Most Read Contributor in Australia, September 2016
The Organisation for Economic Co-operation and Development
(OECD) released its report on the implementation
of the OECD Anti-Bribery Convention in Australia in October 2012
(Report). Whilst the Report was critical of
Australia's enforcement action with respect to foreign bribery
offences to date, it made a number of recommendations which we
expect will be largely adopted by regulators in the coming months
and may result in more Australian companies being scrutinised in
respect of their business conduct overseas. It is also expected
that the Australian Government will adopt a National
Anti-Corruption Plan in the near future.
The offence of bribing a foreign public official is set out in
section 70.2 of the Criminal Code Act 1995 (Cth)
(Criminal Code). A person is guilty of the offence
that person provides, causes or offers to provide a benefit to
another person; and
the benefit is not legitimately due to the other person;
that person intends to influence a foreign public official in
the exercise of the official's duties in order to obtain or
retain business, or a business advantage, that is not legitimately
due to the recipient of the business or business advantage.
If convicted of foreign bribery, an individual may be liable for
a punishment of up to 10 years imprisonment and/or a fine of up to
$1.1 million. For corporations, the offence is punishable by a
fine, whichever is the greater of (a) $11 million; (b) 3 times the
value of the benefit to the corporation; or (c) 10% of the annual
turnover of the corporation.
The Australian Federal Police (AFP) has
investigated 28 allegations of foreign bribery since 2005, one of
which has led to prosecutions. Based on the recommendations made in
the Report, we would expect these numbers to increase in the
future. We also think it is likely that ASIC will begin working
with the AFP to assist in the detection and investigation of
offences of foreign bribery.
Companies should be vigilant in terms of preventing or acting
upon allegations of foreign bribery. Division 12 of the Criminal
Code sets out principles relating to corporate criminal
responsibility. A company can be charged with a foreign bribery
offence if the board or a high level managerial agent
intentionally, knowingly or recklessly committed the offence or
expressly, tacitly or impliedly authorised or permitted the
offence. A company can also be held responsible for the actions of
its employees if its corporate culture is found to have encouraged,
tolerated or led to the offence, or if it failed to create a
corporate culture that required compliance with Australia's
The OECD reports that 75% of the top 100 ASX companies and 63%
of the top 200 ASX companies operate their businesses in high risk
sectors, high risk countries or both, meaning that a significant
portion of Australia's international economic activities are
exposed to risks of foreign bribery.
It is imperative that corporations who operate in overseas
markets are aware of Australia's laws in relation to foreign
bribery and put measures in place to prevent bribery and corruption
from occurring within their organisations. Such measures may
include the implementation of codes of conduct, risk assessments
and compliance programs, provision of training to all employees,
introduction of whistleblower policies and development of a
corporate culture with a zero tolerance approach to bribery and
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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