Clifford Chance International Guide to Anti-Corruption Legislation
AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION MARCH 2019 CONTENTS
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Introduction 3 The United Nations Convention Against Corruption 5 The OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions 7 The OECD Recommendation for Further Combating Bribery of Foreign Public Officials in International Business Transactions 8 1. Australia 9 2. Belgium 12 3. Brazil 14 4. Czech Republic 17 5. France 20 6. Germany 24 7. Hong Kong 30 8. Italy 33 9. Japan 37 10. Luxembourg 40 12. Netherlands 44 13. People’s Republic Of China 47 14. Poland 52 15. Romania 55 16. Russia 57 17. Singapore 62 18. Slovak Republic 65 19. Spain 68 20. Turkey 72 21. Ukraine 75 22. United Arab Emirates 78 23. United Kingdom 80 24. United States 83 AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION 2019
INTRODUCTION
“While there are exceptions, the data [from Transparency International’s Corruption Perceptions Index 2018] shows that despite some progress, most countries are failing to make serious inroads against corruption. …This year, further research analysis shows a disturbing link between corruption and the health of democracies, where countries with higher rates of corruption also have weaker democratic institutions and political rights.”
Extract from Transparency International’s website following the launch of the TI CPI 2018 on 29 January 2019
Corruption is a global phenomenon which affects businesses applying for government licences, seeking tenders (both public and private sector), contracting with intermediaries and agents, giving charitable donations, getting goods or people across borders, providing corporate hospitality, hiring employees, starting up operations abroad, keeping accurate accounts, filing tax claims or just carrying out their daily business. Perhaps a local government official has asked for a favour, or an agent offers to arrange a private meeting with the Minister awarding a contract. A customs official may demand an “expedition fee” before releasing a company’s goods, or an agreement inherited as part of a take-over or merger situation seems to involve unusually high fees.
Corruption is illegal in many countries in the world, but anti-corruption laws can vary considerably from jurisdiction to jurisdiction and the grey area between acceptable corporate behaviour and corruption can be very murky. A number of international agreements on corruption have tried to set common standards, and to improve the ability of national authorities to prosecute corrupt individuals and companies by mechanisms on information sharing and extradition. Differences remain, however, causing headaches for multinationals wanting (or, in some cases, required) to implement global anti-corruption compliance programmes.
There is, indeed, a plethora of international instruments on corruption and related issues. The United Nations Convention against Transnational Organized Crime, adopted in 2000, though aimed mainly at organised crime, also included provisions directly relating to corruption. The Council of Europe has adopted both a Civil Law Convention on Corruption, designed to ensure that effective remedies exist in national law for persons who have suffered damage as a result of corruption, and a Criminal Law Convention on Corruption, aimed to coordinate criminalisation of a range of corrupt practices, including the active and passive bribery of domestic and foreign public officials, parliamentarians, judges and officials of international organisations as well as active and passive bribery in the private sector.
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Both the United Nations and the Council of Europe have adopted model codes of conduct for public officials (the International Code of Conduct for Public Officials adopted by the General Assembly in resolution 51/59 of 12 December 1996, and the Model Code of Conduct for Public Officials, adopted by the Committee of Ministers of the Council of Europe on 11 May 2000), dealing with general principles of integrity for public officials, and addressing specific issues such as conflicts of interest, the misuse of confidential information and the acceptance of gifts and hospitality.
Further instruments, such as the Convention on the Fight against Corruption involving Officials of the European Communities or Officials of Member States of the European Union (adopted by the Council of the European Union on 26 May 1997 and requiring EU Member States to criminalise active and passive corruption of Community or national officials), the African Union Convention on Preventing and Combating Corruption, and the Organization of American States Inter-American Convention against Corruption, emphasise both the importance of the topic and the range of international organisations involved.
This guide looks briefly at what are, arguably, the two most important agreements, the UN Convention against Corruption and the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (and the related OECD Recommendation for Further Combating Bribery of Foreign Public Officials), and provides a short overview of the anti-corruption laws in a number of different countries around the world. It sets out the key elements of the offence in each jurisdiction, looks at whether the law applies extraterritorially, examines how gifts and entertainment and facilitation payments are treated, and identifies what the penalties are, using these ten questions:
• What is the definition of bribery? • What is the definition of a public official and a foreign public official? • Is private sector bribery covered by the law? • Does the law apply beyond national boundaries? • How are gifts and hospitality treated? • Is there an exemption for facilitation payments? • How is bribery through intermediaries treated? • Are companies liable for the actions of their subsidiaries? • Are companies required, or is it a defence, to have compliance procedures in place? • What are the penalties?
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THE UNITED NATIONS CONVENTION AGAINST CORRUPTION
“Corruption is present in all countries, rich and poor, North and South. ...It robs societies of schools, hospitals and other vital services, drives away foreign investment and strips nations of their natural resources. It undermines the rule of law and abets crimes such as the illicit trafficking of people, drugs and arms. …the cost of corruption is at least £2.6 trillion [and] businesses and individuals pay more than $1 trillion in bribes each year.” António Guterres, United Nations Secretary-General, 9 December 2018
The UN Convention, which was opened • the laundering of proceeds of regard”. In particular, Parties must for signature on 9 December 2003, has crime; and establish mechanisms including both civil been ratified by 186 countries1 and and criminal recovery procedures, • obstruction of justice. came into force on 14 December 2005. whereby assets can be traced, frozen, 9 December is now marked annually as seized, forfeited and returned. In addition, Parties must consider international anti-corruption day. criminalising trading in influence, the Preventative measures are also required, abuse of functions by a public The purposes of the Convention, stated including the generation of records that official, illicit enrichment and private at Article 1, are: can be used to assist in the asset sector bribery. recovery process and the identification of • to promote and strengthen measures experts in developing countries to provide to prevent and combat corruption more Each Party must, consistent with its legal technical assistance. efficiently and effectively; principles, adopt measures to establish the liability of legal persons for • to promote, facilitate and support While the Convention is clearly a participation in Convention offences and international cooperation and technical welcome development as the first truly must take, “to the greatest extent assistance in the prevention of and global legal instrument on corruption, possible within its domestic legal fight against corruption, including in there are a number of aspects to the system”, measures to facilitate freezing, asset recovery; and Convention that have given rise for seizure and confiscation of the proceeds concern. One of these concerns, the lack • to promote integrity, accountability and of Convention offences. of any inherent monitoring or enforcement proper management of public affairs mechanism in the instrument itself, was and public property. Parties are required to cooperate with addressed at the November 2009 UN other Parties in areas such as the Conference in Doha when a “Review All Parties to the Convention are required extradition of offenders, mutual legal mechanism” was supported by a vast to criminalise: assistance and less formal methods number of signatory countries, and by of cooperation in the course of the bribery of national and foreign public international companies. investigations and other officials, as well as officials of public law-enforcement activities. international organisations; Under this mechanism, states parties to be reviewed in each year of the four-year • the embezzlement, misappropriation Article 51 states that the return of assets cycle are selected by lot, and the country or other diversion of either public or is a “fundamental principle” of the review, reports composed of self- private funds by a public official to Convention and requires Parties to give assessments and peer reviews are whom the funds have been entrusted; each other “the widest measure of published on the UN website. cooperation and assistance in this
1. As at 22 January 2019
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Critics argue that a handful of countries ineffective because it is an open-ended but only “where appropriate and in have compromised the review intergovernmental group of State parties, accordance with the fundamental mechanism by weakening key provisions, rather than a smaller group of principles of its legal system”. namely those providing for participation independent experts. of civil society organisations in the review There is no doubt, however, that the UN process and publication of country A further concern is the large number of Convention has been instrumental in reports. The adopted mechanism gives “optional” Articles in the Convention. helping countries work towards governments discretion to exclude civil These include Articles where Parties are establishing a common framework for society from the review process, and required simply to “consider” adopting anti-bribery measures, and in increasing withhold information from publication in particular measures (see above for the focus of the international community country reports. Critics also suggest that examples), as well as Articles where on the issues surrounding corruption. the implementation review group will be Parties are required to adopt measures,
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THE OECD CONVENTION ON COMBATING BRIBERY OF FOREIGN PUBLIC OFFICIALS IN INTERNATIONAL BUSINESS TRANSACTIONS
“Corruption remains one of the most pressing challenges of our time. It promotes mistrust in governments, public institutions, banks, corporations, politicians, political parties, democracies, you name it. It corrodes our social fabric. [In a 2017 survey] only 15% of citizens felt the system was working for them and 69% expressed concerns about ‘corruption’. Angel Gurría, OECD Secretary-General, 14 November 2018
On 17 December 1997, OECD member Parties must prohibit off-the-book A table showing the date of ratification, countries and five non-member countries accounts and other accounting the date of entry into force of the (Argentina, Brazil, Bulgaria, Chile and irregularities for the purpose of bribery Convention and the date of entry into Slovenia) signed a Convention on or of hiding such bribery and there are force of the implementing legislation can Combating Bribery of Foreign Public also provisions on money laundering, be found at http://www.oecd.org/daf/ Officials in International Business mutual legal assistance, extradition anti-bribery/ Transactions. There are now 44 signatory and monitoring. antibriberyconventionratification.pdf. countries to the Convention2, which came into force on 15 February 1999. Signatories to the OECD Although (or perhaps because) the scope Convention of the OECD Convention, both in terms The Convention requires Parties to make of geographical coverage and in terms of the bribery of foreign public officials (as Argentina Japan the range of subject matter, is more defined) a criminal offence, as well as Australia Korea restricted than the UN Convention, it has related offences of incitement, aiding Austria Latvia proved an effective instrument for and abetting, authorisation, attempt Belgium Lithuania changes in the laws and procedures of and conspiracy. Brazil Luxembourg the Parties. The Parties are required (by Bulgaria Mexico Article 12) to cooperate in carrying out “a Parties must also (in accordance with Canada Netherlands programme of systematic follow-up to their legal principles) establish the liability Chile New Zealand monitor and promote the full of legal persons for the bribery of foreign Colombia Norway implementation of [the] Convention”, and public officials, and must put in place Costa Rica Peru the evaluation reports drawn up as part effective penalties, including seizure Czech Republic Poland of this programme have identified areas and confiscation or comparable Denmark Portugal of weakness in the implementing monetary sanctions. Estonia Russian Federation legislation and policies of the Parties, and Finland Slovak Republic made detailed recommendations for A key element of the Convention is the France Slovenia changes, which Parties have, in the requirement that Parties establish Germany South Africa main, heeded. jurisdiction where the offence is Greece Spain committed in whole or in part in their Hungary Sweden territory. They are also required to take Iceland Switzerland measures to establish jurisdiction to Ireland Turkey prosecute their nationals for offences Israel United Kingdom committed abroad where such Italy United States jurisdiction exists for other offences, according to the same principles.
2. As at 22 January 2019
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THE OECD RECOMMENDATION FOR FURTHER COMBATING BRIBERY OF FOREIGN PUBLIC OFFICIALS IN INTERNATIONAL BUSINESS TRANSACTIONS
On 9 December 2009, the Parties to the OECD Convention agreed to put in place further measures to reinforce their efforts to prevent, detect and investigate foreign bribery. These include provisions for combating small facilitation payments, protecting whistleblowers and improving communication between public officials and law enforcement authorities.
This Recommendation for Further As an integral part of the The Guidance also recommends that Combating Bribery of Foreign Public Recommendation, the OECD Council business organisations play a leading role Officials called on the State Parties to also adopted (on 18 February 2019) the in providing information, advice and the OECD Anti-Bribery Convention to, Good Practice Guidance on Internal training to companies, especially small inter alia: Controls, Ethics and Compliance3 which and medium-sized enterprises, on how to is “intended to serve as non-legally protect themselves against the risk of • ensure companies cannot avoid binding guidance to companies in foreign bribery. sanctions by using agents and establishing effective internal controls, intermediaries to bribe for them; ethics, and compliance programmes or The OECD has announced a review of • periodically review policies and measures for preventing and detecting the Recommendation and a consultation approach on small facilitation foreign bribery”. Specifically, the Good document is expected to be published in payments. These are legal in some Practice Guidance calls on businesses to: the second quarter of 2019. countries if the payment is made to a • adopt a clear and visible anti-bribery government employee to speed up an policy that is strongly supported by administrative process; senior management; • improve co-operation between • instil a sense of responsibility for countries on foreign bribery compliance with the policy at all levels investigations and the seizure, of the company, and establish confiscation and recovery of the independent compliance structures; proceeds of transnational bribery; • keep up regular communication and • provide effective channels for reporting training on foreign bribery for all foreign bribery to law enforcement employees, as well as with business authorities and for protecting partners; and whistleblowers from retaliation; and • encourage observance of • working more closely with the private anti-bribery compliance measures, sector, adopt more stringent internal and have disciplinary procedures to controls, ethics and compliance address violations. programmes and measures to prevent and detect bribery.
3. http://www.oecd.org/daf/anti-bribery/44884389.pdf
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AUSTRALIA
What is the definition the official’s duties as a foreign What is the definition of a of bribery? public official in order to: public official and a There are laws in each State and Territory (i) obtain or retain business; or foreign public official? of Australia which make bribery of state (ii) obtain or retain a business The term “foreign public official” is and local officials, as well as bribery of advantage that is not broadly defined in the Criminal Code private individuals, an offence in some legitimately due to the and includes: circumstances. In general, such laws recipient, or intended make it an offence to give, offer or accept • an employee or official of a foreign recipient, of the business a benefit of any kind dishonestly or government body; advantage (who may be the corruptly. In addition, the payment or first-mentioned person).” • a member of the executive, judiciary or receipt of secret commissions or corrupt magistracy of a foreign country; rewards as inducements, both in the It is not necessary to prove that business, public and private sectors, also or a business advantage, was actually • a person who performs official duties constitute offences under some obtained or retained. In working out under a foreign law; State laws in Australia. whether a benefit, or a business • a member or officer of the legislature of advantage, is “not legitimately due” for a foreign country; Division 70 of the Criminal Code Act the purposes of the section, the Criminal 1995 (Commonwealth) sets out the Code requires that the following factors • an employee or official or a public statutory offence of bribing foreign be disregarded: international organisation; public officials. • the fact that the benefit or business • an authorised intermediary of a foreign advantage may be, or be perceived to public official or someone who holds Section 70.2 provides: be, customary, in the situation; themselves out to be an authorised “(1) A person is guilty of an offence if: intermediary. • the value of the benefit or business (a) the person: advantage; and The term “Commonwealth public official” (i) provides a benefit to • any official tolerance of the benefit or is also defined in the Criminal Code another person; or business advantage. and includes: (ii) causes a benefit to another • the Governor-General, a Minister, a The Australian Government has proposed person; or Parliamentary Secretary, a member of an amendment to section 70.2 to clarify either House of the Parliament; (iii) offers to provide, or that it is not necessary to prove that the promises to provide, a accused person intended to influence a • a judicial officer; benefit to another person; or particular foreign public official (in the • a member of the Australian Defence Crimes Legislation Amendment (iv) causes an offer of the Force, or Australian Federal Police; (Combatting Corporate Crime) Bill 2017 provision of a benefit, or a (the “CLA Bill”)). • an officer or employee of a promise of the provision of a Commonwealth authority; benefit, to be made to It is also an offence under sections another person; and • an individual who is a contracted 141.1 and 142.1 of the Criminal Code to service provider for a Commonwealth (b) the benefit is not legitimately due to bribe or give a corrupt benefit to a contract; the other person; and Commonwealth public official. The public official who receives the bribe can • individuals who exercise powers or (c) the first-mentioned person does so also be criminally liable under the perform functions, or holds or with the intention of influencing a Criminal Code. performs the duties of an office foreign public official (who may be established, under certain the other person) in the exercise of Commonwealth legislation.
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Is private sector bribery bribing a foreign public official in section • the board of directors or a high covered by the law? 70.4. In summary, there is a defence if: managerial agent intentionally, knowingly or recklessly carried out the Private sector bribery is not addressed in • the value of the benefit was of a conduct or expressly, tacitly or the Criminal Code but is covered by minor nature; impliedly permitted the commission of individual State and Territory laws. • the person’s conduct was engaged in the offence; for the sole or dominant purpose of • a corporate culture existed that Does the law apply expediting or securing the performance directed, encouraged, tolerated or led beyond national of a routine government action of a to the offence; or boundaries? minor nature; and • the company failed to create and Yes. The law will apply if the offending • as soon as practicable after the maintain a corporate culture that conduct occurs wholly or partly in conduct occurred, the person made a required compliance with the Australia or wholly or partly on board an record of the conduct. Australian aircraft or Australian ship. relevant laws. Even if no part of an offence takes place A “routine government action” is an Otherwise the Criminal Code does not in Australia, a person may still be action that is ordinarily and commonly provide that a parent company is liable prosecuted in Australia if, at the time of performed by the foreign public official for the actions of its subsidiaries. the alleged offence, that person is: (such as granting a licence, processing government papers, and unloading • an Australian citizen; The Australian government has proposed cargo), but does not cover decisions (in the CLA Bill) the introduction of a new • a resident of Australia; or about whether to award new business or offence of failing to prevent bribery. If continue existing business. • a body corporate incorporated by or introduced, this would make a company under a law of the Commonwealth or liable for the actions of its associates of a State or Territory. How is bribery through unless the company could establish that intermediaries treated? it had adequate procedures in place to The offence of bribing a Commonwealth A bribe paid to an intermediary of a prevent bribery occurring. public official applies regardless of foreign public official will be captured by whether or not the conduct constituting the legislation. Bribes paid by an Are companies required, the alleged offence occurs in Australia, intermediary of an Australian company, or is it a defence, to have and whether or not a result of the citizen or resident will be captured if the conduct occurs in Australia. principal is found to have aided, abetted, compliance procedures counselled or procured the offence. In in place? How are gifts and order for such an offence to be made There is no specific requirement or hospitality treated? out, the person must have intended that defence of having compliance Gifts and hospitality are likely to be his/her conduct aids, abets, counsels or procedures in place. However, the viewed as a “benefit” and may therefore procures the offence. existence of a robust anti-corruption be bribes depending on whether the programme is likely to be taken into other elements of the offence are Are companies liable for account in an enforcement action present, such as whether or not there is the actions of their against the company and may assist in an intention to influence the recipient negating any allegations that a company when providing the gift or hospitality. subsidiaries? was liable for the actions of its employee The Criminal Code provides that a or subsidiary. Under Australian law, a company can be liable for the conduct of Is there an exemption for company may be held criminally liable its employees, agents and officers if it for an offence if the company’s culture facilitation payments? “expressly, tacitly or impliedly authorised directed, encouraged, tolerated or led to The Criminal Code provides a facilitation or permitted the commission of the the offence, or if the company failed to payment defence to the offence of offence”. This may be established by create a culture that required compliance showing that: with the law.
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As noted above, the Australian What are the penalties? • if the court cannot determine the value government has proposed the The maximum penalty for a corporation is of the benefit, 10% of the annual introduction of a new corporate offence the greater of: turnover of the corporation during the of failing to prevent bribery, similar to 12 month period ending at the end of the offence which exists in the United • 100,000 penalty units (currently AUD the month in which the offending Kingdom. This will require the company 21 million); conduct occurred. to establish that it had adequate • if the value of the benefit obtained procedures in place to prevent directly or indirectly by the corporation The maximum penalty for an individual bribery occurring as a defence to or related body corporate can be is 10 years’ imprisonment and/or a fine any prosecution. determined by the court then three of 10,000 penalty units (currently AUD times the value of the benefit 2.1 million). attributable to the conduct constituting the offence; or
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BELGIUM
What is the definition function to use the real or supposed Managers of private enterprises are of bribery? influence he possesses because of his deemed to exercise public functions to function to induce a public authority or the extent that the act of bribery affects a Belgian law prohibits both active and administration to perform or refrain from public service mission entrusted to the passive bribery, and has separate an act” (Article 247 (4) of the Criminal enterprise. A political party official in a offences of bribing public officials and Code). This offence is very broad since it single party country would be considered private sector persons. covers acts that may or may not be a to be a public official if he performed part of the public official’s duties, and public functions. Active bribery in the public sector is prohibits any use of influence. described as “[t]he act of proposing, whether directly or through Is private sector bribery intermediaries, an offer, promise or What is the definition of a covered by the law? advantage of any kind to a person public official and a Private sector bribery is a separate exercising a public function, either for foreign public official? offence in Belgian law (although there is himself or a third party, in order to induce The term “person exercising a public some overlap). It is an offence for any him to act in one of the ways specified in function”, for the purposes of the public person to propose to another person in Article 247” (Article 246 (2) of the Criminal sector bribery offence, includes all his capacity as director or manager of a Code). Passive bribery consists of the categories of persons who, whatever legal entity, proxy holder or employee of a latter person asking for, accepting or their status, exercise a public function of legal entity, or proxy holder or employee receiving this offer, promise or advantage any kind, i.e., federal, regional, of a natural person, any offer, promise or of any kind (Article 246(1) of the community, provincial, communal civil benefit, directly or indirectly and whether Criminal Code). servants or public officials. It includes for himself or for a third party, in order to elected officials, i.e., any persons do, or omit to do, an act within his It does not matter whether the offer, holding legislative, communal or other function, without the authorisation and promise or advantage is for the benefit of elected office, public officers, and knowledge of the board of directors, the the person who exercises a public temporary or permanent holders of general meeting of shareholders, the function or for a third party, and there is public power or authority. principal or the employer (as the case no requirement to prove a connection may be). It is also an offence for a person between the public official and any such The provisions on public sector bribery acting in one of the capacities above to third party. also extend to certain persons who do request, accept or receive such an offer, not exercise a public function within the promise or benefit (Article 504 bis Article 247 of the Criminal Code (as Belgian legal system. The same sanctions Criminal Code). amended by the Bribery Prevention Act apply to bribery of persons exercising a of 10 February 1999) defines the different public function in a foreign State or in a Does the law apply types of behaviour that bribery may seek public international organisation (Article to induce. Bribery can be aimed at beyond national 250). The same broad, functional boundaries? inducing a public official to perform a definition of “persons exercising a public Belgian courts have jurisdiction over proper but “unpaid” official act, to engage function” applies to them. in an improper act while carrying out public bribery offences where at least one element of the offence took place on official duties or refrain from a proper Individuals who are applying for a public Belgian territory. one, or to commit a criminal offence position, who lead others to believe that or misdemeanour in the course of they will exercise a public function or Where a bribery offence is committed official duties. who, by misrepresenting themselves, outside Belgium, Belgian courts mislead others into believing that they will have jurisdiction: A separate offence of trading in influence exercise a public function are also is defined as bribery that “is aimed at included (Article 246 (3)). inducing a person exercising a public
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(i) where it is committed by a Belgian latter is deemed to have been acting as subject to higher penalties than for citizen or by someone who has their an intermediary through which the other public officials). Bribery of foreign main residence in Belgium; or offence of bribery was committed. pubic officials is also subject to more severe punishment. (ii) with respect to the bribery of a person holding public office, where Are companies liable for For companies and other legal entities, the offence relates to a Belgian the actions of their the maximum fine is EUR 2.88 million, official, to a Belgian official of a subsidiaries? and assets may also be confiscated. foreign country or an international Parent companies are not liable for The calculation of fines for companies is organisation that has its offences committed by their subsidiaries subject to complicated rules, and to headquarters in Belgium. by virtue only of the ownership changes due to the “indexation” relationship. However, the parent (“opdeciemen”) of these amounts. Where the bribe-payer is a Belgian company may be liable where a Legal persons may also be dissolved, national or resident and the act of bribery subsidiary is considered to have been may be prohibited from carrying on an is committed outside Belgium and acting as an intermediary in respect of activity relating to corporate services or concerns a public official who is neither the bribery offence. may be required to close down one or Belgian nor employed by an international more establishments. organisation headquartered in Belgium, Are companies required, Belgian courts will only have jurisdiction if A Law of 11 May 2007 explicitly prohibits the act is also punishable under the laws or is it a defence, to have the tax deductibility of secret of the country in which the act is compliance procedures commissions by companies. Any such committed (Article 10 quater (2) of the in place? commissions cannot be exempted from Preliminary Title of the Belgian Code of Companies are not required to have anti- tax through other deductions. The cost or Criminal Procedure). bribery compliance procedures in place. advantage (i.e., the secret commission) However, a company may be able to will furthermore be taxed at a rate of How are gifts and avoid corporate liability in respect of an 103% (if the beneficiary is a person) or hospitality treated? offence committed by an employee or 51.5% (if the recipient is a legal entity) Gifts and hospitality are likely to be intermediary where it can prove that the (Article 219 of the Income Tax Code). To treated as an “advantage” and may company did not have criminal intent, the extent this separate taxation can be therefore be bribes where the other that it exercised appropriate due diligence considered as a criminal sanction, it is elements of the offence are present. in the hiring or supervision of the person eligible for reduction or mitigation by who committed the offence and that the the judge. Is there an exemption for offence was not the consequence of defective internal controls and systems. facilitation payments? Active private bribery by an individual is punishable with a prison sentence of up There is no exemption in Belgian law for What are the penalties? to three years and/or a fine of up to facilitation payments, and such payments Sanctions for bribery vary according to EUR 800,000. For companies and other will therefore fall within the scope of the the nature of the offence and the capacity legal entities, the maximum fine is Article 246 offence if the necessary of the public official who receives or is EUR 1.6 million. elements of the offence are present. offered a bribe. For both public and private bribery, other Article 247 specifically states that a bribe Active bribery of a person holding public sanctions include being debarred from for performing “a proper but unpaid office by an individual is punishable with a certain offices, from public sector official act” will be an offence. prison sentence of up to five years and/or contracts, and confiscation of the a fine of up to EUR 800,000. These proceeds of the offence. How is bribery through penalties can however be increased intermediaries treated? depending on the capacity of the person A company can be held liable for the bribed (e.g., the bribery of judges being actions of an intermediary where the
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BRAZIL
What is the definition “[an] act of requesting, demanding, (ii) using an intermediary to hide the of bribery? imposing or obtaining, for the agent or for company’s real interest or the a third party, directly or indirectly, any identity of the beneficiary of the The Brazilian Criminal Code improper advantage or promise of prohibited acts; The Brazilian Criminal Code (Article 333) advantage, with the intent of influencing a provides that it is an offence to offer or (iii) engaging in fraudulent activities in a foreign public official in the performance promise an undue advantage to a public public bid or public procurement of his or her duties, related to an official, in order for him to put into process; or international business transaction”. practice, to omit or delay, any official act (iv) intervening, in any way, in the actions (active corruption). The term “undue advantage” is not and decisions of a public official. defined, and does not have to have a Article 316 of the Brazilian Criminal Code direct financial or commercial value. The Administrative Improbity Act prohibits a direct or indirect demand to a Other types of advantage may therefore The Administrative Improbity Act5 public official or a third party to grant an be deemed undue, for example, offering prohibits obtaining any undue patrimonial undue advantage through a public office a job to the son of a government official. advantage due to the exercise of public (even if the person is no longer in office, office (Article 9). or is not yet in office) (graft). The Brazilian Clean Companies Act The Brazilian Clean Companies Act4 Article 317 prohibits passive corruption, What is the definition of a (section 5) creates strict civil and and Article 332 prohibits influence public official and a administrative corporate liability for peddling - the request, demand, or bribery of foreign and domestic officials. It foreign public official? receipt, by oneself or a third party, of an applies to “constituted corporate A public official is defined in Article 327 of advantage or promise, with the aim of enterprises, regardless of the organisation the Brazilian Criminal Code as an influencing an act by a public official in or corporate structure adopted, as well individual who holds a public position, job the exercise of office. as any constituted foundations, or office, whether permanent or associations of entities or individuals, or temporary and whether paid or unpaid. In respect of foreign public officials, foreign companies, based or with The term includes employees from all Article 337-B of the Brazilian Criminal affiliates or representation in Brazilian bodies, entities and branches of the Code prohibits: territory, even if temporarily constituted”. government, at municipal, state and Under this provision, the mere promise of federal levels, including elected officials. It “[an] act or promising, offering or undue advantage is enough to constitute also includes employees of private granting, directly or indirectly, any a corrupt act, even if not materially given. companies who are performing an activity improper advantage to a foreign public typically performed by the state. official or to a third party, to lead the Other corrupt acts prohibited by the official into practising, omitting or delaying Clean Companies Act include: Officials at state-owned or controlled an official act related to an international companies that perform public services business transaction”. (i) bearing, in any way, the costs of are also public officials for the purposes carrying out acts prohibited by the of the corruption offences. Article 337-C prohibits: Clean Companies Act;
4. Federal Law No. 12,846 of 2014 5. Law 8,429 of 1992
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A foreign public official is a person who government officials, and there are or indirectly, benefits from the act of the holds a public position, job or office, state and municipal rules which apply controlled, owned or related company. whether permanent or temporary and more locally. whether paid or unpaid, in a government Under the Clean Companies Act a agency or entity, the diplomatic Is there an exemption for company is jointly liable with its representation of a foreign country, a facilitation payments? subsidiary for conduct prohibited by that legal entity controlled, directly or Act. Penalties are restricted to the There is no exemption in Brazilian law for indirectly, by the government of a payment of fines and compensation facilitation payments. foreign country, or an international for damages. public organisation. How is bribery through Are companies required, Is private sector bribery intermediaries treated? or is it a defence, to have Both the Brazilian Criminal Code and the covered by the law? Clean Companies Act expressly provide compliance procedures Private sector bribery is not covered by that bribery of domestic and foreign in place? Brazilian law. public officials may be committed directly Private sector companies are not required or indirectly. to have anti-bribery internal controls in Does the law apply place either as an affirmative requirement beyond national borders? Under the Administrative Improbity Act a or as a defence to liability for acts of The Brazilian Criminal Code applies company could be held liable for corrupt bribery by employees or agents. to corruption and influence peddling in acts by an intermediary where it had relation to foreign public officials in induced, agreed to, or in any way, directly However, the existence and depth of an the context of international or indirectly benefited from such acts. ‘Integrity Programme’ will be considered business transactions. when determining the range of fines and The Clean Companies Act specifically penalties to be applied to companies The Brazilian Clean Companies Act prohibits the use of an intermediary to found to have violated the Clean applies to bribery of domestic and foreign hide the company’s real interest, or the Companies Act. public officials even in circumstances identity of the beneficiary of a where the corruption takes place outside wrongful act. Additionally, Leniency Agreements signed Brazil, if the relevant company is based, with Brazilian authorities (whether or not or has subsidiaries or representation, in Are companies liable for relating to conduct prohibited by the Brazilian territory. the actions of their Clean Companies Act) typically include an obligation on the company to subsidiaries? How are gifts and implement or improve a Compliance/ There is no corporate criminal liability in Integrity Programme as part of the deal. hospitality treated? Brazil, other than for environmental An undue advantage may include gifts crimes. A company cannot therefore be The General Comptroller’s Office and the and hospitality, which may therefore be held criminally liable for a bribery offence Instituto Ethos (a private organisation of bribes if the other elements of an offence committed by its subsidiary. public interest) have jointly established a are present. programme designed to promote the However, under the Administrative adoption of voluntary anti-corruption or Additionally, there are instructions and Improbity Act, a controlling or investing integrity measures within the corporate guidance from the Government and the entity can be held civilly liable, where it sector. Companies certified by this General Comptroller’s Office which set induces, agrees to or, in any way, directly programme as having internal controls out more detailed rules for federal
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and measures designed to achieve the What are the penalties? Penalties for breaches of the programme’s objective receive specific Active corruption – imprisonment of two Administrative Improbity Act include: the public incentives and market recognition. to twelve years, and fines. loss of illegally obtained gains; indemnification of damages caused; loss State-owned companies are required to Passive corruption – imprisonment of two of public office; suspension of political have internal integrity controls and to twelve years, and fines. rights for eight to ten years; fines; measures to manage compliance and debarment from government contracts; anti-corruption risks related to the Graft – imprisonment of three to eight and a prohibition on receiving subsidies company’s business. years, and fines. or loans from state-controlled financial institution or other entities for a period of Influence peddling – imprisonment of two up to ten years. to five years, and fines.
