UK: The Long Arm Of The Law: Extra-Territoriality And The Serious Crime Act 2007

Last Updated: 3 October 2012

Article by Katherine Hardcastle, pupil at 6 Kings Bench Walk.

Introduction

1. One aspect of the debate surrounding the Bribery Act 2010 has been its broad extra-territorial reach. By contrast, little attention has been paid to the extra-territorial ambit of the Serious Crime Act 2007 and the offences of encouraging or assisting an offence. This might be thought surprising given these offences possess an equally striking jurisdictional scope to the bribery offences and may be equally important in an international business context. Liability under sections 44, 45 or 46 of the 2007 Act may arise where an English-incorporated company advises a Dutch client, for example, on the execution of a financial transaction in Zimbabwe, even though the client could commit no offence if it was to carry out that transaction (see paragraph 19 below). This article offers an overview of the extra-territoriality provisions of the 2007 Act and aims to highlight some of the issues they raise.

The nature of extra-territorial jurisdiction

2. Before turning to the 2007 Act, however, it is helpful, briefly, to say something about the ambit of the English criminal law. Traditionally the position at common law has been that jurisdiction is inherently territorial. Absent express terms, a strong presumption arises that statutory offences are similarly constrained. Different principles have developed in relation to offences occurring across jurisdictions. Prior to the case of Director of Public Prosections v Treacy [1971] AC 537, the orthodoxy was that the final element completing the offence needed to occur within England and Wales to establish jurisdiction. Since then a less rigidly technical approach has emerged, (see for example R v Smith (Wallace Duncan) (No.4) [2004] EWCA Crim 631). As a separate strand again there exist a number of offences of 'universal jurisdiction', triable before the English courts regardless of the nationality of the offender or the victim, or where the offence is committed.

3. Inchoate offences present particular difficulties in the context of jurisdiction. Both the inchoate offence and the principal, or 'anticipated', offence are to be considered. At common law the general rule for conspiracy is that the location of the principal offence is determinative: a conspiracy formed abroad to commit an offence within the jurisdiction is justiciable, while a conspiracy formed within the jurisdiction to commit an offence abroad is not (see for instance Board of Trade v Owen [1957] AC 602). This latter position is, however, reversed by section 1A of the Criminal Law Act 1977. Though no authority exists on the point, it may be assumed that prior to the 2007 Act, jurisdiction over incitement at common law followed the position at common law in relation to conspiracy.

Overview of the 2007 Act

4. It was intended from the outset that the new statutory offences of encouraging or assisting an offence in the 2007 Act would have extra-territorial effect. The provisions derive largely from the recommendations of the Law Commission in their report: Inchoate Liability for Assisting and Encouraging Crime, Law Com. No. 300, in which the frequency with which inchoate offences involve jurisdictional issues was expressly considered.

5. Section 52 and Schedule 4 of the 2007 Act contain the relevant provisions. In overview, they extend the reach of the offences contrary to sections 44, 45 and 46 in three categories of conduct with a foreign element, namely where:

(i) The anticipated offence would occur within the jurisdiction but the assistance or encouragement occurs outside;

(ii) The assistance occurs within the jurisdiction but the anticipated offence would occur outside; and

(iii) Both the assistance and the anticipated offence occur outside the jurisdiction.

6. Section 52(1) applies where the principal offence might take place within the jurisdiction. It is relatively straightforward: encouraging or assisting an offence which would occur within the jurisdiction amounts to an offence triable before the English courts, regardless of where that assistance or encouragement occurs. Accordingly, an offence may be committed under section 44, say, where a defendant, 'D', in Los Angeles, urges a potential perpetrator 'P', in New York, to murder a victim, 'V', in London or Paris. (This example is based on one used by the Law Commission in their Report at paragraph 8.17.)

7. Section 52(2) applies where D does not know or believe that the anticipated offence might take place in England, in other words, the anticipated offence might occur outside the jurisdiction. Here D's liability is governed by paragraphs 1, 2 or 3 of Schedule 4.

8. Paragraph 2 of Schedule 4 is the least complex. It provides for the extra-territorial application of the offences where:

(i) D's act of assistance occurs within the jurisdiction;

(ii) D knows or believes that the anticipated offence might occur outside the jurisdiction; and

(iii) The anticipated offence would amount to an offence under the relevant foreign law.

9. In short, paragraph 2 requires a 'double-criminality' element. That is to say, the anticipated offence must amount to an offence recognised both within the jurisdiction and in the overseas territory. For example, where D, in London, encourages P, in Brisbane, to commit a robbery, D may be convicted of an offence: robbery being an offence in both England and Wales and New South Wales. (This example is also taken from the Law Commission's Report.) It was expressly intended by the Law Commission that this provision was to mirror section 1A of the Criminal Law Act 1977.

