maintain effective, proportionate, and dissuasive sanctions and procedures to enforce the measures that it adopts or maintains pursuant to paragraphs 3 through 5. For foreign bribery offenses, a Party's sanctions should take into account the amounts of the bribe or the value of the profits or other benefits derived and any other mitigating or aggravating factors, in accordance with the fundamental principles of its domestic law.

7. Each Party shall disallow the tax deductibility of bribes, as described in paragraph 3, and, consistent with its tax law, other expenses incurred in furtherance of the commission of an offense described in paragraphs 3 or 5.

8. Each Party is encouraged to consider, as appropriate, using a variety of forms of resolutions to resolve criminal, administrative, or civil cases with both enterprises and individuals, including non-trial resolutions with clear and transparent frameworks. For the purposes of this paragraph, non-trial resolutions refer to mechanisms developed and used to resolve matters without a trial, based on a negotiated agreement between a person and a prosecuting or other authority.

9. Each Party shall raise awareness among its public officials of its bribery laws with a view to eliminating the solicitation and acceptance of payments that are illegal under its domestic law.

10. Each Party is encouraged to consider, as appropriate, criminalizing the bribery in order to obtain or retain business or other undue advantage in relation to the conduct of international business of an individual standing or nominated as a candidate to be a foreign public official. The Parties recognize that the bribery of such an individual with the intent of obtaining an advantage if that individual takes office undermines good governance.

11. Each Party affirms its commitment to enhance the effectiveness of law enforcement actions to prevent and enforce the corruption offenses described in paragraphs 3 and 5 or the acts described in paragraph 4. In accordance with the fundamental principles of its legal system, each Party shall not fail to effectively enforce those measures adopted or maintained to comply with paragraphs 3 through 5 and Articles 9 and 10 through a sustained or recurring course of action or inaction, as an encouragement for trade and investment. (8) In accordance with the fundamental principles of its legal system, each Party retains the right for its law enforcement, prosecutorial, and judicial authorities to exercise discretion with respect to the enforcement of the measures it has adopted or maintained to prevent and combat corruption, including bribery. Each Party retains the right to take bona fide decisions with regard to the allocation of its resources with respect to such enforcement.

Article 6. Asset Recovery and International Cooperation

1. Each Party shall, consistent with the UNCAC, adopt or maintain measures to enable the identification, tracing, freezing, seizure, and confiscation in criminal or civil proceedings of:

(a) proceeds of crime derived from offenses established in accordance with the UNCAC or property the value of which corresponds to that of such proceeds; and

(b) property, equipment, or other instrumentalities used in or destined for use in offenses established in accordance with the UNCAC.

2. Each Party shall adopt or maintain measures, as may be necessary, to the fullest extent permitted by its domestic law and consistent with the UNCAC, to:

(a) permit giving effect to a confiscation order issued by a requesting Party;

(b) permit the freezing or seizure of property upon a freezing or seizure order issued by a requesting Party, consistent with the UNCAC, including Article 54 (Mechanisms for recovery of property through international cooperation in confiscation) of the UNCAC; and

(c) identify, trace, and freeze or seize any item referred to in paragraph 1, for the purpose of eventual confiscation.

3. Each Party shall establish and, as appropriate, strengthen central authorities and, as applicable, competent authorities with the capacity to receive and transmit requests for mutual legal assistance and the authority to direct and enhance cooperation through appropriate channels. Each Party shall also strengthen the capacity of its central authorities and, as applicable, competent authorities to ensure the transmission of well-supported mutual legal assistance requests to enable their speedy and proper execution including by staffing its central and competent authorities with relevant experts or building the capacity of staff to become experts in mutual legal assistance.

4. Consistent with the UNCAC and in accordance with its domestic law, each Party shall take measures and strengthen its international cooperation with the other Parties to:

(a) hold accountable any person who has committed or is otherwise liable for an act of corruption by denying safe haven to such persons through effective cooperation in processes that may include extradition and denial of entry; and

(b) facilitate recovery of the proceeds of crime by denying safe haven to the proceeds of crime through effective cooperation in processes that may include mutual legal assistance and asset recovery.