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CZECH REPUBLIC
What is the definition (iii) to give or accept bribes in order to or other public authority of a of bribery? exert influence on public officials foreign state; (i.e. “indirect bribery”). Czech law approach to bribery is twofold. (iii) persons holding office, employed or In the area of private law, bribery is Under the Czech Criminal Code working in an international prohibited under unfair competition “procuring matters in the public interest” organisation formed by states or provisions contained in Czech Act No. means performing all tasks whose proper, other subjects of public international 89/2012 Coll, as amended (the “Czech due and impartial performance is in the law or its bodies and institutions or Civil Code”) which define “bribery” as interests of the public or in the interests persons acting in a name thereof, offering, promising or providing any of social groups. The Czech Criminal e.g. employees of the EU institutions, benefit in order to obtain an undue Code (section 334(3)) further provides members of the European competitive advantage, as well as that “procuring matters in the public Parliament; and requesting, accepting or being promised interest” is also deemed to include (iv) persons holding an office in an such benefit. compliance with the obligation to cause enterprise in which the Czech no harm and provide no unjustified Republic or a foreign state has a From the public law standpoint, bribery is advantage to parties to commercial decisive influence (section 127 and prosecuted under Czech Act No. transactions. In addition, the Czech 334(2) of the Czech Criminal Code). 40/2009 Coll., the Criminal Code, as Criminal Code prohibits giving or amended (the “Czech Criminal Code”) accepting bribes in connection with There is no separate definition of foreign which defines “bribe” as any unjustified “business activities”. Although the term public official and foreign public officials advantage (i.e. direct property enrichment “business activity” is not defined in the are included within the definition of or other advantage) obtained directly by Czech Criminal Code, this term is public official. the recipient or by another person with indirectly defined in the definition of the recipient’s permission, to which the “entrepreneur” in the Czech Civil Code, recipient is not legally entitled (e.g. gifts, as a profitable trade-like activity carried Is private sector bribery hospitality and invitations to events) out independently on one’s own account covered by the law? (section 334(1)). Based on this definition, and responsibility and with the intention Yes, the bribery offences set out above the Czech Criminal Code describes of doing so systematically in order to can apply to bribery of private sector several “bribery offences” in sections 331 make a profit. persons, except for the offence of to 333, including: indirect bribery. What is the definition of a (a) accepting bribes; Where a bribery offence has been public official and a (b) offering bribes; and committed by a public official or in foreign public official? relation to a public official, the maximum (c) indirect bribery. The term public official is defined to penalties available are higher. include, inter alia: In particular, the Czech Criminal Code Does the law apply makes it an offence: (i) the president of the Czech Republic, the members of the Czech beyond national (i) to give or accept bribes in Parliament, the members of the boundaries? connection with “procuring matters in Czech government or other persons Yes. The provisions of the Czech Criminal the public interest” for oneself or for holding a position in a public Code have particularly broad someone else; authority, e.g. employees of the extraterritorial reach. Among other things, (ii) to give or accept bribes in Czech Permanent Representation to the Czech Criminal Code applies to: connection with the “business the EU and Czech Embassies; (i) an act committed in the Czech activities” of oneself or someone (ii) persons holding office at the Republic even if the breach of, or else; and legislative body, judicial authority threat to, an interest protected under
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the Czech Criminal Code took place that the elements of a bribery office are company’s bodies or persons or was intended to take place present in the relevant conduct. specified under (i) to (iii) above was abroad; and not exercised. (ii) an act committed abroad if the Are companies liable for These provisions do not seem to breach of, or threat to, an interest the actions of their introduce liability of companies for the protected under the Czech Criminal subsidiaries? actions of their subsidiaries. However, Code, or at least a part of the Generally, in accordance with the Czech they have not yet been tested in court consequence of such act, took place Act No. 418/2011 Coll., on Criminal and it is not entirely clear how they or was intended to take place in the Liability of Legal Entities (the “Czech Act would apply to parent companies and Czech Republic. on Criminal Liability of Legal their subsidiaries. Entities”) companies may be held The Czech Criminal Code also applies to criminally liable for specific criminal Are companies required, conduct on board a Czech aircraft or a offences including the criminal offence of Czech ship abroad. offering bribes and indirect bribery. or is it a defence, to have compliance procedures The provisions of the Czech Criminal In particular, under sections 8(1) and 8(2), in place? Code are also applicable to criminal a company may be held criminally liable There is no requirement for companies to offences committed by Czech if the criminal offence is committed on have anti-bribery compliance procedures citizens abroad. its behalf, in its interests or as part of in place, but under the Czech Act on its activities and the offence is Criminal Liability of Legal Entities a How are gifts and committed by: company can attract criminal liability for hospitality treated? (i) its statutory body, a member of its a bribery offence committed by an In line with the definition of a “bribe” statutory body or other persons employee in circumstances where due contained in the Czech Criminal Code, acting on behalf of the company (e.g. supervision was not exercised gifts, hospitality and invitations to events agents) or by a person in a leading (see above). may be considered prohibited where the role within the company; other elements of the offence are A company may defend itself from present. (ii) persons in a leading role within the criminal liability if it proves that it company authorized to perform exercised due care to the maximum Is there an exemption for managerial or supervisory activities extent that can be justly requested of the within the company, even if they are facilitation payments? company in order to prevent persons not specified in (i) above; specified under (i) to (iv) above from the There is no specific exemption in Czech relevant criminal conduct. law for facilitation payments. Each (iii) persons exercising decisive influence payment is judged according to over the management of the whether or not it fulfils the criteria of a company, if the conduct of such What are the penalties? bribery offence. person was one of the causes of the The penalties for a bribery offence under consequences upon which the the Czech Criminal Code include How is bribery through criminal liability of the company is imprisonment for a term of up to 12 based; or years, forfeiture of property and/or a intermediaries treated? monetary penalty of up to approximately (iv) employees of the company or From the perspective of the Czech EUR 1.35 million (forfeiture of property persons with similar status while Criminal Code, it is irrelevant whether a and a monetary penalty cannot be carrying out their work tasks on the bribery offence is committed directly or imposed at the same time). The actual basis of resolutions or instructions of via an intermediary. In addition, also the length of the term of imprisonment and/ the company’s bodies or persons intermediaries may be held criminally or the amount of the monetary penalty specified under (i) to (iii) above, or liable, provided that relevant persons depends, among other things, on the were aware or should have been aware where due supervision by the
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scale and seriousness of the offence, the (section 20 of the Czech Act on (v) publication of a judgment, if the court amount of the bribe etc. Criminal Liability of Legal Entities); deems that the public should be informed about a condemning (iii) prohibition of performance under The penalties for a bribery offence under judgment (section 23 of the Czech public procurement contracts, the Czech Act on Criminal Liability of Act on Criminal Liability of participation in concession Legal Entities are the following: Legal Entities). procedures or public tenders for up (i) monetary penalty of up to to 20 years, if the criminal offence Under the Czech Civil Code, penalties approximately EUR 54 million; in was committed in connection with may include compensation, private addition to factors such as the scale participation of the legal entity therein damages and return of unfair enrichment. and seriousness of the offence, the (section 21 of the Czech Act on amount of the bribe etc., the actual Criminal Liability of Legal Entities); Czech Act No. 137/2006 Coll., on Public amount of the monetary penalty is (iv) prohibition on accepting grants and Procurement, as amended, expressly also based on the value of the subsidies for up to 20 years if the prohibits participation in public property owned by the legal entity criminal offence was committed in procurement by persons who themselves (section 18 of the Czech Act on connection with the application, or whose statutory body (or member Criminal Liability of Legal Entities); provision or utilisation of any grant, thereof) were effectively convicted of a (ii) prohibition of activity (e.g. a business subsidy or any public aid (section 22 bribery offence. activity) for up to 20 years, if the of the Czech Act on Criminal Liability criminal offence was committed in of Legal Entities); and/or connection with such activity
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FRANCE
What is the definition holding a public electoral mandate, for service mission or holding a public of bribery? himself or for a third party: electoral mandate in a foreign country or in an international public organisation, for The offences of corruption are set out in (1) either to induce him to carry out or himself or for a third party, either to the French Criminal Code6, and include abstain from carrying out, or induce him to carry out or abstain from offences of corruption in relation to public because he has carried out or has carrying out, or because he has carried officials, corruption in relation to foreign abstained from carrying out, an act out or has abstained from carrying out, public officials and corruption in relation relating to his office, duty or mandate an act relating to his office, duty or to private individuals. Both passive and or facilitated by his office, duty or mandate or facilitated by his office, duty active corruption fall within the scope of mandate; or or mandate” (Article 435-3, French the legislation. (2) either to induce him to abuse his real Criminal Code). or alleged public influence, or Corruption in relation to because he has abused his real or Corruption in relation to private public officials alleged public influence, with a view individuals Passive corruption: “The direct or indirect to obtaining from a public body any “The direct or indirect request or request or acceptance, without right, at distinction, contract [...]” acceptance, without right, at any time, for any time, of offers, promises, donations, (Article 433-1, French himself or for a third party, of offers, gifts or advantages by a person holding a Criminal Code). promises, donations, gifts or advantages public authority or discharging a public by a person not vested with public service mission, or by a person holding a Corruption in relation to foreign authority or discharging a public service public electoral mandate, for himself or public officials mission, nor holding a public electoral for a third party, where it is committed: Passive corruption: “The direct or indirect mandate, performing in the course of his (1) either to carry out or abstain from request or acceptance, without right, at professional or social duties a function of carrying out, or because he has any time, of offers, promises, donations, management or performing a work for an carried out or has abstained from gifts or advantages by a person holding a individual or a corporate entity or any carrying out, an act relating to his public authority, discharging a public organism, either to carry out or abstain office, duty or mandate, or facilitated service mission or holding a public from carrying out, or because he has by his office, duty or mandate; or electoral mandate in a foreign country or carried out or has abstained from in an international public organisation, for carrying out, an act relating to his activity (2) to abuse, or because he has himself or for a third party, where it is or office, or facilitated by his activity or abused, his real or alleged influence committed either to carry out or abstain office, infringing his legal, contractual or with a view to obtaining from from carrying out, or because he has professional obligations” (Article 445-2, any public body or administration carried out or has abstained from French Criminal Code). any distinction, employment, carrying out, an act relating to his office, contract or any other favourable duty or mandate or facilitated by his decision” (Article 432-11, French What is the definition of a office, duty or mandate” (Article 435-1, Criminal Code). public official and a French Criminal Code). foreign public official? Active corruption: “The direct or indirect Active corruption: “The direct or indirect Public official is defined in the statement proposal [or acceptance], by anyone, proposal, by anyone, without right, at any of the offence (see above) as “a person without right, at any time, of offers, time, of offers, promises, donations, gifts holding a public authority or discharging promises, donations, gifts or advantages or advantages to a person holding a a public service mission or holding a to a person holding a public authority or public authority, discharging a public public electoral mandate”. discharging a public service mission or
6. Relevant articles are essentially 432-11 and 433-1 (domestic public official), 435-1 to 435-4 (foreign bribery) and 445-1 and 445-2 (private sector bribery).
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Similarly, a foreign public official is defined corruption offences committed outside Although a parent company is legally in the statement of the offence (see France by persons “habitually resident in separate from its subsidiary, it may attract above) as “a person holding a public France” or “having all or part of their criminal liability in respect of an offence authority, discharging a public service economic activity in France”. committed by the subsidiary if it has used mission or holding a public electoral its subsidiary as an intermediary for the mandate in a foreign country or in an How are gifts and payment/receiving of a bribe or if it has international public organisation”. hospitality treated? participated in the misconduct of its subsidiary in some way. The relevant provisions of the French Is private sector bribery Criminal Code apply to “offers, promises, covered by the law? donations, gifts or advantages”; gifts and Is there an exemption for Yes, Article 445-2 of the French Criminal hospitality may therefore be bribes facilitation payments? Code, set out above, applies to bribery of where the other elements of an offence There are no specific provisions or “a person not vested with public authority are present. exemptions in French law for facilitation or discharging a public service mission, payments. Each payment must be nor holding a public electoral mandate, How is bribery through considered according to whether it performing in the course of his intermediaries treated? fulfils the criteria for the offence of bribery professional or social duties a function or corruption. A company can be liable for indirect of management or performing a work for bribery, i.e. bribery through an an individual or a corporate entity or intermediary, where there is evidence of Are companies required, any organism”. intent on the part of the company, i.e. or is it a defence, to have evidence of knowledge of the conduct on Does the law apply compliance procedures the part of the senior management of the in place? beyond national company or, in some cases, a conscious The Sapin II Law imposes anti-corruption failure by senior management to prevent boundaries? compliance requirements on French the conduct. Yes. Article 113-6 of the French Criminal companies which: Code provides that “French criminal law is applicable to offences committed by Article 17 of the Sapin II Law requires the (i) have at least 500 employees and French nationals outside the territory of implementation of due diligence whose headquarters are in France, the Republic if the offence involved is procedures for intermediaries, on a risk- or which belong to any group whose punishable under the law of the country based approach. parent company’s headquarters are where it was committed”. in France and which has at least 500 Are companies liable employees, and Under certain conditions, France also for the actions of (ii) have a turnover or group turnover of establishes jurisdiction over offences, their subsidiaries? more than EUR 100 million. punishable by imprisonment, committed According to Article 121-1 of the French by a French national or a foreigner For companies that meet these criteria, Criminal Code, legal entities can be held outside French territory against a French eight specific measures and procedures criminally liable, providing the following victim, where the victim was a French must be implemented: requirements are met: national at the time of the offence (Article 1. A Code of Conduct defining and 113-7, French Criminal Code). • the offence must have been committed illustrating the different types of by one or more natural persons prohibited behaviours, which may Law No. 2016-1691 of 9 December 2016 constituting either a body or a notably constitute bribery or (the “Sapin II Law”) expanded the representative of the legal person; and influence peddling; extraterritorial application of French • the offence must have been committed criminal law so that it also applies to 2. An internal system of alerts designed on behalf of the legal person. to enable employees to report any
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conduct or situation that may be information, and may keep a copy thereof • professional restrictions (a ban of up to contrary to the Code of Conduct; (Article 4 of the Sapin II Law). They may five years on performing a public also verify such information on the spot. function or professional or social 3. A risk mapping document designed activity in connection with the offence to identify, analyse, and hierarchise Article 17 of the Sapin II Law provides and/or performing a commercial or the company’s exposure to any risk that legal entities which do not comply industrial activity in order to manage or related to bribery; with the anti-corruption measures listed control in any capacity, directly or 4. Due diligence on third parties taking above may be punished by a financial indirectly, on his own name or on into consideration the risk mapping; penalty of up to EUR 1 million, while behalf of another, an industrial or individuals may face a financial penalty of commercial enterprise); 5. Accounting control procedures up to EUR 200,000. designed to ensure that the • confiscation; and company’s books and accounts are Any decision issued by the AFA can also • publication of the Court’s ruling. not used to conceal bribery acts or be made public. influence peddling; (ii) Legal entities 6. Training sessions for managers and Disclosures concerning violations Fines of up to five times the maximum employees likely to be exposed to mentioned in Article 17 of the Sapin II amount of the fines on individuals can be the risks of bribery and influence Law or corruption may be submitted imposed on legal persons. The financial peddling; directly to the AFA. resources of the offender are taken into 7. A disciplinary regime to sanction account when a court orders a fine. Where appropriate, the AFA will refer the employees in case of violation of the disclosures to the relevant Public Code of Conduct; and Pursuant to Articles 433-25 and 445-4 of Prosecutor, under the terms of Article 40 the French Criminal Code, additional 8. Internal control procedures to of the French Criminal Procedure Code. criminal penalties applicable to legal assess the efficiency of the persons (each of which may be imposed compliance programme. Corruption for a period of up to five years) include: (i) Individuals Companies that do not meet the criteria • a ban on directly or indirectly • Corruption involving domestic or are not required to have anti-bribery performing the professional or social foreign public officials: imprisonment of compliance procedures in place. activity in connection with which the up to ten years and a fine of up to offence was committed; EUR 1 million. What are the penalties? • placement under judicial supervision; Non-compliance with anti-corruption • Private sector corruption: imprisonment regulations of up to five years and a fine of up to • closure of one or more of the The Sapin II Law led to the creation of EUR 500,000. establishments of the enterprise used to commit the acts; the French Anti-bribery Agency (the When the proceeds derived from the “AFA”) which has the role of monitoring offence are higher than the maximum • exclusion from public procurement the implementation of programmes to penalty, the court may increase the fine contracts; prevent and detect acts of corruption and to up to twice the amount of the • ban on public appeal for funds; influence peddling. proceeds. • ban on issuing cheques (with certain Additional criminal penalties applicable The AFA has been empowered to refer exceptions); cases to its Sanctions Committee to to individuals include: • ban on the use of payment cards; prosecute and punish non-compliant • deprivation of rights (civic, criminal and legal entities. To that purpose, AFA family rights) for five years or more; • confiscation; and agents may order the production of any document, as well as any helpful • possible banishment (in the case of • publication of the court’s ruling. foreign perpetrators);
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With respect to both natural and legal (the “CJIP”). Inspired by the American average turnover based on the last persons, confiscation of the “instrument deferred prosecution agreement, the three turnovers available, with the that was used or intended to be used to CJIP is only available for legal entities possibility of spreading the fine over a commit the offence, or of the proceeds of suspected of acts of bribery or influence maximum of one year; and/or the offence” may be imposed (Section 3 peddling, laundering of tax fraud • Set up, under the AFA’s supervision, a of Act No. 2000-595 of 30 June 2000). proceeds and related offences. compliance programme for three years in line with the measures described French case law supports a broad It may be initiated by the public above; and interpretation of the proceeds of an prosecutor before the opening of criminal offence which can, for example, cover proceedings as well as by the • Compensate the victims for their loss, the price of the contract secured investigating judge before the closing of if necessary. because of bribery. his/her investigation, at the request of or in agreement with the public prosecutor, In accordance with the provisions of the Convention Judiciaire d’Intérêt Public and may lead the legal entity to be French Criminal Procedure Code, (i) the The Sapin II Law introduced a new offered to: validation order, (ii) the amount of the settlement procedure with no public interest fine and (iii) the agreement • Pay a fine in proportion to the acknowledgement of guilt, called the itself are published on the AFA’s website. advantages gained from the offences “Convention Judiciaire d’Intérêt Public” within a limit of 30% of the annual
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GERMANY
What is the definition Accepting a bribe (Bestechlichkeit) person or a third person, for the of bribery? “(1) A public official, a European public discharge of a duty … official or person with special public The principal corruption offences (2) Whoever offers, promises or grants service obligations who demands, (Straftaten) concerning public officials a benefit to a judge or an arbitrator, allows himself to be promised or (Amtsträger) are defined in sections 331 a Member of the Court of Justice accepts a benefit for himself or for a et seqq. of the Criminal Code of the European Union for that third person in return for the fact (Strafgesetzbuch (“StGB”)). Further judicial act … that he performed or would in the legislation – the European Bribery Act future perform an official act, and (3) The act shall not be punishable (EU-Bestechungsgesetz, “EUBestG”) thereby violated or would violate his under subsection (1), if the and the International Bribery Act (Gesetz official duties … An attempt shall competent public authority, within the zur Bekämpfung internationaler be punishable. scope of its powers, either previously Bestechung, “IntBestG”) – has extended authorised the acceptance of the the scope of the offences, some of which (2) A judge, a Member of the Court of benefit by the recipient or authorises was integrated in the StGB just recently. Justice of the European Union or an it upon prompt report by the arbitrator who demands, allows recipient” (section 333 StGB). Accepting a benefit himself to be promised or accepts a (Vorteilsannahme) benefit for himself or for a third Granting a bribe (Bestechung) “(1) A public official, a European public person in return for the fact that “(1) Whoever offers, promises or grants a official or a person with special public he performed or would in the future benefit to a public official, a service obligations who demands, perform a judicial act, and European public official, a person allows himself to be promised or thereby violates or would violate with special public service accepts a benefit for himself or for his judicial duties ... obligations, or a soldier of the a third person for the discharge of Federal Armed Forces, for that (3) If the perpetrator demands, allows a duty … person or a third person, in return for himself to be promised or accepts a the fact that he performed or would (2) A judge, a European public official or benefit in return for a future act, in the future perform an official act arbitrator who demands, allows subsections (1) and (2) shall already and thereby violates or would violate himself to be promised or accepts a be applicable if he has indicated to his official duties … benefit for himself or a third person in the other his willingness to: return for the fact that he performed, (2) Whoever offers, promises or grants a • violate his duties by the act; or or would in the future perform a benefit to a judge, a Member of the judicial act … An attempt shall be • to the extent the act is within his Court of Justice of the European punishable. discretion, to allow himself to be Union or an arbitrator, for that person influenced by the benefit in the or a third person, in return for the (3) The act shall not be punishable exercise of his discretion” (section fact that he: under subsection (1), if the 332 StGB). perpetrator allows himself to be • performed a judicial act and promised or accepts a benefit which thereby violated his judicial Granting a benefit he did not demand and the duties; or (Vorteilsgewährung) competent public authority, within the “(1) Whoever offers, promises or grants a • would in the future perform a scope of its powers, either previously benefit to a public official, a European judicial act and would thereby authorises the acceptance, or the public official, a person with specific violate his judicial duties, perpetrator promptly makes a report public service obligations or a soldier to it and it authorises the … [A]n attempt shall be punishable. in the Federal Armed Forces, for that acceptance” (section 331 StGB).
