A/HRC/19/42 I. Introduction 1. In its resolution 17/23, the Human Rights Council requested the United Nations High Commissioner for Human Rights to prepare a comprehensive study on the negative impact of the non-repatriation of funds of illicit origin to the countries of origin on the enjoyment of human rights, in particular economic, social and cultural rights, and to submit a report thereon to the Human Rights Council at its nineteenth session. 2. The present report is submitted in follow up to this request. II. The main obstacles to the repatriation of funds A. Funds of illicit origin: Estimated flows of funds of illicit origin and of funds not repatriated 3. As Human Rights Council resolution 17/23 refers to funds of illicit origin with regards to corruption, for the purpose of this report, “funds of illicit origin” and “proceeds of corruption” are used interchangeably. Both terms are understood as any property derived from or obtained, directly or indirectly, through the commission of a crime covered by the United Nations Convention against Corruption. 1 4. Proceeds of corruption are difficult to measure. The data is scarce and hard to collect. All methodologies resort to different assumptions and, when the task is of a global nature, the margin of confidence substantially decreases. Results are, therefore, rough estimations.2 For example, global bribery – both petty and grand – has been estimated at between US$ 600 billion and $1.5 trillion, that is to say, a median estimate of US$ 1 trillion.3 5. Annual estimates for international flows of the proceeds of corruption range between US$ 30 and $ 50 billion with a median estimate of US$ 40 billion and for flows out of developing and transition economies estimates range between US$ 20 and 40 billion for a median estimate of US$ 30 billion.4 This figure represents half of the official development 1 2 3 4 See General Assembly resolution 58/4, annex, United Nations Convention against Corruption, art. 2(e). United Nations Office on Drugs and Crime, “Estimating illicit financial flows resulting from drug trafficking and other transnational organized crimes” (2011), available at http://www.unodc.org/documents/data-and-analysis/Studies/Illicit_financial_flows_2011_web.pdf Daniel Kaufmann, “Myths and Realities of Governance and Corruption” (2005). Available at http://ssrn.com/abstract=829244 Raymond Baker, Capitalism´s Achilles Heel (New Jersey, John Wiley & Sons, 2005). According to Baker, proceeds of corruption represent around 3 per cent of the estimated illicit financial flows. Flows originating in organized crime activities – drugs, counterfeit goods and currency, human trafficking, illegal arms trade, smuggling and racketeering - amount to 33 per cent, and flows originating in illegal commercial activities -mispricing for tax evasion, abuses of transfer pricing, and commercial fraud- to 64 per cent. 3