Comparative Guides
Welcome to Mondaq Comparative Guides - your comparative global Q&A guide.
Our Comparative Guides provide an overview of some of the key points of law and practice and allow you to compare regulatory environments and laws across multiple jurisdictions.
Start by selecting your Topic of interest below. Then choose your Regions and finally refine the exact Subjects you are seeking clarity on to view detailed analysis provided by our carefully selected internationally recognised experts.
Results: 4 Answers
Anti-Corruption & Bribery
1.
Legal and enforcement framework
1.1
Which legislative and regulatory provisions govern anti-corruption in your jurisdiction, from a regulatory (preventive) and enforcement (criminal) perspective?
 
United Arab Emirates
The United Arab Emirates has been fighting bribery and corruption since the 1980s, with the enactment of Federal Law 3/1987, otherwise known as the UAE Federal Penal Code, and specifically Articles 234 to 239. The Federal Human Resources (Federal Decree Law 11/08) also combats bribery.

In Dubai, the above laws are supplemented by the Code of 1970 and Dubai Law 37/2009 on the Procedures for the Recovery of Illegally Obtained Public and Private Funds.

Other laws also have the secondary effect of combating bribery and corruption, as follows:

  • Federal Law 4/2002 regarding the Criminalisation of Money Laundering;
  • the Regulations Governing Declarations by travellers entering or leaving the UAE Carrying Cash or Negotiable Instruments;
  • Federal Law 7/2014, Combating Terrorism Crimes;
  • Federal Law 9/2014 amending certain provisions of Federal Law 4/2002 concerning the Combating of Money Laundering Crimes;
  • Cabinet Resolution 38/2014, Executive Resolution of Federal Law 4/2002; and
  • Dubai Law 4/2016 on Financial Crimes.
For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
1.2
Which bilateral and multilateral instruments on anti-corruption have effect in your jurisdiction?
 
United Arab Emirates
The United Arab Emirates has ratified the United Nations Convention against Corruption (UNCAC) pursuant to Federal Decree Law 8/2006. The United Arab Emirates also signed the Arab Convention to Fight Corruption on 21 December 2010, which includes 21 Arab countries, including the United Arab Emirates.

Both the UNCAC and the Arab Council (which is responsible for the creation of the Arab Convention) were created specially to combat corruption on a global and territorial scale respectively. Ratification of the UNCAC means that, along with all 178 countries, as of October 2017 the United Arab Emirates can combat corruption on a global scale. With so many countries ratifying the agreement, a unified front is being presented against corruption and all members are tackling the problem in the same or similar ways. Membership of the Arab Council is also important: unique problems regarding corruption face the Arab states that may not be applicable in the rest of the world, so it is vital that the Arab states join forces to combat corruption on a regional scale.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
1.3
Are there accessible directives or other guidance from enforcement authorities in your jurisdiction?
 
United Arab Emirates
Yes. The government has published the Laws and Regulations on Bribery and Corruption, and has created obligations for companies in the Federal Law on Commercial Companies (2/2015), which sets out obligations for companies to follow. These include a requirement to appoint a completely independent auditor who is listed in the Register for Auditors and Accountants as per the Federal Law the Organisation of Auditing Profession (12/2014), which regulates the professions of auditing and accountancy and stipulates that an auditor must have more than five years’ experience in auditing private and public companies.

Article 153 of the Law on Commercial Companies prevents the following:

  • Article 153(1) states that a joint stock company may not issue any loans or guarantees to any member of the board. It further states that board members’ family members, up to the second degree, will also be considered ‘board members’ in terms of the law.
  • Article 153(2) states that no loan may be granted to a company in which a board member (or family member, as described in Article 153(1)) owns more than a 20% share.
  • Article 153(3) states that any agreement in contravention of Article 153 shall be invalid, and the auditor must report on the extent of compliance by the company in its annual report to the general assembly of the company.