5. Consistent with the UNCAC and in accordance with its domestic law, each Party intends to ensure transparency and accountability in the return and disposition of recovered proceeds of crime. Specifically, each Party should consider making public and available information on the transfer and administration of returned proceeds of crime to the people in both the transferring and receiving country.

6. Each Party should endeavor, to the extent appropriate and permitted by its domestic law, to encourage the participation of non-government stakeholders in the process to return proceeds of crime recovered from corrupt officials, particularly in the identification of ways in which harm can be remedied and in the development of mechanisms to ensure transparency and accountability in the transfer, disposition, and administration of recovered proceeds of crime.

7. Consistent with the UNCAC and in accordance with its domestic law, each Party should endeavor to, where possible and appropriate, prioritize the disposition of confiscated proceeds of crime in a manner that benefits the people of the nations harmed by the underlying corrupt conduct.

8. Where appropriate, each Party may also consider, consistent with the UNCAC, particularly paragraph 5 of Article 57 (Return and disposal of assets) of the UNCAC, the conclusion of case-specific agreements or arrangements that promote the transparent and effective use, administration, and monitoring of confiscated and returned proceeds of crime.

Article 7. Private Sector Internal Controls, Ethics, and Compliance

1. To prevent and combat corruption, including bribery, each Party shall take appropriate measures to promote the active participation of the private sector in preventing and combating corruption, including bribery, and to raise public awareness regarding the existence, causes, and gravity of and the threat posed by corruption, including bribery. To this end, a Party may, for example:

(a) undertake public information activities and public education programs that contribute to non-tolerance of corruption, including bribery;

(b) identify, disseminate, and advocate for good practices for ethical business conduct among enterprises, including MSMEs, such as implementing and enforcing effective internal controls, ethics, and compliance programs, taking into account their size, legal structure, and the sectors in which they operate, to prevent, detect, and mitigate corruption, including bribery;

(c) encourage and, as appropriate, promote multilateral business ethics efforts, business ethics collective action frameworks, and voluntary, collaborative sectoral codes of ethics;

(d) encourage enterprises to include statements in their annual reports on, or otherwise publicly disclose, their internal controls, ethics, and compliance programs, including those that contribute to preventing and detecting corruption, including bribery;

(e) encourage enterprises to implement frameworks for the protection of individuals reporting potential violations of law, as well as channels for such reporting, including as part of an internal controls, ethics, and compliance program or measures for preventing and detecting corruption, including bribery, and to take appropriate action based on such reporting; and

(f) encourage professional associations and other non-governmental organizations, where appropriate, to encourage and assist enterprises, in particular MSMEs, in developing codes, standards of conduct, and compliance programs for preventing and detecting corruption, including bribery.

2. Each Party shall raise awareness in its private sector, particularly among enterprises that engage in international business, of its domestic laws regarding corruption, including bribery and solicitation, and the risks of domestic and foreign bribery and related corruption.

3. Each Party is committed to publishing on a website its measures governing gifts, hospitality, entertainment, and expenses for its public officials, so that individuals and enterprises are aware of such measures and can abide by them.

4. Each Party may encourage its law enforcement authorities with respect to corruption offenses to consider implementing measures to incentivize enterprises to develop effective internal controls, ethics, and compliance programs, as well as to encourage voluntary disclosures of misconduct and cooperation with law enforcement authorities. A Party and its authorities may consider treating the existence of such programs, disclosures, and cooperation as a mitigating factor in determining the severity of an offense and penalties.

5. Each Party shall encourage enterprises, taking into account their size, legal structure, and the sectors in which they operate, to:

(a) adopt or maintain sufficient internal accounting controls, compliance programs, or monitoring bodies, independent of management, such as audit committees of boards of directors or of supervisory boards, to assist in preventing and detecting offenses described in Articles 5.3 and 5.5 or acts described in Article 5.4; and

(b) ensure that their accounts and required financial statements are subject to appropriate auditing and certification procedures.

Article 8. Transparency In Beneficial Ownership and Real Estate Transactions