This article is taken from Lexology GTDT’s Practice Guide to Mining. Led by Fasken, the publication examines key themes topical to the international mining community.


Introduction

In 2013, Norm Keith, author and colleague at Fasken, stated that ‘[c]orruption and bribery of public officials is a fact of life and also a way of life in many countries around the world’.[2] Indeed, can any country or region around the world claim today that it is immune to corruption? – 2019 and 2020 have been quite revealing in this regard for Canada. Shortly after the introduction of a change to the Criminal Code,[3] allowing a prosecutor to conclude remediation agreements (the Canadian version of a deferred prosecution agreement) to address corporate criminal wrongdoing, the government of Canada has been under severe strain in what we call the SNC-Lavalin case. In February 2015, the Royal Canadian Mounted Police (RCMP) laid bribery and corporate fraud charges against the Montreal-based engineering and construction firm, regarding allegations that it used bribery to get government business in Libya – former Justice Minister and Attorney General, Jody Wilson-Raybould, decided not to intervene for the conclusion of a remediation agreement.

The SNC-Lavalin case came to light when The Globe and Mail, a respected Canadian newspaper, reported[4] that Prime Minister Justin Trudeau’s office (and the Prime Minister himself) attempted to press Ms Wilson-Raybould to intervene in favour of an agreement with SNC-Lavalin.

Following the demotion and subsequent resignation of Ms Wilson-Raybould, the resignation of Trudeau’s senior political adviser, Gerald Butts, the resignation of Privy Council Clerk Michael Wernick and the launch of inquiries by both the federal Ethics Commissioner and the House of Commons’ Standing Committee on Justice and Human Rights regarding the facts alleged in The Globe and Mail article, it could be said that remediation agreements have had a difficult start in Canada.

Thus the SNC-Lavalin case shows the seriousness with which the Corruption of Foreign Public Officials Act (CFPOA)[5] is being applied and has left an important footprint on the current Canadian political landscape. On 18 December 2019, after having been denied a remediation agreement, SNC-Lavalin pleaded guilty to committing fraud against various Libyan authorities, thus avoiding any discharges under the CFPOA.

Meanwhile, the Ontario Superior Court of Justice rendered its second decision leading to imprisonment under the CFPOA, validating earlier warnings from the Canadian justice system wanting to be more aggressive in the treatment of corruption cases.

This response to corruption, as we will see, is no surprise when looking at the data revealed by the Transparency International’s Corruption Perception Index (CPI), which scores public sector corruption in more than 180 countries and territories. The CPI ranks countries on a scale from zero to 100: a score closer to 100 indicates a smaller level of corruption. Conversely, in regular commercial dealings, scoring lower on the scale indicates a higher presence of corruption in regular commercial dealings. A score under 50 indicates that corruption is a critical threat to the country’s economy. Transparency International’s 2019 report showed some alarming trends. In fact, only 10 countries scored between 80 and 90, with Denmark continuing to lead a select group with a score of 87 (Canada dropped three positions and is now ranked 12 with a score of 77 in comparison with place 9 with a score of 81 in the 2018 index, and the United States was downgraded to 23rd place, with a score of 69). More importantly, more than two-thirds of countries score below 50 on the CPI (Somalia, South Sudan and Syria ranking lowest with scores of 9, 12 and 13, respectively) with a global average of 43.[6] At the regional level, the worst performing region is Sub-Saharan Africa, with a score of 32, being 11 points lower than the global average.[7]

As the issue of corruption and bribery represents a great challenge for Canadian corporations with increasing business activities around the world, and considering the risks and consequences attached to such unethical behaviour, the section entitled ‘The Canadian legal framework’ gives an overview of the framework under the CFPOA with regard to corruption in business dealings involving a foreign public official (FPO), with a high-level comparison to the legal frameworks in the United States and the United Kingdom. The next section, ‘Settlements and non-trial agreements in Canada’, focuses on a recent measure taken by Canada to address this issue, namely the mechanism of remediation agreements. Finally, the 'Canadian case law' section explores some of the most important and recent case law, to demonstrate the severity and seriousness with which Canadian courts have addressed the issue of bribery and corruption.

