Business operations in South Africa cannot be called corruption-free. The World Bank & IFC Enterprise Surveys 2007 show that 15% of companies surveyed expect to make facilitation payments to public officials to 'get things done', with the figure for SMEs being higher than that for large companies. Companies surveyed by the Business Against Crime South Africa & GTZ Study of Corruption in the Private Sector 2006 report that 61% of bribes paid are under ZAR 10,000, which likely take the form of facilitation payments. However, 18% of bribes paid are reportedly between ZAR 10,001 and 50,000, whereas 11% are between ZAR 50,001 and 100,000. These bribes are substantial and point to bribery at higher levels. According to the same study, there is a very high level of agreement among companies surveyed that bribes are paid in order to bypass arduous regulatory requirements to get approvals to which companies are legally entitled. This suggests that many companies pay bribes in order to deal with the country's cumbersome regulatory environment. However, a greater number of companies surveyed agree that bribes are paid in order to avoid adverse regulatory interventions (fines, fees) and to get approvals to which they are not legally entitled, indicating that the tendency towards 'true corrupt intent' outweighs the tendency to act corruptly 'out of necessity'. The fight against corruption in connection to business operations has apparently not shown any progress. In fact, 73% of the business executives surveyed perceive the government's efforts in fighting corruption as 'ineffective' or 'very ineffective', according to the Transparency International Bribe Payers Index 2008. In addition, South Africa ranks 15th out of 28 economies in the Bribe Payers Index 2011, in relation to the perceived likelihood of companies from South Africa paying bribes abroad.

Public procurements are seriously hampered by corruption and negligence, as demonstrated by an estimated figure given by the head of the Special Investigating Unit (SIU). According to him, as stated in a 2011 article by The Irish Times, around 20% (between EUR 2.5 and 3 billion) of all government procurements are lost annually due to theft or negligence. In addition, public procurement is often cited as an area of business activity in which foreign companies are very likely to encounter corruption and other unethical practices. For example, approximately one-third of the surveyed companies from the World Bank & IFC Enteprise Surveys 2007 stated that they expect to give gifts to secure a government contract. In the aforementioned study of the private sector corruption from 2006, both collusion between competitors before bidding on a public contract and the payment of kickbacks to the awarding civil servant emerge as common practices. The problem was also recently acknowledged by the Minister of Finance in his 2009-2010 budget vote speech. In order to root out corruption in public sector procurement, President Zuma announced in the parliament in February 2010 that his government plans to establish a tender compliance unit and introduce supply chain fraud audits, in addition to improving spending data and establishing a ministerial committee on corruption, as reported in a 2010 article by Supply Management. This announcement was made days after five public officials were arrested on account of procurement fraud. In order to best reduce the risk of extortion and demands for bribes in the procurement process, foreign investors considering bidding on public tenders are advised to use a specialised due diligence tool on public procurement. All in all, due to the likelihood of encountering corruption, companies are generally advised to consult with experienced attorneys, to develop, implement and strengthen integrity systems, and to carry out extensive due diligence before committing funds or when already doing business in South Africa.

In the World Economic Forum Global Competitiveness Report 2011-2012, surveyed companies rank inefficient government bureaucracy as the most serious constraint for doing business in South Africa. The Bertelsmann Foundation 2010 reports that increasing levels of corruption within the public service and particularly at the local government level is a growing concern. Nevertheless, the tax system is efficient. According to the US Department of State 2011, regulations and application forms regarding operating licences are straightforward, and data from the World Bank & IFC Doing Business 2012 reveals that bureaucracy is not as unwieldy in South Africa as in other countries in the region. The data indicates that it only takes an average of 5 procedures and 19 days to start a company in the country at a cost of 0.3% of GNI per capita, compared to a regional average of 8 procedures and 37 days at a cost of 81% of GNI per capita. In total, the World Bank & IFC Enterprise Surveys 2007 reveals that senior managers can expect to spend almost 6% of their time annually on complying with regulatory requirements. Amendments to the Corporate Act have eased company start-ups considerably by allowing for electronic submission of documents and by no longer requiring entrepreneurs to obtain legal assistance to start a company. Compared to the Sub-Saharan regional average, companies in South Africa encounter less complicated and less costly import/export procedures, less complicated procedures related to starting and closing a company and securing property rights, and smoother interaction with tax officials.

The South African Services website provides comprehensive information about the services offered by the South African government, including information on regulations, licences and permits. The Department of Trade and Industry (DTI) provides information and assistance to foreign investors. Its one-stop shop for investment offers information on sectors, industries and the regulatory environment, provides links to joint venture partners and assists with work permits. Investors will find several useful publications on its website, including The Cost of Doing Business in South Africa 2008 and Investors Handbook 2010 Part 1, 2, 3 and 4. The DTI also offers investment incentives in several sectors among which the most prominent are the incentives offered to the Business Process Outsourcing and Off-Shoring (BPO&O). Investors should note that the national government enacted a Broad-Based Black Economic Empowerment Act 2003, which is the legal framework behind a Broad-Based Black Economic Empowerment (BBBEE) strategy aiming at increasing the participation of black citizens in the South African economy. Companies are not required to meet BBBEE criteria, but are less competitive for government tenders if they do not. All companies must have their BBBEE compliance audited every year by an accredited verification agency under the Department of Trade and Industry. The BBBEE requirements are specified in the Codes of Good Practice, which were approved by the Parliament in 2006 and deal with employment equity, skills development, company development, preferential procurement and SMEs. However, the BBBEE strategy has also been criticised for providing too much preferential treatment to wealthy black elites in relation to getting government contracts, which has led to an increase in procurement corruption. For a critical assessment of the BBBEE strategy in relation to procurement corruption, see the Institute for Democracy in South Africa 2008.

South African courts have been struggling with considerable backlogs for many years, which have delayed cases involving private companies. A positive response to this problem has been the establishment of Specialised Commercial Crime Courts that have proven to be successful in dealing with white-collar crime. Business Against Crime South Africa has added financial backing to ensure the success of these courts. Dispute settlement and enforcement of commercial contracts is now relatively easy and not as costly as in other countries in the region, which is also reflected in the fact that companies operating in South Africa have greater confidence in the judicial system. The US Department of State 2011 reports that South Africa applies its commercial and bankruptcy laws with consistency and has a court system for enforcing property and contractual rights which is objective and independent. According to Global Integrity 2010, small companies have the possibility to uphold their rights in court thanks to the Contingency Fee Act 1997, where the fees are not rendered unless the client is successful in his/her claim. South Africa is not a member of the World´s Bank International Center for the Settlement of Investment disputes, yet it is a member of the New York Convention of 1958 and it recognises the International Chamber of Commerce, which supervises the resolution of transnational disputes. Access the Lexadin World Law Guide for a collection of legislation in South Africa.

Individual Corruption

According to Transparency International's Global Corruption Report 2007, around half of the people using the lower courts do not trust the judiciary, but rather perceive it as being corrupt. This perception is corroborated by the findings of Afrobarometer 2008, which reveal that many citizens consider judges and magistrates to be involved in corruption. Furthermore, one-fifth of the surveyed households who had contact with the judiciary in 2009 report to have paid a bribe, as illustrated in Transparency International's Global Corruption Barometer 2010.

Business Corruption

According to the US Department of State 2011, South African commercial law is generally enforced uniformly by an independent and objective judiciary.

As illustrated in the World Economic Forum Global Competitiveness Report 2011-2012, the surveyed business executives give the judiciary's level of independence from influences of government, citizens and companies, a relative high score, indicating that the judicial system in South Africa is rather independent. The business executives also rank the legal framework for private companies to settle disputes and to challenge the legality of government actions and/or regulations as efficient. In addition, a majority of the surveyed companies from the World Bank & IFC Enterprise Surveys 2007 perceive the South African judicial system to be fair, impartial and uncorrupted.

Political Corruption

According to the Bertelsmann Foundation 2010, the South African judiciary acts independently without interference from the government. Constitutional provisions aiming at promoting and safeguarding judicial independence are established. The judiciary, in particular the Constitutional Court (CC), is capable of checking the executive. Some of the court's rulings were major defeats for the executive and the parliament, although the executive and the ruling African National Congress (ANC) play a decisive role in the recruitment process. According to Global Integrity 2010, there are no reports of judges being physically harmed or killed when adjudicating corruption cases. The judiciary is generally not ranked among the most corrupt institutions in the country and observers agree that corruption within the judicial system is low due to high salaries and guaranteed tenure and benefits.

Despite the judiciary being evaluated as rather independent, it has come under pressure in recent years. For example, both Freedom House 2010 and Global Integrity 2010 report that in 2008, the CC lodged a complaint with the Judicial Services Commission (JSC) against a senior judge, John Hlophe, alleging that he had lobbied judges to rule in favour of corruption cases involving President Zuma. However, the Johannesburg High Court later ruled that the CC had violated Hlophe’s rights by filing its complaint in a public manner.

