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CCCA_V3No3_Corruption-FIN.qxd:CCCA_V1No1_DriversSeat-FIN.qxd 9/16/09 9:48 PM Page 34 Feature The basics Why worry? The Canadian Corruption of Foreign Last year’s settlement, where German conglomerate Siemens AG agreed to pay a Public Officials Act (CFPOA) creates record total of $1.6 billion (U.S.) in fines, is proof that even non-U.S. companies are three offences: at risk of running afoul of FCPA provisions. Indeed, companies listed on U.S. stock • bribing a foreign public official exchanges as well as U.S. subsidiaries are captured under the Act, regardless of where • possession of property or proceeds they do business. Siemens had been under investigation by American and German obtained from such a bribe, and authorities for bribing public officials in Argentina, Bangladesh andVenezuela. • laundering such proceeds or property “Foreign companies need to be very careful about their activities in the U.S.,” says Grant Borbridge, vice-president at Equity Investments and counsel at Emergo There are also three defences to the Group of Companies in Calgary.“In 2007, 13 of 29 cases taken forward were against charge of bribing a foreign public offi- foreign companies.” cial, says Grant Borbridge: • The payments are lawful under the laws of the foreign state or public international organization for which the official performs duties or func- tions. “These could be commitments made to the local government, for example providing certain social benefits,” says Borbridge. • The payments by the company were intended for reasonable expenses incurred in good faith by the local official in promoting a product or service or in the execution of a con- tract between the foreign state and the company. • The payments were to facilitate the performance by a foreign public offi- cial of any “act of a routine nature” that are part of his or her duties and functions. “This is a bit of a grey area,” says Borbridge. “But there is a total limit of $5,000 total and these facilita- tion payments cannot be used for the purpose of securing a contract.” MARNIE BURKHART, JAZHART STUDIOS Grant Borbridge Vice-president, Equity Investments and counsel, Emergo Group of Companies Calgary 34 CCCA Canadian Corporate Counsel Association FALL 2009