Article 222 prevents the company or its subsidiaries from giving financial aid to a shareholder to enable the shareholder to hold shares, bonds or Sukuk issued by the company. It further defines ‘financial aid’ as any of the following:

  • providing loans;
  • providing gifts or donations;
  • providing assets of the company as security; or
  • providing security or guarantees for the obligations of another person.

Article 242 prevents the company from making any donations within the first two years. After this period, donations may be made if they meet the following requirements:

  • The donation cannot exceed 2% of the company’s average net profits of the previous two years;
  • The donation must be for the benefit of society;
  • The beneficiary of the donation must be disclosed in the company’s audit report; and
  • A special resolution must be passed to make the donation.
For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
1.4
Which bodies are responsible for enforcing the applicable laws and regulations? What powers do they have?
 
United Arab Emirates
Numerous authorities have jurisdiction to combat bribery and corruption, as follows:

  • the anti-corruption unit (known as the Abu Dhabi Accountability Authority), established in 2015 by Abu Dhabi Law 14/2008, which applies to public sector bodies;
  • the State Audit Institution, which is also for public sector bodies;
  • the Anti-money Laundering and Suspicious Cases Unit of the Central Bank of the United Arab Emirates;
  • the police forces of the United Arab Emirates (jurisdiction restricted to each emirate); and
  • the Dubai Financial Services Authority of the Dubai International Financial Centre, which is the only free zone to have its own specific authority (apart from the Abu Dhabi Global Market, which is still relatively new and is thus not dealt with here).

Dubai has also established the Dubai Economic Security Centre (DESC), which will focus specifically on bribery and corruption. DESC will have an extensive list of competences, including:

  • proposing and auditing legislation to regulate financial and economic affairs in Dubai;
  • preparing and publishing periodical reports and statistics on the financial and economic position of Dubai;
  • following up on cases that DESC is concerned with, including transnational crimes in coordination with the judicial authority;
  • holding and participating in conferences and seminars, cooperating with relevant regional and international organisations to exchange experience, knowledge and information about economic security;
  • combating corruption, fraud, bribery, embezzlement, destruction of public property, forgery, counterfeiting, money laundering, financing of terrorism and other illegal organisations, and other crimes that may be committed in entities that are under the jurisdiction of DESC;
  • monitoring abuses and financial irregularities committed in Dubai;
  • supervising the trading of currencies, commodities, precious metals and securities (listed and unlisted); and
  • developing rules and procedures to prevent interactions with individuals or organisations involved in terrorism or with any individual connected to such organisations.

DESC has the power to:

  • request the public prosecutor to seize funds, documents or anything else in relation to a DESC investigations;
  • liaise with international institutions in order to gain information pursuant to an investigation;
  • suspend trade in the stock market, and freeze, suspend or reactivate any regulations that relate to the financial market; and
  • obtain details of any bank account of any natural or legal person with any relevant body.
For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
1.5
What are the statistics regarding past and ongoing anti-corruption procedures in your jurisdiction?
 
United Arab Emirates
The Corruptions Percentage Index (CPI) ranks countries and territories based on how corrupt their public sector is perceived to be; the higher the score out of 100, the less corrupt the country is perceived to be.

In 2018 the CPI awarded the United Arab Emirates a score of 70, which is a decent score - especially when compared to the score of 52 awarded in 2003. The average CPI ranking from 2003 was 64.56, with the average since 2009 being 68.

The following table highlights the United Arab Emirates' CPI rating for the past 10 years.

The table illustrates the vast improvements the United Arab Emirates has made to tackle bribery and corruption, and how these are working in practice.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
1.6
What are the shortcomings identified in your jurisdiction’s anti-corruption legislation (including recommendations of the Organisation for Economic Co-operation and Development, where applicable)?
 
United Arab Emirates
First and foremost, we believe there should be protection for whistleblowers and amnesty for confessions, even where these are made by the person who accepted the bribe. The goal of wiping out bribery and corruption relies on the good faith of people. So why would someone be willing to risk a lawsuit or defamation charges to report an offence? Second, even if someone accepted a bribe and has had a change of heart due to guilt, if they report it, they are still exposing the crime. Obviously, they need to be punished in some form, but perhaps jail time should be excluded.