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(3) If the perpetrator offers, promises or order (Auftrag) or instruction provisions of the StGB (e.g., section grants the benefit in return for a (Weisung) … 108b on bribery of electors of the future act, then subsections (1) and European Parliament or German (3) The following members are (2) shall already be applicable if he parliamentary representations) or in other equivalent to the members in attempts to induce the other to: statutes (e.g., Article 2 section 2 of the paragraphs 1 and 2 … IntBestG on bribery of members of • violate his duties by the act; or • a member of representative body parliamentary representations of • to the extent the act is within his of a municipality; international organisations or foreign discretion, to allow himself to be states and section 405 para. 3 no. 2 and • a member, elected by direct and influenced by the benefit in the 3 of the German Stock Exchange Act universal suffrage, of an organ of exercise of his discretion” (section (Aktiengesetz) on bribery in connection an administrative division 334 StGB). with voting rights). responsible for part of the territory Section 335a StGB further extends the of a federal state (Land) or a The general criminal offence of bribery of scope of the offences set out in sections municipality; employees (Angestellte) and agents 331 et seqq. StGB to certain foreign and • a member of the Federal (Beauftragte) in the private sector is international officials, such as members Convention (Bundesversammlung); defined in section 299 paras. 1 and 2 of of foreign and international courts, the StGB: functionaries of international institutions • a member of the European and NATO service members stationed Parliament; Accepting and granting a bribe in in Germany. • a member of a parliamentary business transactions assembly of an international (Bestechlichkeit und Bestechung im The criminal corruption offence of bribery organization: and geschäftlichen Verkehr) of delegates (Mandatsträger) is defined in “(1) Whoever, as an employee or an section 108e of the StGB: • a member of a legislative body of a agent of a business, foreign state. Acceptance by, and granting bribes • demands, allows himself to be (4) A benefit will, in particular, not be to, delegates (Bestechlichkeit und promised, or accepts a benefit for undue if the acceptance of the Bestechung von Mandatsträgern) himself or another in a business benefit is in line with the legal status “(1) A member of Parliament of the transaction as consideration for of the member and the respective Federation (Bund) or of the federal giving a preference in an unfair regulations ...” (section 108e StGB). states (Länder) who demands, allows manner to another in the himself to be promised or accepts an According to the explanatory notes to the competitive purchase of goods or undue benefit for himself or a third Act, the undue benefit must be granted commercial services … party as a consideration for the (offered or promised) in pursuance of a • without consent of the business, performance of an action or omission specific agreement of wrongdoing in the demands, allows himself to be in relation to his mandate and in sense that the delegate must act in a promised, or accepts a benefit for accordance with an order (Auftrag) certain way in accordance with an order himself or another in a business or instruction (Weisung) … or instruction of the donor. transaction as consideration for (2) Whoever offers, promises or grants a However, section 108e StGB does not taking or refraining from an action member of parliament of the apply to rewards or benefits agreed for and in doing so violates a duty Federation (Bund) or of the federal past actions. owed to the business .... state (Länder) an undue advantage (2) Whoever, for that member or a third party as a There are also more specific criminal consideration for an action or offences or administrative offences • offers, promises or grants an omission in relation to that member’s (Ordnungswidrigkeiten) defined in other employee or an agent of a mandate and in accordance with an business a benefit for himself or for
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a third person in a business What is the definition of • Section 335a StGB further extends the transaction as consideration for his a public official and a scope of the law to certain foreign and giving him or another a preference international officials, by equating, for in an unfair manner in the foreign public official? the purposes of sections 332, 334 and purchase of goods or commercial The term “public official” (Amtsträger) 335 StGB judges with members of services … within the meaning of sections 331 et foreign or international courts and other seqq. of the StGB (see above) is defined public officials with: • without consent of the business, as follows: offers, promises or grants an (a) functionaries of a foreign state and employee or an agent of the “2. A public official is whoever, under persons tasked with performing business a benefit for himself or for German law: public functions for a foreign state; a third person in a business (a) is a civil servant or judge; (b) functionaries of an international transaction as consideration for (b) otherwise has an official organisation and persons tasked him taking or refraining from an relationship with public law with performing functions for an action and in doing so violating a functions or; international organization; duty owed to the business” (c) has been appointed to a public (c) soldiers of a foreign state and (section 299 paras. 1 and 2 StGB). authority or other agency or has soldiers tasked with performing Please note that the concept of a been commissioned to perform functions for an international “benefit” under these provisions is duties of public administration organization; construed very broadly. German without prejudice to the • for the purposes of sections 331 and prosecution authorities and courts may organisational form chosen to fulfil 333 when applied to acts aiming to assume such benefit even in case of such duties” (section 11 para. 1 influence a future judicial action or modest gifts or hospitality, charitable no. 2 StGB). future discharge of a duty, donations or standard business contracts Please note that such “other agency” with scientists or other employees in the (a) judges with members of the may also be a legal entity under civil law. public or private sector (e.g., regarding International Criminal Court; research, consulting, lectures, etc.). The term “European public official” (b) other public official with (Europäischer Amtsträger) within the functionaries of the International There are also more specific criminal meaning of sections 331 et seqq. StGB Criminal Court; and offences or administrative offences (see above) is defined as follows: (Ordnungswidrigkeiten) defined in other • for the purposes of section 333 provisions of the StGB (e.g., section “2a. A European public official is paras. 1 and 3 when applied to a 108b and 108e on bribery of members whoever: future discharge of a duty, and electors of the European Parliament (a) is a member of the European (a) soldiers of the German Armed or German parliamentary representations) Commission, the European Central Forces (Bundeswehr) with soldiers or in other statutes (e.g., Article 2 section Bank, the European Court of of the troops of NATO member 2 of the IntBestG on bribery of members Auditors or of a Court of the states stationed in Germany of parliamentary representations of European Union; present in Germany at the time of international organisations or foreign the offence; states and section 405 para. 3 no. 2 and (b) is an official or other functionary of 3 of the German Stock Exchange Act the European Union or of an (b) other public officials with (Aktiengesetz, AktG) on bribery in Institution created on the basis of functionaries of these troops; connection with voting rights). European Law; (c) person with special public service (c) is tasked with discharging duties of obligations with persons which are the European Union or of employed by these troops or are Institution created on the basis of working for them and have been European Law.” formally directed by general or
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special directive of a higher office themselves to be promised or accept a that the criminal offences of accepting of these troops to faithfully benefit for themselves or a third person and granting a bribe in business discharge their duties. to influence the course or the result of a transactions apply also to activities in competition to the advantage of the foreign competition. Furthermore, the IntBestG contains opponent and, thereby, an illegal benefit separate criminal provisions regarding will be received from a public sport bet in Furthermore, according to general rules, bribery of members and electors of relation to that competition. provisions on German criminal or parliamentary representations of administrative offences may apply to Germany, foreign countries, the EU and In contrast, section 265d StGB activities outside Germany, in particular, if international organisations. (Manipulation von berufssportlichen they are committed: Wettbewerben) establishes similar (i) by a German perpetrator; Is private sector bribery criminal offences that include corrupt covered by the law? agreements regarding professional sport (ii) jointly with co-perpetrators who act Yes, although there are some differences competitions even if there is no special in Germany; or in the way in which public sector bribery relation to sporting bets. (iii) to the detriment of a German natural and private sector bribery is treated. or legal person (e.g., corruption In the public sector, corruption offences offences to the detriment of the In the public sector, the granting of a are so-called official offences German employer of a bribed benefit to a public official may constitute (Offizialdelikte) which may be prosecuted employee or of a German competitor the criminal offence of granting a benefit without a demand for prosecution of the person bribing him). (Vorteilsgewährung) if there is no prior (Strafantrag). In the private sector, permission by the competent superior. If, corruption offences can only be Moreover, section 9 para. 2 sentence 2 in addition, the benefit is granted on the prosecuted if, and as long as, there is StGB stipulates that German criminal law basis of an agreement that this will such demand for prosecution (e.g., by (including criminal anti-corruption law) influence official activities of the public the employer of a bribed employee or a applies if someone from Germany official, this may constitute the even more competitor of the person bribing him), participates (in the form of instigation or serious criminal offence of granting a unless the criminal prosecution authority of aiding and abetting) in a principal bribe (Bestechung). In the private sector, considers ex officio that the case should offence committed by a principal criminal liability for granting a bribe in be prosecuted because of a special offender outside Germany, even if this business transactions (Bestechung im public interest. principal offence is not a criminal offence geschäftlichen Verkehr) may not result under the law of the country where it from the granting of a benefit in itself, but Does the law apply is committed. only from an agreement that such beyond national granting a benefit will influence the commercial activities of the recipient. boundaries? How are gifts and Yes. Article 2 section 3 IntBestG hospitality treated? Additionally, sections 299a and 299b expressly stipulates that German criminal While there are no specific statutory StGB make it a criminal offence for law applies when a German citizen bribes monetary thresholds on the value of gifts medical professionals to receive bribes in a foreign member of Parliament abroad. and hospitality that may be offered, gifts exchange for preferential treatment for Section 108e para. 3 of the StGB states and hospitality must be “socially medical suppliers or pharmaceutical that paras. 1 and 2 also apply in adequate” (sozialadäquat) and companies when discharging their duties connection with, amongst others, appropriate with regard to the position and for others to grant such bribes. members of the European Parliament, and social status of the recipient. When members of a parliamentary assembly of assessing whether gifts or hospitality are Furthermore, under section 265c para 1 an international organization and socially adequate, German authorities are StGB (Sportwettbetrug), athletes or members of a legislative body of a likely to look at benefits granted to the coaches may be criminally liable if they foreign state. Section 299 para. 1 no. same recipient over a period of time. (as “receivers”) demand, allow 1 and para. 2 no. 1 of the StGB clarifies
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Prosecution authorities and the courts Are companies liable for not use their influence to prevent tend to take a very strict approach to the actions of their such offences. gifts and hospitality, and internal guidelines applicable to domestic subsidiaries? If German prosecution authorities and public officials often impose very low Section 130 of the German Administrative courts assume that senior executives value thresholds. Offences Act committed an administrative offence of (Ordnungswidrigkeitengesetz, “OWiG”) violation of supervisory duties (section Is there an exemption for establishes the administrative offence of 130 of the OWiG) or participated in a violation of supervisory duties, which facilitation payments? criminal offence (e.g., by omission consists of a failure by superiors pursuant to section 13 of the StGB), this There is no specific exemption in appropriately and efficiently to supervise may lead to corporate administrative fines German law for facilitation payments. subordinate employees in enterprises (Verbandsgeldbuße) (section 30 of the Each payment must be judged according where this leads to criminal or OWiG) or forfeiture orders to whether it fulfils the criteria for administrative offences, in particular, (Einziehungsanordnungen) (sections 73b corruption offences. corruption offences. This offence may be of the StGB, 29a para. 2 of the OWiG) sanctioned by an administrative fine against the company (legal entity) they How is bribery through (Geldbuße) against the superiors are working for. intermediaries treated? concerned which may amount to up to There are no general anti-corruption EUR 1 million. Are companies required, provisions regarding the use of or is it a defence, to have intermediaries, or agents. However, in German prosecution authorities and some procurement processes the use courts may assume such violation of compliance procedures of agents is specifically prohibited. If such supervisory duties if superiors do not duly in place? prohibitions are violated and the use of instruct employees regarding anti- There are no specific requirements for agents is not disclosed, German corruption provisions (e.g., by compliance companies to have anti-bribery prosecution authorities and courts guidelines) and do not establish effective compliance procedures in place. may take the position that this monitoring (e.g., by appointing a constitutes fraud. compliance officer and establishing a However, as noted above, a company compliance process). may be subject to a corporate Generally, it is advisable to include into administrative fine (Verbandsgeldbußen)7, agency agreements clauses expressly However, there is debate, not yet settled or a forfeiture order obliging the agent to comply with all by the German Federal Court of Justice, (Einziehungsanordnung)8, specifically applicable legal provisions, in particular, whether managers of a parent company where a representative or manager of the with all anti-corruption provisions. have supervisory duties with regard to company has intentionally or negligently subsidiaries. Regardless of this question, refrained from taking measures (such as Furthermore, agency agreements should though, there is the risk that managers of implementing anti-bribery controls) that not provide for inappropriately high a parent company may, under certain would have been appropriate to prevent commissions or other remuneration circumstances, be held criminally liable or hinder criminal acts or administrative structures which German prosecution pursuant to section 13 of the StGB for offences committed by an employee (i.e. authorities or courts could interpret as participating by omission in criminal the administrative offence of violation of incentives for corruption offences. corruption offences committed by supervisory duties employees of subsidiaries if they do (Aufsichtspflictverletzung)9).
7. Section 30 OWiG 8. Sections 29a OWiG, 73b StGB. 9. Section 130 OWiG
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Financial institutions are required to have What are the penalties? company, the company may also be in place a proper business organisation The maximum penalty under the StGB for subject to a forfeiture order or to a ensuring compliance with applicable legal a corruption offence is imprisonment for corporate administrative fine which provisions (section 25a German Banking a term not exceeding 10 years may generally amount to up to EUR Act (Kreditwesengesetz, KWG), as well as (in particularly serious cases of bribery of 10 million or more if necessary to adequate risk management and policies public officials). disgorge higher profits. and procedures for the prevention of money laundering, terrorist financing A court may also impose a forfeiture Natural persons convicted of bribing a or other criminal actions which order (Einziehungsanordnung) disgorging delegate, and delegates convicted of might jeopardise the institution’s the gross proceeds from a corruption accepting bribes, may also be assets (including bribery and offence (without deduction of expenses). disqualified from voting, and standing corruption offences). Moreover, if a natural person commits a in public elections. corruption offence when acting for a
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HONG KONG
What is the definition (3) assisting, favouring, hindering or • any agent (including any person of bribery? delaying any person in the employed by or acting for another), transaction with a public body without lawful authority or reasonable The Hong Kong Prevention of Bribery (section 4); excuse, soliciting or accepting any Ordinance (“POBO”) does not define advantage in relation to his principal’s “corruption”, but it sets out various public • any person, without lawful authority or affairs or business (section 9); sector bribery offences and private sector reasonable excuse, offering, soliciting bribery offences. or accepting any advantage to the • any person, without lawful authority or Chief Executive or a public servant in reasonable excuse, offering any Public sector bribery offences under the relation to any contract with a public advantage to any agent in relation to POBO include: body (section 5); the latter’s principal’s affairs or business (section 9); and • the Chief Executive or any public • any prescribed officer, without the servant, without lawful authority or • any agent, with intent to deceive his general or special permission of the reasonable excuse, soliciting or principal, using any receipt, account or Chief Executive, soliciting or accepting accepting any advantage in relation to other document containing materially any advantage (section 3); any contract with a public body false, erroneous or defective particular • any person, without lawful authority or (section 5); (section 9). reasonable excuse, offering any • any person, without lawful authority or “Advantage” is widely drafted under the advantage to the Chief Executive or a reasonable excuse, offering, soliciting POBO to capture almost limitless public servant in relation to his: or accepting any advantage for circumstances in which bribes may be (1) performing or abstaining from procuring withdrawal of tenders offered, including, in particular, money, performing any act in public (section 6); gifts, loans, commissions, offices, capacity, contracts, services, favours and • any person, without lawful authority or discharge of liability in whole or in part. (2) expediting, delaying, hindering or reasonable excuse, offering, soliciting There is no de minimis threshold for an preventing the performance of an or accepting any advantage in relation “advantage”. However, evidence of the act in public capacity by himself or to any auction conducted by or on insignificance of the advantage may be other public servants, or behalf of any public body (section 7); relevant to establishing a defence or as (3) assisting, favouring, hindering or • any person, without lawful authority or proof that it was not for an illegitimate delaying any person in the reasonable excuse, offering any purpose. transaction of any business with a advantage to any prescribed officer or public body (section 4); public servant while having dealings It excludes declared political donations. with the Government or any other (Election donations are regulated by the • the Chief Executive or any public public body (section 8); Elections (Corrupt and Illegal Conduct) servant, without lawful authority or Ordinance.) reasonable excuse, soliciting or • any public servant, without lawful accepting any advantage in relation authority or reasonable excuse, to his: offering, soliciting or accepting any What is the definition of a advantage in relation to his principal’s (1) performing or abstaining from public official and a affairs or business (section 9); and performing any act in foreign public official? public capacity, • the Chief Executive or prescribed Public Official officer possessing unexplained property “Public servant” is defined under the (2) expediting, delaying, hindering or (section 10). POBO to mean: preventing the performance of an act in public capacity by himself or Private sector bribery offences under the (1) any prescribed officer; and other public servants, or POBO include: (2) any employee of a public body.
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The Chief Executive of Hong Kong, Is private sector bribery officials), the whole course of offer, though not a public servant, also falls covered by the law? solicitation or acceptance of the illegal within the public sector. Prescribed advantage must take place within Hong Yes. Private sector bribery is covered by officers include government officials, Kong jurisdiction to be caught by the section 9 of the POBO. This prohibits any officials of the Hong Kong Monetary section. The same logic should therefore solicitation to, offer to, or acceptance by, Authority, members of the Independent apply to sections 5 to 8 as well. an agent, without the permission of the Commission Against Corruption, judicial principal, of any advantage in exchange officers, and the Chairman of the Public Therefore, the POBO does not have for doing or forbearing to do any act in Service Commission in Hong Kong. extraterritorial effect in respect of bribery relation to his principal’s affairs or of foreign public officials; while bribery of business. The permission of the principal “Public body” is defined broadly to cover a foreign public official is an offence that can be given before or a reasonable time the Hong Kong Government, the is captured by the broad definition of after the offer or acceptance of such Executive Council, the Legislative agent under section 9 of the POBO, it is advantage. The principal-agent Council, any District Council, any board, only an offence if the bribery takes place relationship includes where a person is commission, committee or other body, within Hong Kong. employed by another or where a person whether paid or unpaid, appointed by or is acting for another. A principal may on behalf of the Chief Executive or the therefore include, for example, an How are gifts and Chief Executive in Council and any board, employer, an investor, a company director hospitality treated? commission, committee or other body or a fund. These offences are punished Gifts and hospitality may qualify as bribes (including government owned enterprises) by a fine of up to HKD 500,000 given the wide definition of “advantage” as set forth in Schedule 1 to the POBO. (approximately USD 64,000) and under section 2 of the POBO. imprisonment of up to seven years. Therefore, the concept of “public servant” Under the POBO, there is no specified is far broader than merely the civil service monetary value or threshold that would and encompasses all persons employed Does the law apply generally be considered reasonable or by, or associated in any way with, an beyond national customary for a gift accepted by a public organisation which the Government boundaries? official in his public capacity, or by a decides has such a substantial and Section 4 of the POBO (which private sector agent. However, there are important role in the public affairs of criminalises bribery of Hong Kong public several types of entertainment, gifts and Hong Kong that it should be made a servants, as set out above) has advantages which are generally permitted public body. For instance, any member of extraterritorial effect since there is an under Hong Kong law. Examples of a club or an association vested with any express reference to the advantage being generally permitted exceptions include: responsibility for the conduct or offered “whether in Hong Kong or promotional items of insignificant value, management of its affairs is considered a elsewhere.” Bribery offences connected offered free of charge to clients in public servant. “Club” is not defined and to Hong Kong public officials are compliance with the practice of the should be given its general meaning. therefore subject to Hong Kong industry; client meals of modest value jurisdiction wherever they take place. that are provided for general goodwill Foreign public official purposes; training programmes offered to The POBO does not expressly apply to For other corruption offences clients on a new product which involves foreign public officials, but case law summarised above, the position is less meals, trips or accommodation being shows that personnel employed by certain as they do not include the words offered to clients free of charge. Such foreign governmental bodies in Hong “whether in Hong Kong or elsewhere.” hospitality and facilities provided must be Kong are also covered by the POBO. As Such omission may well be construed as reasonable and compatible with the such, while case law has established that a legislative intention not to afford professional or educational nature of the bribery of a foreign public official is an extraterritorial effect to these sections. event. Factors to be considered in offence captured by the broad definition Indeed, case law suggests that, with deciding whether or not the advantage of “agent” under the POBO, it is only an regard to section 9 of the POBO (which should be construed as a bribe include offence if the bribery takes place within covers private sector bribery, and bribery the nature of the gift, the position of the Hong Kong. connected with non-Hong Kong public
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agent, the relationship between the donor Are companies liable for What are the penalties? and the agent and whether or not an the actions of their For soliciting or accepting an advantage obligation might be created. subsidiary? (section 3), the maximum penalties are a fine of HKD 100,000 and imprisonment The POBO does not directly address Gifts and hospitality must be for one year. distinguished from “entertainment” which actions of subsidiaries. There does not appear to be any case law in Hong Kong is specifically excluded from the definition Other offences which directly relates to parent of “advantage”. “Entertainment” means On indictment, maximum penalties for: the provision of food or drink, for companies’ liability for bribes or consumption on the occasion when it is corruption committed by their • possession of unexplained property provided, and of any other entertainment subsidiaries. However, it has been (section 10): fine of HKD 1 million and connected with, or provided at the same accepted in Hong Kong case law that, as imprisonment for ten years; a matter of general principle in the time. “Connected with” should not be • bribery in relation to any contract with a context of public policy or illegality, the construed too broadly, and it is public body (section 5) or for procuring courts are inclined to look at the suggested that any entertainment which withdrawal of tenders (section 6): fine substance of an entity, and its activities, occurs at a place other than the premises of HKD 500,000 and imprisonment for rather than its form. Thus, in an extreme at which the food or drink is being served ten years; and is prima facie not connected with the case, such as where the parent company • other offences: fine of HKD 500,000 provision of that food and drink. Case law uses a wholly-owned subsidiary to do and imprisonment for seven years. has held that entertainment was never something illegal, the court may be more intended to be a prohibited advantage for than ready to equate the subsidiary with On summary conviction, maximum the purposes of the POBO, no matter its parent company. Therefore, a parent penalties for: how lavish or corruptly offered. However, company may be liable for bribes or the acceptance of entertainment by a corruption committed by its subsidiaries, • possession of unexplained property: public servant may nonetheless be the particularly a wholly-owned subsidiary. fine of HKD 500,000 and imprisonment subject of disciplinary proceedings. for three years; and Are companies required, • other offences: fine of HKD 100,000 Is there an exemption for or is it a defence, to have and imprisonment for three years. facilitation payments? compliance procedures Under Hong Kong law, there is no in place? exemption for facilitation payments. Companies are not required to have anti- bribery compliance measures in place. How is bribery through Nor is having compliance procedures in intermediaries treated? place a defence under the POBO. It does A bribe through an intermediary is an not seem that having a robust offence under the POBO, in relation compliance programme would be to both the bribe giver and the accepted as a “reasonable excuse” bribe receiver. defence under the POBO.
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ITALY
What is the definition Extortion by a public official (article Undue inducement to give or promise of bribery? 317 of the Criminal Code) a bribe (article 319 quater of the “The public official or the person in Criminal Code) Italian law criminalises both active and charge of a public service who, abusing “Save where this constitutes a more passive corruption in the public and the his or her position or powers, compels serious offence, the public official or the private sector (including bribery of foreign anyone unduly to give or promise to person in charge of a public service who, public officials). Common to all these him/her or to a third-party money or abusing his or her position or powers, offences is that a person gives or other thing of value shall be liable to induces someone unduly to give or promises to give money or other thing of imprisonment of between six and promise money or other thing of value to value, directly or indirectly, to either a twelve years”. him or to a third party shall be liable to public official (including persons in charge imprisonment of between six and ten of a public service) or to a company (Passive) Corruption in the years and six months. director in exchange for an abuse of his performance of a public office (article or her function. 318 of the Criminal Code) The person who gives or promises “The public official who, for the money or any other thing of value shall This abuse may consist of an act in performance of his/her functions or for be liable to imprisonment up to violation of the duties of the public official the exercise of his/her powers, unduly three years”. or company director, but may also receives for him/herself or others money consist of a due act, or a more general or other thing of value or accepts their (Passive) Corruption of persons in abuse of their function which does not promise shall be liable to imprisonment of charge of a public service (article 320 necessarily involve the performance of between three and eight years”. of the Criminal Code) any specific act. The mere offer or The relevant article extends the offences promise of undue payments or other (Passive) Corruption involving a provided for by Articles 318 and 319 of benefits to a public official or a person in specific act in breach of official the Criminal Code to persons in charge of a public service is also an duties (article 319 of the charge of a public service, with offence even where it is not accepted. Criminal Code) lowered penalties. “The public official who, for performing, The offence of corruption in relation to refraining from performing or delaying a (Active) Corruption of a public official foreign public officials was introduced by specific act in breach of his official duties, or of a person in charge of a Law No. 300 of 29 September 2000 receives money or other thing of value for public service (article 321 of the while the offence of private bribery was him/herself or for a third party or Criminal Code) introduced in Italian legislation in 2002 at accepts their promise shall be liable to In addition to where already expressly article 2635 of the Italian Civil Code. On imprisonment of between six and specified, the person who unduly gives or 28 November 2012, Law No. 190 (setting ten years”. promises money or other thing of value out “Rules for the prevention and to bribe a public official or a person in repression of corruption and illegality Corruption in judicial acts (article 319 charge of a public service as described in within the public administration”) ter of the Criminal Code) the articles above shall be punishable introduced further offences and heavier “If the facts referred to in articles 318 and with the same penalties. penalties. More recently, Legislative 319 are committed to favour or damage Decree No. 38/2017 and Draft Bill No. a party in a civil, criminal, or Instigation to Corruption (article 322 1189/2018 (which has recently been administrative proceeding, the sanction of the Criminal Code) approved and will shortly come into force) is imprisonment between eight and Both active and passive corruption are have introduced further offences and twenty years”. punishable as “Instigation to corruption” made sanctions harsher overall. when no illegal agreement is reached between the parties because either the Corruption offences include the following: public official/the person in charge of a public service or the citizen respectively
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refuse to abuse their function and to give The penalty is also increased if the facts Instigation to private bribery (Article or promise undue advantages. are committed in relation to the exercise 2635 bis of the Civil Code) of judicial activities or as a compensation The offence referred to in art. 2635-bis is Corruption of a foreign public official for the public official, the person in punishable as “Instigation to private or of an officer of the European charge of a public service or the subject bribery” when the offer or the promise is Union (Article 322 bis of the referred to in art. 322-bis for the not accepted. The penalty is lowered Criminal Code) performance, the omission or the delay of by a third. The scope of the offences described by an act in breach of their duties. the articles mentioned above is extended Prosecution is ex-officio. to include bribery of foreign officials, The penalty is lowered if the facts are including officials of EU institutions, public particularly tenuous”. What is the definition of a public officials of foreign Countries and official and a foreign public official? members of international organisations. Private bribery (Article 2635 of the Article 357 of the Criminal Code defines Civil Code) “public official”, for the purposes of the Trading in influence (Article 346 bis “Save where this constitutes a more offence of corruption in the public sector, of the Criminal Code) serious offence, companies’ directors, as “any person who performs official “Save where this constitutes aiding and general managers, internal auditors and duties within a legislative body, the abetting corruption offences provided for liquidators, who, also through judiciary and the public administration. by Articles 318, 319, 319 ter and 322-bis intermediaries, urge or receive, for of the Criminal Code, the person who, themselves or for others, or accept the Article 358 of the Criminal Code defines taking advantage of or boasting his or her promise of money or other thing of value, in “person in charge of a public service” as relationship, both existing or alleged, with order to perform or refrain from performing “any person carrying out a public service”. a Public Official, a person in charge of a an act in breach of their fiduciary duties, This term is still unclear and very much public service, or one of the other shall be liable to imprisonment of between discussed between scholars and judges in subjects referred to in art. 322-bis, one to three years. The same penalty is Italy. For the purposes of its application, a induces someone unduly to give or applied if the fact is committed by a person service is normally considered public when promise to him/herself or to a third party exercising managerial functions other than it is regulated by public law and when the money or other thing of value either as those previously referred to. nature of the activity which forms the compensation for his or her illegal object of the service is public or linked to mediation or as compensation for the Where the relevant offence is committed public utility. However, low level tasks are public official, the person in charge of a by those under the respective expressly excluded by the law. public service or the subject referred to in supervision of the individuals art. 322-bis for the exercise of their identified above, the penalty is up to Examples of persons found by case law functions or of their powers shall be liable 18 months’ imprisonment. to be persons in charge of a public to imprisonment of between one to four service include a court translator, the years and six months. The person who, also through head of a public archive, bursar’s officers intermediaries, gives or promises money and trustees. The same penalty shall be applicable to or the undue advantage shall be liable to the person who unduly gives or promises the same penalties. Article 322 bis of the Criminal Code the money or the other thing of value. defines “foreign public officials” as: The penalties are doubled if Listed • Members of the European The penalty is increased if the person Companies are involved. Commission, the European Parliament who induces someone unduly to give or and the Court of Justice; promise to him/herself or to a third party, Prosecution is ex-officio. money or other thing of value is a • Officers and members of the public official or a person in charge of a Save what is provided for by art. 2641, the European institutions; extent of the seizure for equivalent value public service. • Public officials and persons in charge shall not be lower than the value of the of a public service of other European given, promised or offered thing of value”. country governments;
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• Judges, public prosecutors and prosecuted upon the victim’s request, Special rules are also set out to public officials of the European Court unless the crime distorted competition. determine the cases in which Italian Law of Justice; applies to crimes committed abroad Does the law apply against the EU or a foreign State. • Officials of other foreign countries; and beyond national • Members and officials of boundaries? How are gifts and international institutions. Yes. Articles 7, 9 and 10 of the Criminal hospitality treated? Code provide that both Italian citizens The corruption offences are broadly Is private sector bribery and non-Italian citizens who commit worded and “any thing of value” can covered by the law? certain criminal offences (including include gifts or hospitality. Italian criminal Yes, as set out above. The main corruption) abroad are subject to Italian law does not prescribe monetary differences in the treatment of public criminal law when the relevant criminal thresholds on the value of gifts, travel 10 sector bribery and private sector bribery offence was committed by an Italian expenses, meals or entertainment to are as follows. public official, in service, and in breach of public officials, or others. his/her duties. Additionally, Italian citizens • The offence of passive private sector are subject to Italian criminal law if they Is there an exemption for bribery can be committed not only by committed the offence outside Italy when, companies’ directors, managers, under Italian law the relevant criminal facilitation payments? There are no specific provisions or auditors, or liquidators, but also by offence is punishable with imprisonment exemptions for facilitation payments people under their supervision, while of not less than three years11, and the under Italian Law. Consequently, these the offence of passive corruption in the offender is located in Italy. will be considered by the courts in the public sector can only be committed context of all the relevant facts in order to by public officials or people in charge Non-Italian citizens are subject to Italian decide whether they meet the legal test of a public service. criminal law even if they committed the crime outside Italy when: for one of the corruption offences • Unlike the offence of corruption in the provided for by the Italian criminal law. public sector, the private sector bribery • under Italian law the relevant offence is offence requires that some damage to punishable with imprisonment of not Italian courts have so far tended to the corporate entity derive from the less than one year; consider giving or promising small criminal conduct of its bribed director payments and gifts to public officials as for him or her and the corruptor to be • Italy or an Italian citizen were the active corruption, except where the public punishable. victims of the crime; official performs an act without any breach of his or her duties and the gift has such a • While public officials (and their • the offender is located in Italy; and small value that it cannot have any corruptors) are punishable regardless • either the victim of the crime or the influence on the public official’s behaviour. of when the undue payment or promise Italian Ministry of Justice asked that the is made, in the private sector the law offender be prosecuted, save where How is bribery through requires that the undue payment or the committed offences are those promise is made before the breach of provided for in articles 317, 318, 319, intermediaries treated? duties on the part of the director. 319-bis, 319-ter, 319-quater, 320, 321, Bribery through intermediaries is punished. The relevant articles are article • Unlike corruption in the public sector, 322, and 322-bis of the Criminal Code. 346-bis of the Criminal Code for the private sector bribery can only be
10. Please note that under Italian Criminal Law, criminal offences are divided into two main categories depending on the penalty applicable to the relevant offender: these are crimes in the strict sense (delitti) and contraventions (contravvenzioni). The relevant provisions of articles 7, 9 and 10 of the Criminal Code only refer to the first category of criminal offences. 11. The offender may be subject to Italian Criminal Law even where the relevant criminal offence is punishable with a lower term of imprisonment, but only upon the Ministry of Justice’s or victim’s request. The Ministry of Justice’s or victim’s request is not necessary for the offences provided for in articles 320, 321 and 346-bis of the Criminal Code.
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public sector and articles 2635, para. 1 • the employee or agent committed the • Exclusion from facilitations, grants, and 3 for the private sector. offence by fraudulently avoiding the contributions or subsidies, and their internal systems and controls; and revocation if already granted; Are companies liable • the supervisory body had not failed to • Bans from promoting goods or for the actions of exercise adequate controls. services; and their subsidiaries? Guidance for the preparation of Law 231 • Publication of the judgment. Yes. Under the Criminal Corporate Liability internal systems and controls is set out Act (Decreto Legislativo no. 231/2001, in Law 231 itself, and also in Law 231 The availability of plea bargains and “Law 231”) corporate entities may be held Guidelines prepared by the industry suspended judgments for corruption liable if their representatives, employees or representative organisation offences is subject to restitution of the agents commit one of the corruption (Confindustria). profits of the crime. Moreover, when plea- offences set out above in the interest, or bargaining in the context of proceedings for the benefit, of the entity, unless they What are the penalties? involving the offences provided for in are able to demonstrate that they have put Penalties for corruption are applicable articles 314, par. 1, 317, 318, 319, 319-ter, in place and effectively implemented both to individuals and to 319-quater, 320, 321, 322, 322-bis and adequate systems and controls to prevent corporate entities. 346-bis of the Criminal Code, the the commission of the crime. defendant can make the plea conditional Penalties for individuals include: upon receiving an exemption from the ban Are companies required, from serving in public offices or, in case this • Imprisonment; or is it a defence, to have ban applies, conditional upon conditional compliance procedures • Temporary and permanent bans from suspension of the above ancillary sanction. serving in public offices (ancillary Moreover, the judge has the discretion to in place? penalty); impose a ban from serving in public offices Companies are not required to have anti- also if the agreed sentence does not • Bans from contracting with the public bribery compliance controls. exceed two years of imprisonment. administration, except to obtain the However, having anti-bribery compliance supply of a public service Penalties may be reduced where the controls is relevant to a defence under Law (ancillary penalty); offender acted to prevent further 231. As noted above, a company may be • Payment of compensation equal to the consequences of the offence or held liable for a corruption offence which bribe received, in addition to cooperated with the investigation. was committed (at least in part) in the possible damages; interest, or for the benefit, of that company, In connection with the offences provided by an employee, representative or agent of • Confiscation of bribes or, if it is not for in articles 318, 319, 319-ter, the company. However, the company will possible, confiscation of goods of a 319-quater, 320, 321, 322-bis exclusively not be liable if it can show that: corresponding value, available to the in relation to the offences of corruption condemned person. and inducement to corruption, 353, 353- • its management body had adopted Penalties for corporate entities include: bis, and 354 of the Criminal Code, non- and effectively implemented, prior to punishment is allowed if the offender turns • Fines; the commission of the offence, internal himself in voluntarily and cooperates with systems and controls (including an • Temporary bans from carrying out the judicial authorities before becoming assessment of risk areas, a training business activity; aware of being under investigation and in programme, internal communications any event within no more than four • Suspension or revocation of licences and adequate sanctions); months from having committed the crime. which were instrumental to the Eligibility for non-punishment is conditional • a supervisory body had been set up to commission of the crime; oversee the company’s internal upon the offender making available the systems and controls to which • Bans from contracting with the public proceeds from the crime or an equivalent independent powers of initiative and administration, except to obtain the sum of money, or providing elements control had been granted); supply of a public service; useful to identify the actual beneficiary of the proceeds of the crime.