10. In addition, the 2007 Act provides for the extra-territorial application of sections 44, 45 and 46, in relation to a second type of conduct with a foreign aspect: that is where the anticipated offence would be triable within the jurisdiction notwithstanding that it would be committed abroad. It is this principle that underlies paragraphs 1 and 2 of Schedule 4.

11. Paragraph 1 of Schedule 4 extends jurisdiction where:

(i) D's act of assistance occurs within the jurisdiction;

(ii) D knows or believes that the anticipated offence will occur outside the jurisdiction; and

(iii) The anticipated offence could be tried in England and Wales either because -

(a) it is an offence of universal jurisdiction; or

(b) is an offence so triable because it includes certain conditions.

12. Hence D may be convicted for an offence where, within the jurisdiction, D encourages, for example:

(i) P, in Malaysia, to commit piracy on the high seas (an offence of universal jurisdiction); or

(ii) P, a British citizen, to murder V in France (an offence triable within the jurisdiction if the perpetrator is British: see section 9 of the Offences Against the Person Act 1861).

13. The difficulty which arises, however, is what exactly D must anticipate. Section 52(3) of the 2007 Act provides that, for the purposes of sections 44, 45 and 46, a reference to what D anticipates is a reference to an 'anticipated offence'. That term is not defined but on an ordinary reading must mean an offence contrary to the laws of England and Wales. Thus, for an offence to be committed extra-territorially, section 52(3) requires D to anticipate that P will commit an offence contrary to English law. Paragraph 1 of Schedule 4, however, by its nature contemplates acts of P which may only amount to offences under English law in certain circumstances, or if P has certain characteristics. What if P does not in fact possess those characteristics - does D anticipate an offence contrary to English law nevertheless?

14. Although other interpretations are tenable, the better view of paragraph 1 is that it takes no account of P's characteristics, rather it focuses on the nature of the anticipated offence and the English courts' jurisdiction over that offence. Put shortly, D commits an offence where he assists or encourages an offence which is capable of being tried before the English courts notwithstanding that it occurs abroad. It is not necessary that P would, in fact, commit an offence contrary to English law.

15. A natural reading supports this broad approach, as does the symmetry it enjoys with paragraph 2: double-criminality does not require D specifically to anticipate that P's act would amount to an offence triable in the English courts, rather it focuses on the offence itself.

16. Paragraph 3 of Schedule 4 presents similar problems. It provides for extra-territorial application where:

(i) D's conduct occurs outside the jurisdiction;

(ii) D knows or believes that the anticipated offence might occur outside the jurisdiction; and

(iii) D may be tried in the jurisdiction if he were to commit the anticipated offence as principal in that place.

17. Thus, D, a British citizen in Canada, commits an offence where he encourages P, in France, to murder V, also in France. (This example is used in paragraph 191 of the Explanatory Notes to the 2007 Act.) D may be tried in England because he is a British citizen and the anticipated offence is one which could be tried in England because D is a British citizen. Adopting an approach analogous to that outlined above, D need not anticipate that P, in murdering V, will commit an offence contrary to English law (viz. that P is a British citizen).

Potential liability

18. If this construction of the 2007 Act is right, the ambit of its extra-territoriality provisions is striking and extends significantly beyond the reach of conspiracy (the ambit of which has been described by Simester and Sullivan as 'enormous'; they cite the example of two men on the London underground conspiring to fare evade on the Paris Metro).

19. It is also a matter of practical importance. Under paragraph 1 or 3 of Schedule 4, an English-incorporated company may commit an offence by advising a Dutch client, say, on the execution of a financial transaction in Zimbabwe, even though the client could commit no offence if it was to carry out that transaction. Under the Zimbabwe (Financial Sanctions) Regulations 2009 (SI 2009/847), an offence may be committed by a perpetrator who is a British citizen or a body incorporated under the law of any part of the United Kingdom, but not if the perpetrator does not have these characteristics. It follows that, if a British advisor was to advise a foreign client to take certain steps in contravention of those Regulations, notwithstanding that the foreign client, if it took such steps, could not in fact commit any offence, the British adviser may be liable under the 2007 Act nonetheless. Moreover the conduct element of the offences contrary to sections 44, 45 and 46 is widely drawn. Encouragement or assistance might take any form: the mere provision of information for example.

20. A safeguard exists under section 53 of the 2007 Act in that proceedings for an offence punishable by virtue of Schedule 4 may only be instigated by, or pursued with the consent of, the Attorney General. While this may mitigate the risk of a prosecution being pursued however, it may be scant consolation for the company operating internationally for whom an alleged commission of an offence may trigger defaults in its financing arrangements or breach of its contractual terms.

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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