As for investigating and prosecuting bribery and corruption, we believe that we must continue to support agencies that focus on bribery and corruption, and ensure that proper training is given to them and all government officials on what constitutes bribery and corruption.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.
Definitions and scope of application,
2.1
How is ‘public corruption’ or ‘bribery of a public official’ defined in the anti-corruption legislation?
 
United Arab Emirates
Article 236 bis (1) of the Federal Penal Code deals with the offence of accepting a bribe as a public official as follows:

Any person who administers an entity or establishment that pertains to the public sector, or is employed by either one of whatever capacity, who requests, accepts, either directly or indirectly, a gift, benefit or a grant that is not due, or is promised of the same, and, whether to the benefit of himself or another person, in order for such person to commit or omit an act that is included in his duties, even if he has intended not to fulfil or omit such act, or if the request, offer or promise is made after the fulfilment or omission of such act, shall be sentenced to imprisonment for no more than five years.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.2
How is a ‘public official’ defined in the anti-corruption legislation? How is a ‘foreign public official’ defined?
 
United Arab Emirates
Article 5 of the Federal Penal Code defines a ‘public official’ as follows:

A public servant shall be defined in the present Law as any person in a federal or local position, whether legislative, executive, administrative or judicial, whether be appointed or elected such as:

  1. Persons entrusted with public authority and employees of ministries and government departments;
  2. Members of the military forces;
  3. Employees of security bodies;
  4. Members of the judiciary, chairmen and members of legislative, advisory and municipal boards;
  5. Any person assigned to a certain task by a public authority, to the extent of the delegated task;
  6. Chairmen and members of boards of directors, directors and other employees of public authorities and institutions, as well as companies owned, wholly or partially by the Federal Government or local governments;
  7. Chairmen and members of the boards of directors, directors and other employees of societies and associations of public welfare.

Public servants shall be deemed by the present law as any person who is not included within the categories set forth in preceding clauses. Any person engaged in the work of public service as assigned to him by a public servant in charge under laws or regulations with respect to the assigned task.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.3
How is ‘private corruption’ or ‘bribery in the private sector’ defined in the anti-corruption legislation?
 
United Arab Emirates
Article 236 bis (2) of the Federal Penal Code deals with the offences of accepting a bribe in the private sector and states the following:

Any person who promises another person managing an entity or establishment of the private sector, or who is employed by him in any capacity, with a gift, benefit or grant that is not due, or who offers or grants the same, either directly or indirectly, whether to the benefit of the person himself or for another person, in order for that person to perform or to omit an act that is included in his duties or constitutes a violation thereof, shall be sentenced to imprisonment for no more than five years.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.4
How is ‘bribe’ defined in the anti-corruption legislation?
 
United Arab Emirates
There is no ‘set in stone’ definition of ‘bribery’ in a specific UAE law. However, the United Nations Convention Against Corruption, which was adopted as per Federal Decree Law 8/2006, specifically Chapter 3, defines ‘bribery’ as a criminal offence where the following is committed intentionally:

(a) The promise, offering or giving, to a public official either directly or indirectly, of an undue advantage, for the official himself or another person or entity. In order that the official act or refrain from acting in the exercise of his or her official duties;

(b) The solicitation or acceptance by a public official, directly or indirectly, of an undue advantage, for the official himself or herself or another person or entity, in order that the official act or refrain from acting in the exercise of his or her official duties.

The Federal Penal Code supports the above definition.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.5
What other criminal offences are identified and defined in the anti-corruption legislation?
 
United Arab Emirates
The anti-corruption legislation has its roots in the Federal Penal Code, which incorporates most criminal offences.

Specific financial-related offences that are incorporated within the bribery legislation include:

  • fraud;
  • embezzlement;
  • money laundering;
  • terrorist financing;
  • the guarantee of a company loan to a chairman or person in power;
  • disclosure of classified information;
  • perjury;
  • decisions in court which are willingly made against the truth;
  • the purposeful provision of false information by court officials or prejudice against a certain party by court officials (eg, a translator changing the answers of a witness); and
  • the provision of misleading information to authorities for personal reasons.