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JAPAN
What is the definition to act or refrain from acting in a particular performance of its business by a of bribery? way in relation to that official’s duties, in national or local government, as well order to obtain illicit gains in business as a person who is considered similar The offences of bribery are set out in with regard to international commercial to the aforementioned person as the Japanese Criminal Code (Law No. 45 transactions. The UCPA only penalises designated in the cabinet ordinance; of 1907, as amended) (the “Criminal the giver/offeror/promisor of the bribe. Code”) and the Unfair Competition (iv) an official of an international Prevention Act (Law No. 47 of 1993, as organisation consisting of amended) (the “UCPA”). The Criminal What is the definition of a governments or inter-governmental Code deals with the bribery of public public official and a organisations (an “IO”); and officials belonging to Japanese foreign public official? (v) a person engaged in the performance governmental/official bodies and the In relation to the Criminal Code, the of duties over which a national or UCPA deals with the bribery of public definition of public sector is understood local government or an IO has power officials belonging to foreign (non- by reference to public officials (koumu-in) and authority and which are Japanese) governmental/official bodies. who are subject to the offences of delegated to such person by a corruption under the Criminal Code. national or local government or an IO. A “bribe” is construed under both the Criminal Code and the UCPA to mean Under the Criminal Code, such a “public Is private sector bribery any benefit that amounts to illegal official” is defined to mean a national or compensation, including any economic or local government official, a member of an covered by the law? other tangible benefit which could satisfy assembly or committee, or other Under Japanese law there are no general the needs/desires of a person. There is employees engaged in the performance criminal laws against bribery in the private no de minimis threshold amount for of public duties in accordance with laws sector. However, there are several laws a bribe. and regulations. addressing private sector bribery in specific situations, for example: The Criminal Code prohibits a public Foreign public officials for the purpose of • Certain laws in relation to specific official from accepting, soliciting or the UCPA are: companies which perform public agreeing to receive a bribe in connection services include laws prohibiting the with his/her duties and provides penalties (i) an official of a foreign, national or bribery of employees. For example, the for both the public official and the local government; Nippon Telegraph and Telephone individual who offers, gives or promises (ii) a person engaged in the performance (“NTT”) Corporation Act (Law No. 85 of such a bribe. In 2017, the Criminal Code of duties for an entity established 1984, as amended) forbids the bribery was amended to widen the territorial under foreign laws and regulations in of NTT employees; and scope to capture a bribe given by a order to perform specific duties in Japanese national to a public official • The Companies Act (Law No. 86 of respect of public interests; belonging to a Japanese governmental/ 2005, as amended), specifically Articles official body whilst outside of Japan. (iii) a person engaged in the performance 967 prohibits giving economic benefits of duties for an entity (a) a majority to directors (or similar officers) of stock The UCPA provides that no person shall stake of which is owned, or a majority corporations with the request of give, offer or promise to give a bribe to a of the officers (director, statutory unlawful actions/inactions in respect of foreign public official for the purpose of auditor, liquidator and other persons their duties. Both the director and the having the foreign public official act or engaged in management of the entity) person giving the bribe are liable to refrain from acting in a particular way in of which is appointed, by foreign imprisonment or a fine. The bribe will relation to his/her duties, or having the national and/or local government(s) be confiscated or the value of the bribe foreign public official use his/her position and (b) which is granted specific will be levied as a further penalty under to influence another foreign public official rights and interests for the Article 969.
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Does the law apply There is no specific exemption either in Corporate liability is possible under the beyond national the UCPA. However, if a person makes a UCPA. Moreover, a parent company may payment to a foreign public official purely be liable for the action of its subsidiary if boundaries? for the purpose of facilitating a normal it had some involvement in the Yes. Under the Criminal Code public administrative service to which he/she is subsidiary’s bribery or if the bribe-giving officials can be found guilty of being entitled, it is generally understood that employee of the subsidiary could be seen bribed even where the bribery was such payment will not be found by as virtually an employee of the parent. committed outside the territory of Japan. Japanese courts to constitute bribery of In 2017, the Criminal Code was amended the official, as it is not thought that there Parent companies are expected (although to widen the territorial scope to capture a is an improper business advantage. not required) to ensure that subsidiaries bribe given by a Japanese national to a However, the Guidelines for the establish and operate systems to prevent public official belonging to a Japanese Prevention of Bribery of Foreign Public bribery as appropriate to the degree of governmental/official body whilst outside Officials published by the Ministry of risk, as indicated in the METI Guidelines. of Japan. Economy, Trade and Industry in 2004, as subsequently amended (the “METI See also above on the liability of those Any person, whether foreign nationals or Guidelines”), provide that facilitation who consent to money being given to an Japanese nationals can be found guilty of payments can amount to bribery, even in intermediary (which could include a the bribery of foreign public officials under circumstances where a person seeking subsidiary in certain circumstances) for the UCPA if part of the bribery is the performance of a routine the payment of a bribe. committed within the territory of Japan. In administrative process in compliance with addition, Japanese nationals can be local laws may experience significantly Are companies required, found guilty of the bribery of foreign prejudicial treatment as a result of not public officials under the UCPA or is it a defence, to have making a facilitation payment. notwithstanding that the bribery was compliance procedures in committed outside the territory of Japan. How is bribery through place? Companies are not required to have anti- How are gifts and intermediaries treated? bribery compliance procedures in place. Liability for bribing public officials hospitality treated? (domestic or foreign) is not just restricted Gifts or hospitality can amount to a bribe. The METI Guidelines state that Japanese to those who physically pay the bribe. However, Japanese courts generally companies which conduct overseas Under both the Criminal Code and the consider that gifts or hospitality do not business operations should organise and UCPA, an individual who expressly or constitute a bribe if given within the operate an internal control system, ethics impliedly consents to money (or other bounds of “social courtesy” and compliance programmes for the things of value) being given to an (shakouteki girei). The following elements prevention of bribery of foreign public intermediary for the payment of a bribe to will be taken into account in order to officials, on a risk-based approach, taking a public official will also be guilty of an determine whether a gift or hospitality is into account the risks associated with the offence (conspiracy to commit a crime). given within the bounds of social target countries, business fields and Knowledge of the principal is required, courtesy: the relationship between the types of activities. The internal control but such knowledge can be found giver and receiver, the value of the gift, system should address the organisation, impliedly on the basis of the particular the social status of the giver and receiver recording and auditing of appropriate circumstances. and the social circumstances. approval processes for risky operations such as hiring local agents, acquiring Are companies liable for Is there an exemption for local companies and conducting the actions of their business entertainment. facilitation payments? subsidiaries? There is no exemption for facilitation A Supreme Court ruling indicates that for There is no provision providing for payments in the Criminal Code. a company to avoid liability for an corporate liability under the employee’s actions, the company should Criminal Code.
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have taken actions to prevent the offence The person who bribed, or attempted to The person who bribed, or attempted to in the form of proactive and specific bribe, the public official may be bribe, the foreign public official may be instruction. The existence of a strong sentenced to a maximum term of sentenced to a maximum term of compliance programme may also be imprisonment of three years or fined up imprisonment of five years and/or may be taken into consideration by the courts in to JPY 2.5 million (approximately USD fined up to JPY 5 million (approximately determining penalties. 22,700). USD 45,500).
What are the penalties? As noted above, the Criminal Code does Corporations that bribed, or attempted to Under the Criminal Code a public official not provide for corporate liability. bribe, a public official may be fined up to may be sentenced to a maximum term of JPY 300 million (approximately USD imprisonment of 20 years. The bribe may Under the UCPA, there are no sanctions 2,727,300). be confiscated or the value of the bribe for the foreign public official (the UCPA levied as a further penalty. only penalises the persons giving or offering the bribe).
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LUXEMBOURG
What is the definition – any judge or any other person sitting in or mandate or facilitated by such of bribery? a jurisdictional body, any arbitrator or function, mission or mandate. expert appointed whether by a court or On 21 November 1997, Luxembourg by the parties (article 250 of the LCC). Article 248 of the LCC deals with adopted the Convention on Combating influence peddling, i.e. in connection with Bribery of Foreign Public Officials in The LCC distinguishes between active a person actively or passively abusing International Business Transactions public bribery (article 247, article 249 §2 his/her function, in order to obtain a (the “Convention”) of the Organization and article 250 §2 of the LCC) and favorable decision from any of the above- for Economic Cooperation and passive public bribery (article 246, article mentioned persons. Development (the “OECD”) and ratified 249 §1 and article 250 §1 of the LCC). it by a law dated 15 January 2001, introducing several anti-bribery articles Bribery in relation to Offences of active and passive bribery into the Luxembourg Criminal Code foreign public officials are understood to include the concepts (the “LCC”). Article 252 of the LCC defines “foreign of “giving” (active) and “receiving” public official” – to which the provisions (passive), without involving an automatic These anti-bribery provisions of the LCC of articles 246 to 250 (active and passive requirement for an agreement between have since been amended by a law bribery) also apply – as: the parties (a bribery pact). dated 13 February 2011 – implementing – any person, agent or representative of additional recommendations made by the A public bribe consists of an offer, a the public authority or the public force, OECD and the Council of Europe’s Group promise, a donation, a gift or an or vested with a public electoral of States against Corruption – in order to advantage of any kind, directly or mandate, or discharging a public reinforce counter-bribery controls. indirectly promised or given to (active service mission in another State; bribery), or solicited or accepted by The anti-bribery provisions are currently – any person sitting in a foreign (passive bribery) any of the above- set forth in articles 246 to 253, article jurisdictional body, even as a non- mentioned person, with the objective of 310 and article 310-1 of the LCC. professional member of a collegial getting this person either to: body adjudicating on the outcome of a The LCC distinguishes between public – perform or refrain from performing an litigation, or any arbitrator governed by bribery (bribery of public officials, private act linked to his/her function, mission the regulations of another State or of individuals or legal entities corrupting a or mandate or facilitated by such an international public organization; public official) and private bribery (bribery function, mission or mandate; or to – European Union officials and members of a director or manager of a legal entity, – abuse a true or assumed influence in of the European Commission, of the or of a proxy-holder or agent of a legal order to obtain rewards, employment, European Parliament, of the Court of entity or natural person (bribery of a business or any other favourable Justice of the European Union and of private person)). decision from a public authority or the Court of Auditors of the European public administration. Union; and Public bribery A public bribery offence applies whenever – any official, agent or member of Article 249 of the LCC deals with a the following persons are involved: another public international posteriori bribery, i.e. the situation in organization, members of a – any person, agent or representative of which a gift or an advantage of any kind parliamentary assembly of a public the public authority or of the public is directly or indirectly promised or given international organization and persons force, or discharging a public service to, or solicited or accepted by, any of the practicing judicial functions or record mission, or vested with a public above-mentioned persons, as a office functions in another electoral mandate (articles 246 to 249 subsequent compensation for having international court. of the LCC); or performed or refrained from performing an act linked to his/her function, mission
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The term “European Union officials” A private bribe consists of an offer, a in Luxembourg, if there is an element refers to: promise, or an advantage of any kind, which connects the offence to directly or indirectly (through an Luxembourg (e.g. if the offence was – any person who is an official or intermediary) promised or given to, or committed on Luxembourg territory). contracted agent within the meaning of solicited or accepted by, any of the the Staff Regulations of officials of the above-mentioned persons or any third European Union or of the employment How are gifts and party, with the objective of getting this conditions of other agents of the hospitality treated? person to perform or to not perform his European Union; and Gifts and hospitality are not specifically or her duties or an act facilitated by his treated in the LCC, which does not – any person seconded to the European or her position, and whose actions are establish quantitative or qualitative Union by Member States or by any carried out without the knowledge limitations on such expenses. public or private body, who carries out and authorization of the board, the functions equivalent to those shareholders, the principal or They can constitute a bribe, provided that performed by European Union officials the employer. the other constitutive elements of a or other agents. bribery offence are fulfilled. Does the law apply Members of bodies set up in accordance A Grand-Ducal decree dated 14 with the treaties establishing the beyond national November 2014 (and last amended on European Union and the staff of such boundaries? 28 December 2015), fixing the bodies shall be treated in the same way Yes. According to article 5-1 of the deontological rules of the Government’s as European Union officials when the Luxembourg Criminal Procedure Code members and their rules and rights in Staff Regulations of officials of the (the “LCPC”), any Luxembourg citizen, the performance of their duties, deals European Union or the employment any person having his/her usual with gifts, hospitality offers, honours conditions of other servants of the residence in Luxembourg, or any foreign and distinctions given to Government European Union do not apply to them. citizen found in Luxembourg, who committed – abroad – an offence of members and sets out the limits within which gifts and hospitality may Bribery in the private bribery (reference is made to articles 246 to 252 (public bribery), article 310 and be accepted. sector article 310-1 (private bribery)) can be These rules only apply to members of the A private bribery offence applies sued and sentenced in Luxembourg, Government and are consequently not whenever the following persons even though the act is not punishable binding for persons of the private sector. are involved: under the legislation of the country in – any director or manager of a legal which it was committed, and even entity; or though the Luxembourg authority did not Is there an exemption for receive either a complaint from the facilitation payments? – any proxy-holder or agent of a legal offended party, or a denunciation from Luxembourg has not adopted a entity or natural person. the authority of the country where the facilitation payments exception which offence was committed. would allow for certain payments to The LCC distinguishes between active be permitted if they fall under private bribery (article 310-1 of the LCC) According to the principle of ‘ubiquity’, an such exception. and passive private bribery (article 310 of offence is considered to have occurred in the LCC). Here also, offences of active the place where its constitutive elements and passive bribery are understood to How is bribery through (and especially its effects) occurred, even include the concepts of “giving” (active) intermediaries treated? if the perpetrator was found in another and “receiving” (passive), without Bribery through intermediaries is explicitly country when the offence was involving an automatic requirement for covered in cases of active bribery by the committed. Consequently, foreign an agreement between the parties words “directly or indirectly”. individuals can be prosecuted for bribery (a bribery pact).
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A natural person or legal entity could thus (i.e. that both companies form one single In the same way, article 23 of the LCPC be held liable under Luxembourg criminal entity or that the parent company acted compels public officials (fonctionnaires) law if that person had a role in as accomplice in the commission of and employees or agents entrusted with committing the offence and could be the offence). a public service mission (salariés ou considered either: agents chargés d’une mission de service public) to report to the attorney general – as a co-perpetrator (i.e. if their role in Are companies required, any crime or offence (including bribery) the offence was such that it could not or is it a defence, to have they become aware of in the have been committed without their compliance procedures performance of their duties. help), thus incurring the same penalty in place? as the perpetrator; or There are regulatory requirements in Besides, in case of bribery committed by – as an accomplice (i.e. if they provided Luxembourg for companies of the an employee or an agent of a company, material or assisted the perpetrator), banking and financial sector to have anti- the company (as a legal entity) could (in incurring the penalty immediately below bribery policies and procedures in place. addition to the perpetrator) be held the one incurred by the perpetrator. These requirements are documented in criminally liable for such offence, if such guidelines issued by the Commission de offence has been committed in its name Are companies liable for Surveillance du Secteur Financier (i.e. the or in its interest, by one of its legal the actions of their official regulator in charge of overseeing representatives or by one of its ipso subsidiaries? all banks and other institutions and jure or de facto managers (article 34 A subsidiary is an economic and legal professionals active in Luxembourg of the LCC). entity, distinct from its parent company, financial sector), which set out factors although owned by the parent that firms should consider when Having compliance procedures in place is corporation (unlike branches, which are assessing the risks associated with a not a defence per se. not separate legal entities of the business relationship or occasional parent company). transaction and also set out how firms As a matter of fact, there are no can adjust the extent of their customer exceptions to the liability principle under There is no Luxembourg legislation which due diligence measure. bribery regulations, so that no defence is specifically regulates the establishment, available to defendants. However, organization and liability of group Companies from other sectors are not defendants can argue mitigating companies and thus no specific required to have anti-bribery compliance circumstances depending on the case regulation for situations in which criminal procedures in place. at hand. offences are committed in the context of a corporate group. In any case, all companies are subject to Consequently, companies providing clear the general rule set out in article 140 of structures and provisions in order to In principle, the liability of a parent the LCC, according to which any person guarantee their employees’ right to report company cannot arise from acts of its (except if it concerns family members of possible offences (either internally or subsidiaries (and vice versa), due to the the perpetrator or accomplice (i.e. externally) could possibly mitigate their legal autonomy of the companies of a parents and their partners, brothers and guilt in case of legal proceedings. group (unlike offences committed at the sisters and their partners, or partner), or level of a branch, for which the head persons bound by professional secrecy) What are the penalties? office remains fully liable). having knowledge of a crime, which For violations of bribery rules could still be averted or limited in its by individuals The criminal liability of a parent company effects, or whose authors are prone to Public sector bribery could however be involved, if it commit other crimes which could be According to articles 246, 247 and 249 participated in the misconduct of its averted, is required to inform the judicial of the LCC, active and passive bribery subsidiary in some way, although it or administrative authorities as well as a posteriori bribery can remains very difficult to establish that the (public prosecutor, investigating result in: means of acting this way were given by magistrates, police authorities, Labour the parent company to its subsidiary Inspectorate etc.).
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– imprisonment of between 5 and – a fine of between EUR 2,500 and EUR According to articles 35, 36 and 37 of 10 years; and 250,000. the LCC, public sector bribery can result in a fine of up to EUR 3.75 million – a fine of between EUR 500 and Private sector bribery and private sector bribery can result in EUR 187,500. a fine of up to EUR 300,000. According to article 310 and article 310-1 According to article 248 of the LCC, of the LCC, bribery in the private sector Besides the above-mentioned fines, legal influence peddling can result in: can result in: entities also face the following sanctions: – imprisonment of between 6 months – imprisonment of 1 month to 5 years; – special confiscation; and 5 years; and and – debarment from tendering for public – a fine of between EUR 500 and EUR – a fine of between EUR 251 to EUR contracts, either permanently or for a 125,500. 30,000. maximum period of 5 years; According to article 250 of the LCC, For violations of bribery rules by – exclusion from the opportunity to bribery of a magistrate can result in: legal entities obtain public aid or advantages; and/or Since a law dated 3 March 2012, – imprisonment of between 10 and 15 – judicial liquidation. legal entities are also subject to years; and criminal liability.
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NETHERLANDS
What is the definition Commercial bribery includes members of (publicly) elected of bribery? Active private commercial bribery is representative bodies, judges, arbitrators, punishable if the person bribing can and the armed forces. In Dutch case law, Dutch anti-bribery rules are set out in the reasonably assume that making the gift a public official (ambtenaar) is defined as Dutch Criminal Code (“DCC”). Dutch law or promise, or providing or offering a a “person who, under the supervision makes a distinction between bribery of service to an employee or agent, in order and responsibility of the government, has public officials (public bribery) and bribery to induce the employee or agent to act or been appointed to perform a function of persons other than public officials refrain from acting in a given manner is that undeniably has a public character (private commercial bribery). A further contrary to the employee’s or agent’s and to exercise some powers of the distinction is made between active and duty. Passive private commercial bribery State or its agencies”. passive bribery. The term “active” relates is punishable if an employee or agent, in to conduct by the briber, i.e., the person breach of his/her duty, requests or Dutch courts apply the following three who provides a gift or gives a promise, or accepts gifts, promises or services criteria to determine whether a person renders or offers to render a service, offered to induce the employee/agent to can be considered a public official: while the term “passive” refers to the act or refrain from acting in a given conduct of the recipient i.e., the person (i) the function of the public official is to manner (article 328 ter DCC). The bribery being bribed or allowing him/herself to a large part influenced by offence is applicable even where the be bribed by accepting a gift, promise governmental institutions, notably if bribe has been provided, offered or or service. the public official has been appointed promised before the person being bribed under supervision and responsibility becomes an employee or agent or after Public bribery of the government; he/she has ended his/her engagement in Under Dutch law, it is prohibited to bribe relation to which the bribe relates. (ii) the function of the public official is of a public official with the object of inducing a public nature; and him or her to act or refrain from acting in Acting in breach of one’s duty can a given manner (active public bribery, (iii) the public official’s tasks entail the include failing to disclose gifts, promises article 177 DCC). For passive bribery, the execution of governmental tasks. or services to the relevant employer or decisive factor is whether the public principal, contrary to good faith. official knows or should have reasonably Whether a person is also considered suspected that he/she had been given a a public official from an employment Bribes bribe in order to induce him/her to act or or administrative law perspective Bribes may consist of gifts, promises or refrain from acting in a given manner is irrelevant. services. No further definitions of these (article 363 DCC). These prohibitions terms are provided by law. In accordance apply in relation to Dutch and foreign Since the purpose of the anti-bribery with Dutch case law, a gift means a public officials (article 178a DCC). The rules is to prevent any form of corruption transfer of something that has any value bribery offence is applicable even where in the civil service and to stimulate honest to the recipient. A promise is the promise the bribe has been provided, offered or governmental conduct, the term public of a gift (offering money is a promise). promised before the person being bribed official should be interpreted broadly. In becomes a public official or after he/she general, employees of privatised has ended his/her work as public official. What is the definition of a organisations that perform a public public official and a service that is supervised by a The active and passive bribery of judges foreign public official? governmental body will be considered (including both national and international Public official public officials. However, persons judges and arbitrators) is a separate The DCC does not provide a definition of employed by private companies with offence (articles 178 and 364 DCC) with public sector and there is no overall commercial objectives in which the Dutch a tougher maximum punishment. definition of public official. Article 84 DCC state merely has a role as a shareholder states that the term “public officials” also (even if a majority shareholder) will generally not be considered to be public
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officials, because they do not perform the • a Dutch public official or a person in • the payments are made to lower tier government’s duties and are not the public service of an international public officials; appointed by the Dutch state (but are institution with its seat in the • the payment has been entered into the instead appointed, depending on their Netherlands who commits the offence records of the company in a clear, role and on the structure of the company, of bribery abroad. transparent manner; and by a board of directors whose directors will be appointed by the general meeting How are gifts and • the initiative for the payment was taken of shareholders or the board of hospitality treated? by the foreign public official. supervisory directors). As noted above, bribes may consist of gifts, promises or services. In this How is bribery through Foreign public official context, gifts and promises should be intermediaries treated? There is no definition of “foreign public interpreted broadly, and should be A company can be liable for a bribery official” and no case law defining which assumed to include invitations to dinners, offence committed by an intermediary, if criteria would be applied. It can be excursions, working visits, and visits to the bribery can be imputed or attributed assumed that the same criteria for an event. (toegerekend) to the company. The domestic public officials will apply to criteria which are applied in determining foreign public officials. Persons in the The fact that providing/offering a service whether or not an offence can be public service of a foreign state or an may also be a bribe means that bribes imputed to an intermediary are the same international institution are considered can include rewards that may not have a as those for attributing liability to a parent public officials. specific economic value, such as a company for the actions of its subsidiary, (honorary) title, and the provision of and are set out below. Is private sector bribery pleasure trips and holiday homes at covered by the law? significantly discounted prices. Are companies liable for Yes. The offences of active and the actions of their passive private commercial bribery are Is there an exemption for set out above. subsidiaries? facilitation payments? The anti-bribery rules also apply to legal Facilitation payments are considered Does the law apply entities. In Dutch case law, an offence bribes and therefore making facilitation can be attributed to a legal entity beyond national payments is an offence under Dutch depending on the circumstances of the boundaries? criminal law. However, the 2011 case and whether such attribution is The following persons may be Instructions for the Investigation and reasonable. The following (non- prosecuted in the Netherlands: Prosecution of Public Officials Abroad comprehensive) factors are relevant for make it clear that in certain such attribution: • any person who bribes a public official circumstances prosecutors may decide (foreign or domestic) in or from not to prosecute in respect of facilitation • the conduct constituting the offence the Netherlands; payments. Relevant factors for falls within the regular scope of activities/conduct of the entity; • a Dutch public official (not necessarily prosecutors to consider in deciding having Dutch nationality) or a Dutch whether to prosecute are whether: • the entity benefited from the offence; national who accepts a bribe outside • the public official concerned was • the offence was committed by the Netherlands; required by law to carry out or to employees, or persons working on • any person in the public service of an refrain from carrying out the act that behalf of the entity; international institution with its seat was facilitated by the payment; • the entity could have prevented the in the Netherlands who accepts a • the payment cannot in any way have a conduct but neglected to do so and bribe abroad; distortive effect on competition; “accepted” it. Not taking reasonable • a Dutch national who bribes a • the amounts involved are small (in care to prevent such conduct can also public official (foreign or domestic) absolute or in relative terms); constitute acceptance of the conduct. abroad; and
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The Netherlands has no jurisdiction over However, having adequate compliance 12 years where the intention of the foreign subsidiaries of Dutch parent procedures in place may mitigate the risk bribery is to obtain a conviction in companies. However, it is possible to of criminal liability being attributed to a criminal proceedings) and a maximum prosecute the Dutch parent company if company (as described above). For fine of EUR 83,000 for natural persons the conduct constituting the offence of example, it may show that the company and EUR 830,000 for legal entities (article bribery can reasonably be attributed to has taken reasonable care to prevent 178 and 364 DCC). the Dutch parent company (the same such conduct and that the conduct does attribution factors as set out above not fall within the regular scope of The maximum fine for legal entities can would apply). It is generally assumed that conduct of the entity. be increased up to a maximum of 10% of a parent company cannot be held liable their annual turnover, if the maximum fine merely because of its majority What are the penalties? of EUR 830,000 is considered not an shareholding and formal legal structure. Active or passive bribery of a public appropriate punishment. However, there is currently no case law official is punishable by a maximum term to give more guidance on the legal of imprisonment of six years and a position of parent companies with maximum fine of EUR 83,000 for natural regard to offences committed by persons and EUR 830,000 for legal their subsidiaries. entities (articles 177 and 363 DCC). Active and passive private commercial Are companies required, bribery are punishable by a maximum or is it a defence, to have prison term of four years and a maximum compliance procedures fine of EUR 83,000 for natural persons and EUR 830,000 for legal entities (article in place? 328 ter DCC). The active and passive No, companies are not required to have bribery of a judge is punishable by a compliance procedures in place. maximum prison term of nine years (or
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PEOPLE’S REPUBLIC OF CHINA
What is the definition b) “‘kickbacks’ or ‘handling fees’ in (iii) “accepts various kinds of ‘kickbacks’ of bribery? violation of state regulations and the or ‘handling fees’ during a circumstances are serious”13; or commercial transaction for his The relevant rules regarding bribery and personal use in violation of state corruption are contained in various texts, (iii) an individual or an entity offers a state regulations”; or the most important of which are the PRC organisation (i.e., a state organ, a Criminal Law, effective as from 1 October state-owned company/enterprise/ (iv) “abuses his status as a public official, 1997 (as amended on 4 November 2017, institution or a people’s organisation): by influencing another public official to the “Criminal Law”) and the Anti-Unfair secure an illegitimate benefit for a) “money or property for the purpose Competition Law, effective as from 1 another party, in exchange for money of securing illegitimate benefits”; or December 1993 (as amended on 4 or property”16. November 2017, the “AUCL”). The b) “various forms of ‘kickbacks’ or The illegal bribe can take various forms Criminal Law criminalises bribery of public ‘handling fees’ during a commercial such as: (i) cash; (ii) “kickbacks” or officials and commercial bribery involving transaction in contravention of state “handling fees”; or (iii) assets and benefits companies and their employees. The regulations”14. other than cash that can be valued in AUCL deals with commercial bribery only. It is also a criminal offence for any monetary terms, such as home individual or entity to bribe (i) any close renovation, debt relief, membership Corruption in relation to public relative of a public official or any other services and travel.17 officials person who has a close relationship with Under the Criminal Law, a crime of that public official; or (ii) any former public Corruption in relation to foreign bribery is committed if: official, any of his or her close relatives or public officials (i) an individual offers a public official: any other person who has a close Article 164, paragraph 2 of the Criminal relationship with that public official, Law criminalises bribery of foreign public a) “money or property for the purpose for the purpose of securing an officials and officials of international public of securing an illegitimate benefit”; illegitimate benefit.15 organisations (active bribery only). b) “money or property of relatively high value in violation of state regulations Accepting a bribe by a public official is “Providing property to any foreign public during a commercial transaction”; or also criminally prohibited: the criminal official or official of an international public offence of accepting a bribe is committed organisation for the purpose of seeking c) “various forms of ‘kickbacks’ or by a public official if he: improper commercial benefit shall be ‘handling fees’ during a commercial subject to the penalty provided by the transaction in contravention of state (i) “takes advantage of his office to preceding paragraph.” regulations”12; demand money or property”; (ii) an entity offers a public official: The 2016 Interpretation and the (ii) “illegally accepts ‘money or property’ Supplemental Rules to Provisions (II) on a) “a bribe for the purpose of securing in relation to a favour provided to the the Standards for Initiating Investigation an illegitimate benefit”; or briber”; and Prosecution of Criminal Cases under
12 Article 389 of the Criminal Law 13 Article 393 of the Criminal Law 14 Article 391 of the Criminal Law 15 Article 390(1) of the Criminal Law 16 Articles 385 and 388 of the Criminal Law 17 Article 12 of the Interpretation of Several Issues concerning the Application of Law in Handling Criminal Cases Related to Graft and Bribery, promulgated jointly by the Supreme People’s Court and the Supreme People’s Procuratorate on 18 April 2016 (“2016 Interpretation “)