Lower courts in South Africa are more disposed to corruption compared to the higher panels, according to Freedom House 2011.

Frequency

The World Bank & IFC: Doing Business 2012:
- It takes an average of 29 procedures and 600 days to enforce a commercial contract at a cost of 33.2% of the claim.

World Economic Forum: The Global Competitiveness Report 2011-2012:
- Business executives give the independence of the judiciary from influences of members of government, citizens, or companies a score of 5 on a 7-point scale (1 being 'heavily influenced' and 7 'entirely independent').

- Business executives give the efficiency of the legal framework for private companies to settle disputes and to challenge the legality of government actions and/or regulations a score of 5 and 4.7 respectively on a 7-point scale (1 being 'extremely inefficient' and 7 'highly efficient'), constituting competitive business advantages for the country.

Transparency International: Global Corruption Barometer 2010:
- 28.3% of households surveyed consider the judiciary to be 'extremely corrupt'.

- Citizens give the judiciary a score of 3.5 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').

- 20.4 % of households who had contact with the judiciary in 2009 report to have paid a bribe.

Afrobarometer: Summary of Results South Africa 2008:
- 39% of respondents believe that some judges and magistrates are involved in corruption.

- 19% of respondents believe that most judges and magistrates are involved in corruption.

- 7% of respondents believe that all judges and magistrates are involved in corruption.

Transparency International: Bribe Payers Index 2008:
- Business executives give the judiciary a score of 2.9 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').

The World Bank & IFC: Enterprise Surveys 2007:
- Nearly 69% of the surveyed companies perceive the judicial system to be fair, impartial and uncorrupted.

Individual Corruption

According to the US Department of State 2011, the public continues to perceive the police and the Department of Home Affairs as corrupt. Similarly, according to Transparency International’s Global Corruption Barometer 2010, a significant number of households surveyed who had contact with the police in 2009 report to have paid a bribe. The surveyed households also perceive the police as the most corrupt public institution in the country.

The US Department of State Human Rights Report 2010 also states that the South African Police Service (SAPS) remains understaffed, ill-equipped and poorly trained. A 2009 article in Institute for Security Studies shows that the population holds the police in very low esteem, referring to an opinion poll in which majority of the respondents do not trust the police. The article also notes that, while mandated to investigate corruption, the police are considered to represent one of the public organs most prone to it.

Business Corruption

According to Transparency International's Bribe Payers Index 2008, business executives consider the police to be the most corrupt institution in the country. According to the World Economic Forum Global Competitiveness Report 2011-2012, not only do business executives say that South Africa performs poorly in relation to the cost of violence and organised crime to companies, but also in relation to the reliability of the police to protect companies from crime and to uphold law and order. This is corroborated by the World Bank & IFC Enterprise Surveys 2007, which reveal that a little more than three-quarters of the companies pay for security in South Africa while more than one-third of the companies identify crime, theft and disorder as major constraints to doing business in the country.

Political Corruption

In July 2009, the Directorate of Special Operations (DSO), commonly known as the 'Scorpions', was officially shut down and replaced by a new unit, the Directorate for Priority Crime Investigation, commonly known as the 'Hawks'. The Scorpions have been active in investigating high-profile corruption cases, such as those involving the South African Police Service (SAPS). See the 'Public Anti-Corruption Initiatives' section for further information on the SAPS and the Scorpions. The US Department of State 2011 reports that although the Hawks were less effective than the Scorpions, the unit has arrested a number of white collar criminals for banking irregularities and fraud.

High-profile corruption cases plagued South African police units in recent years. According to the US Department of State 2010, in August 2010, National Police Chief and Head of Interpol, Jackie Selebi, was sentenced 15 years in jail for taking USD 168,000 in bribes from a drug dealer in return for secret police reports. Selebi’s successor, Bheki Cele, who took over the position as police chief in 2009, was also suspended in October 2011 due to his alleged involvement in two police office leases at inflated prices from a private company. According to an October 2011 article by Bloomsberg, Cele and other security officials were accused of neglecting procurement procedures when they agreed to the leases.

In response to widespread corruption within the police force, the SAPS is planning to launch a new anti-corruption strategy in December 2011. According to a September 2011 article by News24, the new strategy will build on prevention, detection, investigation and resolution.

Frequency

World Economic Forum: The Global Competitiveness Report 2011-2012:
- Business executives in South Africa give the police a score of 3.6 on a 7-point scale (1 being 'cannot be relied upon at all to enforce law and order' and 7 'can always be relied upon to enforce law and order').

Transparency International: Global Corruption Barometer 2010:
- Citizens give the police a score of 4,4 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').

- 73.9 % of households who had contact with the police in 2009 report to have paid a bribe.

Transparency International: Bribe Payers Index 2008:
- Business executives rank the police as the most corrupt public institution in the country, scoring 4 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').

Afrobarometer: Summary of Results South Africa 2008:
- 37% of the respondents believe that some police officers are involved in corruption.

- 35% of the respondents believe that most police officers are involved in corruption.

- 11% of the respondents believe that all police officers are involved in corruption.

The World Bank & IFC: Enterprise Surveys 2007:
- 76.4% of companies surveyed pay for security.

- 38% of companies identify crime, theft and disorder as major constraints to doing business in the country.

Individual Corruption

Petty corruption is a significant problem in South Africa's civil service. According to Transparency International's Global Corruption Barometer 2010, registry and permit services are revealed as areas where a substantial amount of citizens need to pay bribes. For example, the Department of Home Affairs, which is tasked to issue identity documents, passports, and residence and work permits, is widely considered the most corrupt public institution, according to Freedom House 2010. This has led the UK government, starting from the beginning of 2009, to require South African passport holders to obtain a visa prior to entering the country, as reported in a May 2009 article by Mail & Guardian.

The process of getting a driver’s licence in South Africa is plagued by corruption. According to a February 2010 article by Mail & Guardian, the Department of Roads and Transport in Gauteng receives an average of 500,000 calls per month from applicants who seek to schedule a licence test. However, the department can only help 66,000 calls per month. Therefore, this has led to the emergence of a reported ‘efficiency fee’, meaning that an illegal fee is paid by applicants to secure a date for a licence test and a guaranteed pass.

Business Corruption

Although the regulatory environment in South Africa is continuously being improved, some public services are still characterised by high levels of red tape - much to the disadvantage of companies. According to Global Integrity 2010, the Businesses Act of 1991 assigns the role of granting business licences to local governments, resulting in inconsistent interpretation and implementation of business licensing regulations. Many companies experience corruption when dealing with the Department of Home Affairs and its local units, which are in charge of issuing various licences and permits. The procedures for obtaining work permits and business licences are pointed to as actions likely to involve bribery. Furthermore, Global Integrity 2010 reports that government inspectors sometimes accept bribes from companies in exchange for ignoring non-compliance with health, safety and other licence regulations. However, statistical figures from the World Bank & IFC Enterprise Surveys 2007 show that the corruption rate in relation to getting business permits and licences, and to obtaining utility services is low compared to the regional average.

Political Corruption

According to a 2007 article by The Time, the National Roads Agency has been accused of manipulating a ZAR multi-billion highway project between Durban and East London in 2006. The agency allegedly manipulated the bidding process to disguise conflicts of interest and operated with environmental consultants who have been shown to lack political independence.

In preparation for the 2010 FIFA World Cup which South Africa hosted, large scale infrastructure and construction projects, such as the building of stadiums and related facilities, were built. Some large scale corruption scandals related to these projects were covered by the media. For example, according to a January 2009 article by The Times, in the beginning of 2009, a politician was shot dead by masked men, allegedly because he 'blew the whistle' about corruption in the building of the Mbombela Stadium.

Frequency

The World Bank & IFC: Doing Business 2012:
Dealing with a construction permit requires a company to go through 13 procedures and spend 127 days to obtain the required licences and permits, incurring an average cost of 21.2% of per capita income.

World Economic Forum: The Global Competitiveness Report 2011-2012:
- Business executives give government administrative requirements (permits, regulations, reporting) in South Africa a score of 2.7 on a 7-point scale (1 being 'extremely burdensome' and 7 'not burdensome at all').

Transparency International: Global Corruption Barometer 2010:
- 12.7% of households who had contact with medical services in 2009 report to have paid a bribe.

- 39.3% of households who had contact with registery and permit services in 2009 report to have paid a bribe.

- 14.7% of households who had contact with utilities services in 2009 report to have paid a bribe.

- 7.8% of households who had contact with the education system in 2009 report to have paid a bribe.

Transparency International: Bribe Payers Index 2008:
- Business executives give the permit and registry services a score of 3.5 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').

