Directorate for Financial and Enterprise Affairs SLOVENIA: PHASE 2 REPORT ON THE APPLICATION OF THE CONVENTION ON COMBATING BRIBERY OF FOREIGN PUBLIC OFFICIALS IN INTERNATIONAL BUSINESS TRANSACTIONS AND THE 1997 REVISED RECOMMENDATION ON COMBATING BRIBERY IN INTERNATIONAL BUSINESS TRANSACTIONS This report was approved and adopted by the Working Group on Bribery in International Business Transactions on 21 June 2007. TABLE OF CONTENTS EXECUTIVE SUMMARY ............................................................................................................................ 4 A. INTRODUCTION ............................................................................................................................... 5 1. On-Site Visit ........................................................................................................................................ 5 2. General Observations ........................................................................................................................... 6 a. Economic system .............................................................................................................................. 6 b. Political and legal framework ........................................................................................................... 6 c. Implementation of the Convention and Revised Recommendation ................................................. 7 d. Corruption overview ......................................................................................................................... 7 e. Cases involving the bribery of foreign public officials .................................................................... 8 f. The Commission for the Prevention of Corruption .......................................................................... 9 3. Outline of Report ............................................................................................................................... 10 B. PREVENTION, DETECTION AND AWARENESS OF FOREIGN BRIBERY ............................. 10 1. General Efforts to Raise Awareness .................................................................................................. 10 a. Government initiatives to raise awareness ..................................................................................... 10 b. Private sector initiatives to raise awareness ................................................................................... 11 2. Reporting Foreign Bribery Offences and Whistleblower Protection ................................................. 13 a. Duty to report crimes to law enforcement authorities .................................................................... 13 b. Whistleblowing and whistleblower protection ............................................................................... 14 3. Officially Supported Export Credits .................................................................................................. 14 a. Awareness-raising efforts ............................................................................................................... 14 b. Detection of foreign bribery ........................................................................................................... 15 c. Duty to report bribery of foreign public officials ........................................................................... 16 4. Official Development Assistance ....................................................................................................... 16 a. Awareness-raising efforts ............................................................................................................... 17 b. Detection of foreign bribery and the duty to report foreign bribery ............................................... 17 5. Foreign Diplomatic Representations .................................................................................................. 17 a. Awareness-raising efforts ............................................................................................................... 17 b. Detection of foreign bribery and the duty to report foreign bribery ............................................... 18 6. The Tax Authorities ........................................................................................................................... 18 a. Tax treatment of bribes ................................................................................................................... 18 b. Awareness, training and detection .................................................................................................. 19 c. Duty to report bribery of foreign public officials and sharing of information ............................... 19 7. Accounting and Auditing ................................................................................................................... 20 a. Accounting standards and training ................................................................................................. 20 b. Internal controls, supervisory boards and audit committees .......................................................... 21 c. External auditing ............................................................................................................................ 23 d. The duty to report foreign bribery .................................................................................................. 25 8. Money Laundering ............................................................................................................................. 28 a. Draft Law on the Prevention of Money Laundering and Terrorist Financing ................................ 28 b. The Office for Money Laundering Prevention ............................................................................... 28 c. Suspicious transaction reporting ..................................................................................................... 29 2 d. Exchange of information with other Slovenian government bodies, including law enforcement .. 30 e. International exchange of information ........................................................................................... 31 C. INVESTIGATION, PROSECUTION, AND SANCTIONING OF FOREIGN BRIBERY .............. 32 1. Institutional Framework ..................................................................................................................... 32 a. The Police ....................................................................................................................................... 32 b. The Prosecution Authority ............................................................................................................... 33 c. The Courts ...................................................................................................................................... 34 2. Investigations ..................................................................................................................................... 36 a. Conduct of investigations ............................................................................................................... 36 b. Mutual legal assistance and extradition .......................................................................................... 44 3. Prosecution ......................................................................................................................................... 46 a. Mandatory prosecution ................................................................................................................... 46 b. Grounds for precluding or terminating proceedings ....................................................................... 47 c. Jurisdiction ..................................................................................................................................... 49 d. Statute of limitations ....................................................................................................................... 50 4. The Offence of Bribery of Foreign Public Officials .......................................................................... 50 a. Background..................................................................................................................................... 50 b. Elements of the offence .................................................................................................................. 50 c. Defences ......................................................................................................................................... 54 5. Liability of Legal Persons .................................................................................................................. 55 a. Establishing liability of legal persons ............................................................................................. 55 b. The investigation and prosecution of legal persons ........................................................................ 57 6. Sanctions for Foreign Bribery Offence .............................................................................................. 58 a. Criminal sanctions .......................................................................................................................... 58 b. Seizure and confiscation ................................................................................................................. 61 c. Administrative sanctions ...............................................................................................................