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the Jurisdiction of the Public Security Under the AUCL, business operators are What is the definition of a Authorities jointly promulgated by the prohibited from offering bribes to: public official and a Supreme People’s Procuratorate and the (i) employees of counterparties to Ministry of Public Security on 14 foreign public official? a transaction; November 2011 set out thresholds for The notion of a public official, which is initiating investigation and prosecution of (ii) entities or individuals entrusted by the specific to public sector bribery, is the offence of bribery of foreign public transaction counterparties to handle broadly construed under the Criminal officials or officials of international public relevant matters; and Law and includes in particular, individuals: organisations. The threshold is RMB (iii) entities or individuals that take (i) who perform public services in state 60,000 if the offender is an individual, advantage of their positions or organs including all levels of power and RMB 200,000 if the offender is an influence to affect the transaction20. organs, administrative organs entity (e.g., a company). (i.e., the State Council and the local The former State Administration of governments), judicial organs Corruption in relation to private Industry and Commerce (“SAIC”, currently (e.g., courts and prosecution bodies) individuals or entities replaced by the State Administration for and military organs; Commercial bribery is prohibited under Market Regulation, “SAMR”) issued the Criminal Law (criminal liability) and interpretative guidance (Provisional (ii) who perform public services in state- under the AUCL (administrative liability). Measures on Prohibition of Commercial owned institutions (e.g., universities or The Criminal Law prohibits any person Bribery) which states that a bribe, for the hospitals) or civil organisations; from offering money or property to a staff purposes of the AUCL, refers to any (iii) who perform public services in SOEs, member of a company, an enterprise or money or property provided to an entity or including directors, managers, other organisation for the purpose of individual, such as promotional fees, supervisors or accountants (however, securing an illegitimate benefit18. advertising fees, sponsorship, research SOE employees who perform technical fees, service fees, consulting fees or services without government-related It is also a criminal offence for a staff commissions, etc., or other benefits such functions, such as back office staff, member of a company, an enterprise or as domestic or overseas trips for the should be excluded); and other organisation to accept or solicit purpose of selling or purchasing goods. money or property from any person in Commissions to an intermediary or (iv) who are assigned by the government relation to any benefit provided to discounts to any party must be recorded or SOEs to perform public services in the briber19. in the accounting books of the company; non-state-owned enterprises, 22 any person who receives a commission or institutions or civil organisations . Except for special circumstances, “kickback” not recorded in the accounting The term “foreign public official” is not commercial bribery may trigger criminal books of that party may also be punished defined under the Criminal Law. In an liability (as opposed to administrative for commercial bribery21. liability under the AUCL) but only if the interview, the officials in the Congress value of the bribe is “relatively high” or Accordingly, bribing a state-owned responsible for the drafting of this “high” and if the purpose of the bribery is enterprise (“SOE”) or its employee in provision confirmed that it was adopted to secure illegitimate benefits. It appears order to secure a business transaction to implement the United Nations that the difference between criminal and may trigger both the AUCL and the Convention Against Corruption (ratified non-criminal commercial bribery is Criminal Law. by China in 2005). According to Article 2 essentially based on the amount of of this Convention, “foreign public official” the bribe. refers to any person holding a legislative,
18 Article 164 of the Criminal Law 19 Article 163 of the Criminal Law 20 Article 7 of the AUCL 21 Articles 2, 5, 6 and 7 of the Provisional Measures on Prohibition of Commercial Bribery 22 Article 93 of the Criminal Law
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executive, administrative or judicial (i) within the territory of the PRC (a crime (iii) the timing, form and context of the office of a foreign country, whether is deemed to have been committed gift; and appointed or elected, and any person within the territory of the PRC when (iv) whether the gift giver requested the performing a public function, including for either its act or result – e.g., receiving receiver to act in a certain way in his a public agency or public enterprise or an improper commercial benefit – takes or her relevant position or whether the providing a public service under the law place in China); receiver takes advantage of his or her of a foreign country. (ii) by a PRC citizen or entity anywhere position in the relevant entity for the (unless the maximum penalty for the benefit of the gift giver.26 Similarly, the term “official of an crime is less than three years international public organisation” is not imprisonment); Hospitality, particularly if excessive or defined under the Criminal Law. Under lavish, may be regarded as a bribe if the Article 2 of the United Nations (iii) by a PRC public official anywhere, other elements of bribery are satisfied. Convention Against Corruption, this regardless of the maximum term refers to any international civil penalty; and The wording of the AUCL is sufficiently servant or any person who is authorised (iv) by a non-PRC citizen outside the broad to cover gifts and hospitality, and by such an organisation to act on behalf territory of the PRC, which harms the there is no guidance on the legitimacy of of that organisation. interests of the state or PRC citizens, gifts and hospitality under the AUCL. provided that the minimum penalty However, advertising gifts of nominal Is private sector bribery for the crime is not less than three value, provided in accordance with covered by the law? years imprisonment.25 relevant market practice, are exempted.27 Yes, as provided under Articles 163 and In practice, reasonable and occasional 164 of the Criminal Law and Article 7 of The AUCL may have extraterritorial effect hospitality is unlikely to be investigated the AUCL (see above). when, for example, both the bribe-giver or penalised. and the bribe receiver are incorporated in Under the Criminal Law, the criminal China, while the offence of commercial Is there an exemption for penalties for public sector bribery are bribery takes place overseas. In practice, facilitation payments? much more severe than those for private however, regulatory investigations into There are no specific provisions or sector bribery. For instance, in the most overseas transactions are not common. exemptions under Chinese law for severe cases, a public official convicted of facilitation payments. Each payment taking bribes may be subject to the death How are gifts and must be judged according to whether it penalty,23 while the maximum penalty for a hospitality treated? fulfils the criteria for the offences non-public official who has committed Under the Criminal Law, whether described above. taking commercial bribery is a fixed term a gift is legitimate depends on the imprisonment of up to 15 years.24 following factors: Payments that are made under extortion where no illegitimate benefit is obtained in (i) the background to the gift (e.g., Does the law apply return, however, are not to be regarded whether the parties are relatives or beyond national as bribes under the Criminal Law28. There friends and the history of their is no comparable provision in the AUCL. boundaries? personal relationship); Yes. The Criminal Law applies to any crime committed: (ii) the value of the gift;
23 Articles 383 and 386 of the Criminal Law 24 Article 163 of the Criminal Law 25 Articles 6, 7 and 8 of the Criminal Law 26 Article 10 of the Opinions on Several Issues and Application of Law concerning the Handling of Criminal Cases of Commercial Bribery jointly issued by the Supreme People’s Court and the Supreme People’s Procuratorate on 20 November 2008 27 Article 8 of the Provisional Measures on Prohibition of Commercial Bribery 28 Article 389 of the Criminal Law
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However, the Criminal Law, as opposed affect the transaction for the purposes of Having compliance procedures in place is to the AUCL, sets out differing thresholds seeking business opportunities or not a statutory defence under either the regarding the value of the concerned competitive advantages. Criminal Law or the AUCL. That said, bribe. For example, in the absence of under the AUCL, an act of bribery by an particular circumstances prescribed by Are companies liable for employee may be deemed to be an act relevant laws or regulations, a criminal the actions of their of bribery by the employer unless the offence is committed if (i) the bribe employer can show that the employee’s offered by an individual to a public official subsidiaries? action is irrelevant to seeking business is RMB 30,000 or above,29 (ii) the bribe As a general principle under PRC law, a opportunities or competitive advantages offered by an individual to a non-public company is legally independent from its for the employer. In practice, the PRC official is RMB 60,000 or above,30 or (iii) subsidiary, and not liable for its regulators are likely to consider the the bribe offered by an entity (whether to subsidiary’s actions, unless the company adequacy of an employer’s compliance a public official or non-public official) is itself has participated in such action. For procedures when assessing the evidence RMB 200,000 or above.31 instance, a parent company may be held advanced by an employer to prove that liable if it authorised or instructed its its employee’s act of bribery is irrelevant How is bribery through subsidiary to commit the bribery offence to seeking business opportunities or or it had knowledge that its subsidiary competitive advantages for the employer. intermediaries treated? was involved in criminal conduct. Paying, receiving or soliciting bribes through an intermediary or a third party The AUCL is silent on the liability of a What are the penalties? Corruption in relation to public officials would not exempt the party who actually company for the acts of its subsidiary. Under the Criminal Law, an individual pays, receives or solicits the bribes from Even if, in principle, a company is legally convicted of the offence of offering a criminal liability. independent form its subsidiary and bribe to a public official may be subject therefore not liable for its subsidiary’s to criminal detention32, a fixed term of There is also a criminal offence of conduct, the rules on principal-agent imprisonment, or life imprisonment33, and facilitating a bribe as an intermediary. For relationship under PRC civil law may criminal fines or confiscation of property. example, communicating an intention to apply. In other words, if the subsidiary give a bribe or transferring money involved in bribery conduct is used as an Which penalty shall apply depends on the between the bribe giver and the bribe agent by the parent company, the latter severity of the offence. By defining receiver are criminal offences. may be held liable, as described above. “severe”, “causing significant losses to the State”, and “significantly severe”, the Similarly, the AUCL enhances the Are companies required, prohibition of bribery through 2016 Interpretation provides guidance on intermediaries. Specifically, it is an offence or is it a defence, to have the determination of the penalties. for a business operator to bribe any entity compliance procedures or individual entrusted by the transaction in place? The Interpretation of Several Issues Concerning the Application of Law for counterparty to handle relevant matters, Companies are not legally required to Handling Criminal Cases of Bribery or any entity or individual that takes have anti-bribery compliance procedures (“2012 Interpretation”) jointly advantage of their position or influence to in place.
29 Article 7 of the 2016 Interpretation 30 Article 11 of the 2016 Interpretation 31 Article 1(8) of the Rules on the Standards of Initiating Criminal Investigations in Cases Directly Accepted and Investigation by the People’s Procuratorate, promulgated by the Supreme People’s Procuratorate on 16 September 1999 32 “Criminal detention” is a “less serious form” of imprisonment. The length of criminal detention ranges from one month to six months. An individual under criminal detention is allowed leave from the detention of one or two days each month. 33 Under the Criminal Law, the term of imprisonment usually ranges from six months to 15 years.
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promulgated by the Supreme People’s the death penalty, and a criminal fine or accepted a bribe may be sentenced to Court and the Supreme People’s confiscation of property. criminal detention or to a term of Procuratorate on 26 December 2012 also imprisonment and confiscation of property. sets forth several incentives for Corruption in relation to private confession. Mitigation or exemption from individuals or entities Under the AUCL, a business operator penalties based on confession is possible Under the Criminal Law, an individual who offers a bribe, if the circumstances for both entities and individuals. convicted of the offence of offering a bribe are not serious enough to constitute a to a staff member of a company, criminal offence, may be subject to a fine A corporate entity convicted of the same enterprise or other organisation may be ranging from RMB 100,000 to RMB offence may be subject to a criminal fine subject to criminal detention or a term of 3,000,000 and any illegal income may be and any person directly in charge of the imprisonment of up to 10 years and confiscated. In severe cases, the management of the entity as well as any confiscation of property. An entity offender’s business licence may be other person personally involved in the convicted of the same offence is subject revoked. Pursuant to the Provisional commission of the offence may be to a criminal fine, and any person directly Measures on Prohibition of Commercial sentenced to a fixed term of in charge of the management of the entity Bribery, entities and individuals accepting imprisonment of up to five years or as well as any other person personally bribes when purchasing or selling goods criminal detention, and a criminal fine. involved in the commission of the offence are subject to the same administrative may be sentenced to criminal detention or penalty as the business operators offering A public official who is convicted of to a term of imprisonment of up to the bribes.34 having committed the offence of 10 years and confiscation of property. accepting a bribe may be sentenced to criminal detention, a fixed term of A staff member of a company, enterprise imprisonment, life imprisonment or even or other organisation found guilty of having
34 Articles 4 and 9 of the Provisional Measures on Prohibition of Commercial Bribery
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POLAND
What is the definition According to Article 230a section 1 of the to issue decisions in an of bribery? Polish Criminal Code, it is also an offence administrative procedure; to grant or promise to grant a benefit in According to Article 228 section 1 of the (vi) an employee of a state or local exchange for mediation in the above- Polish Criminal Code, anyone who, in government inspection authority, mentioned institutions, with the intention connection with performing a public unless performing only auxiliary of illegally influencing a decision, or function accepts a material or personal functions; causing a person holding public office to benefit, or a promise thereof, is liable to act or omit to act, in connection with the (vii) a holder of a managerial position in imprisonment for between six months holding of that office. a different government institution; and eight years. (viii) an officer of an agency designated According to Article 229 section 1 of the What is the definition of for the protection of public security Polish Criminal Code, anyone who gives public official and foreign or a prison officer; or promises to give a material or personal public official? (ix) a person doing active military benefit to a person in relation to his/her The public sector bribery offence in the service; holding a public office is liable to Polish Criminal Code applies to bribery of imprisonment for between six months persons performing a public function. (x) an employee of an international and eight years. This term includes: criminal court, unless performing only auxiliary functions; Polish criminal law does not provide a 1. Public officials, which means: definition of a material or personal benefit (i) the President of the Republic of 2. persons holding a position with a and limits itself in this scope to the Poland; foreign government or a supra-national statement that a material or personal organisation; benefit is a benefit received either for (ii) a member of the lower or upper 3. members of local government oneself or for another person. The most chamber of the Polish Parliament administration bodies; obvious form of delivering financial or of a local government agency; benefits is the handing over of money (in (iii) a member of the European 4. persons employed by organisational cash). However, at present it is assumed Parliament; units with public funds at their disposal that the term “material benefit” is capable (unless performing only service-type of referring to any increase in property (iv) a judge, lay judge, public work), e.g. members of tender assets or decrease in liabilities. There are prosecutor, an official of a financial committees in the public procurement also views that winning a tender could be authority responsible for procedures; and a material benefit. conducting preparatory proceedings or of an agency 5 other persons whose competencies or duties concerning public activity are Paid patronage superior to such financial authority, specified by Polish law (e.g. court- Undertaking to assist in dealing with a notary, a court enforcement officer appointed experts, members of matter in exchange for a financial benefit (bailiff), an official received, an arbitral tribunals). by invoking influence in a government or insolvency administrator and local government institution, in an trustee, a member of a disciplinary Officers of state-owned or controlled international or national institution or in a panel adjudicating of specific enterprises, while not specifically listed as foreign organisational unit having public matters on the basis of a statute; persons exercising a public function, may funds at its disposal or by giving another (v) an employee of a government be treated as such when their specific person the impression of such influence agency, other state agency or local duties directly involve public funds or or confirming the belief of that person in government agency, unless then can otherwise be seen as exercising such influence (passive paid patronage) is performing only auxiliary functions, a public function. This would include, e.g. subject to penalty (Article 230 section 1 and any other person authorised senior officers in a bank in which the of the Polish Criminal Code). State Treasury is a majority shareholder.
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Is private sector bribery who commits an offence against the Rules for the medical sector35 permit covered by the law? Polish state, or Polish public officials. giving and accepting items relevant to the practice of medicine or pharmacy which The Polish Criminal Code provides for bear a mark promoting a firm or criminal liability for commercial bribery. How are gifts and hospitality treated? medicinal product and which have a value of under PLN 100 (approximately Passive bribery consists in the Gifts and hospitality are capable of being EUR 23). acceptance by a person holding a treated as bribes. However, according to managerial position in an organisational case law, a custom may constitute, in unit, or by a person who, owing to the some circumstances, a defence to the Is there an exemption for function held, has significant influence on offence of public sector corruption. Thus, facilitation payments? the decision-making connected with this gifts and hospitality to public officials are There is no exemption in Poland for unit, of a financial or personal benefit or a permitted where they are: facilitation payments, and such payments promise thereof in exchange for are likely to fall under the statutory (i) customary and socially accepted as a behaviour that could cause property definition of a bribery offence. gesture of courtesy; damage to that unit, an act of unfair competition or inadmissible preferential (ii) of small value; and How is bribery through action in favour of the acquirer or (iii) provided as an expression of intermediaries treated? recipient of a good, service or benefit. gratitude, i.e. after the provision of a A company can be liable for the corrupt service by a person holding public actions of an intermediary insofar as such Active bribery, on the other hand, consists office, but provided that the gift or actions might have brought it some in granting or promising to grant a financial hospitality was not promised, benefit, where the conditions for corporate or personal benefit in the same cases. suggested or expected in connection criminal liability (set out below) are met. with the service provided. Does the law apply beyond Are companies liable for national boundaries? There is no clear boundary between a the actions of their According to the Polish Criminal Code, small socially acceptable gift and active Polish criminal law applies to Polish bribery. Guidelines issued by the Polish subsidiaries? citizens who have committed an offence Central Anti-Corruption Bureau (Centralne The liability of entities for criminal offences abroad provided that such offence is Biuro Antykorupcyjne) in 2011 (the “CBA is regulated by the Act on the Liability of considered an offence by the law in force Guidelines”) state that it is not an offence Collective Entities for Punishable Acts. where it was committed. The condition to give a customary expression of In general, under that Act, a corporate that the offence has to be considered an recognition or gratitude in the form of entity may be liable if a specified offence is offence by the law in force where it was flowers, a small gift of a promotional nature committed by a specific person and that committed does not apply to a Polish (e.g. a branded pen or calendar) and of a conduct has resulted or may have resulted public official who, while performing his token value after the public official has in a benefit for the corporate entity. duties abroad, has committed an offence taken an action or performed a service. there in connection with performing his A corporate entity may be held liable for duties, or to a person who committed an Certain groups of public officials and their offences committed by: offence in a place not under the spouses are required to record benefits • a person acting on behalf of the jurisdiction of any state authority. received in the Register of Benefits, corporate entity or in its interest and where the value exceeds the amount within the scope of his/her powers or Furthermore, notwithstanding the specified in law (currently PLN 380, duty to represent it, a person who provisions in force in the place where an approximately EUR 88), or where the makes decisions on behalf of the entity offence is committed, Polish criminal law benefit is in the form of domestic or or who exercises internal control, or applies to a Polish national or a foreigner foreign travel not related to the public who exceeds his/her powers or fails to office held. perform his/her duty (a “Manager”);
35 Article 58 of the Polish Pharmaceutical Law.
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• a person given permission to act by a Given that a corporate entity is not liable However, the fine may not exceed 3% of Manager; under the Act on the Liability of Collective the entity’s revenue earned in the financial Entities for Punishable Acts if it has year in which the offence was committed. • a person acting on behalf of the exercised due diligence in preventing the The court is also competent to prohibit corporate entity or in its interest with the offence and in hiring or supervising the the corporate entity from carrying out consent or knowledge of a Manager; or relevant person (as set out above), it has promotions and advertising, benefiting • a person being “an entrepreneur” (a been suggested that internal controls from grants, subsidies or assistance from sole trader) who is involved in a under which such due diligence has international organisations or bidding for business relationship with the been undertaken would provide a public contracts. It can also decide to corporate entity. defence in those circumstances. publicise the judgment. All the above- However, the use of this compliance mentioned bans may be imposed for a The entity will be liable for the actions of defence is largely untested. period of one year to five years. such persons only if:
• the entity’s bodies or representatives A draft Act on Transparency in the Public The Polish Government is currently failed to exercise due diligence in Sphere would introduce a requirement on working on the new draft Act on Liability preventing the commission of an larger companies to implement anti- of Collective Entities for Punishable Acts, offence by the Manager or the corruption procedures. However, this is which is intended to make the procedure entrepreneur; or not yet in force. of bringing corporate entities to account more efficient (under the current Act, the • it has failed to exercise due diligence What are the penalties? procedure has been ineffective in in hiring or supervising a person given The penalty for bribery under the Criminal practice). Work on the draft is at an early permission to act by the Manager or Code is imprisonment for between six stage, but it is expected that it could a person acting with his/her consent months and twelve years. The penalties come into force during 2019. or knowledge. for a criminal offence of paid patronage The liability of the entity is secondary to include imprisonment for between six The purpose of the new draft Act on the liability of the person who committed months and eight years. Liability of Collective Entities for Punishable the offence, i.e. the entity can be held Acts is, first of all, to introduce corporate The court may also order the forfeiture of criminally liable only after the person who criminal liability for all offences, including any object which derived from the committed the offence has been found corruption offences and treasury offences offence or which served or was designed guilty and sentenced by a court of law. (currently, corporate criminal liability is for committing the offence, any benefit limited to the offences specifically The Act on the Liability of Collective which derived from the offence or the mentioned in the Act on Liability of Entities for Punishable Acts provides value of the objects or benefits which Collective Entities for Punishable Acts). It that if a corporate entity is not criminally derived from the offence. will be possible to conduct criminal liable, it may still be civilly liable in respect proceedings against a corporate entity, Under the Public Procurement Law, an of any damages caused, or irrespective of criminal proceedings entity may be fined with an administrative administratively liable. pending against an individual, and penalty of up to PLN 150,000 – conviction of an individual will not be a Otherwise, Polish criminal law does not approximately EUR 35,000 (depending criterion for instituting criminal proceedings provide that a parent company is liable on the value of the contract). Also, natural against a corporate entity (which is the for the actions of its subsidiaries. persons sentenced for certain specified case at present). The new draft Act on criminal offences (in particular, in Liability of Collective Entities for Punishable Are companies required, connection with a contract award Acts would also considerably increase the procedure) are by law excluded from or is it a defence, to have maximum penalty for criminal liability of contract award procedures. corporate entities to PLN 30 million compliance procedures (approximately EUR 7 million). Under the Act on the Liability of Collective in place? Currently the maximum fine is Entities for Punishable Acts a corporate Polish law does not require companies PLN 5 million (approximately entity may be fined up to PLN 5 million to have anti-bribery internal controls EUR 1.162 million). (approximately EUR 1.162 million). in place.
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ROMANIA
What is the definition economic agent or legal entity which is offence was against the Romanian of bribery? owned, or partly owned by the state. The state, a Romanian citizen or term public official also includes any a Romanian company. Articles 289 and 290 of the Criminal individual who performs a service of Code (“Taking a bribe”/”Giving a bribe”) public interest entrusted to him or her by set out the offences of soliciting or How are gifts and a public authority, or an individual who is receiving, and promising, giving or hospitality treated? subject to the control or supervisions of a offering, money or other undue benefits, There is no specific provision in public authority. in exchange for the performance or non- Romanian law for gifts and hospitality, performance of professional duties, or for which will constitute bribes if the The term foreign public official is not expediting or delaying an act either within elements of a bribery offence are present. defined in the Romanian Criminal Code. the scope of the public official/person’s professional duties, or in breach of his or Is there an exemption for her professional duties. Is private sector bribery covered by the law? facilitation payments? There is no exemption in Romanian law The Criminal Code also criminalises Yes. According to Romanian legislation, for facilitation payments. trading in influence, both selling and the same conditions that would trigger buying. The offence of buying influence the criminal liability in respect of bribery of consists of promising, offering or giving a public official are applicable to the How is bribery through money or other undue benefits, directly private sector, i.e. offering an undue intermediaries treated? or indirectly, for oneself or for another, to benefit to any person that carries out, on Romanian anti-corruption law specifies a person who holds influence, or who a permanent or on a temporary basis, that bribery offences may be committed claims to hold influence over a public with or without a remuneration, a duty, directly or indirectly. Therefore, a principal official, intending to persuade the public irrespective of its nature, in the service of who commits a bribery offence through official to perform or omit to perform a a legal entity (including a private legal the assistance of an intermediary will itself professional duty, or to expedite or delay entity). The sanctions however are lower be criminally liable. the performance on an act either within (i.e. the minimum and maximum the scope of the person’s professional sentences are reduced by a third). Are companies liable for duties, or in breach of his or her the actions of their professional duties. Does the law apply subsidiaries? beyond national Passive bribery is also criminalised, A company is criminally liable for a and there is a separate offence of abuse boundaries? corruption offence committed by any of office. Yes. Romanian criminal law applies in the person who is carrying out a core activity case of criminal offences committed by a of the company, or who is acting in the interest of or on behalf of the company What is the definition of a Romanian citizen or a Romanian legal entity outside Romania, where the (e.g., directors, managers or other public official and a offence is punishable by a term of persons with control or decision-making foreign public official? imprisonment of ten years or more, or if powers for the company). A public official is an individual who, on a the conduct is also a criminal offence in temporary or permanent basis, whether the jurisdiction in which the offence Under Article 135 of the Criminal Code, a paid or unpaid, (i) performs legislative, was committed. legal entity may be held criminally liable if executive or judicial duties: (ii) holds the offence is committed: Romanian criminal law also applies to public office or has public functions of (i) in respect of the legal entity’s core criminal offences committed outside any nature; or (iii) performs duties related business activity; to the activity of a public enterprise, Romania by a foreign citizen if the
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(ii) in the interest of the legal entity (i.e. What are the penalties? in a maximum amount of EUR 720,000), the offence must lead to a benefit to For individuals: and one or more auxiliary sanctions, the legal entity, or avoid a loss); According to the Romanian Criminal such as: (iii) by an agent or representative of the Code, an individual that commits the • Debarment from public sector legal entity and on its behalf; and offence of receiving a bribe may be contracts for one to three years; sentenced to a term of imprisonment of (iv) further to a resolution taken by between three and ten years. For the • Suspension of activity for between the legal entity, or as a result of offence of giving a bribe, an individual three months and three years; its negligence. may be sentenced to a term of • Closure of working points for three imprisonment of between two and seven months to three years; Are companies required, years. However, depending on the or is it a defence, to have specific circumstances in which the • Dissolution of the legal entity; compliance procedures bribery was committed, these sentences • Judicial surveillance; and may be reduced or increased. Also, the in place? giving of bribe will not be punished if • Publication of the conviction. Companies are not required under the public /private officer self-denounces Romanian law to have anti-bribery before the criminal investigation compliance procedures in place. While is started. there is no statutory defence in Romanian law of having such procedures in place, For legal entities: there have been cases in which the Legal entities may be penalised by a fine courts have reduced the penalties where (which may be daily and within a specific it was shown that procedures were range subject to the legal entity income, in place.
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RUSSIA
What is the definition In Russian anti-corruption legislation EUR 128 at the current exchange rate) of bribery? bribery is defined, among other things, (Article 291.2 of the Criminal Code). as follows: Russian anti-corruption laws include The Plenum of the Supreme Court has Federal Law No. 273-FZ dated 25 (a) Bribery of public officials clarified37 that a bribe occurs if financial December 2008 On Preventing Under the Criminal Code, the crime of gain or any other benefit is given to, or Corruption (the “Anti-Corruption Law”) bribery in relation to public officials is accepted by, a public official for and Federal Law No. 115-FZ dated 7 defined as: performing duties that derive solely August 2001 On Preventing Legalisation from his/her official position and which (Laundering) of the Proceeds of Crime • “directly or indirectly, accepting are of an organisational, management and Financing of Terrorism. unlawful remuneration (in the form of or administrative nature. monetary funds, securities or other The Anti-Corruption Law defines property, services or property rights) by However, if the benefit is not given corruption as follows: a public official, foreign public official or directly to or accepted by a public official of a public international “Corruption is (a) the abuse of public official or his/her relatives, but is organisation (including when at the office, the giving or receiving of bribes, instead provided to another individual instruction of a public official a bribe is the abuse of powers, commercial bribery or organisation, and neither the public transferred to another individual or legal or other illegitimate use by an individual official nor the relatives obtain any entity) in return for performing an act of his/her official status contrary to the financial gain or other benefit from it, (or omitting to act) in favour of the legal interests of society and the State in then giving or accepting such a benefit bribe-giver or the persons they order to obtain private gain in the form of does not constitute the crime of giving represent, if it falls within the authority money, benefits, other property or or accepting a bribe. In such cases the of the bribe-taker, or, if not, facilitating services involving property, or other public official may nevertheless be such an act (or omission to act) by property rights for himself/herself or for prosecuted for abuse of office if his/her means of abuse of official position, third parties, or the illegal provision of action (or omission to act) is including general patronage or such a benefit to the individual by other tantamount to such abuse. connivance” (Article 290 of the individuals; and (b) the servicing of Criminal Code); actions mentioned in section (a) above (b) Commercial bribery on behalf of or for the benefit of a • “directly or indirectly, giving unlawful Bribery in business transactions is legal entity”. remuneration to a public official, foreign a crime under the Criminal Code, public official or official of a public specifically: Individuals are subject to criminal, international organisation (including • “giving unlawful remuneration (in the administrative, civil and/or disciplinary when at the instruction of a public form of money, securities or other liability for bribery and other related official a bribe is transferred to another property, services or property rights) to offences36. Organisations are subject to individual or legal entity)” (Article 291 of a person exercising management administrative liability for providing, the Criminal Code); functions at a commercial or other offering or promising unlawful • “directly or indirectly, giving or organisation (including when at the remuneration (Article 19.28 of the accepting a bribe in an amount not instruction of such person such Administrative Offences Code). exceeding RUB 10,000” (approximately unlawful remuneration is transferred to
36 The Criminal Code establishes the following crimes of bribery and other related offences: accepting a bribe (Art. 290), providing a bribe (Art. 291), acting as an intermediary for a bribe (Art. 291.1), small-scale bribery (Art. 291.2), commercial bribery (Art. 204), acting as an intermediary in commercial bribery (Art. 204.1), small‑scale commercial bribery (Art. 204.2), bribery in public procurement (Art. 200.5), incitement of a bribe (Art. 304), abuse of powers (Art. 201), abuse of public office (Art. 285), fraud (Art. 159), embezzlement (Art. 160) and forgery (Art. 292). 37 Item 23 of Decree of the Plenum of the Supreme Court of the Russian Federation No. 24 dated 9 July 2013.