The Canadian legal framework

In many emerging economies, the making of certain payments to a FPO was often considered and referred to as the ‘cost of doing business’. So much so that, for many years, Canadian legislation on the matter allowed facilitation payments as a solution to the business challenges brought upon Canadian companies by unduly slow-moving bureaucracies.[8]

With the Foreign Corrupt Practices Act (FCPA), the United States was the instigator of an international effort to address the issue of corrupt transactions around the world. This initiative gave birth to the Organisation for Economic Co-operation and Development’s Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (the OECD Convention), signatories of which agreed to adopt ‘effective measures to deter, prevent and combat the bribery of FPOs in connection with international business transactions’[9] and, most importantly, to:

take such measures as may be necessary to establish that it is a criminal offence under [the country’s] law for any person intentionally to offer, promise or give any undue pecuniary or other advantage whether directly or through intermediaries, to a foreign public official . . . in order that the official act or refrain from acting in relation to the performance of official duties, in order to obtain . . . improper advantage in the conduct of international business.[10]

The OECD Convention stresses that an attempt, or conspiracy, to bribe a foreign official must also be considered as a criminal offence.[11] Since the ratification of the OECD Convention, at least 560 individuals and 184 entities in almost half of member states have been sanctioned under criminal proceedings for foreign bribery.[12] Based on the most recent enforcement data, not only have at least 172 of those individuals been sentenced to prison but there are currently more than 500 investigations and over 155 prosecutions relating to OECD Convention offences within member states.[13] Though these numbers may be alarming, they are no surprise. According to a study conducted by Ernst & Young, 36 per cent of chief financial officers and 46 per cent of other finance team members interviewed could rationalise unethical conduct (such as corruption and bribery) to improve financial performance.[14] Canada signed the OECD Convention on 17 December 1997, and quickly realised its obligations by enacting the CFPOA.

Corruption of Foreign Public Officials Act

The CFPOA came into force on 14 February 1999, allowing Canada to officially become a member state of the OECD Convention.[15] Finally, far-reaching amendments – the most important since the enactment of the CFPOA – were proposed through Bill S-14, An Act to amend the Corruption of Foreign Public Officials Act, and received royal assent on 19 June 2013 (Bill S-14)[16]. Fundamental to the CFPOA is section 3(1), which codifies its primary offence – bribing an FPO. It states that every person commits a criminal offence that, to obtain or retain an advantage, directly or indirectly provides a benefit of any kind to an FPO or to any person for the benefit of an FPO (1) as consideration for an act or omission by the official in connection with the official’s duties or functions, or (2) to induce the official to influence any acts or decisions of the foreign state or public international organisation for which that official performs duties or functions.[17]

The term ‘person’ as defined by the CFPOA adopts the definition in the Criminal Code[18] in that it includes individuals, organisations including corporations, the Crown, and third parties such as agents, consultants or any other intermediary. As for the term ‘business’, the current definition under the CFPOA reads as follows: ‘any business, profession, trade, calling, manufacture or undertaking of any kind carried on in Canada or elsewhere’.[19] Pursuant to Keith, this definition is one of the results of Bill S-14 that effectively removed the words ‘for profits’ from the definition and therefore eliminated the requirement for a business ‘to be doing work for profit, be profitable or have a profit motive’.[20] Finally, a ‘foreign public official’ is understood broadly under the CFPOA as any person who (1) holds a legislative, administrative or judicial position of a foreign state, (2) performs public duties or functions for a foreign state, including a person employed by a body or authority that is established to perform such duties or functions on behalf of the foreign state, or (3) is an official or agent of a public international organisation that is formed by two or more states or governments, or by two or more public international organisations.[21]

Bill S-14 has brought forth five important modifications. The most important amendment of the CFPOA is certainly the addition of section 4(1), a new offence by which it is now illegal – among other things – to maintain false accounts, make transactions that are not recorded or adequately identified, record non-existent expenditures, use false documents or intentionally destroy accounting books if such an action is carried out to obtain an advantage or for the purpose of hiding that bribery.[22] Arguably, this addition ‘effectively lowers the bar for prosecutions by requiring Canadian companies to keep adequate – and truthful – records, and establishing stiff fines for failure to do so’.[23] Bill S-14 has also significantly expanded the scope of the Canadian jurisdiction, allowing the country to prosecute Canadian citizens (including officers and directors), permanent residents and Canadian corporations for offences under the CFPOA, regardless of where the offence took place.[24] Adding this extraterritorial application of Canadian law certainly reinforces the need for businesses to adopt rigorous and clear directions for Canadian employees working abroad.

