New Corruption And Foreign Bribery Legislation
In March of this year, the Australian Parliament introduced new legislation aimed squarely at corporate corruption and foreign bribery. The Crimes Legislation Amendment (Powers, Offences and Other Measures) Bill 2017 operates to amend the existing corruption and foreign bribery provisions in the Criminal Code Act 1995 (Cth). The Bill imposes absolute liability on not only Companies and individuals but seeks to ‘pierce the corporate veil’, by making corporations liable for the actions of their subsidiaries, contractors and any third-party entity that provides services or acts on behalf of the company.
In an effort to effect change at a cultural level, the legislation will require companies to have appropriate policies and procedures in place to prevent and detect bribery, including vetting and managing third parties. Significantly, the burden of proof will be reversed – companies will now have to prove they have appropriate policies and procedures in place. Anti-Bribery and Corruption policies will be required to demonstrate a commitment to anti-bribery processes ‘from the top down’ from the board and senior management to employees across the company.
A reversal of the burden of proof, at a practical level, means organisations will be required to implement processes and guidelines for vetting contractors and external service providers and undertaking due diligence in respect of any joint project or venture. Of course, not all companies will be required to immediately implement a full suite of foreign bribery policies, but it is important that each company assesses their exposure and individual risk and responds appropriately.
At the very least companies should be implementing ongoing training for all employees in identifying and reporting illegal activities, particularly in relation to offering or accepting gifts, donations or sponsorships. It is important that employees understand that strict liability, both personal and corporate comes with the risk of criminal liability, including imprisonment.
International organisations, or any company that contracts with a Government, locally or internationally, should be taking additional steps to assess risk areas, implement both internal and external reporting guidelines and undertake regular reviews of their bribery and corruption framework. In addition to strengthening whistle-blowing provisions to encourage disclosure of illegal activities, Australia has also drawn from the UK ‘Deferred prosecution scheme’ in which a company that has discovered illegal conduct and refers the matter to the Federal Police force may benefit from a negotiated settlement agreement in which the company receives a suspended indictment in return for payment or fines, profit or compensation.
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* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.