The so-called Remediation Agreement (RA)* was concluded with Ultra Electronics Forensic Technology Inc. (UEFTI).

UEFTI is a Canadian company specialising in forensic technology solutions focused on identification of matching between firearms and their fired bullets and carriage cases. The Royal Canadian Mounted Police is among its clients.

As per the materials of the case, between 2006 and 2018, the company paid bribes to Philippine officials to secure a multimillion public contract for a ballistic identification system for the Philippine National Police. To disburse bribes, UEFTI involved local agents to whom it paid approximately $4.4 million in “commissions”; some of this money was used to pay bribes.

The company was charged with bribery of Philippine public officials under two paragraphs of article 3 of the Corruption of Foreign Public Officials Act (CFPOA) and with defrauding the public in the Philippines under one paragraph of article 380 of the Criminal Code.

Under the four-year RA, UEFTI must:

• pay a penalty of $6,593,178;
• pay a victim surcharge (a special penalty that is automatically imposed on offenders at the time of sentencing; money collected from offenders is intended to help fund programs and services for victims of crime, see article 371 of the Criminal Code) amounting to $659,318.
• agree to the forfeiture of $3,296,589 for the advantage obtained from the wrongful conduct;
• cooperate with any investigation or prosecution related to the offences;
• report on the implementation of the agreement;
• abide by the terms of an anti-bribery and corruption program under the supervision of an external auditor, retained at UEFTI’s expense.

The mechanism of pre-trial agreements was established in Canada in 2018 following other countries (the United States, the United Kingdom, Singapore, France, Brazil and Argentina). The agreement can be concluded by legal persons only and its approval is preceded by court scrutiny.

The agreement with UEFTI is the second one** since the mechanism was established and the first one concerning CFPOA offences.

However, based on the existing practice of conclusion of RAs in Canada, it is possible to make a number of important conclusions for the companies undertaking their activities in the country:

1) Refusal to have in camera hearings: before holding the approval hearing itself, the Court dealt with a joint request from the parties that the hearing be held in camera and declined to grant it, endorsing a strong view of the public’s interest in transparency of judicial proceedings.

The Court rejected that settlement privilege entitles parties to an in camera approval hearing. It further stressed that, unlike the negotiation stage, the approval of an RA requires Court scrutiny, including with regard to denunciation, accountability, ensuring respect for the law, reparation of victims, and sparing innocent third parties from the consequences of the wrongdoing. This is due to the fact that the administration of criminal law is a matter of public order.

The publication of RAs during the hearings is prohibited: if the RA is not approved, admissions made under negotiation will remain privileged and can never be used against their maker. As soon as the Court approves the RA, this prohibition is lifted.

2) Consideration of “additional factors” by the Court: the Court in its decision on the RA with UEFTI highlighted that it had to take into consideration “other factors in addition to the prosecutorial public interest factors at the negotiation stage”, which “allows conducting broader contextual analysis in assessing the public interest”, in particular:

• Whether the organization remains commercially viable in order to benefit innocent third parties which could impact positively on national economy;
• Whether the agreement avoids a lengthy, complex and expensive criminal investigation;
• Whether the agreement avoids lengthy, complex and expensive criminal and/or civil litigation;
• For transnational offences, the extent of collaboration that can be expected from a foreign state at the police investigatory stage;
• The extent and sincerity of the collaboration offered by the organization to state authorities; and
• The degree of confidence and certainty generated by the terms of an RA that further offences will not occur.

However, the factor of national interest in the conclusion of the first RA in the history of the country with SNC Lavalin was subject to public debate. It was stressed that

Therefore, the question whether the consideration by the Court in the UEFTI case of such a factor as “commercial viability of the organisation which could impact positively on national economy” (i.e. the actual consideration of national interest) in spite of the fact that prosecutors are prohibited from taking account of these conditions in negotiating an RA, remains open.

3) Victim compensation: the UEFTI agreement makes no arrangement for compensation of victims in spite of the fact that it is an important condition for concluding an RA.

At the same time, it may be difficult if not impossible to establish who the victims of a crime are. UEFTI creates unique technology solutions and did not have an obvious competitor that would have secured the contract. The Court concluded that the identity of victims and their loss could not be established with sufficient precision rather than there were no victims as such.

As a consequence, the uncertain victims and impossibility to assess the damage in foreign bribery cases (where RAs are likely to prevail in the future) can be an inherent element of this offence contrary to fraud or embezzlement cases, which can be either an advantage or disadvantage for the accused companies depending on how the penalty will be calculated.

It is noteworthy that in the UEFTI case it was Philippine Concept Dynamics Enterprises (CDE), local intermediary of the Canadian company, which . CDE

*A pre-trial agreement is in general sense an agreement concluded for a certain term between an accused company and law enforcement. Under the agreement, the company recognises the facts of the offence described and agrees to the obligations established therein (payment of a penalty, reparation of damage, monitoring of implementation of prevention measures and the like), while law enforcement does not formally bring charges against it. If the terms of the agreement are fulfilled, the company is cleared of all charges. Conversely, in the event that the agreement is violated while in force, the company is held liable for relevant offences in court.

**The first pre-trial agreement was concluded with the SNC Lavalin group of companies (SNC-Lavalin Inc. and SNC-Lavalin International Inc.) in 2022 on charges of fraud against different public officials of Libya. The charges concerning the violation of CFPOA by the company were dropped. It should also be highlighted that the first attempt to conclude an agreement in 2019 in the SNC Lavalin case was unsuccessful: the Court ruled then that law enforcement did not have sufficient evidence to bring charges.