Trends and climate
Are there plans for any changes to the law in this area?
The General Scheme of the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Bill 2019 was published by the Irish government on 3 January 2019. When enacted, this will transpose many of the provisions of the Fifth EU Money Laundering Directive, which aims to strengthen EU money laundering and terrorist financing laws. The bill will amend the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010, which gave effect to the Third EU Money Laundering Directive and complements the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018, which gave effect to the Fourth EU Money Laundering Directive.
Have there been any recent changes in the enforcement of anti-corruption regulations?
The Criminal Justice (Corruption Offences) Act 2018 came into operation on 30 July 2018 and consolidated the law in Ireland in the areas of anti-corruption and bribery. The act repealed the Public Bodies Corrupt Practices Act 1889 and the Prevention of Corruption Acts 1906-2010.
The 2018 act is part of a suite of measures published by the Irish government in November 2017 aimed at enhancing corporate governance, increasing transparency and strengthening Ireland’s response to white collar crime. The main elements of the government’s package on the proposed reform on white collar crime, along with the introduction of the 2018 act, include:
- Establishing the current Office of the Director of Corporate Enforcement (ODCE) as an independent company law, compliance and enforcement agency to be known as the Corporate Enforcement Authority. In this regard, the General Scheme of the Companies (Corporate Enforcement Authority) Bill 2018 was published on 4 December 2018. Under the proposed legislation, the ODCE will take the form of a commission, as opposed to its current structure as an office within the Department of Business, Enterprise and Innovation, with the intention that this will provide the organisation with more autonomy and flexibility in the investigation and prosecution of complex breaches of company law.
- Piloting a Joint Agency Task Force within the Irish police force to tackle white collar crime.
- Enacting the Criminal Procedure Bill, the revised general scheme for which was published in June 2015. When enacted, it is envisaged that this legislation will streamline criminal procedures to enhance the efficiency of criminal trials.
- Implementation of the EU Markets in Financial Instruments Directive II (MiFID II) to improve the functioning of financial markets, making them more efficient, resilient and transparent and strengthen investor protection (the directive was implemented into Irish law by the Markets in Financial Instruments Regulations (SI 375/2017) which came into operation on 3 January 2018).
- Evaluating the Protected Disclosures Act 2014 (Ireland’s whistleblower legislation) to identify its effectiveness and how it might be improved.
Which authorities are responsible for investigating bribery and corruption in your jurisdiction?
The Garda National Economic Crime Bureau is the primary body tasked with investigating bribery and corruption in Ireland. The body tasked with the prosecution of any such bribery or corruption offences is the Office of the Director of Public Prosecution.
The Organisation for Economic Cooperation and Development (OECD) also monitors and prosecutes violations of company law. Should the Companies (Corporate Enforcement Authority) Bill 2018 be enacted and the Corporate Enforcement Authority established, the authority will also assume a greater role relating to the monitoring of anti-bribery and anti-corruption measures and will play a significant part in the investigation of corruption offences.
What are the key legislative and regulatory provisions relating to bribery and corruption in your jurisdiction?
The Criminal Justice (Corruption Offences) Act 2018 is the key legislative provision in Ireland relating to bribery and corruption.
What international anti-corruption conventions apply in your jurisdiction?
Ireland is party to several international agreements including:
- the EU Convention on the Protection of the European Communities Financial Interests (and Protocols);
- the OECD Convention on Combatting Bribery of Foreign Officials in International Business Transactions;
- the Council of Europe Criminal Law Convention on Corruption;
- the Convention on the Fight against Corruption Involving Officials of the European Communities or Officials of Member States of the European Union;
- the Additional Protocol to the Council of Europe Criminal Law Convention on Corruption;
- the UN Convention against Transnational Organised Crime; and
- the UN Convention against Corruption.
Specific offences and restrictions
What are the key corruption and bribery offences in your jurisdiction?
The key corruption and bribery offences are provided for in Part 2 of the Criminal Justice (Corruption Offences) Act 2018 and include the following offences.
Active and passive corruptionIt is an offence to directly or indirectly corruptly offer, give, agree to give, request, accept, obtain or agree to accept a gift, consideration or advantage as an inducement to, or reward for or otherwise on account of, doing an act in relation to one’s office, employment, position or business.