The other three major changes concern facilitation payments, the maximum penalty for the conviction of individuals and the exclusive jurisdiction of the RCMP. First, prior to Bill S-14, the CFPOA permitted facilitation payments (commonly called grease payments)[25] when, in particular circumstances, nominal amounts of money were paid for the purpose of expediting or securing the performance of an ‘act of routine nature’ by an FPO. This type of payment was effectively repealed by Bill S-14. Note, however, that two statutory defences have been maintained. In fact, paragraph 3(3)(a) states that no person can be found guilty under the CFPOA if the benefit given is permitted or required under the laws of the foreign state. Paragraph 3(3)(b) allows the payment of reasonable expenses, incurred in good faith on behalf of the FPOs, that are related to the promotion of the individual’s products or services, or the execution or performance of a contract between an individual and a foreign state for the official who performs duties or functions.

The maximum penalty for the conviction of individuals under the CFPOA has been increased from five years to 14 years. Further, ‘individuals found to have violated the CFPOA will not be eligible upon conviction for either conditional sentences or discharges’.[26] Corporations, although unconcerned by jail sentences, are still exposed to monetary fines of an unlimited amount, subject to the discretion of a judge.[27] Finally, Bill S-14 enacted a new section 6, giving the exclusive investigative jurisdiction to the RCMP and, more precisely, to its dedicated International Anti-Corruption Unit. While some interpret this legislative development as a logical response to a prior lack of enforcement of the CFPOA by local police officers and local crown attorneys,[28] others view this amendment as an attempt to eliminate the potential for private prosecutions – presumably by international entities such as non-governmental organisations.[29]

Comparing the CFPOA with the FCPA

The FCPA, enacted in 1977, was the first significant international anti-corruption law. It is enforced by both the US Department of Justice (DOJ) – through the Federal Bureau of Investigation – and the US Securities and Exchange Commission, which, during the past decade, have intensified their efforts to identify and prosecute FCPA violations.[30] This is how the DOJ summarises the main FCPA offence:

[T]he anti-bribery provisions of the FCPA prohibit the willful use of the mails or any means of instrumentality of interstate commerce corruptly in furtherance of any offer, payment, promise to pay, or authorization of the payment of money or anything of value to any person, while knowing that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to a foreign official to influence the foreign official in his or her official capacity, induce the foreign official to do or omit to do an act in violation of his or her lawful duty, or to secure any improper advantage in order to assist in obtaining or retaining business for or with, or directing business to, any person.[31]

Originally, the FCPA was only applied to public issuers and domestic concerns (ie, US citizens and businesses).[32] However, amendments resulting from the International Anti-Bribery and Fair Competition Act of 1998[33] broadened the scope of the legislation, making it applicable to three categories of persons or entities, namely issuers, domestic concerns and certain persons and entities under territorial jurisdiction.[34] These three categories include all US individuals – including officers, directors and employees – businesses, certain defined FPOs and certain issuers of financial securities.[35] The FCPA further mandates record-keeping and internal control standards for publicly held corporations registered under the Securities Exchange Act of 1934.

