Update of the Instruction on the Investigation and Prosecution of Foreign Corruption
Investigation and prosecution of offences relating to corruption (of public officials) abroad is one of the priorities of the Dutch Public Prosecution Service (“PPS”). Since 2001, anyone who bribes a Dutch public official abroad is liable to prosecution in the Netherlands. The same applies to a Dutch citizen who bribes a foreign public official outside the Netherlands. It is considered as a serious offence that can cause public indignation and major damage. The Netherlands is committed to rigorously tackling corruption of foreign public officials. That commitment, including in an international context, is a major factor in assessing the expediency of investigating and prosecuting such corruption. As a result, the Dutch basic attitude with regard to investigation and prosecution of foreign corruption is positive, but the approach always remains of a tailor-made nature and must be assessed by the PPS on a case-by-case basis. It was against this background that the new Instruction on the Investigation and Prosecution of Foreign Corruption (“the Instruction) (Aanwijzing opsporing en vervolging buitenlandse corruptive) came into force on 1 October 2020, replacing the previous version from 2012. Here is a brief overview of relevant points and amendments in the Instruction.
The Instruction – which concern both the party bribing (companies and individuals) and the party bribed (public officials) – comprises factors (a non-exhaustive list) that play a role in determining the expediency of investigation and prosecution of cases of corruption of foreign public officials that are in themselves criminal. With regard to the expediency of the PPS, the Public Prosecutor must not allow him/herself to be influenced by considerations regarding the national economic interest, the possible effect on relations with another state, or the identity of the natural or legal persons concerned. Factors that can be taken into account by the PPS in its assessment, and also when setting priorities in cases of foreign corruption, are as follows:
- the significant size of the gift, promise, service and/or quid pro quo, either in absolute or relative terms (for example a significant percentage of the contract sum in question);
- bribery is a structural component of how business is conducted;
- the involvement of influential foreign public officials or politicians or their close friends and relatives (in the sense that if such persons are involved their role as an example and/or their position of power would make the bribery more serious than if less influential persons were involved);
- the money paid as a bribe is derived directly or indirectly (for example in the form of government aid, fundings, etc.) from Dutch public resources or from funds earmarked for international development aid;
- the harm to the country where the public official has been bribed;
- the extent to which competition is distorted;
- the possibilities for further investigation and the likelihood of successful prosecution.
The Instruction also explicitly state that if the suspected party reports itself and is open about this towards the PPS, the Public Prosecutor will take this so-called “self-reporting” into account transparently in the (manner of) settlement and possible punishment.
In the previous version of the Instruction, “facilitation payments” were discussed and – with reference to the absence of any treaty obligation to criminalise such payments to foreign public officials – were designated as not to be prosecuted, under certain conditions, by the PPS. That provision is not included in the new Instruction.
The Instruction specifically state that there must be absolutely no room for misunderstanding within the international business community that engaging a third party – such as a local agent, representative, or consultant – does not indemnify the company or organisation concerned as regards its own criminal liability. Such third parties are quite often made use of in cases when bribes are being paid abroad. Dutch companies and organisations need to be sufficiently alert to this.
Finally, the possibility for confiscation of unlawfully obtained gains will always play an important role in this type of cases. Such confiscation may then target the profit that a company has realised by paying bribes abroad when tendering so as to win the contract in question. When calculating that profit, the bribes paid cannot be included under “costs”.
Do not hesitate to contact us if you have any questions about the above.