‘Corruptly’ is defined under the 2018 act and includes acting with an improper purpose personally or by influencing another person, whether:
- by means of making a false or misleading statement;
- by means of withholding, concealing, altering or destroying a document or other information; or
- by other means.
Active and passing trading in influenceIt is an offence to directly or indirectly corruptly offer, give, or agree to give, a gift, consideration or advantage in order to induce another person to exert an improper influence over an act of an official in relation to the office, employment, position or business of that official.
Similarly, it is an offence to directly or indirectly corruptly request, accept, obtain, or agree to accept for one’s self or for any other person, a gift, consideration or advantage on account of a person promising or asserting the ability to improperly influence an official to do an act in relation to their office, employment, position or business.
Corruption in relation to office, employment, position or businessAn Irish official who directly or indirectly does an act in relation to their office, employment, position or business for the purpose of corruptly obtaining a gift, consideration or advantage for themselves or any other person, will be guilty of an offence.
It is also an offence for an Irish official to use confidential information obtained in the course of their office, employment, position or business for the purpose of corruptly obtaining a gift, consideration or advantage for themselves or for any other person.
‘Irish official’ includes members of Parliament, members of the judiciary, officers, directors and employees of public bodies and persons employed by or acting for or on behalf of the public administration of the state.
Giving a gift, consideration or advantage that may be used to facilitate an offence under the 2018 act
It is an offence to give a gift, consideration or advantage to another person where the person knows, or ought reasonably to know, that the gift, consideration or advantage, or a part of it, will be used to facilitate the commission of an offence under the 2018 act.
Creating or using a false document
It is an offence to directly or indirectly create or use a document that the person knows or believes to contain a statement which is false or misleading in a material particular, with the intention of inducing another person to do an acting relation to their office, employment, position or business to the prejudice of the last-mentioned person or another person.
It is an offence to directly or indirectly threaten harm to a person with the intention of corruptly influencing that person or another person to do an act in relation to their office, employment, position or business.
Are specific restrictions in place regarding the provision of hospitality (eg, gifts, travel expenses, meals and entertainment)? If so, what are the details?
Common examples of corporate hospitality such as meals, match tickets and other entertainment fall within the ordinary meaning of ‘gift, consideration or advantage’. However, such gifts or entertainment do not necessarily fall within the scope of the Criminal Justice (Corruption Offences) Act 2018.
In order for the provision of corporate hospitality to amount to an offence, it must satisfy the criteria under the 2018 act. The act does not criminalise corporate hospitality that is offered simply to maintain good business relations.
For example, in order for the offence of active corruption to apply, the hospitality must be offered corruptly (ie, with an improper purpose personally or by influencing another person) and it must be offered as an inducement to or reward for a person doing an act in relation to their employment, position or business.
What are the rules relating to facilitation payments?
There is no distinction in Irish law between facilitation payments and other types of corrupt payments. Therefore, should a payment fall within the scope of the Criminal Justice (Corruption Offences) Act 2018, it may constitute an offence.
Scope of liability
Can both individuals and companies be held liable under anti-corruption rules in your jurisdiction?
Yes. Under Section 18(1) of the Criminal Justice (Corruption Offences) Act 2018, a body corporate will be guilty of an offence if an offence under the act is committed by any of the following individuals with the intention of obtaining or retaining either business for the body corporate, or an advantage in the conduct of business for the body corporate:
- a director, manager, secretary or other officer of the body corporate;
- a person purporting to act in that capacity;
- a shadow director within the meaning of the Companies Act 2014; or
- an employee, agent or subsidiary of the body corporate.
It is a defence for a body corporate when faced with a prosecution under Section 18(1) of the act to show that it took “all reasonable steps and exercised all due diligence” to avoid the commission of the offence.
Pursuant to Section 18(3) of the act, where an offence under the act is committed by a body corporate and it is proved that the offence was committed with the consent or connivance, or was attributable to any wilful neglect of a person who was a director, manager, secretary or other officer of the body corporate or a person purporting to act in that capacity, that person will, as well as the body corporate, be guilty of an offence.