A particularity of the FCPA is that both criminal and civil penalties are available and they can be significant – up to US$2 million per count for corporations under criminal proceedings, while individuals face both a maximum fine of US$100,000 per count and imprisonment for up to five years. As for civil proceedings, sentences range from US$50,000 to US$500,000 for corporations and from US$5,000 to US $100,000 for individuals. Another particularity is that the FCPA also provides for additional penalties in respect of violations such as ‘wilfully and knowingly making a false or misleading statement’[36] – up to US$25 million per count for corporations and US$5 million per count or 20 years in prison, or both, for individuals.[37]

Another major difference with the CFPOA is that, unlike the Canadian law, facilitation payments are permitted under the FCPA. The FCPA states that the anti-bribery provisions ‘shall not apply to any facilitating or expediting payment to a foreign official, political party, or party official the purpose of which is to expedite or to secure the performance of a routine governmental action by a foreign official, political party, or party official’.[38] Similarly to the CFPOA, however, lawful payments under the laws of the foreign country, and reasonable bona fide expenses incurred by or on behalf of the foreign official or party that are related to the promotion, demonstration or explanation or product or services, or the execution of a contract with a foreign government, are also exceptions.[39]

Comparing the CFPOA with the UK Bribery Act

To replace legislation that was more than 100 years old, the United Kingdom, after having ratified the OECD Convention, took more than a decade longer than Canada to enact anti-corruption legislation. In addressing general bribery offences, the Bribery Act 2010 (UKBA),[40] which came into force on 1 July 2011, ‘prohibits both the giving and the receiving of financial or other advantage to induce a person to improperly perform a function or activity or to reward a person for improperly performing a function or activity’.[41] The UKBA also targets the bribery of FPOs by prohibiting a person from giving a financial or other advantage to an FPO to obtain or retain a business or an advantage in the conduct of that business. Similarly to both the CFPOA and FCPA (as well as the OECD Convention), section 6(3)(b) of the UKBA provides a defence for payments permitted under the written law applicable in a foreign country.

Similarly to the CFPOA, enforcement under the UKBA is carried out by way of criminal prosecution, and fines (of an unlimited amount) are left to the discretion of the court. As for prison sentences for individuals, the maximum period is 10 years, slightly lower than under the CFPOA. Another distinction from both the FCPA and the CFPOA is that a commercial and business organisation may be found guilty of failing to prevent the prohibited types of bribery. As Keith explains: ‘In this situation, the organization may raise a defence of due diligence by proving that, at the time of the alleged offence, it “had in place adequate procedures designed to prevent persons associated with [the organization] from undertaking such conduct”.’[42] The following section explores in greater detail a relatively new mechanism that countries such as Canada have developed to address the issue at hand in a more efficient manner: deferred prosecution agreements.

Settlements and non-trial agreements in Canada

In most countries that have ratified the OECD Convention, we have observed that settlements and non-trial agreements have been the predominant method of prevention and repression of corruption.[43]

Canada is on its way to joining this group, following a recent amendment to its Criminal Code to establish a non-trial agreement regime, which has not yet been used. Indeed, in June 2018, the Canadian Parliament adopted a regime for the implementation of non-trial agreements (or ‘remediation agreements’ under the Criminal Code), which came into force in September 2018.[44] A remediation agreement is a discretionary tool that prosecutors may use to address wrongdoing by organisations,[45] specifically consisting of an agreement between a prosecutor and an organisation accused of having committed an offence,[46] where prosecution for the offence is deferred, provided the organisation respects the conditions of the agreement.

The objectives of a remediation agreement are set out in section 715.31 of the Criminal Code. The principal objectives are to denounce wrongdoing and the harm that wrongdoing by an organisation has caused to victims or communities, and to provide reparations for any harm done to such victims or communities, to hold an organisation accountable for its wrongdoing through effective and dissuasive measures and sanctions, and to impose an obligation on organisations to put in place corrective measures and promote a compliance culture.

In February 2019, as noted in the introduction to this chapter, remediation agreements became the subject of national discussion in Canada when allegations of political intervention arose in the SNC-Lavalin case. The Quebec-based engineering firm, which employs 52,000 employees worldwide, was facing corruption and fraud charges stemming from alleged corporate dealings in Libya. If convicted, SNC-Lavalin, notably, would have been prevented from participating in federal contracts for 10 years,[47] a prohibition that might have affected the long-term viability of the company’s Canadian operations. However, on 18 December 2019, SNC-Lavalin pleaded guilty to fraud and was sentenced to a C$280 million fine payable over a five-year period and three years of probation, avoiding any prosecution under the CFPOA and, as a side effect, allowing SNC-Lavalin to continue to bid on federal public contracts.