This list is not exhaustive and merely highlights a few examples of offences identified in the anti-corruption legislation.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.6
Can both individuals and companies be prosecuted under the anti-corruption legislation?
 
United Arab Emirates
Both individuals and corporate entities can be held liable for bribery, although the penalties may differ: individuals found guilty of bribery will face possible jail time, whereas corporate entities will typically be issued with a fine.

Both individuals and companies may also face administrative penalties, such as sector exclusion and cancellation of trade licences.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.7
Can foreign companies be prosecuted under the anti-corruption legislation?
 
United Arab Emirates
Yes, a foreign company may be prosecuted for corruption if the following conditions are met:

  • The perpetrator or victim is a UAE national;
  • The crime was committed by a public or private employee in the United Arab Emirates; or
  • The crime involved UAE public property.
For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
2.8
Does the anti-corruption legislation have extraterritorial reach?
 
United Arab Emirates
Yes, the anti-corruption legislation is explicitly extraterritorial, provided that the conditions in question 2.7 are met.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
3.
Corruption and bribery
3.1
How are gifts, hospitality and expenses treated in your jurisdiction?
 
United Arab Emirates
Specific provisions govern expenses of this type for public officials.

Articles 234 and 237 of the Federal Penal Code punish the recipient of a bribe, the offeror of a bribe and any intermediaries involved, and also regulates the acceptance of any benefits.

Article 234 states as follows:

Any public servant or person entrusted with a public service, a foreign public servant or an employee of an international organization who requests or accepts, whether directly or indirectly, a gift, benefit or other grant that is not due, or is promised the same; whether to the benefit of the employee himself or for another entity or establishment, in order for such employee to commit or omit an act included in his duties even if he has intended not to commit or omit such act, or if the request, acceptance or promise is made after the fulfilment or omission of such act, shall be sentenced to temporary imprisonment.

Article 237 states as follows:

Any person who promises, offers or gives a public servant or a person entrusted with a public service, a foreign public servant or an employee of an international organisation, a gift, benefit or grant that is not due, either directly or indirectly, whether to the benefit of the employee himself or for another person or entity, for such employee to commit or omit an act included in his duties, shall be sentenced to imprisonment for no more than five years.

Article 237 bis states as follows:

Any person who promises, offers, grants or gives, either directly or indirectly, a public servant or any other person, a gift, benefit or grant that is not due, to abet that public officer or person to abuse his power, whether actual or presumed, to obtain, from a public department of authority, an unlawful benefit for the benefit of the original abettor of such act or for the benefit of any other person.

Any public servant or any other person who requests or accepts a benefit, gift or grant that is not due, whether for himself or for another person, either directly or indirectly, so as such public servant or person abuse his power, whether actual or presumed, to obtain, from a public department or authority, that unlawful benefit.

Finally, Article 237 bis 2 states as follows:

An intermediary between the briber and a bribe-taker to offer, request, accept, take a briber or any promise thereof shall be sentenced to imprisonment for no more than five years.

As is evident from these provisions, it is clearly prohibited for public officials - whether foreign or local - to accept any form of hospitality, travel or entertainment expenses of any kind.

Any gifts that are of a symbolic nature or promotional material must have the gifter’s logo on the material.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
3.2
How are facilitation payments treated in your jurisdiction?
 
United Arab Emirates
Facilitation payments are regulated; Articles 234 and 237 of the Federal Penal Code again come into play here. The code was updated in 2016 to allow for the inclusion of foreign public officials, specifically to combat such issues. The penalties under Articles 234 and 237 will also apply in this case.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
3.3
How is bribery through intermediaries and other third parties treated in your jurisdiction? Can those third parties be held liable?
 