Can agents or facilitating parties be held liable for bribery offences and if so, under what circumstances?
Yes. Part 2 of the 2018 act includes offences in respect of corrupt gifts, consideration, advantages and inducements made directly and indirectly. Agents and facilitating parties can therefore be held equally liable for offences committed under the 2018 act.
Can foreign companies be prosecuted for corruption in your jurisdiction?
The 2018 act provides for the concept of ‘dual criminality’. In that regard, acts committed outside Ireland may be prosecuted if certain connections to Ireland can be established – for example, the offence having involved the corruption of an Irish official, or that the person carrying out the corrupt act is an Irish citizen or a company domiciled in Ireland.
Whistleblowing and self-reporting
Are whistleblowers protected in your jurisdiction?
The Protected Disclosures Act 2014 provides protection for a whistleblower who is a worker when a disclosure of relevant information is made.
The term ‘worker’ is broadly defined and includes employees, contractors, self-employed individuals, agency workers and people on work experience.
‘Relevant information’ is information which a worker reasonably believes tends to show one or more relevant wrongdoings and which came to their attention in connection with their employment.
‘Relevant wrongdoings’ include:
- the commission of a criminal offence;
- failure to comply with a legal obligation;
- the occurrence of a miscarriage of justice;
- endangerment of health or safety of an individual;
- misuse of public funds;
- mismanagement of a public body; and
- the concealment or destruction of information tending to show any of the foregoing.
In order for the protections under the 2014 act to apply, the disclosure must be made through a specified disclosure channel, including disclosures made:
- to a worker’s employer;
- to a person prescribed by the minister for public expenditure and reform;
- to a relevant government minister;
- to a legal adviser; or
- to a third party (in certain circumstances).
The 2014 act requires that the recipient of the disclosure protect the whistleblower’s identity insofar as possible. A whistleblower is also protected from penalisation or dismissal by their employer for making a protected disclosure. Further, a whistleblower will be immune from criminal liability in respect of any offence prohibiting or restricting the disclosure of information if, at the time of making the disclosure, they reasonably believed that it was a protected disclosure under the 2014 act.
Is it common for leniency to be shown to organisations that self-report and/or cooperate with authorities? If so, what process must be followed?
Section 19 of the Criminal Justice Act 2011 makes it an offence to withhold information from the Irish police force which one knows or believes might be of material assistance in preventing the commission by any other person of a relevant offence or in securing the apprehension, prosecution or conviction of any other person for a relevant offence. The relevant offences for the purposes of the 2011 act are specified in Schedule 1 to the 2011 act (as amended) and include offences under the Criminal Justice (Corruption Offences) Act 2018. This therefore imposes a mandatory obligation on companies and individuals to report suspected instances of bribery and corruption. However, there is no specific statutory provision in Ireland that provides for leniency in circumstances where a company self-reports a corruption or bribery offence.
Dispute resolution and risk management
Is it possible for anti-corruption cases to be settled before trial by means of plea bargaining or settlement agreements?
In Ireland, the courts have exclusive jurisdiction relating to sentencing in criminal matters. The law does not provide for formal plea bargaining or the entering into of settlement agreements with the Office of the Director of Public Prosecution.
It may be possible for an accused in a criminal matter to plea to a lesser charge than that with which they were initially charged, which may result in a more lenient sentence. However, in all instances, the court retains ultimate discretion relating to sentencing.
Are any types of payment procedure exempt from liability under the corruption regulations in your jurisdiction?
The Criminal Justice (Corruption Offences) Act 2018 does not provide for any specific exemptions in respect of payment procedures. However, there are some exceptions – for example, payments for gifts or hospitality which are in furtherance of developing business relationships are not considered corrupt and therefore do not fall foul of the provisions of the act.
What other defences are available and who can qualify?
Pursuant to Section 18(2) of the 2018 act, it shall be a defence for a company against which proceedings are brought to prove that it took “all reasonable steps and exercised all due diligence” to avoid the commission of the offence.
In the event of such a prosecution and reliance on the foregoing defence, the company’s anti-corruption policies and procedures would come under intense scrutiny.
