THE LAWYERS WEEKLY
April 1, 2011 | 15
Governments around the
world increasingly focus on preventing the practice of bribery of
foreign government officials. Two
of the most recent examples of
the current impetus for enforcement are the pending implementation of the Dodd-Frank Act in
the U.S. and the Anti-Bribery Act
in the U.K.
The Dodd-Frank Act, a major
financial reform bill signed into
law on July 21, 2010, creates an
incentive for “whistleblowers,”
entitling individuals who alert the
Securities and Exchange Commission or the Commodities
Futures Trading Commission of
violations of securities and commodities laws from 10 to 30 per
cent of any recovery in excess of
$1 million. Although the
Dodd-Frank Act has faced criticism
from major U.S. companies for
placing U.S. filers at a competitive
disadvantage, there is no indication the implementation of the
Act will be impeded on this basis.
The U.S. already has a strong
track record of combating corruption under the Foreign Corrupt
Practices Act (FCPA). Enforcement actions leading to hundreds
of millions in fines against major
corporations such as Siemens,
Halliburton/KBR and Technip
have reminded the world of the
potential severity of facing charges for violation of the FCPA. The
Dodd-Frank Act will tighten the
noose on foreign bribery practices
The U.K. has also been actively combating international
bribery, most notably penalizing
both BAE Systems and Innospec
Ltd. However, the U.K. Bribery
Act 2010 will bring the threat of
enforcement, and the reach of
the U.K.’s laws, to a new level.
Although the subject of significant criticism by the U.K. business community which has led
Since the enactment
of Canada’s Corruption
of Foreign Public
has been the subject
of criticism both at
home and abroad for
its shortcomings in
to the implementation of the Act
being postponed, the Act (if
implemented in its current
form) will be sweeping in its
scope and potentially far broader
than the FCPA.
For example, the Act will create a new strict liability corporate
offence (no knowledge or element of intent required) for failing to prevent bribery. There are
also fewer exceptions for offenders; for example, the Act does not
include an exception for “
facilitation payments” (payments made
to expedite or secure performance of routine, non-discretion-ary governmental action).
So where does Canada stack
up against these two close allies?
Since the enactment of Canada’s
Corruption of Foreign Public Offi-
cials Act (CFPOA) in 1999, Can-
ada has been the subject of criti-
cism both at home and abroad for
its shortcomings in enforcement.
In fact, a 2004 report by an
Organization for Economic Co-
operation and Development
(OECD) working group on cor-
ruption stated that “no govern-
ment-wide agenda for proactively
addressing foreign bribery has
been developed [by Canada].”
Part of the criticism Canada
has faced is due to limited
enforcement. There have only
been two prosecutions under the
CFPOA made public to date. The
first concerned bribes paid by
Hydro Kleen Group Inc. to a sen-
ior U.S. immigration inspector at
the Calgary International Airport.
The second, currently in progress
at the Ontario provincial court in
Ottawa, involves the alleged brib-
ery of an Indian government offi-
cial by a former employee of
Cryptometrics Canada Inc.
Some of the explanation for
Canada’s limited record is attributable to situational factors. The
CFPOA is only 11 years old and
arguably one should expect growing pains with implementation.
For instance, the first 11 years of
FCPA resulted in only a small
number of prosecutions relative
to today’s number (averaging
about three FCPA-related prosecutions a year).
Canadian enforcement efforts
may also be hampered by institutional impediments. For instance,
Canada has not empowered its
securities exchanges to enforce
the CFPOA, instead relying on
the RCMP. Canada is also the
only signatory to the OECD
Convention on Combating Bribery of
Foreign Public Officials in International Business Transactions
that applies “territorial jurisdic-
An oddity in International Trade
Lawddities Snakes (and more) on a plane
Thailand airport authorities recently detained a man for attempting to smuggle over 200 rare and
endangered animals out of the country — in three suitcases.
Bangkok officials detained the Indonesian man after a luggage scan at the airport revealed images of a
large assortment of animals jammed inside his three bags. The animals included tortoises, snakes, a parrot, spiders, lizards and even a squirrel. The man is in police custody and faces charges for his illegal smuggling attempt, according to TRAFFIC, a wildlife trade monitoring network.
Forget Snakes on a Plane— this guy brought the whole zoo. — Natalie Fraser
Legal Oddities in (Blank) Law
tion” to the offence of bribing a
foreign public official, requiring
that a court find a “real and substantial connection” between the
alleged offence and Canada. In
contrast, other countries have
adopted the “nationality principle,” which extends jurisdiction
over nationals even when that
national is abroad without requiring any jurisdictional nexus.
However, Canada has taken
steps to ramp up enforcement
efforts. In 2008, the RCMP created the International Anti-Cor-ruption Unit; the RCMP confirmed in February that the unit is
pursuing 23 separate investigations under the CFPOA.
In the coming years, we may
see greater levels of enforcement
in Canada. However, until Can-
ada’s legislators address some of
the systemic issues noted above, it
is likely that Canada will be
unable to match the efforts of its
peers in the U.S. and U.K. n
Andrew Thompson is an associate practising in the Business
and International Trade Groups
with Blake, Cassels & Graydon
LLP in Toronto. Prakash Narayanan is an associate at the same
firm, where he practises in the
Business and International Trade
Groups, as well as being a member
of the India Practice Group.
We want to hear from you!
Email us at: email@example.com
As in-house counsel, you know the answers to your colleagues’ questions most of the time. Use LexisNexis® Quicklaw® Corporate Counsel the rest of the time.
Try LexisNexis Quicklaw Corporate Counsel FREE for
15 days and get a FREE Butterworths® legal text (up
to a $160 value) for your time.*
As you transfer more work in-house, arm your team with a tool built
to meet their needs. Compare the only Canadian legal research tool
optimized for in-house counsel to what you currently use:
•;Much more than case law with a Corporate Counsel Bookshelf,
forms, quantums and access to thousands of news sources like
the Economist Intelligence Unit, the Financial Post, The Globe
and Mail and The New York Times.
•;Easy to register — no credit card information is required.
•;Build confidence among your colleagues by answering their
legal questions quickly.
or register online at
LexisNexis and the Kno wledge Burst logo are registered trademarks of Reed Elsevier Properties Inc., used under licence. Quickla w
is a registered trademark of LexisNexis Canada Inc. Butterworths is a registered trademark of Reed Elsevier (U. K.) Limited and its
affiliated companies. © 2011 LexisNexis Canada Inc. All rights reserved.
* This offer is valid until June 30, 2011. Some restrictions may apply.