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another individual or legal entity) in The offence here is acting (or omitting property rights) to public officials, return for performing an act (or omitting to act) in the interests of the persons exercising management to act) for the benefit of the bribe-giver bribe‑giver or other person in functions at a commercial or other or other individuals or legal entities, if connection with the procurement of organisation, foreign public officials or such actions (or omissions) are part of goods, services or works for state or officials of public international the work duties of the person or the municipal needs (in the absence of organisations (including when unlawful person may facilitate such actions (or elements of the offence of bribery or remuneration is given to another omissions) on account of his/her commercial bribery) (Article 200.5 of individual or legal entity at the position” (Article 204 of the the Criminal Code). instruction of such person) Criminal Code); (Article 19.28 of the Administrative (d) Incitement to bribe Offences Code). • “accepting unlawful remuneration by a Any attempt to transfer money, person exercising management Criminal proceedings against an securities or other property, services or functions at a commercial or other individual and administrative property rights to a public official, organisation” (Article 204 of the proceedings against the respective foreign public official, official of a public Criminal Code); organisation may be based on the international organisation, a person same facts and can be heard • “commercial bribery in an amount not exercising management functions at a in parallel. exceeding RUB 10,000” (approximately commercial or other organisation or EUR 128 at the current exchange rate) any of the persons listed in items (i)-(iv) What is the definition of a (Article 204.2 of the Criminal Code). of paragraph (c) above without their public official and a consent for the purposes of falsifying An example of the bribe-taker could evidence of a crime or blackmail is foreign public official? be a CEO, a member of the board of categorised as incitement of a bribe, a As a matter of Russian anti-corruption directors or the head of a particular commercial bribe or a bribe in public law, “public official”, “foreign public department responsible for procurement (Article 304 of the official” and “official of a public certain approvals. Criminal Code). international organisation” are defined as follows: (c) Bribery in public procurement (e) Bribery as an administrative Under the Criminal Code, the crime of offence • A “public official” is an individual who, bribery in public procurement is While managers and employees may on a permanent or temporary basis or defined as bribe-giving/bribe-taking in be subject to criminal penalties for by special authority, performs the relation to the following persons bribery as described above, the only functions of a representative of the representing the interests of the regulatory implications for legal entities state or fulfils organisational and customer in the procurement of that are found to be involved in bribery management or administrative goods, services or works for state or are administrative penalties. In practice, functions at state or local authorities, municipal needs: Russian law enforcement authorities state or municipal enterprises, state tend to initiate investigations of corporations, state companies, state or (i) contracting service employees; organisations where a manager or municipal unitary enterprises, joint- stock companies in which the Russian (ii) contracting administrators; employee is convicted of bribery. Federation or a constituent entity or a (iii) persons responsible for the Organisations are subject to municipality holds a controlling stake, acceptance of goods, services or administrative liability for providing, or the military.38 works; and offering or promising unlawful remuneration (in the form of money, • A “foreign public official” is an individual (iv) other authorised representatives. securities or other property, services or who holds legislative, executive, administrative, or judicial office in a
38 Note 1 to Article 285 of the Criminal Code.
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foreign country, whether appointed or general public or the state), the actors international documents setting out elected, and any person who exercises can generally only be prosecuted if and obligations recognised by Russia; and duties of public office of a foreign as long as the organisation seeks • no verdict has been rendered by a country, including at a public agency or prosecution (Article 23 of the Criminal foreign court in relation to the crime public enterprise.39 The Plenum of the Procedure Code). and they are brought to criminal liability Supreme Court has clarified that • The Administrative Offences Code in Russia. foreign ministers, mayors, judges, and establishes administrative liability for public prosecutors are to be The Administrative Offences Code providing, offering or promising recognised as foreign public officials.40 provides that an organisation is subject to unlawful remuneration to (among administrative liability if it commits an • An “official of a public international others) persons exercising offence in Russia, unless prescribed organisation” is an international civil management functions at a otherwise by an international treaty to servant or any person who is authorised commercial or other organisation which Russia is a party (Article 1.8 of the by an international organisation to act (see item (e) above). Administrative Offences Code). An on behalf of that organisation.41 The organisation that has committed an Plenum of the Supreme Court has Does the law apply offence outside the borders of the clarified that members of a beyond national Russian Federation is subject to parliamentary assembly of an boundaries? administrative liability if so prescribed by international organisation to which Yes. As prescribed in the Criminal Code, an international treaty to which Russia is Russia is party, individuals who hold Russian citizens and stateless persons a party. In addition, an organisation that judicial office at an international court, who permanently reside in Russia and has committed a corruption-related the jurisdiction of which is recognised by who have committed a crime outside the offence by providing, offering or Russia, etc. are recognised as officials borders of the Russian Federation are promising unlawful remuneration of international organisations.42 subject to criminal liability under the (Article 19.28 of the Administrative Criminal Code in the absence of a foreign Offences Code) outside the borders of Is private sector bribery court judgment relating to the crime. the Russian Federation is subject to covered by the law? administrative liability if the following Yes. Private sector bribery is covered by Foreign nationals and stateless persons conditions are met: Russian anti-corruption laws, specifically: who do not permanently reside in Russia and who have committed a crime outside • the offence is directed against interests • The Criminal Code establishes criminal the borders of the Russian Federation are of the Russian Federation; or liability for commercial bribery also subject to criminal liability under the • if prosecution under administrative law (see above). Criminal Code if the following conditions for such corruption-related offences is As a matter of Russian criminal are met (Article 12 of the Criminal Code): envisaged by international treaties to procedure law, in the case of private • the crime is directed against the interests which the Russian Federation is a sector bribery, where the harm caused of the Russian Federation or against a party; and by corruption offences is restricted Russian citizen or a stateless person who • the organisation has not been exclusively to the interests of a permanently resides in Russia; or prosecuted under administrative law in commercial or other organisation which a foreign state for the corruption- is not a state or municipal enterprise or • if it is provided for by international related offence. state-owned/municipally owned treaties to which the Russian organisation (and no harm is caused to Federation is a party or by other other organisations, individuals, the
39 Note 2 to Article 290 of the Criminal Code and Note 3 to Article 19.28 of the Administrative Offences Code. 40 Item 1 of Decree of the Plenum of the Supreme Court of the Russian Federation No. 24 dated 9 July 2013. 41 Note 2 to Article 290 of the Criminal Code & Note 3 to Article 19.28 of the Administrative Offences Code. 42 Item 1 of Decree of the Plenum of the Supreme Court of the Russian Federation No. 24 dated 9 July 2013.
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How are gifts and assessed using the criteria for corruption- Since there is no corporate criminal hospitality treated? related offences, whether criminal or liability in Russian law, companies cannot administrative. Neither the Criminal Code be held criminally liable for bribery Under the Civil Code (Article 575), it is nor the Administrative Offences Code offences committed by an intermediary. prohibited “to donate gifts, with the contain any rules as to the minimum However, where a third party agent is exception of customary gifts worth no amount of a payment to qualify as a bribe engaged by a company to act on its more than RUB 3000 [approximately (including commercial bribe). behalf (e.g., by virtue of a power of EUR 38 at the current exchange rate], to attorney or under contract) the company persons holding public office of the could be subject to administrative Russian Federation, public office of Is there an exemption for liability for corrupt actions committed by constituent entities of the Russian facilitation payments? the intermediary. Federation or public office of There is no specific exemption under municipalities, or to state employees, Russian law for facilitation payments. municipal employees or employees of the Each payment must be assessed using Are companies liable for Bank of Russia in connection with their the criteria for corruption offences, the actions of their official capacity or in connection with the whether criminal or administrative. subsidiaries? performance of their official duties.” There As a general principle under Russian law, is no clear guidance as to whether How is bribery through a company is legally independent from its gratuities and hospitality are to be treated intermediaries treated? subsidiaries and not liable for any actions as gifts, but there are grounds to believe Bribery through intermediaries is a crime taken by them, unless the company itself that the definition of a ‘gift’ should be under Russian law. Specifically, the has participated in such actions. construed broadly to include both Criminal Code establishes criminal gratuities and hospitality. liability for: However, there is an exception to this rule. Since January 2019 companies can These limitations do not apply to cases • “acting as an intermediary in bribery, be prosecuted under Russian where gifts are donated in connection i.e. directly transferring a bribe at the administrative law for providing, offering with official entertainment, business trips, instruction of the bribe-giver or bribe- or promising unlawful remuneration in the and other official events. taker or otherwise facilitating the interests of a related legal entity (e.g., a reaching or realisation of an agreement subsidiary or affiliate of the company) If the value of a gift exceeds RUB 3,000, between the bribe-giver and bribe-taker (Article 19.28 of the Administrative it should be deemed state, regional, or to receive and give the bribe” Offences Code). local property and officials must hand it (Article 291.1 of the Criminal Code); over to the body for which the public • “acting as an intermediary in Are companies required, official works. In practice this means that commercial bribery, i.e. directly the value of officially given gifts can or is it a defence, to have transferring the thing of value exceed RUB 3,000, but any such gifts compliance procedures constituting the commercial bribe must be handed over to the state, (unlawful remuneration) at the in place? regional or local authorities (alternatively, instruction of the bribe-giver or Under Russian law, companies are such gifts can be bought out by the bribe‑taker or otherwise facilitating obliged to have adequate procedures in official under a special procedure). 43 the reaching or realisation of an place to prevent bribery. Such agreement between them to receive procedures may include, amongst other Russian law contains no specific and give the thing of value constituting things: defences (such as classing them as the commercial bribe” (Article 204.1 of promotional expenses, etc.) to the above (i) determination of departments and the Criminal Code). limitations. Each payment (whether it officials responsible for prevention of exceeds RUB 3,000 or not) must be corruption-related and other offences;
43 Article 13.3 of the Federal Law No. 273-FZ of 25 December 2008 On Combating Corruption.
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(ii) cooperation with law-enforcement and As regards defences to corporate liability, The maximum penalties under the other public authorities; if a company is charged with an Criminal Code for commercial administrative corruption-related or other bribery/bribery in public procurement (iii) elaboration and implementation of offence, it may be a defence to are as follows: standards and procedures aimed at demonstrate that the company has taken ensuring the company operates in • for accepting a commercial bribe/bribe all reasonable steps possible to prevent good faith; of RUB 1 million (approximately the offence and comply with the relevant EUR 12,839 at the current exchange (iv) adoption of a code of ethics and statutory requirements. Furthermore, a rate) or more – imprisonment for up to professional behaviour for employees; legal entity can be exempted from 12 years, accompanied by a fine equal administrative liability for providing, (v) prevention and management of to 50 times the value of the bribe; offering or promising unlawful conflicts of interest; and remuneration (Article 19.28 of the • for giving a commercial bribe/bribe of (vi) prevention of false accounting and use Administrative Offences Code) if it assists RUB 1 million (approximately of falsified documents. in the detection or investigation of the EUR 12,839 at the current exchange offence and/or crime.45 It should be noted rate) or more – imprisonment for up to The Russian Ministry of Labour and Social that this defence is not available in cases eight years, accompanied by a fine Security has also adopted non-binding where the unlawful remuneration was equal to 40 times the value of Guidance on Elaboration and Adoption of provided, offered or promised to a foreign the bribe. Anti-corruption Measures by Organisations public official or an official of a public Where an organisation is found guilty of of 8 November 2013. This guidance is international organisation in connection corruption, the maximum possible aimed at developing a uniform approach with a commercial transaction.46 administrative penalty for a bribe of by legal entities, regardless of their form of RUB 20 million (approximately ownership, legal form, etc., to What are the penalties? EUR 256,777 at the current exchange anti‑corruption measures. The maximum penalties under the Criminal rate) or more is a fine equal to 100 times Code for corruption in relation to public In addition, public joint-stock companies the value of the bribe (but in any case not officials are as follows: for accepting/giving are obliged to put in place a risk- less than RUB 100 million (approximately a bribe of RUB 1 million (approximately management and internal control system EUR 1.28 million at the current exchange EUR 12,839 at the current exchange rate) by, amongst other things, adopting an rate)), accompanied by confiscation of or more – imprisonment for up to appropriate policy and conducting an the money, securities or other assets that 15 years, accompanied by a fine equal to internal audit to assess the reliability and constituted the bribe. 70 times the value of the bribe. effectiveness of their risk-management and internal control system.44
44 Article 87.1 of the Federal Law No. 208-FZ of 26 December 1995 on Joint-Stock Companies. 45 Note 5 to Article 19.28 of the Administrative Offences Code. 46 Note 6 to Article 19.28 of the Administrative Offences Code.
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SINGAPORE
What is the definition (c) any payment, release, discharge or • a person to accept or agree to accept of bribery? liquidation of any loan, obligation or any gratification as a motive or reward other liability whatsoever, whether in in order to influence a public servant, Section 5 of the Prevention of Corruption whole or in part; by corrupt or illegal means, to do an Act (Cap 241, 1993 Rev Ed) (the “PCA”) official act; prohibits any person (by himself or by (d) any other service, favour or advantage or in conjunction with any other of any description whatsoever, • a person to accept any gratification as person) from: including protection from any penalty a motive or reward for exercising or disability incurred or apprehended personal influence over a public servant (a) corruptly soliciting or receiving, or or from any action or proceedings of a to do an official act; and for agreeing to receive for himself, or for disciplinary or penal nature, whether or any other person; or • a public servant to obtain or agree to not already instituted, and including accept anything of value, without (b) corruptly giving, promising or offering the exercise or the forbearance from consideration, or with inadequate to any person whether for the benefit the exercise of any right or any official consideration, from a person concerned of that person or of another person, power or duty; and in any proceedings or business any gratification as an inducement to (e) any offer, undertaking or promise of conducted by such public servant. or reward for, or otherwise on any gratification within the meaning of account of – While the term “gratification” is not paragraphs (a), (b), (c) and (d) above. expressly defined in the Penal Code, the (i) any person doing or forbearing to explanatory notes to the relevant section do anything in respect of any The PCA also expressly prohibits certain stipulate that the word is not restricted to matter or transaction (whether corrupt dealings by or with “agents” in pecuniary gratifications, or to actual or proposed); or relation to their “principal’s affairs or gratifications estimable in money. business” (section 6). These terms are (ii) any member, officer or servant of a defined so as to cover both the public public body doing or forbearing to and private sectors. What is the definition of a do anything in respect of any public official and a matter or transaction (whether There is no de minimis threshold. actual or proposed), in which such foreign public official? a public body is concerned. Domestic public official The PCA stipulates that evidence that The PCA does not define “public official”, any such gratification is customary in any The term “person” covers companies as but rather makes express reference to profession, trade, vocation or calling is well as individuals. certain types of public officials, namely a inadmissible in any civil or criminal “Member of Parliament”, “public body” proceedings under the PCA. A bribe is referred to under the PCA by with the power to act under written law, use of the term “gratification”, which is and also a general reference to a “person The Penal Code (Cap 224, 2008 Rev Ed) broadly defined to include the giving, in the employment of the Government or (the “Penal Code”) criminalises bribery of promising or offering of: any department thereof”. The PCA also public officials (sections 161 to 165). In contains express prohibitions with respect particular, it is a criminal offence for: (a) money or any gift, loan, fee, reward, to dealings with “agents” in relation to his/ commission, valuable security or • a public servant to accept or agree to her “principal’s affairs or business”. other property or interest in property accept any gratification, other than legal “Agent” is defined to include a person of any description, whether movable remuneration, as a motive or reward in serving the Government or under any or immovable; respect of doing an official act; corporation or public body. “Principal” (b) any office, employment or contract; includes the Government or a public body.
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Where the defendant is a public official of Singapore in any place outside reasonable amount are unlikely to and the gratification is paid to or received Singapore, he/she may be dealt with in be prosecuted. by him, there is a rebuttable presumption respect of that offence as if it had been that where the gratification has been paid committed within Singapore. The PCA Is there an exemption for or given to or received by a public official, also expressly provides that a person facilitation payments? that it has been paid or given and who abets the commission of an offence There are no specific provisions or received corruptly. outside Singapore in relation to the affairs exemptions in Singapore under the PCA or business or on behalf of a principal and Penal Code or any other law in The Penal Code provides a broad and residing in Singapore, shall be deemed to Singapore in relation to facilitation exhaustive definition of “public servant”. have committed the offence. payments. Each payment must be Moreover, it not only covers “public considered by the courts according to servants” but also persons “expecting to In addition, under the abetment whether it fulfils the criteria for the offence be a public servant”. provisions in the Penal Code, a person of bribery or corruption. who abets an offence (including an Foreign public official offence under the PCA) from outside The PCA expressly prohibits the offering Singapore legislation does not expressly Singapore shall be liable for the offence, of any gratification to a member of a deal with bribery of foreign public officials. notwithstanding that the acts of abetment public body as an inducement or reward However, the drafting of the PCA were carried out outside Singapore. for the official’s “performing, or... prohibitions is sufficiently broad so as to expediting... the performance” of any include bribery of foreign public officials The Penal Code also expressly provides official act. by Singapore citizens. that every public servant who, being a citizen or a permanent resident of Is private sector bribery Singapore, when acting or purporting to How is bribery through covered by the law? act in the course of his employment, intermediaries treated? commits an act or omission outside The PCA provides that a person will be Private sector bribery is covered by the Singapore that if committed in Singapore liable for the actions taken by that person PCA but not by the Penal Code. Section would constitute an offence under the “in conjunction with any other person”. 5 of the PCA prohibits bribing “any law in force in Singapore is deemed to Where an intermediary acts in person”, and therefore applies to bribes have committed that act or omission conjunction with its principal, the principal to any company or individual, be it in the in Singapore. will therefore be liable. The PCA does not public sector or the private sector. As specify the knowledge required on the noted above, the terms “agent” and part of the principal of the bribery “principal”, in the context of the offence How are gifts and committed by the intermediary in order of corrupt dealings with agents, cover hospitality treated? for the principal to be liable. both the public and private sectors. The term “gratification” is sufficiently broad to encompass gifts and hospitality, The Penal Code does not expressly which are therefore capable of being Does the law apply provide for the liability of a principal for bribes if the other elements of the offence beyond national the acts of an intermediary. are present. The explanatory notes to the boundaries? Penal Code make it clear that the term is Yes, both the PCA and the Penal Code not restricted to gratification in Are companies liable for apply beyond national boundaries. monetary terms. the actions of their subsidiaries? The PCA expressly provides that its In practice, in the private sector, gifts No, Singapore legislation does not provisions have effect in relation to and hospitality provided on a “one-off” expressly provide for the liability of a citizens of Singapore, outside as well as basis and which cost only a modest or parent company for the actions of within Singapore. Where an offence its subsidiary. under the PCA is committed by a citizen
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Although the reference to “person” is compliance measures in place, and there a) Fine not exceeding SGD sufficiently broad under the PCA and is no formal defence of having such 100,000; and Penal Code to cover companies, based procedures in place. Nevertheless, a b) Imprisonment for a term not on a review of current reported case law, robust anti-bribery programme would be exceeding five years; or both. no company has been prosecuted under likely to be taken into consideration by the PCA and/or Penal Code to date in the Singapore courts in any proceedings II. For public sector bribery: this regard. against a company. a) Fine not exceeding SGD 100,000; and Are companies required, What are the penalties? The penalties for offences of private and b) Imprisonment for a term not or is it a defence, to have exceeding seven years; or both. compliance procedures public sector corruption are as follows: in place? I. For private sector bribery: No, Singapore legislation does not require companies to have anti-bribery
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SLOVAK REPUBLIC
What is the definition order to enable an undue advantage Permanent Representation to the EU and of bribery? to be gained or maintained; the Slovak Embassies, and local administration, etc. (section 128(1) of the Slovak Act No. 300/2005 Coll., the (iii) accepting or requesting a bribe, or not Slovak Criminal Code). Criminal Code, as amended (the “Slovak refusing to be bribed, directly or via an Criminal Code”), sets out several intermediary, in order to exert influence The Slovak Criminal Code also refers corruption offences in sections 328 to on the exercise of the authority of a to the exertion of influence on 336b, including: person under (i)(a) above, a public “foreign public officials”. This term official under (i)(b) above or a foreign (a) accepting bribes; includes persons: public official under (i)(c) above, or for (b) offering bribes; and having done so; and (i) holding office in the legislative body, executive body, judicial or arbitral (c) indirect bribery. (iv) promising, offering or providing a organs, or in another public bribe, directly or via an intermediary, to administration body of a foreign state In particular, the Slovak Criminal a third party to exert its influence on (including the head of a foreign state); Code prohibits: the exercise of the authority of a person under (ii)(a) above, a public (ii) holding office, employed by, or (i) accepting or requesting a bribe, or not official under (ii)(b) above or a foreign working at, an international refusing to be bribed, directly or via an public official under (ii)(c) above, or for organisation or supranational intermediary: having done so, or promising, offering organisation formed by states or other (a) in order for a person to act in a way or providing a bribe to another person subjects of international public law in that breaches the duties under for this purpose. its organ or institution, or authorised to his/her employment, position act on its behalf; The Slovak Criminal Code also prohibits or function; bribery at elections and bribery in (iii) holding office, employed by, or (b) in connection with procuring sporting contests. working at, an international judicial matters in the public interest; and organ or authorised to act on The Slovak Criminal Code (section its behalf; or (c) as a foreign public official in 131(3)) defines a “bribe” as any kind of connection with the performance of (iv) holding office in an enterprise in thing or performance of a property or his/her official duties, or in connection which a foreign state has a non-property nature to which there is no with exercising his/her authority, in decisive influence, legal entitlement (e.g. gifts, hospitality and order to enable an undue advantage invitations to events), regardless of value. provided that the performance of the to be gained or maintained; office is connected with competence in (ii) promising, offering or providing a What is the definition of a procuring public matters and the criminal bribe, directly or via an intermediary: public official and a offence was committed in connection with such competence, or by abusing (a) in order for a person to act in a way foreign public official? such person’s position (section 128(2) of that breaches the duties under Certain sections of the Slovak Criminal the Slovak Criminal Code). his/her employment, position Code refer to the exertion of influence on or function; “public officials”; this term is defined to Is private sector bribery (b) in connection with procuring include the president of the Slovak matters in the public interest; and Republic, members of the Parliament of covered by the law? the Slovak Republic as well as the Yes. The Slovak Criminal Code prohibits (c) to a foreign public official in European Parliament, members of the both bribery in the private sector in connection with the performance of Slovak government, judges and other general and bribery in connection with his/her official duties, or in connection persons holding office in public authority procuring matters in the public interest. with exercising his/her authority, in institutions, e.g. employees of the Slovak However, there are some differences
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between private sector bribery and conduct on board a Slovak aircraft or a public official under (ii)(c) above, or for public sector bribery, reflecting the fact Slovak ship abroad. having done so, or promises, offers or that the latter is considered to be a more provides a bribe to another person for serious offence. The provisions of the Slovak Criminal this purpose. Code are also applicable to the most In relation to public sector bribery, the serious criminal offences (including Are companies liable for term “procuring matters in the public certain corruption offences) committed the actions of their interest” is very broad and encompasses, against Slovak citizens abroad. among other things, the decision-making subsidiaries? of state authorities as well as activities by How are gifts and Although under the Slovak Criminal Code only an individual (not a legal entity) may which social and similar rights are hospitality treated? satisfied. In other words, “procuring be held liable for a criminal offence set Since the Slovak Criminal Code defines a matters in the public interest” means out by the Slovak Criminal Code (i.e. only bribe as any kind of thing or the performing all tasks whose proper, due an individual can be an offender), the performance of a property or non- and impartial performance is in the Slovak Act on Criminal Liability of Legal property nature to which there is no legal interests of the public or in the interests Entities has introduced the concept of entitlement, any gifts, hospitality and of social groups. Private corruption, on liability of legal entities for certain invitations to events, regardless of value, the other hand, is limited to situations criminal offences, including bribery as may be treated as bribes where the other where a person acts or refrains from defined above. elements of a bribery offence are present. acting, and thus breaches his/her duties resulting from his/her employment, According to the Slovak Act on Criminal occupation, position or function. Is there an exemption for Liability of Legal Entities, a legal entity facilitation payments? may be held criminally liable if the criminal The maximum penalty is higher for public There is no specific exemption in Slovak offence is committed in favour of, on sector corruption (up to fifteen years law for facilitation payments. Each behalf of, within the scope of the imprisonment) than for private sector payment is judged according to whether activities of, or through, the legal entity corruption (up to twelve years). or not it fulfils the criteria of a and if it is committed by: corruption offence. Does the law apply (i) its statutory body or a member of its statutory body; beyond national How is bribery through boundaries? intermediaries treated? (ii) a person performing management or supervisory activities in the legal Yes. The provisions of the Slovak Criminal As stated above, an intermediary may entity; or Code have particularly broad be also held liable under the Slovak extraterritorial reach and apply, e.g. to (i) Criminal Code if he/she, directly or via (iii) a person authorized to represent or an act committed within the territory of an intermediary, decide on matters on behalf of the the Slovak Republic even if the breach of, (i) accepts or requests a bribe, or does legal entity. or threat to an interest protected under, not refuse to be bribed in order to the Slovak Criminal Code took place or exert influence on the exercise of the The criminal liability of a legal entity is not was intended to take place abroad, and authority a person under (i)(a) above, a conditional on the criminal liability of the (ii) an act committed abroad if the breach public official under (i)(b) above or a individual offender. A legal entity may be of or threat to an interest protected under foreign public official under (i)(c) above, held criminally liable even if the individual the Slovak Criminal Code, or at least a or for having done so; or offender cannot be identified. Moreover, part of the consequence of such act, criminal liability of a legal entity does not took place or was intended to take place (ii) promises, offers or provides a bribe, to preclude the criminal liability of the within the territory of the Slovak Republic. a third party to exert its influence on individual offenders under the general The Slovak Criminal Code also applies to the exercise of the authority of a provisions of the Slovak Criminal Code. person under (ii)(a) above, a public Although the Slovak Act on Criminal official under (ii)(b) above or a foreign
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Liability of Legal Entities does not What are the penalties? (vi) prohibition on participating in public expressly regulate liability of companies The penalties for a corruption offence tenders; for the actions of their subsidiaries, it under the Slovak Criminal Code include (vii) prohibition on receiving state cannot be excluded that the parent imprisonment for a term of up to 15 subsidies and subvention; company may be held liable for a criminal years and/or a monetary penalty of up to offence committed by an individual approximately EUR 331,930. The actual (viii) prohibition on receiving subsidies holding a position in its subsidiary. length of the term of imprisonment and/ and incentives provided from the However, this has not yet been tested by or the amount of the monetary penalty funds of the European Union; and the Slovak courts. Therefore, it remains to depends, among other things, on the (ix) publication of the conviction. be seen whether the courts would take scale and seriousness of the offence, the such a broad approach. amount of the bribe etc.
Are companies required, Sanctions under the Slovak Act on or is it a defence, to have Criminal Liability of Legal Entities include: compliance procedures (i) dissolution of the legal entity; in place? (ii) seizure of property; There is no requirement in Slovak law for (iii) seizure of assets; companies to have anti-bribery compliance procedures in place, and it is (iv) fines of up to EUR 1.6 million; not a defence. (v) prohibition of business activities;
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SPAIN
What is the definition 2. passive corruption (“being bribed”), the duties which the authority or of bribery? which consists of receiving, soliciting civil servant must carry out. or accepting an unfair benefit or The Criminal Code of Spain provides for 3. Passive bribery in compliance with advantage, to the detriment of others. two types of corruption: inherent duties: where the following actions by the public official or (i) corruption between individuals, set For the purposes of both these offences authority are prohibited: out in Article 286 bis of the Criminal both the individuals involved must be Code; and “the executives, directors, employees 3.1 Receiving or soliciting, or collaborators of a commercial personally or through an (ii) corruption between, on the one hand, enterprise, company, association, intermediary, gifts, favours or a public official or authority47 who foundation or organisation”. remuneration of any kind, or solicits or accepts the benefit or accepting offers or promises to advantage and, on the other hand, an Bribery carry out an act inherent to the individual who receives the solicitation In the case of bribery, the Criminal Code public office or in reward for an from the public official or proposes the identifies the following three main types act already performed; and bribe to the public official. This latter of offences: type is referred to in the Spanish 3.2 Accepting, personally or through Criminal Code as “bribery” (cohecho), 1. Active bribery: an intermediary, a gift offered rather than “corruption” (corrupción), in view of the office held or 1.1 Where the individual takes the which mainly refers to the duties performed, not including initiative in the corruption, and private sector. small gifts considered inherent 1.2 Where the individual responds to to a friendly or good The relationship between the personal the solicitation made to him/her. neighbourly relationship. elements set out in both offences is 2. Passive bribery in breach of inherent These provisions also apply to European assessed differently, depending on who duties (“cohecho pasivo propio”): Union officials48. takes the initiative, and that is also where the conduct of the civil servant reflected in the punishment imposed. or authority is sanctioned when they Bribery of foreign public officials receive or solicit, personally or through There is a separate offence in the Corruption between individuals an intermediary, gifts, favours or Criminal Code of bribery of foreign public The Criminal Code distinguishes between: remuneration of any kind, or when officials which consists of offering, 1. active corruption (“bribing another they accept offers or promises to do promising or granting any unjustified person”), which consists of promising, one of the following: profit to a foreign civil servant or an offering or granting an unfair benefit or authority, for his benefit or for the benefit 2.1 to commit an act, while carrying advantage to another individual in of a third party, with the purpose of out the duties of the public office, order for the individual making the obtaining a specific action or omission by which is contrary to the duties promise, offer or grant to obtain, in the civil servant or authority, aiming to inherent to the post held, or turn, a benefit for him/herself or for a achieve or maintain a contract, business third party, to the detriment of 2.2 to not carry out the duties or to activity or an unjustified profit in others; and unfairly delay the performance of international commercial transactions, as
47 In this context, authority means an individual public official with authority to enforce the law and to give orders to others for that purpose (e.g., a policeman, a judge, a dean or provost of a university, a mayor of a city or town, or a Cabinet minister). 48 Meaning (a) Any person holding a legislative, administrative or judicial position or employment in a country of the European Union or in any other foreign country, both by appointment or by election; (b) Any person exercising a public function for a country of the European Union or any other foreign country, including a public body or a public enterprise, for the European Union or for another public international organization; (c) Any civil servant or agent of the European Union or of a public international organization.