United Arab Emirates
Yes: under Articles 234 and 237 of the Federal Penal Code, intermediaries will face the same penalties as the parties that offer and accept the bribe.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
3.4
Can a company be held liable for bribery committed by management or other employees?
 
United Arab Emirates
Yes. Article 65(1) of the Federal Penal Code (as amended) states that legal persons (other than government services, government departments, public organisations and institutions) shall be held liable for the crimes of their representatives, directors and agents that were carried out in the legal person’s name.

The company can be sued if a third party suffered damages as a result of the bribery. As regards the criminal consequences of bribery, fines and penalties can also be imposed on the company up to a maximum of AED 50,000. The person who committed the crime will be held fully liable to the extent of the laws of the United Arab Emirates.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
3.5
Can a company be held liable for bribery committed by domestic or foreign subsidiaries?
 
United Arab Emirates
This is highly unlikely, except in the event of collusion.

The principle that a person cannot be held liable for the actions of another is fundamentally ingrained within the UAE law.

Article 2 of the Federal Penal Code states that no one shall be answerable for the crimes committed by another, and that a person is innocent until proven guilty. Legal persons are regarded as separate persons.

Article 65 (as amended) of the code further extends the principle expressed in Article 2 by specifically stating that a legal person can be held liable for the actions of its agents.

In Penal Case 4542/2015 the Court of Cassation upheld the above principles and found that the parent entity was not liable for the actions of its subsidiary.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
3.6
Post-merger or acquisition, can a successor company be held liable for bribery committed by legacy companies?
 
United Arab Emirates
Under Article 291 of the Law on Commercial Companies, as a result of a merger, the merged company or companies shall cease to be a corporate person(s) and the merging company or the new company shall replace such company or companies in all their rights and obligations. The merging company shall be a legal successor of the merged company or companies.

In terms of Article 281 of the Companies Law, in the event a company is converted to another company, the following applies:

  • Upon conversion, every partner or shareholder shall have a number of shares or stocks in the new company equal to the value of its shares or stocks in the company prior to conversion. If the value of the shares or stocks of a partner or shareholder is less than the applicable minimum limit of the nominal value of the new shares or stocks, the difference shall be completed in cash; failing which such partner or shareholder shall be deemed to have withdrawn from the company. The value of its shares or stocks shall be paid according to their market or book value on the date of conversion, whichever is higher.
  • Upon its conversion and re-registration under its new legal form, the company shall maintain its corporate personality and its rights and obligations prior to such conversion. Such conversion shall not discharge the acting partners from the obligations of the company prior to the conversion, unless the creditors agree thereto in writing.

It is clear from the above that a successor company can be held liable for bribery committed by legacy companies.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
4.
Compliance
4.1
Is implementing an anti-corruption compliance programme a regulatory requirement in your jurisdiction?
 
United Arab Emirates
No set compliance programme requirement is set out in the UAE corruption laws. However, the United Arab Emirates is very serious about corruption and bribery, and the obligation to prevent it is imposed on public officers, private companies and individuals alike. The penalties for bribery and corruption are severe and, in the case of private companies, if the board consented to the bribery, the entire board can be found guilty; such exposure encourages companies to prevent bribery and corruption as far as possible. As such, all companies have developed their own internal mechanisms in line with the law to deal with corruption. They have instituted programmes to restrict the chances of bribery and corruption occurring, and will punish the occurrence of either very strictly.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
4.2
What compliance best practices should a company implement to mitigate the risk of anti-corruption violations?
 
United Arab Emirates
  • Adopt strict and clear policies to avoid corruption that are specifically tailored to the company’s business, and ensure they are applied and enforced from the very top of the company to the very bottom.
  • Encourage reporting of offences, where such offences have been witnessed, by offering protection for whistleblowers, by investigating each claim and by rewarding such reports. In the case of completely fabricated reports, punishment should be administered, as this will discourage frivolous and ‘personal vendetta’ related reporting.
  • Utilise external monitoring such as external auditors to audit both incoming and outgoing accounts, and to ensure that a clear and clean financial path can be attributed to the company’s money. In case of a discrepancy, forensic accountants should be appointed to investigate.
  • Operate transparently by making accounting records fully and freely accessible. This would immediately discourage bribery and corruption, as such offences could easily be identified if the records were freely available.
For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
4.3
Which books and records requirements have relevance in the anti-corruption context?
 