What compliance procedures and policies can a company put in place to assist in the creation of safe harbours?
In order to create a robust anti-bribery and anti-corruption environment, companies should consider taking the following steps:
- Put in place clear and comprehensive anti-corruption policies and review existing policies already in place;
- Ensure all personnel receive training on the said policies and are aware of their obligations pursuant to the policies, and how to recognise and deal with suspected bribery;
- Discuss and review the effectiveness of the policies and procedures at the appropriate level within the organisation (eg, compliance or board level);
- Appoint a compliance manager with day-to-day responsibility for implementing the policies, monitoring their use and effectiveness and updating them as necessary;
- Keep a written record of any gifts or entertainment given or received in order to ensure transparency; and
- Communicate the organisation’s zero-tolerance approach on bribery and corruption to third-party service providers, suppliers and other organisations with which the company does business.
Record keeping and reporting
Record keeping and accounting
What legislation governs the requirements for record keeping and accounting in your jurisdiction?
The Companies Act 2014 governs the requirements in respect of record keeping and provides for offences in respect of non-compliance with record-keeping requirements. The Criminal Justice (Theft and Fraud Offences) Act 2001 makes it an offence to engage in false accounting.
What are the requirements for record keeping?
All companies operating in Ireland are required to keep accurate corporate books and records in accordance with Sections 281 to 285 of the Companies Act.
The books and records of a company must:
- correctly record and explain the transactions of the company;
- enable the assets, liabilities, financial position and profit or loss of the company to be determined with reasonable accuracy at any point in time; and
- enable the directors to ensure that any financial statements of the company and any directors’ reports required to be prepared under the Companies Act comply with the act’s requirements and international accounting standards and can be audited.
Section 380 of the Companies Act requires that Irish companies appoint an external auditor to examine the company’s accounts and prepare a report that accurately reflects the company’s financial position.
Section 387 of the Companies Act gives auditors the right to seek access to company documents and compel information and explanations from company officers and employees.
Failure to comply with these requirements results in the commission of an offence. In addition, a director of a company who fails to take all reasonable steps to secure compliance by the company with these requirements, or has, by their own intentional act, been the cause of any default by the company under any of them, may be held criminally liable.
In addition, Section 877 of the Companies Act makes it an offence for an officer of a company to destroy, mutilate or falsify any book or documents affecting or relating to the property or affairs of the company.
Section 10 of the Criminal Justice (Theft and Fraud Offences) Act 2001 also provides for the offence of false accounting where a person who, with the intention of making a gain for themselves or another or causing loss to another, provides false information relating to documents made or required for any accounting propose.
What are the requirements for companies regarding disclosure of potential violations of anti-corruption regulations?
Section 19 of the Criminal Justice Act 2011 creates a positive obligation to disclose information to the Irish police force which one knows or believes might be of material assistance in preventing the commission by any other person of a relevant offence or in securing the apprehension, prosecution or conviction of any other person for a relevant offence. The relevant offences are set out in Schedule 1 to the act (as amended) and include certain corruption offences under the Criminal Justice (Corruption Offences) Act 2018.
What penalties are available to the courts for violations of corruption laws by individuals?
Under the Criminal Justice (Corruption Offences) Act 2018, on summary conviction, penalties range from:
- a fine of up to €5,000;
- a term of imprisonment of up to 12 months; and
- forfeiture of any gift, consideration or advantage obtained in connection with the offence or property to the value of such gift, consideration or advantage.
On conviction on indictment, penalties range from:
- an unlimited fine;
- a term of imprisonment of up to 10 years; and
- forfeiture of any gift, consideration or advantage obtained in connection with the offence or property to the value of such gift, consideration or advantage.
In certain circumstances, the court may also order an Irish official to forfeit their office and prohibit them from holding office for up to 10 years.
Companies or organisations
What penalties are available to the courts for violations of corruption laws by companies or organisations?
Under the 2018 act, if convicted, a company is liable to a fine of up to €5,000 on summary conviction or an unlimited fine on conviction on indictment. Should a director, officer or employee of a corporate body also be found liable, they will attract penalties as set out above.