Afrobarometer: Summary of Results South Africa 2008:
- 33% of respondents in this public opinion survey who applied for an official document or a permit in 2007 did not pay any bribe to obtain it, while 56% stated that they have never paid a bribe to obtain it.

- 32% of respondents who applied for public utilities, such as water or sanitation in 2007 did not pay any bribe to obtain it, while 59% stated that they have never paid a bribe to obtain utility services.

The World Bank & IFC: Enterprise Surveys 2007:
-3% of the interviewed companies identify business licensing and permits as a major constraint to doing business in South Africa.

- 6.7% of the surveyed companies expect to pay a bribe to get an electrical connection.

- 4.6% companies expect to give gifts to get a phone connection.

- 4% companies expect to give gifts to get a water connection.

- No companies expect to give gifts in order to obtain an operating licence or to get a construction permit.

Individual Corruption

There are numerous cases of citizens obtaining fraudulent housing subsidies administered at the provincial level. People have successfully applied for grants using invalid identity documents. According to a 2009 article by BuaNews, fraudulent activity related to misrepresentation of employment status, income, marital status and spousal income status. Between May 2007 and March 2009, a total of 1962 were found to have fraudulently received housing subsidies valued at R26 million, while 224 officials were found to be overpaid through the subsidy system amounting to over R2.4 million.

Figures from the Transparency International Global Corruption Barometer 2010 illustrate that only a very small percentage of the households who had contact with land administration services in 2009 reported to have paid a bribe.

Business Corruption

Corruption connected to the comprehensive land reform and redistribution designed to transfer 30% of commercial farmland to black citizens by 2014 has led the government to review procedures within the programme. According to the US Department of State 2010, only 5% of total farmland had been redistributed under the reform programme by 2008. According to a February 2006 article by BuaNews, in the Badplaas area, prices for land earmarked for sale to the government have been fraudulently inflated by an average of 30% by property speculators and farmers. Speculators have purchased rundown vegetable and dairy farms at very low prices only to resell these properties to the government at much higher prices, thus generating massive profits. There are indications that officials at the provincial level have cooperated with property speculators to systematically manipulate sale prices or even bankroll some of the fraudulent transactions. This over-charging is estimated to have cost the government ZAR 20 million in Mpumalanga Province alone.

Political Corruption

In June 2009, the Human Settlement Minister, as cited in a 2009 article by BuaNews, acknowledged that corruption was a major problem in the awarding of housing to the poor. Furthermore, a 2009 article by South Africa: The Good News also reports that in November 2009, the minister cracked down on 923 government officials for their involvement in low-cost housing scams. The minister also stated that the Special Investigation Unit had been asked to conduct a comprehensive investigation of corruption and fraud in the housing department in order to develop a strategy to curb maladministration.

Furthermore, the Human Settlement Minister in August 2010 announced the arrest of 1,910 government officials who have illegally benefited from housing subsidies worth ZAR 44 million, as reported in the US Department of State 2011.

Frequency

The World Bank & IFC: Doing Business 2012:
- Registering property requires a company to go through an average of 6 administrative procedures taking an average of 23 days at a cost of nearly 6% of the property value.

World Economic Forum: The Global Competitiveness Report 2011-2012:
- Business executives give the protection of property rights in South Africa, including financial assets, a score of 5.3 on a 7-point scale (1 being 'very weak' and 7 'very strong'), constituting a competitive business advantage for the country.

Transparency International: Global Corruption Barometer 2010:
- 3.8% of households who had contact with land administration services in 2009 report to have paid a bribe.

Individual Corruption

Afrobarometer 2008 illustrates that nearly one-third of the surveyed households believed that some tax officers are involved in corruption. However, only a very small percentage of the households who had contact with tax revenue services in 2009 reported to have paid a bribe, as illustrated in Transparency International’s Global Corruption Barometer 2010.

Business Corruption

Companies frequently interact with tax officials when they conduct inspections of plants. In many countries, these inspection visits form a market for corruption. However, according to the World Bank & IFC Enterprise Surveys 2007, this is not a major issue in South Africa compared to many other African countries. Although paying taxes can be rather time-consuming, companies do not consider tax officials to be very corrupt. According to Global Integrity 2010, the South African Revenue Service (SARS) has low levels of corruption, and tax laws are in practice, enforced uniformly and without discrimination. Furthermore, the SARS operates a 24-hour Fraud and Anti-Corruption Hotline (0800 00 28 70) to which companies can report corruption related to tax administration.

Frequency

The World Bank & IFC: Doing Business 2012:
- A medium-sized company operating in South Africa must on average make 9 payments to the tax authorities every year and spend 200 hours preparing, filing, and paying taxes at a total tax rate of a little over 33% of profits.

Transparency International: Global Corruption Barometer 2010:
- 4% of households who have had contact with tax revenue services in 2009 report to have paid a bribe.

Afrobarometer: Summary of Results South Africa 2008:
- 32% of respondents believe that some of the SARS officials are involved in corruption.

- 21% of respondents believe that most of the SARS officials are involved in corruption.

- 8% of respondents believe that all of the SARS officials are involved in corruption.

Transparency International: Bribe Payers Index 2008:
- Business executives give tax revenue authorities a score of 2 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').

The World Bank & IFC: Enterprise Surveys 2007:
- 3.1% of companies report that they are expected to give gifts when meeting with tax inspectors. This is among the lowest rates in the region.

Individual Corruption

According to Transparency International's Global Corruption Barometer 2010, more than one out of ten surveyed South African households point to the interaction with customs as an area where bribes are demanded.

According to a December 2009 article by ZimEye reports that, in December 2009, a South African immigration official who allegedly obtained a bribe from a Zimbabwean at the Beitbridge border post was arrested. In addition, International Intellectual Property Alliance Special 301 Report 2007 reveals that South Africa's expansive and porous borders also continue to hamper efforts to stem the flow of pirated products, especially audiovisual materials, between the countries that make up the Southern Africa Customs Union. South African Customs authorities remain unwilling in many instances to stop pirate products in transit through its territory. Furthermore, the South African Federation Against Copyright Theft reported statistics on seizures of counterfeit DVDs as well as a growing number of successful criminal cases, including imposition of prison sentences, against pirates in 2008.

Business Corruption

Trading across borders is not as bureaucratically cumbersome in South Africa as other countries in the region. However, according to the World Bank & IFC Doing Business 2012, it takes more time and requires more documents to clear imports and exports through South African customs than the average for OECD countries. When rating the transparency of border administration in South Africa, in relation to irregular payments in exports and imports, business executives surveyed from the World Economic Forum Global Enabling Trade Report 2010 rate it as relatively transparent, constituting a competitive advantage for the country.

Frequency

The World Bank & IFC: Doing Business 2012:
- 8 documents are needed to export a standard shipment of goods, taking an average of 30 days at a cost of USD 1,531 per container.

- 8 documents are needed to import a standard shipment of goods taking an average of 32 days at a cost of USD 1,795 per container.

World Economic Forum: The Global Competitiveness Report 2011-2012:
- Business executives give the efficiency of customs procedures (formalities regulating the entry and exit of merchandise) in South Africa a score of 4.2 on a 7-point scale (1 being 'extremely inefficient' and 7 'extremely efficient').

World Economic Forum: The Global Enabling Trade Report 2010:
- Business executives give the transparency of border administration (pervasiveness of undocumented extra payments or bribes connected with imports and exports) in South Africa a score of 4.4 on a 7-point scale (1 'non-transparent' and 7 'transparent').

Transparency International: Global Corruption Barometer 2010:
- 12.4% of households who had contact with customs administration in 2009 report to have paid a bribe.

Transparency International: Bribe Payers Index 2008:
- Business executives give the customs a score of 2.9 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').

The World Bank & IFC: Enterprise Surveys 2007:
- 2.7% of the interviewed companies expect to give gifts to get an import licence.

Business Corruption

According to observers, corruption is rife in the granting of government contracts in South Africa. Bribery thrives at the central government level, as exemplified by the high-profile procurement scandals that have been exposed within the last decade. In addition, there are numerous, though less publicised, scandals at the provincial level, indicating that the provinces are also struggling with serious irregularities in public procurement and contracting.

Multinational companies have been involved in what is commonly known as the 'Arms Deal', which is the largest corruption scandal in post-apartheid South Africa. Read more about the South Africa Arms Deal.

Companies are recommended to use a specialised public procurement due diligence tool in order to help mitigate the corruption risks associated with public procurement in South Africa.

See more on public procurement under 'Public Anti-Corruption Initiatives' in the Initiatives section.