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well as agreeing, at the request of a Union or any other foreign country, between individuals or private foreign civil servant or an authority to give including a public body or a public parties; and any unjustified profit, for his benefit or for company for the European Union or • where the offence is committed outside the benefit of a third party, with the for another public international Spain by a citizen of Spain or any other purpose of obtaining a specific action or organization; and country, if interests especially relevant omission by the civil servant or authority, (iii) any officer or agent of the to all of humanity are harmed (the aiming to achieve or maintain a contract, European Union or of an principle of universal jurisdiction). business activity or an unjustified profit in international public organisation. international commercial transactions Therefore, the general rule is that non- (article 286 ter of the Spanish Spanish citizens who have committed the Criminal Code). Is private sector bribery covered by the law? offence of corruption between private parties outside Spain may not be Yes. As noted above, there in an offence What is the definition of a prosecuted in Spain. If the offence is of corruption between individuals, who public official and a committed by a Spanish citizen, it will must be “the executives, directors, only be prosecuted if the act constitutes foreign public official? employees or collaborators of a an offence in the place where it was Article 24 of the Criminal Code provides: commercial enterprise, company, committed and if charges have been association, foundation or organisation”. “For criminal liability purposes, a brought by the aggravated party or by person will be considered a public the Public Prosecutor. official if he, alone, or as a member of Does the law apply any corporation, tribunal or professional beyond national borders? However, the offence of bribing a foreign association, has a commanding post or The general rule is that the Spanish official (corruption in international exercises jurisdiction pertaining thereto. Criminal Code applies to all residents of business transactions foreseen in Regardless, the following will always be Spain and to any individual who commits article 286 ter) is subject to some considered public officials: members of an unlawful act in Spanish territory. extraterritorial jurisdiction. the Congress, the Senate, the regional legislative assemblies and the Article 23 of the Organic Law on the If the bribe was paid or received in Spain European Parliament. The officers of Judiciary (“LOPJ”) sets out the but the benefit, such as awarding a the Public Prosecutor’s Officer are also circumstances in which Spanish contract, took place in another country, regarded as public officials. jurisdiction may apply where the offence the person who paid the bribe can be Any person that participates in the was committed outside Spain: prosecuted in Spain if the following requirements are met: (i) an offer, promise exercise of public duties by provision of • where the offence is committed outside or grant of any undue pecuniary or other law, or by election or appointment by Spain by a Spanish citizen or a advantage (the bribe) is made directly or the competent authority will also be naturalised citizen of Spain, provided through intermediaries, to a foreign public considered to be a public official.” that: the act constitutes an offence in official or a third person with the official’s the place where it was committed, the acquiescence; (ii) the bribe aims to obtain A foreign public official is defined injured party or the Public Prosecutor or retain a business or other improper as (article 427 of the Spanish presses charges and the offender has advantage in the conduct of international Criminal Code): not already been sentenced and business; and (iii) the bribe must seek to served time for the same offence (i) any person who holds a legislative, influence the foreign official so that he or outside Spain; administrative or judicial position or she acts or refrains from acting in relation employment in a country of the • where the offence is committed outside to the performance of official duties. European Union or in any other Spain by a citizen of Spain or any other country, either by appointment or country, if interests especially relevant How are gifts and election; to the Spanish State are harmed. hospitality treated? These interests are expressly listed (ii) any person who exercises a public Gifts and hospitality may be considered and include bribery but not corruption duty for a country of the European bribes if they meet the criteria set out
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above in the statement of the offences. Predicate offences for the purposes of four years, be specially barred from being However, it is generally accepted that Article 31 bis include bribery and active in the industry or business for gifts and hospitality of low value which corruption between individuals. between one and six years and be fined do not relate to an unjustified benefit or up to three times the value of the benefit advantage are unlikely to be Parent companies may be held directly or advantage obtained. considered bribes. criminally liable for their own actions or omissions, or for the actions or omissions Where the offence is committed by a Is there an exemption for of their subsidiaries, according to the legal entity, it may be fined a daily amount facilitation payments? percentage stake held by the parent for two to five years, if the offence entails company and the degree to which they a prison term of more than two years; No. Article 420 of the Criminal Code control the subsidiaries’ decisions. and otherwise fined a daily amount for six provides that it is an offence where a months to two years, in other cases. person offers or gives (or where an authority or civil servant receives or Are companies required, For offences involving bribery, the solicits) gifts, favours or remuneration or or is it a defence, to have punishment depends on the type of any kind of offer or promise to carry compliance procedures offence committed. Articles 419 to 425 of out an act inherent to the office of in place? the Criminal Code set out the potential the recipient. Spanish law does not impose a specific sanctions as follows: obligation on companies to have How is bribery through anti‑bribery internal controls in place. For passive corruption offences: However, having implemented such intermediaries treated? • Passive bribery in breach of inherent Legal entities may be liable for bribery controls can be an effective defence to duties, that is, performing an act in carried out through intermediaries where corporate liability under section 31 bis of violation of the duties inherent to one’s such intermediaries were performing the Criminal Code. post or unjustifiably failing to perform an corporate activities on behalf of the act which the authority or civil servant legal entity, in the circumstances set Organic Law 1/2015, amending section should have performed, entails a prison out below. 31 bis of the Criminal Code, aimed to term of three to six years, a daily fine for clarify what constitutes “due control”, and 12 to 24 months and special barring introduced grounds for an exemption Are companies liable for from employment and holding public from criminal liability for legal persons the actions of their office for seven to 12 years. able to demonstrate that they possess subsidiaries? and have efficiently implemented a crime • Passive bribery in compliance with According to Article 31 bis of the Spanish prevention or compliance programme inherent duties, that is, performing acts Criminal Code, “legal entities shall be which meets specified requirements. not in breach of the duties inherent to held criminally accountable for offences one’s post, entails a prison term of two committed in their name or on their These requirements include (a) risk to four years, a daily fine for 12 to 24 behalf, and for their benefit, by their legal assessment; (b) corporate governance months and special barring from representatives and de facto or de jure procedures on decision-making; (c) due employment and holding public office administrators” and for “offences diligence; (d) whistleblowing; (e) a for five to nine years. committed when performing corporate disciplinary system; and (f) verification of • Passive bribery in compliance with activities on behalf of the company and and modifications to the programme inherent duties for accepting gifts for its benefit, by parties who, while as required. subject to the authority of the legal offered in accordance with the post or duty, entails a prison term of six entities mentioned in the preceding What are the penalties? paragraph, were able to perpetrate the months to one year and suspension For offences involving either active acts because due control was not from employment and holding public (“bribing”) or passive (“being bribed”) exercised over them, in view of the office for one to three years. corruption between individuals, offenders specific circumstances of the case”. may be sentenced to a term of For active corruption offences: imprisonment of between six months and
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Active bribery entails the same more than five years; or fined a daily creditors, for not more than five punishment, both in terms of the amount for a period of one to three years; and imprisonment and fines corresponding to years, or two to four times the benefit • the entity be prohibited from carrying the authority or civil servant, except where obtained, if the offence entails a prison out, in the future, the activity during the the act is related to a procurement, term of two to five years; or fined a daily exercise of which the offence was granting or auction process tendered by amount for a period of six months to two committed, concealed or favoured. the public administration, in which case years, or two to three times the benefit the individual or legal entity will also be obtained, in the remaining cases. The general exonerating circumstances barred from obtaining grants or public aid established in Article 20 of the Spanish and tax and social security incentives and In addition, the judge may also order that: Criminal Code may apply to these from being awarded public sector • the legal entity be wound up; offences, as well as the exemption set contracts, for between five and ten years. forth in Article 426, in cases where the • its activities be suspended for not more individual who has accepted the For cases in which a legal entity is found than five years; solicitation for a gift or remuneration liable for the offence: • its premises and establishments be reports this fact to the authorities. The legal entity will be fined a daily closed for not more than five years; amount for a period of two to five years, • the court intervene in the entity’s or three to five times the benefit obtained, administration, in order to safeguard if the offence entails a prison term of the rights of the employees or
March 2019 71 AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION 2019
TURKEY
What is the definition engagements in order to influence the organisations incorporated based on of bribery? tender conditions and price during (i) an international agreement. tenders relating to the purchase, sale or The principal offences of corruption are rental of goods and services on behalf of Is private sector bribery set out in the Turkish Criminal Code (Law public institutions or corporations; or (ii) covered by the law? No. 5237). Article 252 of the Turkish construction tenders. Under the Turkish Criminal Code, the Criminal Code defines bribery as offering offence of bribery also applies to or promising an undue benefit, directly or benefits offered or promised to through a third party, to a public official What is the definition of a individuals, whether or not they are public for taking or failing to take an action in public official and a officials, acting in the name of the connection with the duties carried out by foreign public official? following entities: such public official. “Public official” is defined widely; any individual who is involved in a public • professional organisations (e.g. Turkish jurisprudence’s interpretation of function continuously, temporarily or professional authorities, chambers the concept of “benefit” is wide and provisionally can be considered as a of commerce, unions, trade extensive. Any economic or social benefit public official (i.e., whether appointed, exchanges etc.); that is provided for the purpose of elected or otherwise involved). (For a list • corporations that have public inducing a public officer to perform or not of other individuals subject to the anti- institution/entity shareholders or to perform his/her official duties is bribery laws see the section on private professional organisation shareholders; considered a benefit within the scope of sector bribery below.) the bribery offence. • foundations that carry out their In line with the OECD Convention, there activities within the public institutions/ It is not necessary to prove that the is also a specific offence of bribing a entities or professional organisations benefit was actually obtained or retained. foreign public official. The Criminal Code qualified as the same; In working out whether a benefit is not (Article 252(9)) qualifies the following as • associations incorporated with the aim legitimately due for the purpose of the foreign public officials: of public benefit (kamu yararına bribery offence, the following factors are çalışan dernekler); disregarded: (i) public officials elected or designated in a foreign country; • co-operatives; and • the fact that the benefit may be, or be perceived to be customary, in the (ii) judges, jury members and other • publicly traded joint stock companies. circumstances; officers working for international or supranational or foreign state courts; Otherwise, bribery of individuals in the • the value of the benefit; and private sector is not covered. (iii) international or supranational • any official tolerance of the benefit. parliament members; Does the law apply There is also a specific offence of (iv) those who conduct public transactions beyond national corruption in connection with public for a foreign country, including public boundaries? bodies and public enterprises; tenders (ihaleye fesat karıştırma). The Yes. The anti-bribery provisions of the Criminal Code (Article 235) defines this (v) citizen or foreigner arbitrators Turkish Criminal Code apply to activities offence as engaging in mischief (defined appointed within the scope of outside Turkey if: as certain fraudulent or corrupt acts), arbitration method used for the (i) they are committed by a Turkish forceful acts or duress, disclosing purpose of settlement of a legal national, or information in relation to tender offers dispute; and which were meant to be kept confidential (ii) they involve bribery of a Turkish (vi) officers or representatives of as per public procurement legislation or public official, tender specifications, making international or supranational
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in both cases if such activities relate to a Gifts from foreign Are companies liable for matter to which Turkey, a legal entity countries, international the actions of their incorporated in accordance with the laws of Turkey, a Turkish public entity or a organisations and foreign subsidiaries? Turkish citizen is a party. citizens/companies Although companies are not subject to Under Law No. 3628 Concerning the criminal liability in Turkey, Article 43/A of How are gifts and Declaration of Wealth, Combating Bribery the Misdemeanours Law (Law No 5326) stipulates that a private legal person may hospitality treated? and Corruption public officials are permitted to accept gifts or grants from be fined in respect of a bribery offence Under the Turkish Criminal Code, any foreign citizens/companies up to a value committed by: benefit (with no minimum threshold) of ten months’ worth of monthly wage provided to a public official in the (i) a representative of the legal person; (monthly wage is subject to revision each circumstances set out above, may year, TRY 20,200 for 2019), provided (ii) an entity that is an organ of the legal constitute a bribe. there is no corrupt intent. Gifts above that person; or amount must be returned. Law No. 657 on Civil Servants prohibits (iii) a person who is not a representative civil servants from: of the private legal person but who Is there an exemption for has duties within the commercial • requesting gifts directly or through facilitation payments? activities of such legal person, an intermediary; Article 250 of the Turkish Criminal Code • accepting gifts with the intention of specifically criminalises the receipt of in each case, where the offence was taking an advantage even while not payments by public officials for the committed for the benefit of the relevant exercising their duties; or purpose of expediting the performance of private legal person. a routine governmental action. However, • asking for or accepting a monetary In addition, the Turkish Criminal Code it does not provide for criminal liability for loan from their principals. and the Turkish Commercial Code the person making such a payment. (Law No. 6102) provide that directors or Gifts are defined in the Public Officials’ board members of commercial Ethics Regulation as any benefit or goods How is bribery through companies shall be liable for the (with or without economic value) provided intermediaries treated? conduct of their employees, agents and to a public official that may affect Under the Misdemeanours Law, a officers if they expressly or tacitly decisions or the execution of duty by that company could be held liable for the authorised or permitted the commission public official. Exceptions to the corrupt actions of a third party agent of the offences. prohibition on the acceptance of gifts are engaged by that company if the relevant books, magazines, calendars or agent were to commit a corrupt act while Are companies required, marketing materials that are distributed to obtaining or retaining business or a the public as gifts. business advantage for that company or is it a defence, to have and if the company were shown to have compliance procedures Gifts of greeting, farewell and celebration, the requisite intent. in place? scholarships, travel, cost-free There are no requirements in Turkish law accommodation and gifts vouchers from Pursuant to the Misdemeanours Law for companies to have specific persons who have work, service or (see below), if an organ or representative anti‑bribery internal controls, and no beneficiary relationships with the of a private legal entity, or a person specific statutory defence is available. institutions for which the public official appointed within the scope of the legal Turkish law does not recognise any works, regardless of economic value, are entity’s activities, commits an offence of measures to mitigate the liability of a prohibited. bribery for the benefit of that legal entity, company for corrupt acts of its third that legal entity may be liable to an party agents. administrative penalty.
March 2019 73 AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION 2019
The Regulation on Programme of This penalty may also be imposed on: The penalty for a corruption offence Compliance with Obligations of Anti- relating to tenders is imprisonment of • a third party (whether or not a public Money Laundering and Combating between five to 12 years. This penalty official) who is indirectly provided with Terrorism Financing requires banks, may be increased by one half where the benefit (e.g. a relative of the public capital markets brokerage houses, damage or loss is suffered by a public official etc.) or who accepts such insurance and pension companies to institution or corporation as a result of the benefit; and develop a compliance programme that offence. Additionally, persons are includes policies and procedures, risk • a person (whether or not a public excluded from public tenders for a management activities, internal training official) who acts as an intermediary in specified period. and internal supervision and controls. the bribery. These entities are also required to Where an organ or representative of a appoint a compliance officer and to The penalty shall be halved where a legal entity, or a person performing duties establish a compliance unit to monitor benefit is requested by a public official for a legal entity, commits a corruption or and control the fulfilment of relevant from a person and such request is not bid-rigging offence for the benefit of the legal requirements. accepted, or vice versa; whereas the legal entity, the legal entity may be penalty for bribery shall be increased subject to an administrative fine of What are the penalties? (from one third up to one half) if a party to between TRY 10,000 and TRY 2 million. The maximum penalty for a bribery the bribe is a judicial officer, arbitral judge, In addition, where a bribe has led to a offence under the Turkish Criminal Code court appointed expert, notary public, or benefit for a legal person, further is 12 years imprisonment (for both the (sworn) chartered accountant. measures may be imposed, e.g. a licence receiver and the payer of the bribe). or authorisation may be revoked, and assets or benefits may be confiscated.
74 March 2019 AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION 2019
UKRAINE
What is the definition Illicit enrichment compliance officer of the company (for of bribery? In addition to the above, if any public company officers), this also constitutes official receives any undue advantage and an administrative offence under the Code The offences relating to bribery and there is no intent to induce the public of Administrative Offences. corruption are contained in several official to exercise his or her official duties legislative acts in Ukraine. The relevant in a particular manner, this would still acts include the Law of Ukraine “On What is the definition of a constitute an offence of illicit enrichment Preventing Corruption” No. 1700-VII public official and a in Ukraine. dated 14 October 2014 (the foreign public official? “Anti‑Corruption Law”), the Trading in influence A public official means an individual who, Criminal Code of Ukraine No. 2341-III Active trading in influence on a permanent or temporary basis, dated 5 April 2001 (the “Criminal Code”) It is a criminal offence to promise or performs functions of a state or local and the Code of Ukraine on give an undue advantage to any person government representative and holds a Administrative Offences No. 8073-X who offers or agrees to influence any position with organisational and dated 7 December 1984 (the “Code of public official in his or her decision regulatory powers (i.e., is entitled to Administrative Offences”). making, or any third party designated by manage other employees of the entity such person. and is responsible for some field of work) The corruption offences cover various or administrative and asset management actions committed by public officials, Passive trading in influence powers (i.e., is entitled to manage and/or company officers and individuals which Receiving or soliciting any undue dispose of assets) at the state or local include the promise, offering or giving of advantage from any person in return for government authorities or at a an undue advantage to public officials or agreeing to exert influence over any state/municipal enterprise. A state or company officers. Undue advantage can public official is also considered a criminal municipal enterprise here means a consist of cash or other assets (including offence in Ukraine. company where a state or a local intangibles), as well as the provision of government, respectively, holds 50 or services or other benefits. Other related corrupt acts more per cent of shares or votes or has Extortion other decisive influence on the Bribery If a public official elicits any promise, company’s activity. Active bribery offering, giving or receiving of an undue An individual may be held criminally liable advantage from someone with the The above public officials include, but are for promising, offering, and/or giving an intention of later reporting that person, not limited to, members of Parliament, undue advantage to a public official or a the public official commits a crime of deputies of local governments, ministers, company officer if such undue advantage extortion (so-called “provocation of judges, and the management of state- was promised, offered and/or given to a bribe”). owned enterprises. induce a public official or company officer to act or refrain from acting in the Undue advantage to relatives There are separate corruption offences exercise of his or her official duties. Under Ukrainian law it does not matter related to individuals rendering public whether a public official or a company services (including, without limitation, Passive bribery officer receives the undue advantage or auditors, notaries, state registrars, public Both public officials and company officers his or her relatives. Either is considered a experts and private enforcement officers may be held criminally liable for receiving criminal offence. acting on behalf of a public authority). any undue advantage or accepting an offer of such advantage in return for the Failure to react to corrupt activities A foreign public official is defined by the public official or company officer acting or If a public official or a company officer Criminal Code as an individual holding a refraining from acting in the exercise of becomes aware of any corrupt acts and position in the legislative, executive or his or her official duties. fails to notify the relevant state authorities judicial authorities of a foreign state, (for public officials) or management and including juries, as well as foreign
March 2019 75 AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION 2019
arbitrators, officials of international non- conduct which occurs on board a violation. For instance, the Criminal Code governmental organisations (i.e., any Ukraine registered aircraft or vessel (with provides that an undue advantage individuals authorised to act on behalf of certain reservations). received by a third party related to a public such organisations), members of official or company officer constitutes a international parliamentary assemblies in How are gifts and criminal offence equal to the one where which Ukraine is a member, and judges hospitality treated? such undue advantage is given directly to and officials of international courts. a public official or company officer. The Anti-Corruption Law provides that public officials cannot request, ask for The same principle applies to cases Is private sector bribery or accept gifts for themselves or where an undue advantage is promised, covered by the law? related persons from either individuals offered, and/or given to a public official or Yes, Ukrainian anti-corruption laws also or companies: company officer, so that a third party apply to bribery of private sector • if such gifts are related to them holding could benefit from such officer/official individuals, particularly company officers. a position of a public official; or acting or refraining from acting in the exercise of his or her official duties. Employees of private sector legal • if the giver is subordinated to such entities are considered officers if the public official. employee has: Are companies liable for In all other cases, public officials are the actions of their • organisational and regulatory powers allowed to accept common hospitalities (i.e., the employee is entitled to subsidiaries? with the value of up to UAH 1,921 manage other employees of the entity Under Ukrainian law parent companies (approximately EUR 60) per gift, and up and is responsible for some field of are legally independent from their to UAH 3,842 (approximately EUR 120) work); or subsidiaries and as such are not liable for for aggregated gifts from one person any actions taken by the subsidiaries, • administrative and asset management within one year. The specific value of except in certain limited cases relating to powers (i.e., the employee is entitled to permitted gifts may be subject to change. the insolvency of a subsidiary, when a manage and/or dispose of assets). parent company can be liable. As regards company officers and The major difference between the anti- individuals rendering public services, At the same time, the Anti-Corruption corruption regulations in the public and there are no restrictions for gifts. Law makes shareholders (both individuals private sectors is that penalties applicable Ukrainian anti-bribery laws use the and legal entities) responsible for to corrupt activities involving public terminology of “undue advantage”, which monitoring corruption risks and taking officials are heavier than those involving is wide enough to include gifts and measures to address such risks. The law company officers. hospitality. These may therefore does not provide any explicit liability that constitute bribes if the other elements of can be imposed on shareholders for Does the law apply a bribery offence are present. failure to perform this obligation. beyond national However, companies may provide certain boundaries? Is there an exemption for liability measures for shareholders in their internal compliance policies. Yes. The Criminal Code applies to facilitation payments? offences committed abroad by Ukrainian There are no exemptions under Ukrainian citizens and stateless persons law for facilitation payments and in most Are companies required, permanently residing in Ukraine, as well cases such payments would constitute a or is it a defence, to have corruption offence. as to corrupt acts partially committed in compliance procedures Ukraine (e.g., in cases where a corrupt in place? payment is made outside Ukraine but How is bribery through Compliance procedures are required by relates to an act which occurs in Ukraine) intermediaries treated? law. The requirements for an adequate by foreigners and stateless persons not Usually bribery through intermediaries is compliance system are more detailed residing permanently in Ukraine. Ukrainian equal to direct bribery and is also a for public companies, but Ukrainian law criminal law also applies to criminal
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also imposes potential liability for failure to What are the penalties? 850,000 (approximately EUR 26,560) prevent corruption by company officers of Penalties for corruption offences may be imposed on it; and private companies in cases of conduct vary significantly. • in limited cases (e.g., where misuse of amounting to bribery by their subordinates. office results in unlawful acquisition of For individuals such penalties include: firearms) a company which benefits The Anti-Corruption Law provides that from a corruption offence may be the following companies are obliged to • fines of up to UAH 25,500 subject to the confiscation of property. have an anti-corruption programme: (approximately EUR 796); • state and municipal enterprises with an • confiscation of property; average number of employees • debarment from certain positions and amounting to 50, and an annual income types of activities for up to three years; amounting to UAH 70 million; and • restriction of freedom for a period of up • companies (including foreign-owned to five years; and/or companies) which participate in the • imprisonment for a period of up to public procurement procedure for 12 years. projects equal to or exceeding UAH 20 million. For companies: Further, almost all public authorities • if a company officer or any of the are required to have anti-corruption company’s authorised representatives programmes. commits a corruption offence and the company receives an undue It should be noted that the Criminal Code advantage, a court may impose on the provides that a company can be subject company a fine of up to double the to criminal liability if its officers’ failure to amount of the undue advantage; perform their duties regarding the • if a company does not receive any implementation of anti-corruption undue advantage, or its amount cannot measures set out by law or by the be assessed, a fine of up to UAH company’s statutory documents led to the commission of corruption offences.
March 2019 77 AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION 2019
UNITED ARAB EMIRATES
What is the definition or privilege of any kind in return for a federal or local function, whether of bribery? performing, or abstaining from legislative, executive, administrative or performing an act in breach of his judicial, whether appointed or Articles 234 to 239 bis of UAE Federal official duties (even if the public elected, including: Law No.3 of 1987 (the “Federal Penal servant rejects the offer, grant or Code”) provide that the following privilege); and (i) Persons entrusted with a public duty constitute offences: and employees of ministries and 4. anyone who requests or accepts for 1. a public servant, a person assigned to government departments; himself or another person a grant, a public service, a foreign public privilege or benefit of any kind in return (ii) members of the armed forces; servant or an employee of an for his exercise of influence over [an international organisation who directly (iii) employees of security agencies; individual who can be guilty of a or indirectly requests or accepts for bribery offence] in order to influence (iv) members of the judiciary, chairmen himself or for another person an the individual to offer, demand, accept, and members of legislative, advisory unentitled gift, grant or privilege (or the receive or promise a bribe. and municipal councils; promise thereof) of any kind: (v) any person assigned to a certain task (i) in return for performing or failing to There are other Federal and emirate-level by a public authority, within the extent perform an act in breach of his regulations that deal with bribery and of the delegated task; official duties; which may apply. For example, in the emirate of Dubai, under Article 122 of the (vi) chairmen and members of boards of (ii) pursuant to the completion or Dubai Penal Code it is an offence to offer directors, directors and any abstention from doing an act in anything of value to a public servant employees of public bodies and breach of his official duties; or without consideration if the offeror is establishments, and companies wholly (iii) in return for performing or failing to party in a proceeding or a transaction or partially owned by the federal or perform an act that is wrongly with that public servant. Criminal intent is local governments; believed or which he believes to be not prima facie required. Provisions of the (vii) chairmen and members of the boards within his official duties; Dubai Penal Code which conflicted with of directors, directors and other the Federal Penal Code were repealed by 2. a manager or employee of a private employees of associations and Dubai Law No.4 of 1994. Since the sector establishment who requests or societies for the public welfare. Federal Penal Code does require a accepts, directly or indirectly, for corrupt intent, it is arguable that the himself or for another person, an Any person who is not included in the offence in the Dubai Penal Code following unentitled gift, grant or privilege in categories above, and who carries on such repeal requires corrupt intent, but return for performing or failing to activities which are related to public the legal position is not clear. Advice perform an act included in the duties service under a delegation by a Public should be obtained on a case-by-case of his office, or in breach of such Servant who may duly delegate such basis to ascertain the extent to which duties, even if he did not intend to duty under the laws or regulations in other regulations may be relevant. perform the act or to breach the relation to the delegated duty shall be duties, or if he has already performed/ deemed a Public Servant under the refrained from performing the act or What is the definition of a present Law.” breached his duties; public official and a foreign public official? Article 234 includes “foreign public 3. anyone who, directly or indirectly, servants” in the list of people who may Article 5 of the Federal Penal Code offers or promises to a public servant commit an offence under the bribery defines a “public servant”. or a person assigned to a public provisions of the Federal Penal Code, service, a foreign public servant or an “A public servant shall be defined in the however the term itself has not employee of an international present Law as any person who holds been defined. organisation, an unentitled gift, grant
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Is private sector bribery How are gifts and Are companies liable for covered by the law? hospitality treated? the actions of their Yes, as noted above, it is an offence for a UAE law uses broad language such as subsidiaries? manager or employee of a private sector gift, privilege or grant, which can include We are not aware of any provisions which establishment to request or accept a gifts and hospitality, where the other would make a company automatically bribe. Unlike the public sector provisions, elements of the offence are present. liable for an offence of bribery committed it is not an offence for a private sector by its subsidiary. As noted above, a manager or employee to offer a bribe Is there an exemption for company can be liable for an offence (unless the bribe is offered to a person facilitation payments? committed by a person acting on its assigned to a public service, a foreign There is no exemption for facilitation behalf or in its name (which could be a public servant or an employee of an payments. Accordingly, any payment to a subsidiary), but will not have liability international organisation, as referred public official to facilitate or expedite a where that person was acting outside the to above). routine governmental action will be scope of its mandate, or where the considered a bribe if the other elements company can show it had not instructed Does the law apply of the offence are present. the subsidiary to commit the offence. beyond national boundaries? How is bribery through Are companies required, Yes, it applies where: intermediaries treated? or is it a defence, to have (a) a UAE citizen, while in a foreign The bribery offences under the Federal compliance procedures country, become involved in an act Penal Code encompass both direct and in place? which is considered a crime under the indirect requests, promises and We are not aware of any requirements provisions of the Federal Penal Code, acceptances, therefore including bribes under UAE law for companies to have whether as a principal or an offered through intermediaries. anti-bribery compliance procedures in accessory. Offending citizens shall be place, or of a statutory defence of having sanctioned on their return to the Furthermore, Article 65 of the Federal procedures in place. country, provided the act is punishable Penal Code provides that a body in accordance with the Federal corporate is criminally liable for “crimes The Federal Penal Code (Article 239(1)) Penal Code; committed by its representative, directors provides that a briber or intermediary or agents acting on its behalf or in who reports the offence to the judicial or (b) the victim is a UAE citizen, the crime is its name”. administrative authorities before it committed by an employee of the UAE is discovered shall be exempt public of private sector, or the crime The principal is not liable for bribery by an from punishment. affects UAE public property; and intermediary if it can show that the third (c) any individual who commits a crime party was acting outside its mandate, or that the principal had not instructed the What are the penalties? under the Federal Penal Code in a Depending on the nature of the bribe, intermediary in any way to commit the foreign country has not already been penalties range from imprisonment for bribery offence. the subject of an acquittal or an undefined “temporary” period to conviction by a foreign court and imprisonment for no longer than subsequently served any sentence. five years.