United Arab Emirates
Under Article 26 of Federal Law 2/2015 and Articles 2 and 3 of the Executive Regulations for the Tax Procedures Law (7/2017), accounting records must accurately show the company’s financial standing and must further be kept for a period of five years after the company’s financial year end.

Articles 26 to 38 of the Federal Commercial Transactions Law (18/1993) state that a company must keep financial records as required by the nature of the business of the company to accurately show its financial standing. Furthermore, a daybook and general ledger must also be utilised.

Financial institutions must also keep records of documents as prescribed by relevant supervisory authorities from time to time for a period of five years, including relevant judgments, inspection reports and the outcome of any investigations conducted by relevant authorities, and any details pertaining to the closure of a client account.

In the Dubai International Financial Centre (DIFC), companies, limited partnerships and registered partnerships are governed respectively by the DIFC Companies Law, the General Partnership Law and the Limited Partnership Law.

Article 101 of the DIFC Companies Law states that a company must keep accounting records for a period of six years; while Article 18 of the General Partnership Law and Article 26 of the Limited Partnership Law state that records must, with reasonable accuracy, disclose the financial position of the business.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
4.4
Are companies obliged to report financial irregularities or actual or potential anti-corruption violations?
 
United Arab Emirates
Yes - as is anyone.

Article 274 of the Federal Penal Code obliges a person to report a crime. Furthermore, it is illegal to knowingly fail to report money laundering or the financing of criminal organisations or terrorism.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
4.5
Does failure to implement an adequate anti-corruption programme constitute a regulatory and/or criminal violation in your jurisdiction?
 
United Arab Emirates
No, there is no formal requirement in the bribery and anti-corruption legislation for companies to have implemented an anti-corruption programme. However, as discussed in question 4.1, companies implement their own compliance programmes, as the penalties for bribery and corruption are strictly enforced and are severe.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
5.
Enforcement
5.1
Can companies that voluntarily report anti-corruption violations or cooperate with investigations benefit from leniency in your jurisdiction?
 
United Arab Emirates
In terms of Article 239 of the Federal Penal Code, if bribers or intermediaries report an offence before it is discovered, they shall be exempt from the penalty. The code makes no mention of whether parties which accept a bribe will be exempt from the penalty if they report the bribe.

Should the offender (in any context as defined) plead guilty, this will likely be considered a mitigating circumstance.

In these types of cases the courts have wide discretion to consider the circumstances of each matter and any mitigating factors that may apply in deciding on the type of punishment that should be handed down.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
5.2
Can the existence of an anti-corruption compliance programme constitute a defence to charges of anti-corruption violations?
 
United Arab Emirates
As per question 5.1, this will likely be a mitigating circumstance in a matter.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
5.3
What other defences are available to companies charged with anti-corruption violations?
 
United Arab Emirates
Articles 234 and 237 of the Federal Penal Code make clear that there is no defence to bribery.

Article 234 goes further and specially states the following: “Any person who commits or omits an act included in his duties even if he has intended not to commit or omit such act.” Even if the party which has accepted a bribe had no intention of committing or omitting the act in question, this is irrelevant. With such a strenuous onus placed on the population, both public and private, there are clearly no defences to the act of bribery and corruption.

Again, there may be mitigating circumstances, but there is no absolute defence.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
5.4
Can companies negotiate a pre-trial settlement through plea bargaining, settlement agreements or similar?
 
United Arab Emirates
Currently, no legislation provides for this. However, should a company cooperate fully, this may be a mitigating circumstance at the time of sentencing.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
5.5
What penalties can be imposed for violations of the anti-corruption legislation? Can non-exhaustive penalties be imposed for such violations (eg, exclusion from public procurement, exclusion from entitlement to public benefits or aid, disqualification from the practice of certain commercial activities, judicial winding up)?
 
