ANTI-CORRUPTION UPDATE: THE UK ENTERS INTO ITS FIRST DEFERRED PROSECUTION AGREEMENT BUT WILL CANADA FOLLOW SUIT?
Both UK and Canadian anti-corruption law have extraterritorial application, so a company carrying on business anywhere in the world should consider whether such laws apply to them. A new development for the UK is the entry into of Deferred Prosecution Agreements (DPAs) which can help minimise the adverse consequences of any breach of anti-corruption law. This article looks at key features of DPAs in the UK and its first UK application as well as at the status of these issues in Canada.
Key features of UK DPAs
DPAs came into force in the UK under the Crime and Courts Act 2013 and became available as an enforcement tool on 24 February 2014 following consultation and publication of a DPA Code of Practice (Code) on how they will be used.
Key features include: (i) DPAs are at the discretion of the prosecutor and a company has to be invited to enter into a DPA; (ii) DPAs will only be entered into where the public interest is not best served by mounting a prosecution; (iii) the Code sets out a list of factors that the prosecutor may take into account when deciding whether or not to enter into a DPA (DPAs are unlikely to be appropriate for serious offences and early and full co-operation by the company is a key factor); (iv) proceedings are automatically suspended where a company is charged with a criminal offence (fraud, bribery or other economic crime) and a DPA is entered into; (v) in the DPA, a company agrees to various conditions often including financial penalties, compensation and future co-operation – if the company does not comply with the conditions in the DPA, the prosecution may resume; (vi) the DPA process is supervised by a judge and the court has to declare that the DPA is in the interests of justice and the proposed terms are fair, reasonable and proportionate; and (vii) DPAs apply to organisations not individuals.
Jul-Sep 2016 issue
McCarthy Tetrault LLP