"On 24 June 2015, the Commonwealth Senate voted in favour of an inquiry into foreign bribery. The Senate will consider why prosecutions of foreign bribery offences under Australian law appear difficult to bring and so rarely result in conviction. The inquiry will also provide an opportunity to examine whether Australian authorities should have more latitude to negotiate plea bargains with offenders, in addition to conventional criminal prosecutions. Public submissions closed on 24 August 2015, and King & Wood Mallesons provided submissions seeking further guidance on how to comply with the law as it currently stands. The inquiry is likely to lead to legislative changes depending on the recommendations that result. A further development is the recent introduction of accounting records offences."
1. What is bribery?
The offence of bribing a foreign public official is contained in section 70.2 of the Criminal Code Act 1995 (Cth) (“Criminal Code”). Hence, foreign bribery is regulated at a Federal national level. A person is guilty of an offence if the following elements are present:
- the person provides, offers or promises to provide a benefit to another person, or causes a benefit to be provided to another person; and
- the benefit is not legitimately due to the other person.
The bribe must be given or offered with the intention of influencing a public official in the exercise of his or her duties, to obtain or retain business or to obtain or retain a business advantage. That intention need not be expressed and the benefit given can be monetary or non-monetary.
Sections 141 and 142 of the Criminal Code criminalises bribery of domestic public officials.
There is also regulation of domestic bribery at the State and Territory level. Generally, domestic bribery involves the corrupt giving, offering or receiving of inducements or rewards to or from employees or agents of companies and individuals or public officials. The conduct will be “corrupt” only if the person engaging in it had the intention of influencing the recipient of the inducement or reward to show favour.
2. What are the exceptions/defences?
The Criminal Code provides two defences against allegations of foreign bribery:
- lawful conduct in the jurisdiction in which it was made according to the written law in that jurisdiction; or
- a facilitation payment, or a minor payment provided in return for expediting or securing the performance of a ‘routine government action’, and an appropriate record of the payment was created. This exception is under review.
3. What are the sanctions?
The Criminal Code provides significant penalties for the bribery of foreign and domestic public officials:
- for individuals, a fine of up to AU$1.8 million or up to ten years’ imprisonment; and
- for corporations, a fine which will be the greatest of AU$18 million, three times the value of the benefit received by the corporation and its related entities, or 10% of the annual turnover of the corporation and each of its related entities.
In relation to domestic bribery, each State or Territory varies as to the specific penalties that may be imposed. Generally, individuals may be liable for anywhere between three to ten years’ imprisonment. In relation to bribery by a company, certain jurisdictions provide for fines instead of imprisonment whereas other jurisdictions make no specific provision.