Political Corruption

Cases of corruption involving politicians and public officials from provincial governments are numerous and often involve persons with the ability and authority to influence tender procedures. For example, according to a November 2011 article by Times Live, John Block, the African National Congress (ANC) Northern Cape leader, was arrested in November 2011 for tender fraud in relation to the purchase of water purification equipment. Block had also been previously accused of channelling ZAR multi-million tenders to a construction company owned by a businessman, who introduced Block to his wife. According to an October 2011 article by Mail & Guardian, the case related to the purchase of water purification equipment is now postponed to February 2012.

President Jacob Zuma, was accused of being involved in the 'Arms Deal' scandal, where he allegedly demanded a bribe of ZAR 500,000 from the companies involved in the scandal. Charges against Zuma himself were repeatedly dropped and revived, and in September 2011, the South African government announced that a commission of inquiry will be set up to probe allegations that surround the ZAR multi-billion arms deal. The commission is scheduled to complete its task within two years, after which a final report will be submitted to the president with recommendations, according to a September 2011 article by BBC News and an October 2011 article by Times Live. Read more about the South African Arms Deal.

A commission has been appointed to investigate the alleged illicit activities of certain South African companies and individuals connected to the UN Oil-for-Food Programme in Iraq. There are allegations that the ANC received financial support from companies that obtained tenders from the UN programme as well as alleged kickbacks from the regime of Saddam Hussein. A report was submitted to the Presidency in June 2006 by the commission and, according to an October 2011 press release by the official Presidency Republic of South Africa website, President Zuma agreed to release the report to the public no later than 7 December 2011.

See more on public procurement under 'Public Anti-Corruption Initiatives' in the Initiatives section.

Frequency

World Economic Forum: The Global Competitiveness Report 2011-2012:
- Business executives give the diversion of public funds to companies, individuals, or groups due to corruption a score of 3 on a 7-point scale (1 being 'very common' and 7 'never occurs').

- Business executives give the favouritism of government officials towards well-connected companies and individuals when deciding upon policies and contracts a score of 2.5 on a 7-point scale (1 being 'always show favouritism' and 7 'never show favouritism').

The World Bank & IFC: Enterprise Surveys 2007:
- 32.2% of the companies surveyed expect to give gifts to secure a government contract.

- The value of a gift expected to secure a government contract is 1.7% of the contract value.

Business Corruption

South Africa has introduced a comprehensive legal framework for environmental protection, which includes several sector-specific measures. Companies should note that all decisions affecting the environment are subject to Environmental Impact Assessment regulations. Although the formal measures for environmental protection are in place, the efficiency of regulations is reduced by lack of enforcement capacity and experience. According to Global Integrity 2010, government inspectors sometimes accept bribes from companies to ignore non-compliance with environmental regulations.

Political Corruption

Mail & Guardian in its October 2011 article reports that bribery, intimidation, non-compliance and a lack of cooperation from holders of mining and prospecting licences are some of the obstacles that mining-audit inspectors encounter during licence audits.

According to a February 2007 article by IOL News, despite a large sum of money being spent on mining security each year; the South African government continues to suffer huge losses in terms of unpaid tax revenue and royalties due to problems of thefts. The same articles also reports that there is evidence indicating that smuggling syndicates pay ZAR millions in bribes to buy off mining staff and members of the South African Police Services.

The local media uncovered a case in which a lucrative Nigerian oil contract was diverted to an offshore company. Former President Mbeki and other government officials lobbied the Nigerian government for the award of the contract, which subsequently went to the South African Oil Company (SAOC), registered in the Cayman Islands. SAOC has not transferred any funds to the South African state or public services, although the profits of this contract are estimated to be around ZAR 30 million a year. This in itself is not unusual. However, the company's South African contacts have turned out to have strong links to ANC interests, and a senior official in the Department of Minerals and Energy has lobbied for the contract to be increased in value, despite the apparent absence of benefits to the South African state and public. Following this case, the man behind SAOC planned to establish an oil refinery in East London. This project turned out to benefit several senior South African politicians and their families. See the Institute for Security Studies SA Corruption Briefing Issue 4 and Issue 5.

• Legislation: South Africa ratified the United Nations Convention against Corruption in November 2004, the African Union Convention on Preventing and Combating Corruption in November the following year, and the OECD Anti-Bribery Convention in 2007. The country has a well-developed legislative framework aimed at fighting corruption; Global Integrity 2010 describes the framework as 'very strong'. The Prevention and Combating of Corruption Act 2004 criminalises corruption in the public and private sector and codifies specific offences, making it easier for courts to use the legislation. The act specifically criminalises attempted corruption, extortion, active and passive bribery, bribing a foreign official, abuse of office, money laundering and obliges public officials to report corrupt activities. The PCCA Act, however, does not protect whistleblowers against recrimination or defamation claims. See the website of the National Anti-Corruption Forum for a useful guide to the act and its components and information on blacklisting of companies and how to report corruption (see 'Public Procurement' and 'Whistle-Blowing' sections below). The Public Finance Management Act of 1999 holds government officials accountable for unauthorised expenditures, and the Promotion of Access to Information Act 2000 ensures that public agencies cannot hide information that should be available to the public. However, the implementation of the law has not yet reached all levels of the public sector. In November 2011, the parliament passed a controversial ‘secrecy bill’, which still needs to be passed by the upper house in 2012. According to a November 2011 article by BBC News, if passed, the bill would give the state the power to classify documents as secret in the ‘national interest’, which, according to some critics, as cited in the article, could include reports about government corruption and human rights abuses. The Code of Conduct for Assembly and Permanent Council Members requires public officials to disclose gifts and interests, but observers say that sanctions are weak and there are reports of public officials who fail to declare their interests. Many of these legal initiatives, including the Prevention and Combating of Corrupt Activities Act 2004 and the Framework for Supply Chain Management (see 'Public Procurement' section below) suffer from poor implementation. Read more about South Africa's anti-corruption legislative framework in the Transparency International National Integrity Systems South Africa 2005 and in the UNDP Institutional Arrangements to Combat Corruption. Access the Lexadin World Law Guide for a collection of legislation in South Africa.

• Government Strategies: The Public Service Anti-Corruption Strategy of 2002 outlines the government's anti-corruption efforts and directs resources to the anti-corruption unit within the Department of Public Service and Administration (DPSA). The unit, the Anti-Corruption Coordinating Committee (ACCC), is staffed by a group of anti-corruption specialists and advises and supports the public sector on the implementation of anti-corruption policies and legislation. Although the ACCC does not carry out corruption investigations, it does run learning programmes for other public service departments under the Anti-Corruption Learning Network, which was started in July 2008. The DPSA has also announced that it will carry out a nationwide survey among companies, The Business Survey Against Corruption, that will target South African companies operating domestically and internationally. However, as of December 2011, this survey has not yet been released. Furthermore, in 2006, the Department of Provincial and Local Government (DPLG) launched a Local Government Anti-Corruption Strategy (LGACS) to  prevent, detect and investigate corruption at the municipal level. This is part of national government's anti-corruption campaign focusing on local government, in which the provinces are expected to launch the strategy for their respective municipalities. The government has also entered into a collaborative strategic organisation through the National Anti-Corruption Forum (NACF). The NACF was established in 2001 and consists of representatives of the government, the private sector and civil society with the objective of advising the government on its approach towards combating corruption. Each sector is represented by ten members. Following the NACF's second National Anti-Corruption Summit in March 2005, a National Anti-Corruption Programme (NAP) was developed, aiming at coordinating key problem areas and projects with specific outputs, timeframes and budgets. Since the development of the NAP, the pace of the NACF's activities has accelerated significantly. The NACF's fourth National Anti-Corruption Summit National Anti-Corruption Summit was held on 8-9 December 2011. For further information, read the Business Fighting Corruption NACF case summary.

• Anti-Corruption Agency: South Africa does not have a single anti-corruption agency with the powers and mandate to investigate, arrest and prosecute corruption cases. Instead a wide range of agencies are granted authority to address corruption in South Africa. These include, among others, the Special Investigating Unit (SIU), the Auditor-General, the Public Protector (Ombudsman), the Public Service Commission, the South African Police Service (SAPS) and the National Prosecuting Authority (NPA). See below for a description of these agencies.

• Special Investigating Unit (SIU): The SIU is the only state agency solely dedicated to fighting corruption. The SIU is an independent statutory body established by the president's office in 2001. It conducts investigations of any form of corruption in state institutions at the President's request and reports to him on the outcome. The SIU is not mandated to arrest and prosecute suspects. Instead, it cooperates with the National Prosecuting Authority (NPA) and the Asset Forfeiture Unit (AFU) to make sure that prosecutions take place. The status of the SIU has been disputed due to the fact that the agency was left out of the 'Arms Deal' investigation (perhaps the biggest corruption scandal in the history of South Africa). The SIU has now regained its credibility as an effective anti-corruption agency. According to a January 2010 article by BusinessDay, in 2010, the head of SIU said the unit would continue to grow significantly in the future, while underlining that this was not an indication that corruption was becoming more prevalent but rather that there was a lack of capacity in government departments to investigate all the allegations of corruption against public servants. It was also an additional sign of the government's commitment to combating corruption. The website of the SIU has a whistleblower mechanism where corruption within government departments can be reported (see 'Whistle-Blowing' below).