United Arab Emirates
The penalties differ between companies and individuals, but both can be severe.

For bribery, individuals can face up to 15 years in prison or a fine equal to the bribe or AED 5,000 (whichever is higher). Crimes under other corruptions laws will also command a fine and/or jail sentence.

Further administrative penalties can be imposed by supervisory authorities pertaining to money laundering and funding of terrorism, such as:

  • fines;
  • sector exclusion;
  • cancellation of trade licences;
  • suspension of business operations;
  • restrictions on owners or board members; and
  • warnings.

For companies, the penalties are fines as well as possible administrative penalties, as described in question 5.5.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
5.6
What is the statute of limitations to prosecute anti-corruption violations in your jurisdiction?
 
United Arab Emirates
There is no statute of limitations for a claim against bribery.

Article 239 bis 2 of the code states as follows:

A criminal lawsuit shall not be terminated by lapse of time limitation in any of the crimes set forth in this Chapter, and the punishment imposed shall not be extinguished. Moreover, civil actions either arising or related thereto shall not be terminated by the lapse of time limitation.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
6.
Trends and predictions
6.1
How would you describe the current anti-corruption enforcement landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?
 
United Arab Emirates
As stated in question 4.1, the United Arab Emirates is very serious about anti-corruption enforcement, within both the public and private sectors, and as against both companies and individuals. The very real and serious threat of imprisonment and fines is a substantial motivator for individuals and companies alike to refrain from bribery and corruption.

No known developments are anticipated in terms of anti-corruption legislation in the next 12 months. However, the Federal Penal Code was recently amended to further cover bribery and corruption, and new developments are regularly announced in the effort to combat bribery and corruption.

For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP
7.
Tips and traps
7.1
What are your top tips for the smooth implementation of a robust anti-corruption compliance programme and what potential sticking points would you highlight?
 
United Arab Emirates
  • Build the compliance programme on ethical foundations:
    • Both shareholders and employees will appreciate an ethical compliance programme, as it demonstrates that the company is ethical at heart and has not merely established a compliance programme for the sake of compliance.
    • An ethical compliance programme that explains the ethics behind the compliance points will resonate more with various stakeholders, making it easier to secure buy-in.
  • Ensure that the compliance programme is easy to understand:
    • All documents in which the compliance programme is set out must be drafted in an easy-to-read format using simple language.
  • Consistently develop the compliance programme:
    • The compliance programme cannot be a static programme without room to evolve; it rather must evolve over time, as the business evolves and as laws and regulations evolve.
    • Ensuring that the programme is revised relatively often and keeps up to date with current laws and regulations will help to ensure stricter compliance by the company.
  • Cover important areas:
    • For small companies, implementing a compliance programme is by nature far simpler than for large companies.
    • As a company grows, it becomes harder to ensure that the compliance programme is covering all aspects of the business. This can result in extremely detailed and lengthy compliance programme requirements, which become more difficult to follow.
    • By ensuring that the compliance programme is streamlined and covering important areas such as regulatory risks, document retention, trailing and other tools that can assist, there is a greater chance that the compliance programme will be understood and thus followed by all employees.
  • Provide training:
    • As described in question 7.1, a compliance programme must include details of training and available tools to be used to ensure compliance.
    • It is no good simply covering the programme in general; specific training on relevant areas of the programme, as well as how employees should implement, must be provided on a regular basis.
  • Ensure that the compliance programme is implemented for all employees:
    • The compliance programme must include all levels of employees, from top to bottom.
    • If management are not included in compliance programme enforcement or training, there is a substantial risk that they themselves will fail to understand it fully and furthermore their blasé attitude may filter down to other employees.
    • Involving the CEO in the compliance programme and training will set a good example to employees on how they should operate and the importance of the compliance programme.
For more information about this answer please contact: Nadim Bardawil from BSA Ahmad Bin Hezeem & Associates LLP