Canada: Ottawa Businessman Convicted Of Foreign Corruption

Last Updated: August 21 2013
Article by W. Michael G. Osborne

Ottawa businessman Nazir has been convicted of agreeing to offer bribes to public officials in in order to obtain preferential treatment for a bid submitted by Cryptometrics to supply facial recognition software and related equipment to Air .

Mr Karigar was charged under the Act (). The makes it an offence in Canada to bribe foreign officials in order to obtain an advantage in the course of business. The Act is drafted broadly, and includes offering a bribe or agreeing to offer a bribe in the prohibition.

Regional Senior Justice Hackland held that Mr Karigar conspired with two individuals representing Cryptometrics Inc. (a US company) and Cryptometrics Canada Inc. to offer bribes to certain officials and India's Minister of Civil Aviation.

Mr Karigar defended the case on two bases, both of which Hackland RSJ rejected.

The meaning of "agree"

First, Mr Karigar argued that the CFPOA only applies to actual bribes paid to foreign public officials, and not to conspiracies or agreements to bribe a foreign public official. There was no evidence that two payments that ended up in Mr Karigar's bank account in Mumbai were ever used to pay bribes.

Hackland RSJ rejected this contention. He accepted that a conspiracy or agreement to bribe a foreign public official is a violation of the CFPOA: the CFPOA uses the word "agrees", which imports the concept of a conspiracy into the Act. He noted that in so doing, the CFPOA meets Canada's obligation under the OECDConvention on Combating Bribery of Foreign Public Officials in International Business Transactions (Anti-Bribery Convention) to make conspiracy to bribe a foreign public official an offence.

As well, adopting Mr Karigar's interpretation would restrict the scope of the CFPOA and defeat its objectives. Requiring proof of the offer or receipt of a bribe would also require evidence from foreign jurisdictions, which would make the CFPOA difficult or impossible to enforce, Hackland RSJ noted.

Canada has jurisdiction

Mr Karigar's second contention was that Canada lacked jurisdiction over the offence because it did not occur in Canada. Indeed, the payments in question were made from the US.

Hackland RSJ applied the real and substantial connection test from the decision of LaForest J in R. v. Libman. He stated:

The substantial connection test is not limited to the essential elements of the offence as submitted by the accused. Moreover, one cannot segregate or otherwise deal with the bribery as a separate and discrete issue thereby excluding the legitimate aspects of the transaction from consideration in applying the substantial connection test.

In holding that there was a real and substantial connection to Canada, Hackland RSJ cited a number of facts showing a connection between the transaction and Canada, including that it involved a Canadian company, that Mr Karigar is a Canadian, employed by a Canadian company, and that had the contract been awarded to Cryptometrics, a great deal of the work would have been done by Cryptometrics Canada employees in Ottawa.

Impact on future CFPOA enforcement

As the first decision to interpret the provisions of the CFPOA, Karigar's case will undoubtedly have an impact on future CFPOA enforcement.

Hackland RSJ's refusal to narrow the meaning of the word "agree" in the CFPOA is particularly important. Had he accepted Mr Karigar's contention that "agree" applied only to the agreement between the person offering the bribe and the foreign public official, the CFPOA would have become largely toothless, as it would have required to investigators to prove an agreement with a foreign government official, or to trace money all the way to the foreign government official. Since it is unlikely that foreign officials who accept bribes would cooperate with Canadian anti-bribery enforcers, CFPOA enforcement would have ground to a halt.

Perhaps equally important is Hackland RSJ's resort to the Anti-Bribery convention to assist him in interpreting the provisions of the CFPOA. Since the CFPOA implements the Anti-Bribery Convention in Canada, the convention and its travaux préparatoires are in principle available to assist the interpretation the provisions of the CFPOA.

Hackland RSJ's conclusion on jurisdiction is unlikely to have much impact on future CFPOA enforcement, as the CFPOA has recently been amended to deem foreign corruption offences committed by Canadian citizens, residents, and corporations to have been committed in Canada (see our summary).

That being said, Hackland RSJ's application of the real and substantial connection test is less than satisfactory. In Libman, LaForest J was dealing with the doctrine of territoriality, which is codified in subsection 6(2) of the Criminal Code, which provides that

Subject to this Act or any other Act of Parliament, no person shall be convicted or discharged under section 730 of an offence committed outside Canada.

In Libman, LaForest J held that

As I see it, all that is necessary to make an offence subject to the jurisdiction of our courts is that a significant portion of the activities constituting that offence took place in Canada. As it is put by modern academics, it is sufficient that there be a "real and substantial link" between an offence and this country, a test well known in public and private international law;

In other words, LaForest J contemplated that the "real and substantial link" would be established by showing that "a significant portion of the activities constituting [the] offence took place in Canada". The concept of "activities constituting the offence" may be broader than just the elements of the offence, since other portions of the decision suggest other relevant factors or activities, including where the offence was planned, where the fruits of the offence were obtained, and where the effects of the offence were felt. But, on the facts recited by Hackland RSJ, Karigar's case appears to test the outer boundaries of this concept. Hackland RSJ was correct in considering more than just the bare elements of the offence. But the connection between Canada and the offence was mainly founded on facts of the underlying transaction. Hackland RSJ did not make any finding that any element of the offence had occurred in Canada. It is at least questionable whether LaForest J's test can be stretched to encompass a case where all of the elements of the offence occur outside of Canada, given that subsection 6(2) of the Criminal Code says that no one can be convicted of an offence committed outside of Canada.

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
W. Michael G. Osborne
Similar Articles
Relevancy Powered by MondaqAI
Blake, Cassels & Graydon LLP
Affleck Greene McMurtry LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Blake, Cassels & Graydon LLP
Affleck Greene McMurtry LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions