Foreign Anti-Corruption: Some Thoughts About Preparing for the Repeal of the Facilitation Payments Exception
Section 3(1) of the Corruption of Foreign Public Officials Act (“CFPOA”) provides that:
Every person commits an offence who, in order to obtain or retain an advantage in the course of business, directly or indirectly gives, offers or agrees to give or offer a loan, reward, advantage or benefit of any kind to a foreign public official or to any person for the benefit of a foreign public official
(a) as consideration for an act or omission by the official in connection with the performance of the official’s duties or functions; or
(b) to induce the official to use his or her position to influence any acts or decisions of the foreign state or public international organization for which the official performs duties or functions.
Amendments to the CFPOA received Royal Assent in June 2013.They include the repeal of subsection 3(4) (regarding facilitation payments) which provides an exception to subsection 3(1) permitting payments to foreign public officials for the purpose of securing the performance of acts of a routine nature. This amendment awaits its proclamation into force by the Governor-in-Council, presumably to permit organizations operating overseas the opportunity to adjust their compliance policies accordingly.
Once the amendment comes into force, it will be up to the courts to decide whether a particular payment for a routine act is prohibited by subsection 3(1). The amendment confirms that routine payments are bribes, but in some cases they may not be intended to “obtain or retain an advantage in the course of business.” Each case will have to be decided on its own facts.
One potential, negative result of the repeal of subsection 3(4), is that business property and business representatives working abroad could be put at risk of harm if, within the context of routine acts, they refuse requests or demands for payment.
As part of the adjustment of its compliance policy to reflect the pending repeal of section 3(4), an organization may want to assess the risk to employees and property for each of the foreign jurisdictions in which it operates or conducts business. In some extreme cases, it may very well be that an organization may decide that the risk to property and employees is so great that continued operations in a host jurisdiction cannot be justified.
In those jurisdictions where the risk may be less likely, and business operations continue, organizations may want to remind their employees that duress and necessity are defences to criminal offences that excuse the conduct constituting an offence, including, possibly, the subsection 3(1) prohibition.
Duress is available as a defence for an individual who involuntarily commits an offence because: he/she was threatened with death or serious physical injury; no reasonable safe means of escape existed, or there was no reasonable opportunity to render the threat ineffective; and, there is proportionality between the threat and the criminal act alleged.
Necessity is also available as a defence when: the accused is in imminent peril or unavoidable danger; the accused had no reasonable legal alternative to the course of action he or she undertook; and, the harm inflicted by the accused is proportionate to the harm avoided by the accused.
Academics and the courts have disagreed as to whether there is a difference between the two. But there is agreement that both defences are narrow and of limited application in the criminal law. In some exceptional circumstances, however, they may excuse routine payments proscribed (post-amendment) by section 3(1) of the CFPOA on the basis that the payments were truly involuntary.