v. reports on enforcement in oecd convention countries - Begroting

In other jurisdictions, in November 2010, Sherwood International Petroleum Ltd., a company registered in the
Cayman Islands and a subsidiary of Bankers Petroleum Ltd. of Canada, was indicted by the federal government of
Nigeria alongside the TSKJ Consortium companies, four other companies and four individuals, for alleged bribery of
Nigerian public offi cials in connection with the Bonny Island Liquefi ed Natural Gas Plant. 89
Domestic bribery by foreign companies: No publicly known cases or investigations.
Inadequacies in legal framework: The CFPOA does not provide for nationality jurisdiction, thus requiring
investigators and prosecutors to devote scarce resources to developing a suffi cient evidentiary basis to satisfy
the Canadian jurisdictional test of “real and substantial connection to Canada”. The CFPOA is limited to criminal
enforcement, requiring proof “beyond a reasonable doubt” and the absence of civil and/or administrative provisions
that can be invoked on a lower “balance of probabilities” standard places a signifi cant evidentiary burden on all cases.
Though the OECD Convention does not require these two elements, their absence undermines the effectiveness of
the legal framework. Other inadequacies include the exclusion of charities from coverage, as the offence is defi ned
as the conferring of a business-related benefi t; the explicit allowance of facilitation payments; and an absence of
provisions requiring the maintenance of accurate books and records. In addition, the OECD in its Phase 3 Report
called on Canada to clarify that it would not violate Article 5 of the Convention, namely that in investigating and
prosecuting offences under the CFPOA it would not take into account considerations of national economic interest,
the potential effect upon relations with another state or the identity of the natural or legal persons involved.
Inadequacies in enforcement system: The Canadian legal system and courts do not handle complex white-collar
criminal cases well. Long delays occur due to limited co-operation between prosecutors and investigators at the
pre-charge stage; a cumbersome disclosure process with judicial tolerance of defence counsel dragging out the
disclosure process; and multiple successive judges hearing pre-trial proceedings rather than the assignment of a
single “trial judge” early in a case. 90 Another concern is the inadequacy of resources for the RCMP Anti-Corruption
Unit, which has only 14 offi cers, who periodically need to attend to non-CFPOA issues as well. Though the sanctions
under the CFPOA are adequate, those imposed in Canada’s only CFPOA prosecution to date were considered by the
OECD Working Group on Bribery too low to be effective, proportionate and dissuasive. 91
Legal framework and enforcement system regarding subsidiaries, agents and other intermediaries: The
offence of bribing a foreign public offi cial via an intermediary is expressly provided for under Canadian law. As far
as subsidiaries are concerned, experience in Canadian competition law in the past two decades shows that it is
possible to enforce white-collar criminal laws against major companies and their subsidiaries. Recent amendments
to the Criminal Code have also facilitated the establishment of corporate liability by codifying certain measures
with respect to the attribution to a corporation of the acts of a senior offi cer. Canadian criminal law generally, and
the CFPOA in particular, do not provide for strict liability of parent companies for the conduct of their subsidiaries
and third parties (e.g. agents and representatives). However, companies can incur liability for the conduct of
subsidiaries, agents and intermediaries where the evidence discloses that the parent company has had knowledge
of and involvement in the unlawful conduct. Canadian law will impute liability in cases of wilful blindness where
there is evidence to show that the parent knew or ought to have known that a subsidiary or third party was going to
engage in unlawful conduct and chose not to do anything about it. With regard to conduct abroad, the jurisdictional
standard is that there must be a “real and substantial connection” between the conduct and Canada. There have
been no cases to date that have addressed this issue in the context of the CFPOA. However, in the context of a
treaty-based law such as the CFPOA that is inherently concerned with conduct abroad, it is likely that the court
would fi nd the requisite jurisdictional nexus where senior offi cials of the parent company in Canada had knowledge
of the proposed unlawful conduct and encouraged, approved or acquiesced in the conduct, particularly where other
links to Canada exist, such as the fruit of the unlawful act accruing to the benefi t of the parent company in Canada
(e.g. payment of fees, dividends, etc.), the parent company’s conduct in facilitating the unlawful conduct (e.g.
providing the fi nancial resources to make the illegal payment), and other relevant factual connections to Canada.
Recent developments: The Public Prosecution Service of Canada (PPSC) has designated one prosecutor as the
principal contact person for international corruption-related inquiries from other countries.
89 Bankers Petroleum Ltd website, accessed 21 February 2011,
http://www.bankerspetroleum.com/index.php?page=structure ; PMNews Nigeria, 9 March 2011, “Halliburton Bribery Scam:
Court Summons Accused” pmnewsnigeria.com/.../halliburton-bribery-scam-court-summons-accused/
90 Patrick J. Lesage, C.M., Q.C., Professor Michael Code, November 2008, Report of the Review of Large and Complex Criminal Case
Procedures, http://www.attorneygeneral.jus.gov.on.ca/english/about/pubs/lesage_code/
91 OECD Working Group on Bribery, Phase 3 Report on Canada, March 2011, http://www.oecd.org/dataoecd/55/25/47438413.pdf
Progress Report 2011: Enforcement of the OECD Anti-Bribery Convention
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