The mandatory content of a remediation agreement is set forth in section 715.34 of the Criminal Code.[48]

Further, any remediation agreement will include a warning that the breach of any term of the agreement may lead to an application by the prosecutor for termination of the agreement and a recommencement of proceedings. This gives true meaning to the term ‘deferred prosecution’ and serves as a warning to organisations that would be tempted to breach any term of a remediation agreement.

The Criminal Code sets forth certain conditions that must be met for the prosecutor to negotiate any remediation agreement with an organisation alleged to have committed an offence.[49]

First, the prosecutor must be of the opinion that there is a reasonable chance of conviction regarding the alleged offence and that concluding such an agreement will be in the public interest. Should the prosecutor determine or suspect that the alleged offence resulted in serious bodily harm or death, or injury to national defence or national security, then no remediation agreement could be negotiated – the same conclusion would be reached if the alleged offence was committed for the benefit of (or in association with) a criminal organisation or terrorist group.

The negotiation of a remediation agreement also requires the consent of the Attorney General.

Assessing the public interest criterion is important as it requires the prosecutor to consider many factors.[50] These factors include, notably, the nature and gravity of the alleged offence, the involvement of senior management of an organisation and the circumstances in which the alleged offence was brought to the attention of investigative authorities. The prosecutor would also need to consider any remedial or disciplinary action an organisation has taken following the commission of the alleged offence. Of course, if an organisation or any of its representatives has been sanctioned in the past by a regulatory authority, or has previously entered into a remediation agreement or settlement, this should be strongly considered by the prosecutor in determining whether it is in the public interest that a remediation agreement be entered into in the circumstances.

When an organisation is alleged to have committed an offence under section 3 or 4 of the CFPOA, the prosecutor must not consider the ‘national economic interest’, the potential effect on relations with a state other than Canada or the identity of the organisation or individual involved.[51] Finally, a remediation agreement must be first sanctioned by a court to come into force.

In March 2019, the OECD published the first cross-country study (the OECD Study) on the use of non-trial resolutions by parties to the Anti-Bribery Convention.[52] The OECD Study shows that 23 enforcing countries have concluded 890 foreign bribery resolutions with sanctions or confiscation.[53] Of these, 15 countries have concluded 299 resolutions to impose sanctions on legal persons in foreign bribery cases. In total, 12 countries[54] have concluded 272 non-trial resolutions (91 per cent) to impose sanctions on legal persons in connection with a foreign bribery scheme.[55] Collectively, the sanctioned entities have paid sums amounting in the aggregate to approximately US$14.9 billion. This sum includes both monetary sanctions, confiscations, and, if applicable, compensation sums or prosecution costs.[56]

As a result, 20 years after the OECD Convention came into effect, the OECD Study confirms that non-trial resolutions are the main mechanism being used to combat transnational corruption issues. Thus, Canada’s introduction of a legal framework for remediation agreements, which has a similar approach to non-trial agreement, will certainly have an impact on the fight against corruption, despite a somewhat chaotic start in the wake of the SNC-Lavalin ordeal.

Canadian case law

The first major prosecution of a Canadian corporation under the CFPOA was in respect of Niko Resources Ltd (Niko), a publicly traded oil and natural gas exploration and production company based in Calgary, Alberta. Niko entered a guilty plea before the Court of Queen’s Bench (Calgary) on 24 June 2011 for a count of bribery resulting in a fine of C$8.26 million with a 15 per cent victim surcharge.[57] According to the plea bargain agreement between Niko and the Crown, the subsidiary Niko Bangladesh entered into a joint venture agreement (JVA) in 2003 with BAPEX[58] to develop two gas fields in Bangladesh. On 7 January 2005, during drilling at the Chattak-2 gas wells, an explosion occurred,[59] which left a large crater in the ground. Although nobody was injured, the gas fire burned for weeks, forcing a widespread evacuation. The resulting diplomatic crisis and negative press denouncing the fairness of the entire JVA award process presumably led to the bribery described as follows in the plea agreement:

In May 2005, Niko Bangladesh provided the use of a [Toyota Land Cruiser] costing . . . $190,984.00 to AKM Mosharraf Hossain, the Bangladeshi State Minister for Energy and Mineral Resources, in order to influence the Minister in dealings with Niko Bangladesh within the context of ongoing business dealings. . . . Additionally, Niko Canada paid the travel and accommodation expenses for Minister . . . Hossain to travel from Bangladesh to Calgary to attend to GO EXPO oil and gas exposition, and onward to New York and Chicago, so that the Minister could visit his family who lived there, the cost being approximately $5,000.00.[60]

The Crown justified, in part, the negotiated penalty with the defence as covering, among other things, the cost of the RCMP investigation which, according to the prosecutor, cost in this single case almost C$870,000. The Niko case, as we will see, clearly set the tone for subsequent jurisprudence.

Griffiths Energy International Inc (Griffith), a privately held oil and gas company based in Calgary, was sentenced on 25 January 2013 to pay a C$9 million fine with a 15 per cent victim surcharge, thus a total financial penalty of C$10.35 million.[61] This case is of particular interest because it relates to the largest fine imposed under the CFPOA to date. More so, it is the first case where a corporation took steps to self-disclose its past corrupt practices.

In 2008, Griffith made initial enquiries about acquiring blocks in Chad and established contact with the Chadian Embassy. There was then, through the Embassy, a formal introduction to Chad’s then Minister of Petroleum and Energy.[62] What followed was a series of negotiation sessions between 2009 and 2011, which led to the payment of US$2 million to a corporate entity owned by the wife of the foreign ambassador and the issuance of a number of founder shares in Griffith.[63] Shortly thereafter, a boating accident resulted in the death of Brant Griffith, a high-profile Bay Street investment banker and founder of Griffith. It is therefore the succeeding management team that took the decision, once it discovered the corrupt transactions, to disclose its CFPOA breaches to authorities and cooperate with their investigation, effectively resulting in a guilty plea that Griffith directly agreed to provide, and indirectly provided, improper benefits to a Chadian public official to further the business objectives of Griffith. Despite the joint submission by the prosecution and defence, the court explained that the joint submission was not binding on the court and added:

The bribing of a foreign official by a Canadian company is a serious matter. As I said in R. v. Niko Resources Ltd, such bribes, besides being an embarrassment to all Canadians, prejudice Canada’s efforts to foster and promote effective governmental and commercial relations with other countries; and where, as here, the bribe is to an official of a developing nation, it undermines the bureaucratic or governmental infrastructure for which the bribed official works. Accordingly, the penalty imposed must be sufficient to show the Court’s denunciation of such conduct as well as provide deterrence to other potential offenders.[64]

This case clearly shows that, although self-disclosure may help mitigate legal consequences, it still does not prevent heavy fines from being imposed.

Another case – R v Karigar[65] – is of particular importance as it represents the very first prison sentence imposed on an individual under the CFPOA.[66] On 15 August 2013, Nazir Karigar was convicted to three years’ imprisonment by the Ontario Superior Court of Justice for making a payment to Indian government officials to facilitate the execution of a multimillion-dollar contract for the supply of a security system by Cryptometrics, a Canadian high-tech firm.[67] More specifically, the accused was the paid agent of a group of Canadian companies that sought to secure a major contract from Air India for the provision of facial recognition software and related equipment.[68] The contract sought was never awarded to any entity represented by the accused.

As the Superior Court of Justice stated, several aspects of the evidence supported the conclusion that the accused was an ‘active and knowledgeable part of a conspiracy to offer bribes to Air India officials to obtain the Air India contract’:[69] among other things, the vice president attended meetings at which the necessity of bribes was raised, and several emails containing details concerning the method of payment of bribes, and a spreadsheet budgeting intended bribes, were circulated within the company.[70] These facts led the Court to conclude that it was not necessary for the Crown to establish actual payment of the bribe and that it was sufficient to show that the accused believed that bribes were in fact paid, as was demonstrated in his comments to various authorities.[71]