• National Prosecuting Authority (NPA): The NPA was established in 1998 and is South Africa's first centralised prosecuting authority. It is constitutionally independent and has the power to initiate criminal proceedings on behalf of the state. It is led by the National Director of Public Prosecutions (NDPP) and three Deputy National Directors of Public Prosecutions. The NPA consists of seven distinct units, one of which was most prominent, the Directorate of Special Operations (DSO), commonly known as the 'Scorpions'. The unit succeeded in exposing several high-ranking officials involved in corruption and had a high prosecution record, with an average of 90% of cases prosecuted resulting in conviction. However, despite its impressive record and the high degree of trust it enjoyed within the population, the unit became the victim of the power struggle within the leading political party (ANC) and was dismantled in July 2009. The Scorpions have now been replaced by the Directorate for Priority Crime Investigations, known as the 'Hawks'. The Hawks form a unit under the police ministry and as such, are subject to the control of the executive. In March 2011, the Constitutional Court ruled the formation of the Hawks unconstitutional, giving the reason that having the Hawks under the police ministry is ‘inconsistent with the Constitution and invalid to the extent that it fails to secure an adequate degree of independence’. The court gave parliament 18 months to establish an independent organ to fight corruption, as reported in a March 2011 article by AFP. Supporters of the Scorpions see their dismantling as an act by the ANC to defend and protect corrupt ANC officials. Another prominent unit under the NPA is the Asset Forfeiture Unit (AFU), which was established in 1999 with the mandate to take cases of organised crime and money laundering to court under Chapter 5 and 6 of the Prevention of Organised Crime Act 1998. According to the Institute of Security Studies 2007, the AFU has shown willingness and determination to operationalise the provisions of the act, which has resulted in a number of court cases. The AFU has had notable success in several cases against drug dealers, smugglers, as well as commercial fraudsters. It has also been directly involved in asset and property recovery of some high profile figures, involving Zuma's former financial adviser, Schabir Schaik, former Nigerian state governor, Diepreye Alamieyeseigha, and the former owner of Wheels of Africa and Hyundai Motor distributors, Willie Rautenbach.

• Auditor-General of South Africa (AGSA): The AGSA is appointed by the National Assembly and has its independence guaranteed by the constitution. Global Integrity 2010 reports that the supreme audit institution is protected from political interference by law and, in practice, the Agency's appointments  respect its independency. The AGSA reports to the National Assembly through the Standing Committee on Public Accounts (SCOPA) and AGSA counterparts at the provincial level. It is mandated to audit and report on the accounts, financial statements and financial management of national and provincial state departments and administrations, municipalities and other institutions legally authorised to receive money for public purposes. The AGSA plays an important role in the control of economic crime in South Africa, including the prevention of corruption. According to Freedom House 2010, while the independence of the AGSA is constitutionally guaranteed, the 'Arms Deal' corruption case brought the extent of AGSA's independence into question. Freedom House 2010 also notes that incomplete reporting, particularly at the provincial and municipal levels, and the lack of motivation by Parliament to act on the AGSA's recommendations hamper the efforts of the institution.

• South African Police Service (SAPS): The Constitution of South Africa 1996 established the SAPS as a single, nationwide police service under the executive command and control of a presidentially appointed National Commissioner. Within the SAPS, the Commercial Branch of the Detective Service Division holds the main responsibility in relation to corruption. In mid-2007, the SAPS was hit by a large-scale scandal, as its National Commissioner (and head of Interpol), Jackie Selebi, was found guilty of taking bribes from a drug dealer and sentenced to 15 years in prison in August 2010. Selebi’s successor, Bheki Cele, who took over the position as police chief in 2009, was also suspended in October 2011 due to his alleged involvement in two police office leases at inflated prices from a private company. According to an October 2011 article by Bloomsberg, Cele and other security officials were accused of neglecting procurement procedures when they agreed to the leases. In response to widespread corruption within the police force, the SAPS is planning to launch a new anti-corruption strategy in December 2011. According to a September 2011 article by News24, the new strategy will be based on prevention, detection, investigation and resolution.

• South African Revenue Service (SARS): The SARS is legally mandated to collect tax revenues and ensure compliance with tax law. It runs a national Fraud and Anti-Corruption Hotline (see 'Whistle-Blowing' below). In September 2006, SARS appointed a special task team to work closely with other law enforcement agencies, after various forms of tax refund fraud were identified by SARS investigators. According to a 2007 SARS press release, this task team identified 55 suspects for investigation and arrested them over a period of 18 months. Of these, 20 individuals, including one SARS employee, were successfully prosecuted. Another 16 individuals were arrested and were awaiting trial. The prosecution of 17 others was under consideration by the National Prosecuting Authority (NPA). In addition, SARS conducts lifestyle audits of MPs and cabinet ministers when unexplained income and conspicuous consumption occurs. Furthermore, Freedom House 2010 comments that the SARS is a well-funded, highly professional institution with an excellent record of fairly enforcing the tax laws. Global Integrity 2010 also evaluates the SARS as ‘very strong’, and reports that the SARS initiatives such as the SARS Fraud and Anti-Corruption Hotline (+ 27 080 000 2870) carries out different activities to reduce tax avoidance and evasion, as well as illegal or fraudulent activities. As a result, a number of individuals have been arrested in relation to tax fraud and tax evasion in recent years, according to Global Integrity 2010.

• International Complaints Directorate (ICD): The ICD is mandated to investigate any alleged misconduct of a member of the SAPS, as well as the Municipal Police Service with the purpose of promoting proper police conduct. This includes investigating allegations of SAPS officers being involved in any form of corruption.

• Office of the Public Protector (Ombudsman): The Ombudsman has the power to investigate any suspected misconduct or prejudice in state affairs or in the public administration in any sphere of government. According to Global Integrity 2010, the office continues to illustrate improved performance by reducing the number of its backlogged cases that plagued the institution in the past. Former Public Protector Leonard Mushwana, a former ANC Member of Parliament, has been accused of obstructing investigations of senior ANC members. Yet, Global Integrity 2010 notes that the Ombudsman released a number of significant critical reports. The institution receives regular funding to carry out its work, which amounted to approximately USD 16.5 million for the 2010/11 financial year. However, Global Integrity 2010 also notes that the Ombudsman is not completely free from political interference and the government does not always act on the findings from the Ombudsman’s Office. For example, according to the report, the incumbent Public Protector, Thulisile Madonsela, complained to Parliament that some organs of state do not readily comply with her recommendations without providing adequate reasons for not complying. Nevertheless, according to an October 2010 article by Bloomberg, in July the same year, Madonsela ruled that police buildings were leased at inflated prices, and Madonsela called for disciplinary action against police chief, Bheki Cele. In October 2011, amid the corruption scandal surrounding Cele, he was suspended by President Zuma, while a board of inquiry will be set up to probe Cele’s conduct.

• E-governance: E-governance is well-developed in South Africa and a large number of government offices have their own websites with information about their work. The South African Services website provides a one-stop shop for information about services offered by the South African government. Companies will find useful information and forms on business regulations and registration, taxes and online tax payments, licences and permits. The Government of South Africa has also launched a website for online access to government tenders (e-procurement).

• Public Procurement: Built upon five pillars (value for money, open and effective competition, ethics and fair dealings, accountability and reporting, and equity), the General Procurement Guidelines regulate public procurement in South Africa. Furthermore, the Framework for Supply Chain Management is designed to deal with corruption in government tendering processes by ensuring oversight, and the Guide to the Prevention and Combating of Corruption Act provides regulations for blacklisting of companies. Numerous cases of corruption related to public procurement indicate that all administrative levels struggle with irregularities in public procurement and contracting, and the Institute for Security Studies 2007 describes the process of awarding tenders as 'notoriously opaque'. Moreover, a hearing before Parliament's Standing Committee on Public Accounts (SCOPA) on 6 July 2009 revealed that many government departments still lack the systems and skills to enforce the ethics and disciplinary standards applicable to public servants. According to Global Integrity 2010, despite that there are several regulations addressing conflicts of interest for public procurement officials, these regulations suffer from uneven, unsatisfactory and/or inactive enforcement. In addition, the BBBEE strategy, aimed at increasing the participation of black citizens in the South African economy, has been criticised for providing too much preferential treatment to wealthy black elites in relation to getting government contracts, which has lead to an increase in South African procurement corruption. For a critical assessment of the BBBEE strategy in relation to procurement corruption, see the Institute for Democracy in South Africa 2008. Nevertheless, the legal framework for procurement is generally evaluated as being strong on disclosure requirements and mandatory training for procurement officials, as well as for the possibility for unsuccessful bidders to access and challenge decisions. The national government has established an online Tender Bulletin and many provincial and local governments are following suit and providing online access to tenders. The 'Tenders' section on the website of the Government of Western Cape is a good example of e-procurement at lower administrative levels in South Africa.