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UNITED KINGDOM
What is the definition employment or by or on behalf of a body (iii) the person intends to obtain or retain of bribery? of persons (whether corporate or business, or an advantage in the unincorporate). It will be performed conduct of business; and The Bribery Act 2010 (the “Bribery Act”), “improperly” where the person which came into force on 1 July 2011, (iv) the official is neither permitted nor performing the function or activity is in sets out the statutory offences of bribing required by written law to be breach of an expectation: and being bribed. The offence of bribing influenced in his capacity as a foreign another person is set out in section 1. (i) that it will be performed in good faith; public official by the offer, promise or gift. “(1) A person (“P”) is guilty of an offence if (ii) that it will be performed impartially; or either of the following cases applies. (iii) as to the manner in which, or the What is the definition of a (2) Case 1 is where: reasons for which, the function or public official and a activity will be performed that arises (a) P offers, promises or gives a from the position of trust the person foreign public official? financial or other advantage to is in. Public official is not defined in the Bribery another person, and Act and is not a relevant term for the (b) P intends the advantage: Section 2 of the Bribery Act sets out the purposes of the Bribery Act offences. offences relating to being bribed. It (i) to induce a person to perform makes it an offence for a person to Foreign public official is defined at improperly a relevant function or request, agree to receive or accept a section 6(5) of the Bribery Act as an activity, or financial or other advantage in relation to, individual who: (ii) to reward a person for the or where acceptance is, the improper “(a) holds a legislative, administrative or improper performance of such a performance of a relevant function or judicial position of any kind, whether function or activity. activity (using the same definition of appointed or elected, of a country or improper performance of a function as for (3) Case 2 is where: territory outside the United Kingdom the section 1 offence). It is also an (or any subdivision of such a country (a) P offers, promises or gives a offence to perform a relevant function or territory), financial or other advantage to improperly, or to request or acquiesce in another person, and improper performance by someone else, (b) exercises a public function: where a financial or other advantage (b) P knows or believes that the (i) for or on behalf of a country or is involved. acceptance of the advantage would territory outside the United itself constitute the improper Kingdom (or any subdivision of Section 6 of the Bribery Act sets out a performance of a relevant function such a country or territory), or separate offence of bribing a foreign or activity. public official. (ii) for any public agency or public (4) In case 1 it does not matter whether enterprise of that country or the person to whom the advantage is This offence has four elements: territory (or subdivision), or offered, promised or given is the same (i) a person, directly or through a third (c) is an official or agent of a public person who is to perform or has party, offers, promises or gives any international organisation.” performed, the function or activity financial or other advantage to a concerned” (section 1, Bribery Act). foreign public official (or to another Is private sector bribery person at the official’s request or with A person will be performing a function or covered by the law? his assent); activity if he is performing a function of a Yes, section 1 applies to bribery of both public nature, or an activity connected (ii) the person intends to influence the public officials and non-public officials. with a business, or if the activity is foreign public official in his capacity performed in the course of his as such;
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Does the law apply How are gifts and How is bribery through beyond national hospitality treated? intermediaries treated? boundaries? The Bribery Act offences apply to any The offences of bribing, being bribed and Yes. Even where no part of an offence “financial or other advantage” which bribery of a foreign public official may all takes place within the UK, the Bribery Act includes gifts and hospitality. Gifts and be committed either directly, or indirectly, provides that a person may be hospitality may therefore be bribes i.e. through a third party. prosecuted in the UK if that person has where the other elements of an offence “a close connection” with the UK. A are present. Additionally, under section 7 of the person has a close connection with the Bribery Act, a relevant commercial UK if he is: Statutory guidance on anti-bribery organisation is liable for failing to prevent compliance procedures49 (the “UK bribery by an intermediary, where the “(a) a British citizen, Guidance”) states that “[b]ona fide intermediary was an associated person (b) a British overseas territories citizen, hospitality and promotional, or other (i.e. was performing services for or on business expenditure which seeks to behalf of the commercial organisation), (c) a British National (Overseas), improve the image of a commercial and was intending to obtain or retain (d) a British Overseas citizen, organisation, better to present products business for the commercial organisation and services, or establish cordial (see further below). (e) a person who under the British relations, is recognised as an established Nationality Act 1981 was and important part of doing business Are companies liable for a British subject, and it is not the intention of the Act to the actions of their (f) a British protected person within the criminalise such behaviour … It is, meaning of that Act, however, clear that hospitality and subsidiaries? promotional or other similar business Section 7 of the Bribery Act makes it an (g) an individual ordinarily resident in the expenditure can be employed offence for a commercial organisation to United Kingdom, as bribes.50” fail to prevent bribery by a person associated with it. (h) a body incorporated under the law of any part of the United Kingdom, Is there an exemption for “(1) A relevant commercial organisation (i) a Scottish partnership” facilitation payments? (“C”) is guilty of an offence under (section 12(4), Bribery Act). There is no exemption in UK law for this section if a person (“A”) facilitation payments, and there is a high associated with C bribes another In addition, under section 7, a risk that such payments will fall within the person intending: commercial organisation may be statutory definition of a bribery offence. (a) to obtain or retain business for C, or prosecuted in the UK for failing to prevent The Serious Fraud Office website states bribery, even where no part of the that “[a] facilitation payment is a type of (b) to obtain or retain an advantage in underlying bribery offence (see below) bribe and should be seen as such”. the conduct of business for C. took place in the UK, where the (2) But it is a defence for C to prove that commercial organisation is incorporated Prosecution will be more likely, however, C had in place adequate procedures in the UK (wherever it carries on where such payments are systemic51. designed to prevent persons business), or where it is incorporated associated with C from undertaking outside the UK but carries on a business, such conduct.” or part of a business, in the UK.
49 Guidance about procedures which relevant commercial organisations can put into place to prevent persons associated with them from bribing, Ministry of Justice, March 2011. 50 Paragraph 26 of the UK Guidance. 51 Joint Prosecution Guidance of the Director of the Serious Fraud Office and the Director of Public Prosecutions, 30 March 2011.
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Where a subsidiary has committed an associated person. The UK Guidance Persons convicted of corruption are offence under section 1 or section 6, the addresses such procedures. excluded from bidding for public sector parent company will be liable where the contracts, and contracts obtained subsidiary was performing services for or Firms regulated by the Financial Conduct through corruption may be set aside. on behalf of the company (this is the Authority (the “FCA”) are required to Companies convicted of failing to prevent test for whether a person is “associated”), have effective anti-financial crime bribery are subject to discretionary and where the bribery was intended to procedures in place, including anti-bribery debarment from public sector contracts. obtain business or an advantage in the compliance procedures. conduct of business for the company, The FCA also has powers to intervene or unless it has adequate procedures What are the penalties? discipline FCA regulated firms, if they in place. The maximum penalty under the Bribery have fallen short of the FCA’s Act is imprisonment for a term not requirements: this could include a failure The UK Guidance addresses the exceeding ten years or a fine, with no to have effective anti-corruption adequate procedures companies are upper limit, or both. procedures in place. expected to have in place and which, if implemented, will serve as a defence to Upon conviction, the offender may be Under the Crime and Courts Act 2013 the section 7 offence. ordered to pay a sum equal to the (the relevant provisions of which came “benefit” received from the commission into force on 14 February 2014) Are companies required, of the offence. A confiscation order is corporate organisations are able to reach or is it a defence, to have also enforceable against property in the a deferred prosecution agreement with a possession of third parties who have prosecutor under which charges will be compliance procedures received a gift from the defendant, up to laid but not proceeded with if the in place? the value of the gift. The court may organisation complies with agreed terms Companies are not generally required to also issue a restraint order when criminal and conditions, typically the payment of have anti-bribery compliance procedures proceedings have been or are about to fines and the implementation of in place. However, having “adequate be instituted to prevent dissipation of remedial steps. procedures” in place is a defence for a assets; this may remain in force until commercial organisation charged with an a confiscation order is made and offence of failing to prevent bribery by an fully satisfied.
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UNITED STATES
What is the definition The FCPA prohibits US “issuers”52, (A) (i) influencing any act or decision of 53 of bribery? “domestic concerns” , and any person such party, official, or candidate in acting within the United States, from its or his official capacity, (ii) It is a crime under US law to bribe both using the instrumentalities of interstate inducing such party, official, or domestic and non-US government commerce in furtherance of: candidate to do or omit to do an officials, and to engage in private act in violation of the lawful duty of commercial bribery. Bribery, however, falls “[A]n offer, payment, promise to pay, or such party, official, or candidate, or under several distinct federal and state authorisation of the payment of any (iii) securing any improper criminal statutes. In general, prohibited money, or offer, gift, promise to give, or advantage; or conduct involves paying, offering, authorisation of the giving of anything of attempting or promising to pay, public (B) inducing such party, official, or value to: officials improperly to influence their candidate to use its or his influence official acts, or, in the private context, (1) any foreign official for purposes of: with a foreign government or influencing the conduct of an employee, instrumentality thereof to affect or (A) (i) influencing any act or decision of agent, or fiduciary in relation to his influence any act or decision of such foreign official in his official employer’s or principal’s affairs, without such government or instrumentality, capacity, (ii) inducing such foreign consent of the employer or principal. US in order to assist such issuer in official to do or omit to do any act law also generally recognises the concept obtaining or retaining business for in violation of the lawful duty of of aiding and abetting a violation and or with, or directing business to, such official, or (iii) securing any conspiring to engage in violative conduct any person; or improper advantage; or as separate criminal offences. (3) any person, while knowing that all or a (B) inducing such foreign official to use portion of such money or thing of Non-US Government Officials his influence with a foreign value will be offered, given, or The Foreign Corrupt Practices Act of government or instrumentality promised, directly or indirectly, to any 1977, as amended (“FCPA”), 15 U.S.C. thereof to affect or influence any foreign official, to any foreign political sections 78dd-1, et seq., in general act or decision of such government party or official thereof, or to any terms prohibits certain parties from or instrumentality, in order to assist candidate for foreign political office, for making, offering, promising, or such issuer in obtaining or retaining purposes of: authorising a payment or anything of business for or with, or directing value, directly or indirectly, to a non-US business to, any person; (A) (i) influencing any act or decision of government official to improperly such foreign official, political party, in order to assist such issuer in influence that official or to secure an party official, or candidate in his or obtaining or retaining business for improper advantage. The statute is its official capacity, (ii) inducing such or with, or directing business to, enforced by both the US Department of foreign official, political party, party any person; Justice (“DOJ”) and the US Securities official, or candidate to do or omit and Exchange Commission (“SEC”), (2) any foreign political party or official to do any act in violation of the which have criminal and civil jurisdiction, thereof or any candidate for foreign lawful duty of such foreign official, respectively, over certain companies political office for purposes of: political party, party official, or and individuals.
52 An “issuer” is defined as any company with a class of securities registered under section 12 of the Securities Exchange Act of 1934 (“Exchange Act”) or that files reports with the SEC under section 15(d) of the Exchange Act. 15 U.S.C. section 78dd-1(a). 53 A “domestic concern” is defined as any individual who is a citizen, national, or resident of the United States, or any corporation, partnership, association, joint-stock company, business trust, unincorporated organization, or sole proprietorship which has its principal place of business in the United States, or which is organized under the laws of a State of the United States, or a territory, possession, or commonwealth of the United States. 15 U.S.C. section 78dd-2(h)(1)(A)-(B).
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candidate, or (iii) securing any (C) to induce such public official or testimony under oath or affirmation as improper advantage; or such person who has been a witness upon any such trial, hearing, selected to be a public official to do or other proceeding, or in return for (B) inducing such foreign official, or omit to do any act in violation of absenting himself therefrom; shall be political party, party official, or the lawful duty of such official or fined under this title or not more than candidate to use his or its influence person; three times the monetary equivalent of with a foreign government or the thing of value, whichever is greater, instrumentality thereof to affect or (2) being a public official or person or imprisoned for not more than 15 influence any act or decision of selected to be a public official, directly years, or both, and may be disqualified such government or instrumentality, or indirectly, corruptly demands, from holding any office of honour, trust, seeks, receives, accepts, or agrees to in order to assist such issuer in or profit under the United States” receive or accept anything of value obtaining or retaining business for or (18 U.S.C. section 201(b)(1)-(4)). personally or for any other person or with, or directing business to, any entity, in return for: person” (15 U.S.C. sections 78dd-1(a), Local Government Officials 78dd-2(a), and 78dd-3(a)). (A) being influenced in the performance Bribery of state and local public of any official act; officials is prohibited by individual state US Government Officials law. For example, California Penal Law There are a number of US federal criminal (B) being influenced to commit or aid in section 67 provides: statutes that address various iterations of committing, or to collude in, or domestic federal public corruption. The allow, any fraud, or make “Every person who gives or offers any primary domestic public bribery statute, opportunity for the commission of bribe to any executive officer in this state, 18 U.S.C. section 201, criminalises bribery any fraud, on the United States; or with intent to influence him in respect to of US federal public officials. Similar to the (C) being induced to do or omit to do any act, decision, vote, opinion, or other FCPA, the statute generally prohibits any act in violation of the official proceeding as such officer, is punishable payments, offers and promises to make duty of such official or person; by imprisonment in the state prison for payments intended improperly to influence two, three or four years, and is an official act. Unlike the FCPA, however, (3) directly or indirectly, corruptly gives, disqualified from holding any office in the statute also applies to the corrupt offers, or promises anything of value this state.” official. Specifically, the statute imposes to any person, or offers or promises criminal penalties on anyone who: such person to give anything of value Private Commercial Bribery to any other person or entity, with “(1) directly or indirectly, corruptly gives, Private commercial bribery primarily is a intent to influence the testimony under offers or promises anything of value matter of individual state law. Most states oath or affirmation of such first- to any public official or person who have enacted individual commercial mentioned person as a witness upon has been selected to be a public bribery statutes that render it a crime for a trial, hearing, or other proceeding, official, or offers or promises any a person to bribe employees of private before any court, any committee of public official or any person who has businesses or for an employee to accept either House or both Houses of been selected to be a public official to such a bribe. Congress, or any agency, commission, give anything of value to any other or officer authorised by the laws of person or entity, with intent: For example, New York Penal Law the United States to hear evidence or prohibits conferring a benefit upon an (A) to influence any official act; or take testimony, or with intent to agent or fiduciary without the consent of influence such person to absent (B) to influence such public official or the latter’s employer or principal, with the himself therefrom; person who has been selected to intent to influence his conduct in relation be a public official to commit or aid (4) directly or indirectly, corruptly demands, to his employer’s or principal’s affairs in committing, or collude in, or seeks, receives, accepts, or agrees to (N.Y. Penal Law section 180.00). allow, any fraud, or make receive or accept anything of value opportunity for the commission of personally or for any other person or An individual who commits an act in any fraud, on the United States; or entity in return for being influenced in violation of any state’s anti-bribery law,
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including bribery of local government who has been elected or designated to under the FCPA if an act in furtherance of officials and private commercial bribery, become a public servant. a prohibited bribe, including, for example, may also be liable under the federal a single telephone call, occurs within the Travel Act (18 U.S.C. section 1952) or the The FCPA specifically applies to United States. federal mail and wire fraud statutes (18 corruption involving any “foreign official”, U.S.C. sections 1341 and 1343). defined under the FCPA as: How are gifts and hospitality treated? The Travel Act makes it a crime to travel “any officer or employee of a foreign The FCPA does not prohibit all gifts and in interstate commerce or use the mail or government or any department, agency, hospitality, as the DOJ and SEC have any interstate facility with the intent to or instrumentality thereof, or of a public recognized in their guidance that “[a] commit bribery under the law of the state international organisation, or any person small gift or token of esteem or gratitude in which the act was committed. Similarly, acting in an official capacity for or on is often an appropriate way for business the federal mail and wire fraud statutes behalf of any such governmental, people to display respect” (‘A Resource generally prohibit the use of the mail or department, agency, or instrumentality, or Guide to the U.S. Foreign Corrupt other instrumentalities of US commerce for or on behalf of any such public Practices Act’ (November 2012), available in furtherance of a payment in violation of international organisation.” (15 U.S.C. at https://www.justice.gov/sites/default/ a state anti-bribery law. section 78dd-1(f)(1)(A)). files/criminal-fraud/legacy/2015/01/16/ guide.pdf (the “FCPA Guide”), page 15). The term “foreign official” has been What is the definition of a The FCPA also recognises an affirmative interpreted broadly to include officials of defence for “reasonable and bona fide public official and a government-owned commercial expenditure, such as travel and lodging foreign public official? enterprises, even if the individual would expenses, incurred by or on behalf of a Under the federal domestic public bribery not be considered a government official foreign official, party, party official, or statute, a “public official” is defined to under the relevant local law. include the following: candidate and… directly related to” either “the promotion, demonstration, or “Member of Congress, Delegate, or Is private sector bribery explanation of products or services” or Resident Commissioner, either before or covered by the law? “the execution or performance of a after such official has qualified, or an Yes. As noted above, private commercial contract with a foreign government or officer or employee or person acting for bribery is primarily covered at the agency thereof” (15 U.S.C. sections or on behalf of the United States, or any individual state level, although the federal 78dd-1(c)(2), 78dd-2(c)(2), 78dd-3(c)(2)). department, agency or branch of Travel Act and certain other federal Government thereof, including the District criminal statutes may apply derivatively. This exception may apply, for instance, to of Columbia, in any official function, Federal and non-US public corruption is the provision of reasonable travel and under or by authority of any such governed by federal statute. meals to employees of a commercial department, agency, or branch of state-owned entity in the course of Government, or a juror” (18 U.S.C. Does the law apply negotiating a deal. But US authorities have section 201(a)(1)). beyond national taken a rather narrow view as to whether expense reimbursements or outlays are In general, the state bribery statutes boundaries? “reasonable and bona fide” and “directly Yes. The FCPA’s anti-bribery prohibitions apply to bribery of public servants, related” to the promotional activities. including any public officer or employee have broad extraterritorial reach. The of the state or of any political subdivision prohibitions apply to violative acts by The DOJ has provided guidance as to thereof or of any governmental issuers, domestic concerns, and their what should qualify for the affirmative instrumentality within the state, or any agents and employees that occur entirely defence: modest travel conditions person exercising the functions of any outside US territory, and acts by any US (economy class flights; standard business such public officer or employee. The term citizen or resident, wherever they occur. hotels); payments made directly to the public servant usually includes a person In addition, any person (including foreign service providers, not to the officials; and companies or persons) may be liable no expenses for family members. Gifts of
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a nominal value are also likely to qualify (15 U.S.C. section 78dd-1(f)(3)(B) and Are companies liable for as a promotional gift covered by the section 78dd-2(h)(4)(B)). the actions of their affirmative defence. subsidiaries? How is bribery through Under US law, parent companies can be However, regulators will infer corrupt intermediaries treated? intent if a gift to a public official is likely to held liable for the violative acts of their As many bribery schemes involve have an influence on the business of the non-US affiliates if, for example, they are payments through third parties, the FCPA gift giver, in particularly when the gift giver found to have known of, or to have expressly prohibits making corrupt eventually obtains a favourable decision authorised, the prohibited payment. payments to a foreign official through from the public official. The value and the Knowledge, for these purposes, includes “any person, while knowing that all or a total number of advantages provided to circumstances constituting wilful blindness portion of such money or thing of value the public official, the nature of the toward, and conscious disregard of, the will be offered, given, or promised, relationship, the way it has been affiliate’s prohibited conduct. directly or indirectly” (15 U.S.C. sections authorised within the organisation and 78dd-1(a)(3), 78dd-2(a)(3), 78dd-3(a)(3)). recorded, would be examined by the Are companies required, As such, the FCPA prohibits knowing regulators in order to determine if a engagement in the prohibited conduct or is it a defence, to have corrupt intent could be inferred from such through a third party, such as a compliance procedures circumstances. consultant, contractor, joint venture in place? partner, or other business associate. Is there an exemption for The FCPA does not expressly require that companies implement compliance facilitation payments? The FCPA deems a person to have the procedures. And while the FCPA includes Yes. The FCPA has an express and requisite knowledge to be culpable for two affirmative defences to bribery narrow exception for facilitation or the acts of a third party if he or she is violations (i.e., the “local law” defence for expediting payments – which are relatively aware that a third party is engaging in payments lawfully made under the written insignificant payments made to facilitate or such conduct, that such circumstance laws of the foreign country (15 U.S.C. expedite performance of a “routine exists, or that such result is substantially sections 78dd-1(c)(1), 78dd-2(c)(1), and governmental action” that does not require certain to occur. A person also is deemed 78dd-3(c)(1)), and the “reasonable and the foreign official to exercise discretion. to be “knowing” if “such person has a bona fide expenditure” defence detailed Routine governmental actions include firm belief that such circumstance exists above), having existing compliance obtaining permits or licenses, processing or that such result is substantially certain procedures is not a defence. governmental papers, providing police to occur”54. Knowledge is further protection, and other similar actions. established under the FCPA if a person is However, U.S. authorities expect that Routine governmental actions do not aware of a “high probability” of such companies will adopt risk-based include “any decision by a foreign official circumstance55. Further, a person’s compliance programs and their failure to whether, or on what terms, to award new “conscious disregard”56, “wilful establish effective programs may lead to business to or to continue business with a blindness”57, or “deliberate ignorance”58, harsher treatment when violations are particular party, or any action taken by a of culpable conduct or suspicious discovered. In their guidance, U.S. foreign official involved in the decision- circumstances may be adequate to authorities stated that “an effective making process to encourage a decision support a violation of the FCPA. compliance program is a critical to award new business to or continue component of a company’s internal business with a particular party” controls and is essential in detecting and
54 15 USC § 78dd-1(f)(2)(A). 55 15 USC § 78dd-1(f)(2)(B). 56 United States v. London , 66 F.3d 1227, 1242 (1st Cir. 1995). 57 United States v. Kaplan , 832 F.2d 676, 682 (1st Cir. 1987). 58 United States v. Manriquez Aribizo , 833 F.2d 676, 682 (1st Cir. 1987).
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preventing FCPA violations” (FCPA offense, as well as at the time of a provided for under the FCPA (18 U.S.C. Guide, page 40). charging decision” among the nine section 3571 (d)). The SEC also may factors to consider when determining impose civil sanctions for violations of the A company’s adoption of compliance whether to charge a corporation and for FCPA within its jurisdiction, including procedures can be treated as a mitigating negotiating a plea or other agreements fines, disgorgement of profits, and factor when resolving an FCPA (section 9-28.000 et seq.). prejudgment interest. enforcement action. The US authorities have stated that they will “consider the What are the penalties? Under the US domestic public bribery adequacy of a company’s compliance Under the FCPA, companies can be statute, companies and individuals may program when deciding what, if any, subject to a criminal fine of up to be fined USD 20,000 or up to three times action to take” in light of identified FCPA USD 2 million per bribery violation and as the monetary equivalent of the bribe violations. As examples, the authorities much as USD 25 million for violations of (whichever is greater), and, in the case of stated that a compliance program may the accounting provisions. Individuals are individuals, imprisoned for up to 15 years. influence how charges are resolved (e.g., subject to criminal fines of up to through a deferred prosecution USD 250,000 and imprisonment of up to Penalties for breaches of state bribery agreement or a non-prosecution five years per bribery violation and statutes differ from state to state. For agreement), the amount of any penalty, or USD 5 million and 20 years’ example, depending on the whether a monitor will be required (FCPA imprisonment for violations of the circumstances, an individual in New York Guide, page 56). DOJ’s US Attorney’s accounting provisions. Also, under the may be imprisoned for up to 25 years for Manual also lists “the adequacy and Alternative Fines Act, courts may impose a bribery conviction. effectiveness of the corporation’s significantly higher fines than those compliance program at the time of the
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CONTACTS
Australia Belgium Tim Grave Sébastien Ryelandt E: [email protected] E: [email protected] Clifford Chance Dorothée Vermeiren No. 1 O’Connell Street, Level 16 E: [email protected] Sydney Clifford Chance NSW 2000 Avenue Louise 65 Australia Box 2 1050 Brussels Jenni Hill Belgium E: [email protected] Kirsten Scott E: [email protected] Lara Gotti E: [email protected] Clifford Chance 190 St Georges Terrace Perth Western Australia 6000 Brazil Czech Republic Patrick Jackson Alex Cook E: [email protected] E: [email protected] Fernando Zanzarini Jan Dobry E: [email protected] E: [email protected] Clifford Chance Clifford Chance 04551-060 Jungmannova Plaza 24 São Paulo-SP 110 00 Prague 1 Brazil Czech Republic
Shin Jae Kim E: [email protected] Renata Muzzi Gomes de Almeida E: [email protected] Giovanni Paolo Falcetta E: [email protected] TozziniFreire Advogados R. Borges Lagoa 1328 04038-004 São Paulo-SP Brazil
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France Germany Charles-Henri Boeringer Heiner Hugger E: [email protected] E: [email protected] Thomas Baudesson David Pasewaldt E: [email protected] E: [email protected] Clifford Chance Clifford Chance CS 60058, 1 rue d’Astorg Mainzer Landstraße 46 75377 Paris Cedex 08 60325 Frankfurt am Main Paris Frankfurt France Germany Hong Kong Italy Wendy Wysong Antonio Golino E: [email protected] E: [email protected] Nicholas Turner Jean-Paule Castagno E: [email protected] E: [email protected] Feifei Yu Pasquale Grella E: [email protected] E: [email protected] Clifford Chance Clifford Chance Jardine House, 27th Floor Piazzetta M. Bossi, 3 One Connaught Place 20121 Milan Hong Kong SAR Italy Japan Luxembourg Tatsuhiko Kamiyama Albert Moro E: [email protected] E: [email protected] Peter Coney Olivier Poelmans E: [email protected] E: [email protected] Tess Forge Léa Bidani E: [email protected] E: [email protected] Clifford Chance Clifford Chance 1-1, Marunouchi 1-chome 10 boulevard G.D. Charlotte Palace Building, 3rd floor B.P. 1147 Chiyoda-ku L-1011 Luxembourg Tokyo 100-0005 Japan
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Netherlands People’s Republic of China Jeroen Ouwehand Wendy Wysong E: [email protected] E: [email protected] Frans Muller Feifei Yu E: [email protected] E: [email protected] Guido Bergervoet Clifford Chance E: [email protected] Jardine House, 27th Floor One Connaught Place Clifford Chance Hong Kong SAR Droogbak 1A 1013 GE Amsterdam Lei Shi PO Box 251 E: [email protected] 1000 AG Amsterdam Clifford Chance The Netherlands 25/F, HKRI Centre Tower 2 HKRI Taikoo Hui, 288 Shi Men Yi Road Shanghai 200041 China Poland Romania Marcin Cieminski Daniel Badea E: [email protected] E: [email protected] Pawel Pogorzelski Bianca Alecu E: [email protected] E: [email protected] Clifford Chance Clifford Chance Badea Norway House Excelsior Center ul. Lwowska 19 28-30 Academiei Street Warsaw Sector 1 00-660 Poland Bucharest, 010016 Romania Russia Singapore Timur Aitkulov Nish Shetty E: [email protected] E: [email protected] Olga Semushina Kabir Singh E: [email protected] E: [email protected] Clifford Chance Janice Goh ul. Gasheka, 6 E: [email protected] 125047 Moscow Clifford Chance Russia Marina Bay Financial Centre 25th Floor, Tower 3 12 Marina Boulevard Singapore 018982
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Slovak Republic Spain Alex Cook Carlos Zabala E: [email protected] E: [email protected] Stanislav Holec Sonia Trendafilova E: [email protected] E: [email protected] Clifford Chance Clifford Chance Jungmannova Plaza 24 Paseo de la Castellana 110 110 00 Prague 1 28046 Madrid Czech Republic Spain Turkey Ukraine Itir Sevim-Çiftçi Ario Dehghani E: [email protected] E: [email protected] Deniz Göçük Yulia Brusko E: [email protected] E: [email protected] Yegin Ciftci Attorney Partnership Redcliffe Partners Kanyon Ofis Binası Kat 10 75 Zhylyanska Street Büyükdere Cad. No. 185 13th floor Istanbul 34394 Kyiv 01032, Ukraine Turkey United Arab Emirates United Kingdom James Abbott Luke Tolaini E: [email protected] E: [email protected] Jack Hardman Roger Best E: [email protected] E: [email protected] Connor Partos Michael Lyons E: [email protected] E: [email protected] Clifford Chance Patricia Barratt Level 15, Burj Daman E: [email protected] Dubai International Financial Centre Clifford Chance P.O. Box 9380 10 Upper Bank Street Dubai, United Arab Emirates London E14 5JJ UK
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United States David DiBari E: [email protected] Megan Gordon E: [email protected] Catherine Ennis E: [email protected] Clifford Chance 2001 K Street NW Washington District of Columbia 20006-1001 United States of America
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March 2019 93 AN INTERNATIONAL GUIDE TO ANTI-CORRUPTION LEGISLATION 2019
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94 March 2019 OUR INTERNATIONAL NETWORK 32 OFFICES IN 21 COUNTRIES
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