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Anti-Bribery & Corruption – Allen & Overy
Overview
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Global Anti-Corruption Law – What we now face
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Impact on Asian & Global Businesses
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Anti-corruption in 2010 : New Law–new enforcement?
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Anti-corruption in 2010 : New Law – same old reality?
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China story
Global Anti-Corruption Law - What we now face
 Greater application to the commercial sector
 No longer just bribery of Government officials
 Shift in emphasis from Individuals to Corporate
 New offences - Making companies liable for their corrupt
employees – criminal, not just regulatory
 Extraterritorial reach
 Attacking conduct abroad & cross-border co-operation
 Active enforcement internationally
 Political will post GFC – Obama/UK administrations
 Globalisation of markets – level playing field
Impact on Asian & Global Businesses
 The Key Recent International Developments
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July 2010 Dodd-Frank Act passed introducing Whistleblower
provisions in the FCPA
 January 2011 UK Govt. publish guidance on “adequate
procedures” to prevent bribery
 April 2011 UK Bribery Act comes into force
 The Global Reach of Sanctions
 Germany - Siemens – US$1.6 billion paid in joint US/German
settlement, employees fined, directors
 China - Rio Tinto – employees given sentences from 7 to 14
years with fines ranging from US$43,000 to US$74,000
Anti-corruption in 2010 : New Law – New Enforcement?
Global Anti - Corruption - the Hot issues
FCPA
 Enforcement gone exponential – target high risk sectors
 Whistle blower provisions
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UK Bribery act - the new Corporate Offence
 “failing to take adequate steps to prevent bribery”
 Just who does the UK bribery act apply to ?
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Is a connected subsidiary or associated company enough
The importance of the Bribery Act will become clear :
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If & when an enforcement culture develops
the British High Courts develop the jurisprudence
Anti-corruption in 2010 : New Law – same old reality ??
FCPA –
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Whistle blower provision having significant impact on reporting
This is not yet seen in prosecutions but exponential increase
anyway
UK Bribery Act –
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Not to be dismissed as overlapping with FCPA
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Applies expressly to commercial bribery, not just Govt officials
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Creates new strict liability offence – must take positive steps to
be able to defence the company
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No US style plea bargaining in the UK Bribery Act
Must update for UK Bribery Act
Enormous fines, combined US/UK prosecutions.
The race to report :
Whistle blowers – a “tip a day” will enhance the pay
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Voluntary self reporting – global wrenching !
What about local legal environment?
 China – Corruption Perceptions Index ranking: 78
 Cf: Vietnam 116, Indonesia 110, India 87, Thailand 78,
Malaysia 56, Taiwan 33, US 22, UK 20, Japan 17, Hong Kong
13, Singapore 1
 China statistics – Five years - 120,000 corruption charges;
20,000 commercial bribery cases – RMB3.4 billion
 “Collusion between officials and business, trade between
power and money, power and sex, and cases seriously
damaging public interests will be severely punished.” Premier Wen Jiabao, “Seeking Truth”, April 2008
China
 Legislation – Criminal Code. Anti-Unfair
Competition Law. Anti-Money Laundering Law.
 Corruption of state officials - criminal
 Commercial bribery – criminal and administrative
 Givers and takers liable.
 Vicarious liability.
 Severity of punishment.
How to deal with it?
 Pre-investment reality check
 Operation controls
 Demonstrable compliance; independent audit
 top down culture
 fair disciplinary measure
 reporting hotline
 KPI – staff and management