• Whistle-Blowing: The Guide to the Prevention and Combating of Corruption Act includes information on how to report corruption in South Africa. The National Prosecuting Authority (NPA) hosts a Service Delivery Hotline to which corruption, fraud and abuse of authority can be reported anonymously. Also, the Public Service Commission (PSC) administers the National Anti-Corruption Hotline (NACH) under the Department of Trade and Industry to which individuals can report corruption by toll free telephone as well as by e-mail. The PSC reports that its hotline has had a considerable response from the public. The South African Revenue Service (SARS) also operates a 24-hour Fraud and Anti-Corruption Hotline (+27 080 000 2870) to which companies can report corruption related to tax administration. However, government departments have largely failed to take action on the complaints. Furthermore, despite the fact that the Protected Disclosures Act (PDA) officially protects whistleblowers within both the public and the private sector from retribution, they are in reality rarely protected from job demotion, discharge or other negative consequences. Freedom House 2010 reports that internal mechanisms for acting on reports of corruption are unclear, ineffective and inconsistent across provinces and municipalities. Similarly, Global Integrity 2010 also reports that, although whistleblowers are protected by law, implementation is not thoroughly effective, but that research and high-profile cases prove that whistleblowers do suffer from negative consequences.

• General Comments on the Public Anti-Corruption Initiatives: South Africa's numerous anti-corruption agencies and laws indicate a strong political will and commitment towards combating corruption. However, many of the agencies and laws suffer from uneven implementation and overlapping mandates, which affects the operating ability of these initiatives and the enforcement of the anti-corruption legal framework. After being elected, President Zuma stated that the fight against corruption would be a government priority. This is evident by his orders to 280 mayors to stop corruption and power squabbles in an effort to stop protests over the lack of basic services such as housing, water and electricity, as reported in an October 2009 BBC News. His government has also pledged to streamline procedures and provide an overall more efficient and democratic public service after what it calls the Batho Pele (Putting People First) principle. The fight against corruption will also need to be strengthened in the areas of public education and prevention of corruption. The Economist in February 2010 reports that measures already introduced by President Zuma's government include: 1) a new law to facilitate efficient and effective prosecution of corrupt officials, 2) a review of the ANC's 'deployment' policies to ensure that positions are based on competence and not just personal or political connections, 3) a ban on anyone holding public office from having links with companies doing business with the state for at least a year after leaving their posts, 4) tougher rules and much greater openness in the award of public contracts, and 5) better protection for local-authority accounting officers, who are often suspended or dismissed by their employers for conducting investigations. Furthermore, Reuters reports that, in February 2010, President Zuma ordered an external audit of state companies, after reports of mismanagement and political meddling had emerged in state-owned enterprises, in an effort to take faster action to curb corruption.

• Media: Press freedom in South Africa is legally protected by the Constitution of South Africa and is generally respected in practice. According to Global Integrity 2008, media focus on corruption has never been as high as during 2008, peaking during now President Zuma's vicissitudes with justice. The study also reports that corruption in the private sector is less likely to be covered than political corruption. Freedom House 2011 reports that several apartheid-era laws remain in effect that permit authorities to restrict the publication of information about issues such as the police and the national defence forces, as well as to compel journalists to reveal sources. The US Department of State 2010 notes that governmental information is, by law, accessible, yet disclosure can be restricted. The Open Democracy Advice Center reported that many requests for information is either answered outside the period of legislation or not answered at all. In November 2011, South Africa’s parliament passed a controversial ‘secrecy bill’, which still needs to be passed by the upper house in 2012. According to a November 2011 articles by BBC News, if passed, the bill would give the state the power to classify documents as secret in the ‘national interest’, which, according to some critics, as cited in the article, could include reports about government corruption and human rights abuses. According to the Bertelsmann Foundation 2010, only 'hate speech' is prosecuted by law. In some instances politicians have attempted to intimidate journalists by threats of legal action. Political influence in the state-owned South African Broadcasting Corporation (SABC) led to journalists who voice criticism of the government being replaced by more loyal ANC supporters. Freedom House 2011 quotes the governance watchdog Global Integrity, and mentions that the government has threatened to withdraw advertising from newspapers that report on corruption and other scandals. Despite these problems, violation of press freedom is generally not held to be a major issue of concern in the country. Furthermore, according to Freedom House's Special Report 2009, there is a high level of digital media freedom in South Africa. Political content is not censored, and bloggers are not prosecuted for online activities. More people access the internet from their mobile telephones than from their computers. Nevertheless, the majority of the population is unable to benefit from internet access due to high costs and the fact that most content is in English, which is an obstacle for those who speak only local dialects. Reporters Without Borders 2010 ranks South Africa 38th out of 178 countries, and Freedom House 2011 describes the country's press environment as 'partly free' and ranks it 72nd out of 196 countries.

• Civil Society: Civil society in South Africa is evaluated as 'strong' by Global Integrity 2010, mainly as a result of past mobilisation and politicisation of large groups against the apartheid regime. The South African constitution guarantees the freedom of association and free assembly. Furthermore, civil society, together with the media, is relatively well-organised and plays an important role in ensuring government accountability. Also, freedom of religion and academic freedom are guaranteed and South Africans are free to form and join independent trade unions as well as NGOs. According to the Bertelsmann Foundation 2010, although these rights are respected, the police have been accused of overreacting to illegal demonstrations in some cases. Isolated cases of candidate intimidation during electoral campaigns by opponents, but not by state agencies, have been reported.

• Institute for Security Studies (ISS): The ISS is an applied policy research organisation with a dedicated anti-corruption programme. The ISS Organised Crime and Anti-Corruption Programme undertakes research on corruption and anti-corruption and produces a monthly newsletter on corruption in South Africa, the Umqol'Uphandle SA Corruption Briefing. The ISS houses the Information Portal on Corruption in Africa (IPOC in Africa), which provides research, links and surveys related to corruption in countries in Southern Africa.

• Business Against Crime South Africa (BACSA): BACSA is a non-profit organisation established with the aim of supporting the government in the fight against crime, including fraud and corruption. It operates a Commercial Crime Programme, which supports the National Prosecution Authority. The BACSA regularly issues news releases and publishes annual reports.

• Business Unity South Africa (BUSA): BUSA represents South African business on macroeconomic issues and has 49 business organisations as its members. BUSA has put together an information guide to help companies, especially SMEs, which are particularly vulnerable to corruption, to understand the anti-corruption laws in South Africa, where to draw the line, and how to build an ethical business. In response to the resolutions taken at the third National Anti-Corruption Summit, it has proposed a South African Charter of Ethical Business Practice, which it defines as an inspirational 'Business Code of Ethics' that could be applicable to the South African business community. It sets out what ethical business conduct means in the South African context, encouraging the business community to adhere to this charter, and provides a standard which can be cited when organised companies need to publicly indicate their moral stance on unethical practices related to South African business. In addition, it has put together anti-corruption information guides as starting points for both domestic and foreign entrepreneurs who want to invest in the country. Access the Anti-corruption guide for South African SMEs and/or the Anti-corruption Information Guide for Foreign Investors to South Africa.

• Ethics Institute of South Africa (EISA): The EISA is an independent, non-profit organisation, which advocates for improved ethical practices, such as in relation to conflicts of interest and anti-competitive practices, in business behaviour and in public agencies. It runs various educational programmes and provides development and implementation services for ethics codes.

• Institute for Democracy in South Africa (IDASA): The IDASA is an independent public interest organisation that advocates for the strengthening of public and private institutions, good governance and social justice. Although its work is not directly anti-corruption related, it has published a number of highly relevant research studies and articles on corruption in South Africa. Procurement Corruption (New Agenda 2008) is among the more recent studies.

The websites listed below provide useful facts on South Africa as well as contacts and tools for companies operating in South Africa:

• International Finance Corporation: South Africa SME Toolkit
  Guide to sustainable business management practices for SMEs.
• Business Fighting Corruption
  An online resource centre for business on collective action to avoid corruption which contains a guide and resources for partnerships with companies and other stakeholders to fight against corruption.
• CIA World Factbook: South Africa Country Profile
• World Bank: South Africa Data Profile

Sources for further reading:

• US Department of State: Investment Climate Statement - South Africa 2011.
• Freedom House: Freedom of the World - South Africa 2011.
• US Department of State: Human Rights Report 2010.
• Global Integrity: South Africa Country Report 2010.
• The Bertelsmann Foundation: Transformation Index - South Africa 2010.
• Afrobarometer: Summary of Results South Africa 2008.

