knowledge | 13 July 2018 |
Bribery – Out with the Old, In with the New!
Ireland has adopted its latest Corruption Act. As well as updating the existing bribery offences, the new Act provides for several new corruption offences. Perhaps most significantly it also provides that, in certain circumstances, bodies corporate will be held liable for corruption offences committed by their staff, agents or subsidiaries, where they failed to take reasonable steps to avoid the commission of the relevant offence.
The principal bribery offences are currently set out in the Prevention of Corruption Acts 1889 – 2010 (the “PCA”). Those acts criminalise both active and passive bribery, use of false documents, and corruption in public office. They contain a number of presumptions of corruption and have a relatively strong extra-territorial effect. Bribery offences are also set out in the Criminal Justice (Theft and Fraud) Offences Act 2001 (“2001 Act”).
Ireland is the signatory of a number of international anti-bribery conventions, including, in particular, the OECD’s Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. The OECD has reviewed Ireland’s compliance with the Convention on a number of occasions and has generally been critical of the PCA. Among other things, it has called on Ireland to consolidate and modernise its two foreign bribery offences.
Notwithstanding that bribery has long been a criminal offence in Ireland, numerous allegations of political corruption emerged in the late 1990’s and early 2000’s. These were the subject of a number of Tribunals of Investigation, including the so-called Flood/Mahon Tribunal which was charged with investigating allegations of corruption in the planning process. Ultimately that Tribunal made a number of findings of corruption, as well as a number of recommendations aimed at reforming the existing bribery offences.
In June 2012 the Department of Justice published the General Scheme of the Criminal Justice (Corruption) Bill 2012 with the intention of consolidating the existing corruption offences in line with the OECD’s recommendations, and to implement the Mahon Tribunal’s recommendations. The Department subsequently published the Criminal Justice (Corruption Offences) Bill 2017, in November 2017 and the Criminal Justice (Corruption Offences) Act 2018 (“2018 Act”) was signed into law on 5 June 2018.
Overview of the 2018 Act
The 2018 Act’s principal objective is to modernise and consolidate the law on bribery and corruption. It is divided into 6 parts. Part 2 sets out the corruption offences while Parts 3, 4 and 5 deal with: extraterritoriality; presumptions relating to corruption; and penalties and enforcement respectively.
The 2018 Act provides for a more comprehensive framework for prosecuting corruption than either the PCA or 2001 Act. In particular, Part 2 contains a number of new corruption offences, Part 4 includes a new presumption of corruption, while Part 5 contains a new provision on corporate liability which broadens the circumstances in which a corporate will be held liable for corruption.
The 2018 Act has not yet been commenced. Once it is commenced, it will repeal the PCA and the bribery offences set out in the 2001 Act.
The Corruption Offences
The 2018 Act provides for 6 corruption offences in all, including a number of new offences that are not explicitly provided for in the PCA. These new offences include: active and passive trading in influence; corruption in office involving the use of confidential information; facilitating the commission of a corruption offence; and intimidation.
Active and Passive Trading in Influence
Trading in influence broadly involves bribing a person to use that person’s influence with an official in relation to that official’s office, employment, position or business. While the bribery offences under the PCA were arguably broad enough to cover most types of trading in influence, the 2018 Act explicitly criminalises both active and passive trading in influence.
Corruption in Office
Currently it is an offence for a public official to do any act in relation to his or her office for the purpose of obtaining a gift, consideration or advantage (“advantage”) for himself, herself or any other person. The 2018 Act broadens the scope of this offence in some respects. It also provides for a new offence which criminalises the use of confidential information by an Irish official, where that information was obtained by the relevant official as a result of his or her position and used for the purpose of obtaining an advantage for the Irish official or some other person.
Facilitating the Commission of a Corruption Offence
Under the 2018 Act it is an offence to give an advantage to another person, where the person giving the advantage knows or ought reasonably to know that the advantage will be used to facilitate a corruption offence. This offence stems from a recommendation of the Mahon Tribunal and is designed to prevent the use of intermediaries in order to distance the person giving the advantage from the corruption offence. The Mahon Tribunal inquired into a number of instances where a lobbyist was paid a significant commission which was used to make payments to public officials in circumstances where the person paying the commission denied any knowledge of its subsequent use.
Corruption offences generally focus on the giving or receipt of an advantage. The 2018 Act also recognises that persons may be coerced into acting in a particular way through fear rather than the potential for profit. Specifically, the 2018 Act makes it a criminal offence for a person to threaten harm to a person with the intention of corruptly influencing that person or another person to do an act in relation to that person’s office, employment, position or business.
Presumptions of Corruption
Like the PCA, the 2018 Act contains a number of presumptions of corruption which effectively seek to facilitate the prosecution of corruption offences by easing the burden on the prosecution. Generally the presumptions set out in the 2018 Act appear to be broader in scope than those provided for in the PCA. Moreover, the 2018 Act contains a new presumption of corrupt enrichment, which arises where an Irish official is proved to have an interest in land or other property that he or she was required to disclose in his or her statement of registrable interests, and which he or she failed to disclose.
In DPP v Forsey, the Court of Appeal held that a presumption of corruption set out under the PCA imposed a legal rather than an evidential burden of proof on the accused (see our previous briefing here). This case is currently under appeal to the Supreme Court (see our related briefing here).
Penalties and Enforcement
One of the most significant differences between the 2018 Act and the PCA is that the 2018 Act significantly expands the circumstances in which a corporate entity may be convicted of a corruption offence. Specifically it provides that a body corporate is guilty of an offence if certain persons, including officers, employees, agents or subsidiaries of the body corporate commit a corruption offence with the intention of:
- obtaining or retaining business for the body corporate; or
- an advantage in the conduct of business for the body corporate.
It is a defence for the body corporate to prove that it “took all reasonable steps and exercised all due diligence to avoid the commission of the offence”.
The 2018 Act provides for a robust and modern framework for prosecuting corruption offences. From a corporate perspective, the most significant development is the introduction of the new failure to supervise type of offence, which is reminiscent of the offence of failing to prevent bribery set out in section 7 of the UK Bribery Act 2010. Corporates should start putting in place anti-corruption measures to prepare for the new type of corporate liability, if they have not already done so. See our related briefings here and here.
This briefing is for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.