Canada only carries out ‘limited enforcement’ of the Corruption of Foreign Public Officials Act (CFPOA) according to the latest biannual Transparency International Report.
The report, Exporting Corruption 2022, assesses 43 signatories to the OECD Anti-Bribery Convention along with China, India, Hong Kong SAR and Singapore.
Canada was assessed by Transparency International Canada experts for the period 2018-2022. In that time Canada opened three foreign bribery investigations, commenced three cases and concluded three cases with sanctions.
“This is disappointing” said TI Canada executive director, James Cohen. “Canada needs to recognize the devastating impact of foreign bribery and ensure our own companies and citizens don’t contribute to corruption globally. We need to give law enforcement the resources they need to adequately enforce the CFPOA.”
An area of concern in the report is the lack of use of a key anticorruption measure enacted in 2018, the “remediation agreement”. It is intended to offer a means for Canadian companies to admit to foreign corruption and bribery while avoiding a criminal conviction. This Canadian version of a deferred prosecution agreement imposes financial penalties and compliance obligations on a company and requires cooperation with law enforcement in the prosecution of individuals involved in criminal acts. The decision to invite a company to negotiate a remediation agreement lies with prosecutors following a full investigation by law enforcement. Where an agreement is reached, it is subject to court-approval.
In recent years the RCMP had signaled that Canadian companies were coming forward for remediation agreements, but no specific number was provided to TI Canada. After the period of analysis for the report, the first-ever RA, negotiated by Quebec provincial prosecutors and SNC-Lavalin to settle domestic corruption and fraud charges, was approved by the Quebec Superior Court in May 2022. A second RA is pending. In September 2022, the RCMP announced it had laid CFPOA charges against Ultra Electronics Forensic Technology Inc. (UEFTI) and four of its former executives. At the company’s first appearance on the charges, federal prosecutors with advised the court that they and UEFTI had entered into a remediation agreement. The agreement is expected to be submitted to a court for approval in the coming months.
“The announcement of a first remediation agreement in a foreign corruption matter is an encouraging sign that we are monitoring closely. It has been a long time coming. However, it is still too early to tell if this is the beginning of a serious enforcement trend, or a one off,” said report researcher and University of Ottawa Civil Law Section Associate Professor, Jennifer Quaid. “We would be better able to gauge the state of enforcement efforts if Canadian law enforcement released more data on the number of cases being examined .”
TI Canada’s criticisms of Canada’s CFPOA enforcement record remains mostly unchanged from the previous Exporting Corruption 2020 report. TI Canada continues to recommend greater transparency in several areas, including more fulsome statistics that adequately document foreign bribery cases, publication of timely, publicly accessible versions of court decisions, and the development of an administrative framework that supports consistency and rationality in decision making and the structure of remediation agreements. Increased resources for law enforcement to pursue CFPOA cases is also critical. In addition, the merits of other anticorruption tools, such as a ‘failure to prevent’ offence for companies and the creation of separate regulatory body to oversee anticorruption measures should be considered.
ABOUT THE EXPORTING CORRUPTION 2022 REPORT
The Exporting Corruption 2022 report analysed 47 countries that account for 84% of global export. Countries’ enforcement against foreign bribery has dropped to its lowest level since Transparency International began this measurement in 2009. Now just two countries – Switzerland and the United States, making up only 11.8 per cent of global exports – are considered “active enforcers” that investigate, charge and impose sanctions commensurate with their share of exports.
Read the full Exporting Corruption 2022 report here.
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For Media Inquiries, Please Contact:
James Cohen
Executive Director
Transparency International Canada
Phone: 416-488-3939
E-mail: ti-can@transparencycanada.ca