OECD Anti-Bribery Convention Status:

Entry into Force of Implementing Legislation 27 April 2004. Deposit of Instrument of Ratification 19 June 2007. Entry into Force of the Convention 18 August 2007.

This field describes the country's status on the OECD Convention on Bribery of Foreign Officials in International Business Transactions. Please note any declarations and reservations made upon ratification. View the list of signatories to the OECD Convention. Read more about the OECD Convention.

UNCAC Status: Signed 9 December 2003. Ratified 22 November 2004.

This field describes the country's status on the United Nations Convention against Corruption. Please note any declarations and reservations made upon ratification. The list of signatories can be found on the UNODC website. Read more about the UNCAC.

Other Relevant Conventions or Treaties:

• African Union Convention on Preventing and Combating Corruption: Signed 16 March 2004. Ratified 11 November 2005. Deposited 7 December 2005.
  Read Transparency International's summary and assessment of the convention.
• United Nations Convention against Transnational Organized Crime: Signed 14 December 2000. Ratified 20 February 2004.
  Read Transparency International's summary and assessment of the convention.

Transparency CPI: 2011: 64/182(Score: 4.1)

Transparency CPI
This field consists of the score for the country in question on the Corruption Perceptions Index from Transparency International as well as its ranking.

World Bank CORR Index (-2.5 - +2.5): 2010: +0.09

World Bank Corruption Index
This field consists of the score for the country in question on the 'Control of Corruption'-indicator in the World Bank Governance Research Indicator Country Snapshot (GRICS): 1996-2010.

OECD Country Risk Classification (0-7): 2011: 3

Country Risk Classification
The classification of countries by risk category has the aim of providing OECD countries with a basis for calculating the premium interest rate to be charged to cover the risk of non-repayment of export credits. Countries are placed in risk categories 0 - 7, with 0 being the lowest risk category and thus the least expensive. Conversely, premium group 7 is the highest risk category. Each classification is comprised of 2 components: 1) an assessment of the country's economic/financial situation, and 2) its overall political stability. Access the complete list of OECD Country Risk Classification figures.

Data Verification:

Latest update: December 2011

Data verified by: Global Advice Network

General Information Sources

• The World Bank & IFC: Doing Business 2012.
• World Economic Forum: The Global Competitiveness Report 2011-2012.
• US Department of State: Investment Climate Statement - South Africa 2011.
• Transparency International: Bribe Payers Index 2011.
• Times Live: 'Arms deal commission will have subpoena powers', 27 October 2011.
• The Irish Times: 'ANC government under pressure as €3bn annual corruption revealed', 14 October 2011.
• BBC News: 'South Africa reopens 1999 arms deal investigation', 15 September 2011.
• The Bertelsmann Foundation: Transformation Index - South Africa 2010.
• Transparency International: Global Corruption Barometer 2010.
• Global Integrity: South Africa Country Report 2010.
• Supply Management: 'Corruption crackdown in South Africa', 18 February 2010.
• The Economist: 'Stop that virus: As widespread corruption is exposed, will Jacob Zuma tackle it?', 4 February 2010.
• South Africa Government Information: Budget vote speech for National Treasury by Minister of Finance Pravin Gordhan, 1 July 2009.
• Global Integrity Commons: 'Cha-Ching! in South Africa, Zuma's Cabinet Stocked with Potential Conflicts of Interest', 15 May 2009.
• BBC News: 'ANC is denied two-thirds majority', 25 April 2009.
• The Mail & Guardian Online: 'NPA drops corruption charges against Zuma', 6 April 2009.
• International Herald Tribune: 'Zuma Faces Charges After Ruling', 12 January 2009.
• Transparency International: Bribe Payers Index 2008.
• Afrobarometer: Summary of Results South Africa 2008.
• Institute for Security Studies, Reddy, T. and Sokomani, A.: Corruption and Social Grants in South Africa, November 2008.
• IDASA, Pienaar, G.: Procurement corruption - New Agenda (Issue 31 Third Q) 2008.
• BBC News: 'New S Africa president sworn in', 25 September 2008.
• The Guardian: 'Mbeki fights for survival after Zuma showdown', 15 September 2008.
• Mail and Guardian South Africa: 'Zuma Charges: NPA denies political interference', 2 January 2008.
• Mail and Guardian: 'Prosecution alleges Shaik paid thousands for Zuma kids', 1 January 2008.
• The World Bank & IFC: Enterprise Surveys 2007.
• Business Day: 'Call for Zuma Charges to be Dropped', 31 December 2007.
• Financial Times: 'Zuma's ANC Leadership needs to prove sceptics wrong', 20 December 2007.
• BBC News: 'S Africa's controversial arms deal', 20 December 2007.
• Business Against Crime South Africa & GTZ: Research Report on corruption in South African Private Sector, 2006.
• Transparency International: Global Corruption Report 2006.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.
• H.V. Vuuren: Small Bribes, Big Challenge: Extent and Nature of Petty Corruption in South Africa 2004.
• H.V. Vuuren, Transparency International: New Anti-Corruption Governments: The Challenge of Delivery 2004.
• UNODC & Department of Public Service and Administration: Country Corruption Assessment Report South Africa 2003.
• Institute for Security Studies: Who Funds Who?.
• Trading Economics: South Africa GDP Growth Rate.

Corruption Levels Sources

Judicial System

• The World Bank & IFC: Doing Business 2012.
• World Economic Forum: The Global Competitiveness Report 2011-2012.
• US Department of State: Investment Climate Statement - South Africa 2011.
• Freedom House: Freedom of the World - South Africa 2011.
• Freedom House: Freedom of the World - South Africa 2010.
• The Bertelsmann Foundation: Transformation Index - South Africa 2010.
• Transparency International: Global Corruption Barometer 2010.
• Global Integrity: South Africa Country Report 2010.
• Transparency International: Bribe Payers Index 2008.
• Afrobarometer: Summary of Results South Africa 2008.
• Global Integrity: South Africa Country Report 2008.
• The World Bank & IFC: Enterprise Surveys 2007.
• Transparency International: Global Corruption Report 2007
• National Anti-Corruption Forum: Fighting Corruption Together: Past Achievements, Future Challenges, Report on the Proceedings of the Second National Anti-Corruption Summit 2006.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.

Police

• World Economic Forum: The Global Competitiveness Report 2011-2012.
• US Department of State: Investment Climate Statement - South Africa 2011.
• Bloomberg: 'Zuma Suspends South African Police Chief After Graft Claims', 24 October 2011.
• News24: 'SAPS plans new anti-graft strategy', 13 September 2011.
• BBC News: 'South Africa police chief Bheki Cele in 'unlawful deal'', 14 July 2011.
• Transparency International: Global Corruption Barometer 2010.
• US Department of State: Human Rights Report 2010.
• Institute for Security Studies: 'All eyes on you: ANC Election Promises, Integrity, and the SAPS', 8 July 2009.
• AllAfrica: 'South Africa: Scorpions make way for the Hawks', 7 July 2009.
• Africasia: 'S. Africa's safety minister admits corrupt police', 5 January 2009.
• Global Integrity: South Africa Country Report 2008.
• Transparency International: Bribe Payers Index 2008.
• Afrobarometer: Summary of Results South Africa 2008.
• Aljazeera: 'S. Africa to shut anti-crime agency', 12 February 2008.
• The Irish Times: 'Interpol chief accused of corruption', 14 January 2008.
• The Irish Times: 'Investigator of SA police chief arrested for graft', 10 January 2008.
• The World Bank & IFC: Enterprise Surveys 2007.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 24, 2005.

Licences, Infrastructure and Public Utilities

• The World Bank & IFC: Doing Business 2012.
• World Economic Forum: The Global Competitiveness Report 2011-2012.
• US Department of State: Investment Climate Statement - South Africa 2011.
• Transparency International: Global Corruption Barometer 2010.
• Freedom House: Countries at the Crossroads - South Africa 2010.
• Mail & Guardian: 'Getting a licence can drive you to corruption', 12 February 2010.
• The Mail & Guardian Online: 'US slams corrupt SA home affairs department', 7 May 2009.
• The Times: '2010 World Cup worries rise with brutal killing of top official', 6 January 2009.
• Global Integrity: South Africa Country Report 2008.
• Transparency International: Bribe Payers Index 2008.
• Afrobarometer: Summary of Results South Africa 2008.
• The World Bank & IFC: Enterprise Surveys 2007.
• The Times: 'Roads agency 'manipulated' highway project', 30 May 2007.
• Global Integrity: South Africa Country Report 2006.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 27, 2006.
• Business Day: 'Waiting to See Where Ghavalas' Chickens Roost', 20 March 2006.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 24, 2005.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.