On 6 July 2017, the Ontario Court of Appeal dismissed Karigar’s appeal against his 2013 conviction. The Court held that ‘the foreign bribery offence is clearly committed when a person agrees with a foreign public official to give that official a benefit, but, equally clearly, when there is an indirect agreement to give or offer an advantage’.[72]

Since the Karigar case, two individuals related to this story, Robert Barra and Shailesh Govindia, have been convicted of one count of agreeing to bribe the Indian Minister of Civil Aviation contrary to section 3(1)(b) of the CFPOA.[73] Robert Barra was the chief executive officer of Cryotometrics US, which owned all the shares of its Canadian subsidiary, Cryptometrics Canada Limited. Echoing the Karigar case, in that the Canadian subsidiary contracted Mr Govindia, as Cryptometrics’s agent, in an agreement to pay an initial bribe of US$500,000, plus a possible additional US$1.5 million at a later date, to the Indian Minister in exchange for his approval to award the same contract as was involved in Karigar. Both men were sentenced on 7 March 2019 to two-and-a-half years' imprisonment, but partially acquitted of the charges under the CFPOA. Indeed, it was demonstrated during the trial that both Mr Barra and Mr Govindia were not aware that both employees of Air India proposed to receive a payment were FPOs. As explained by the court in this decision, the Crown has to demonstrate that actual knowledge of the accused that the person proposed to receive a payment is indeed an FPO within the meaning of the CFPOA.[74]

As mentioned, the SNC-Lavalin case came to an end in December 2019. Through a joint recommendation, SNC-Lavalin’s affiliate SNC-Lavalin Construction Inc was sentenced to pay a C$280 million fine over a five-year period and three years of probation, thus avoiding any conviction under the CFPOA. Such was not the case for one of its former executives, Sami Bebawi, who, as was demonstrated during the trial, played a central role in the corruption scheme in Libya and was sentenced to eight years' imprisonment.

As these cases have shown, the consequences of an infraction under the CFPOA can be fairly important and have major economic consequences for convicted offenders. This further demonstrates the necessity for Canadian corporations to exercise thorough oversight on all individuals carrying out acts and duties for them, or on their behalf. The message is indeed clear: there is no room for complacency. It is therefore imperative for all businesses to be proactive in implementing preventive measures against acts of bribery and corruption.

Conclusion

It is clear that acts of corruption and bribery continue to occur regularly worldwide, given that, as shown in Transparency International’s 2019 Corruption Perception Index, no country is immune (with some regions being prone to acts of bribery and corruption more than others). Going forward, however, as the landscape of corporate risk changes, public scrutiny intensifies and regulations tighten around the world, it has become an inevitable requirement for companies to conduct thorough risk assessments and implement a top-down culture against bribery and corruption.

In addressing the worrying issue of corruption, this chapter has given an overview of the Canadian legal framework with regard to corruption in business dealings involving FPOs, and has established that the CFPOA, alongside the Criminal Code, directly codifies the offences of corruption, bribery and false accounting (showing, too, that the CFPOA is part of a greater network of anti-bribery laws, including the UKBA and the FCPA). In guiding readers through the CFPOA’s latest amendments, the authors have sought to identify the nature and scope of its codified offences.

There continues to be much discussion about deferred prosecution agreements as an alternative method of remediation to address the issue of corruption and bribery of foreign officials and to punish those who commit such acts. There is also much to learn from some important recent case law in Canada. All in all, it is apparent that any benefit sought through corrupt practices is marginal compared to the consequences of getting caught.

Hard to conclude here without mentioning the unprecedented times we are currently experiencing with the effects of the covid-19 virus and the resulting turmoil worldwide. For organisations the pandemic has added an extra layer of complexity in assessing and mitigating bribery and corruption risks. The vast availability of public funding, combined with the almost light-speed changes in the regulatory regime, especially regarding public tender rules, will without questions result in new opportunities for fraud and corruption. 2021 will most probably be a very interesting year in this regard.

Ultimately, it is easy to conclude that corruption and bribery no longer have a place in international affairs and that compliance can be achieved with rigorous internal oversight and policies. The question of whether the business community has the will to adapt no longer seems to be a question but a necessity. The risk of engaging in corrupt practices is clearly not worth the anticipated reward.