Land Administration

• World Economic Forum: The Global Competitiveness Report 2011-2012.
• The World Bank & IFC: Doing Business 2012.
• US Department of State: Investment Climate Statement - South Africa 2011.
• US Department of State: Investment Climate Statement - South Africa 2010.
• Transparency International: Global Corruption Barometer 2010.
• South Africa: The Good News: '923 caught for housing fraud', 27 November 2009.
• BuaNews: 'South Africa: Sexwale Vows to Stamp out Corruption in Dept.', 30 June 2009.
• BuaNews: 'Fraud, Corruption Unit Saves Tax Payers R18 Million', 11 March 2009.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 29, 2006.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 27, 2006.
• Business Day: 'Fakie Uncovers Housing Grant Graft of R323m', 28 February 2006.
• BuaNews: 'Land Reform Scam Inflated Farm Prices by R20m', 28 February 2006.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 6, 2003.

Tax Administration

• The World Bank & IFC: Doing Business 2012.
• US Department of State: Investment Climate Statement - South Africa 2011.
• Transparency International: Global Corruption Barometer 2010.
• Global Integrity: South Africa Country Report 2010.
• Transparency International: Bribe Payers Index 2008.
• Global Integrity: South Africa Country Report 2008.
• Afrobarometer: Summary of Results South Africa 2008.
• The World Bank & IFC: Enterprise Surveys 2007.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.
• BuaNews: 'South African Revenue Service Official Nabbed for Corruption', 3 February 2004.
• UNODC & Department of Public Service and Administration: Country Corruption Assessment Report South Africa 2003.

Customs Administration

• The World Bank & IFC: Doing Business 2012.
• World Economic Forum: The Global Competitiveness Report 2011-2012.
• US Department of State: Investment Climate Statement - South Africa 2011. .
• World Economic Forum: Global Enabling Trade Report 2010.
• Transparency International: Global Corruption Barometer 2010.
• ZimEye: 'SA Immigration official arrested for bribery', 25 December, 2009.
• Global Integrity: South Africa Country Report 2008.
• The World Bank & IFC: Enterprise Surveys 2007.
• International Intellectual Property Alliance: Special 301 Report 2007.
• Cape Times: 'Corruption Causes Staff Vacancies at Home Affairs', 27 August 2007.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.
• UNODC & Department of Public Service and Administration: Country Corruption Assessment Report South Africa 2003.
• Sally Peberdy, Southern African Migration Project: Trading Places. Cross-Border Traders and the South African Informal Sector, Migration Policy Series No. 6.

Public Procurement and Contracting

• World Economic Forum: The Global Competitiveness Report 2011-2012.
• US Department of State: Investment Climate Statement - South Africa 2011.
• Times Live: 'Arms deal commission will have subpoena powers', 27 October 2011.
• Presidency of Republic of South Africa: ‘Presidency to publicly release the Donen Commission Report’, Press release 18 October 2011.
• BBC News: 'South Africa reopens 1999 arms deal investigation', 15 September 2011.

• Mail & Guardian: ‘John Block fraud case postponed to 2012’, 10 June 2011.

• Time Live: ‘ANC provincial boss bust for tender fraud’, 4 November 2010.

• Global Integrity: South Africa Country Report 2008.

• The Bertelsmann Foundation: Transformation Index - South Africa 2008.
• IDASA, Pienaar, G.: Procurement corruption - New Agenda (Issue 31 Third Q) 2008.
• The World Bank & IFC: Enterprise Surveys 2007.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 37 2007.
• Global Integrity: South Africa Country Report 2006.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 28, 2006.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 27, 2006.
• Business Day: 'Inquiry into SA's Role in UN's Iraq Food Plan', 13 February 2006.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 24, 2005.
• Cape Times: 'Angry Skwatsha Responds to Allegations of Corruption, Not Paying Traffic Fines', 27 May 2005.
• The Herald: 'Smeared Malatsi to quit ministerial post', 18 May 2005.
• Business Day: 'Companies face threat of blacklist for tenders', 11 April 2005.
• Institute for Security Studies Information Portal on Corruption in Africa: The South African Strategic Defence Procurement Package Case Study.

Environment, Natural Resources and Extractive Industry

• The Bertelsmann Foundation: Transformation Index - South Africa 2010.
• Global Integrity: South Africa Country Report 2010.
• Mail & Guardian: 'Mining-audit inspectors face bribery, intimidation', 15 November 2010.
• Global Integrity: South Africa Country Report 2008.
• Institute for Security Studies, André Standing: Corruption and the Extractive Industries in Africa: Can combating corruption cure the resource curse? ISS Paper 153, October 2007.
• IOL News: 'Bookkeeper tells all', 18 February 2007.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 27, 2006.
• IOL: 'Massive corruption exposed in metal smuggling', 16 April 2006.

Public Anti-Corruption Initiatives Sources

• US Department of State: Investment Climate Statement - South Africa 2011.
• BBC News: 'South Africa MPs pass controversial 'secrecy bill'', 22 November 2011.
• Bloomberg: 'Zuma Suspends South African Police Chief After Graft Claims', 24 October 2011.
• News24: 'SAPS plans new anti-graft strategy', 13 September 2011.
• BBC News: 'South Africa police chief Bheki Cele in 'unlawful deal'', 14 July 2011.
• AFP: 'Elite S.Africa cops not independent enough: court', 17 March 2011.
• US Department of State: Human Rights Report 2010.
• Freedom House: Countries at the Crossroads - South Africa 2010.
• Global Integrity: South Africa Country Report 2010.
• BusinessDay: 'Motlanthe rejects additional lifestyle audits', 4 March 2010.
• Reuters: South Africa's Zuma orders review of troubled state firms', 21 February 2010.
• The Economist: Stop that virus: As widespread corruption is exposed, will Jacob Zuma tackle it?', 4 February 2010.
• BusinessDay: 'State urged to act on corrupt public servants', 29 January 2010.
• Institute for Democracy in South Africa: 'Public servants still profit from state procurement', 15 July 2009.
• South Africa Government Information: Address by the President of the Republic His Excellency Jacob G Zuma on the occasion of the Budget Vote of The Presidency, 24 June 2009.
• BuaNews: 'New Committee to Help Government Fight Corruption', 23 November 2009.
• BBC News: 'SA mayors told to end corruption', 20 October 2009.
• AllAfrica: 'South Africa: Scorpions Make Way for the Hawks', 7 July 2009.
• News24: 'Ex-Scorpion boss warns Hawks', 6 July 2009.
• The African Institute of Corporate Citizenship: Report on Benchmarking Anti-Corruption Initiatives in Africa 2009.
• The Bertelsmann Foundation: Transformation Index - South Africa 2008.
• Institute for Democracy in South Africa: Procurement Corruption 2008.
• Global Integrity: South Africa Country Report 2008
• The Economist: 'Scorpions Stung', 8 May 2008.
• Aljazeera: 'S. Africa to shut anti-crime agency', 12 February 2008.
• News 24: 'Scorpions to be dissolved', 12 February 2008.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 37 2007.
• Institute for Security Studies Information Portal on Corruption in Africa: SA Corruption Briefing Issue 36 2007.
• Mail and Guardian South Africa: 'Zuma Charged with Corruption', Fraud, 28 December 2007.
• Markinor Research Group: 'Tingle or Sting? The Potency of the Scorpions', 22 November 2007.
• Xinhua General News Service: 'South Africa to Conduct Survey to Help Combat Corruption', 31 July 2007.
• Pretoria News: 'Surge in Graft in Public Service - Report', 14 June 2007.
• Pretoria News: 'Training in Anti-Corruption Standards Lags', 4 July 2007.
• Freedom House: Countries at the Crossroads - South Africa 2006.
• Transparency International: Global Corruption Report 2006.
• UNDP: Institutional Arrangements to Combat Corruption 2005.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.
• The World Bank Institute: Business Fighting Corruption.

Private Anti-Corruption Initiatives Sources

• Freedom House: Freedom of the Press - South Africa 2011.
• Freedom House: Freedom of the Press Index 2011.
• BBC News: 'South Africa MPs pass controversial 'secrecy bill'', 22 November 2011.
• The Wall Street Journal: 'South Africa Parliament Passes Secrecy Bill', 22 November 2011.
• Freedom House: Countries at the Crossroads - South Africa 2010.
• US Department of State: Human Rights Report 2010.
• The Bertelsmann Foundation: Transformation Index - South Africa 2010.
• Global Integrity: South Africa Country Report 2010.
• Reporters Without Borders: South Africa Country Report 2010.
• Freedom House: Special Report Section - South Africa 2009.
• Freedom House: Freedom of the World - South Africa 2009.
• Pretoria News: 'Knives Out for Whistleblower Who Leaked SABC Graft Report', 16 August 2007.
• Transparency International: National Integrity Systems Country Study Report South Africa 2005.