The introductory part of the document briefly recalls the history of the development of anti-corruption regulation in France. Specialized anti-corruption bodies were established in the country in 2013: the National Financial Prosecutor’s Office (Parquet National Financier, PNF), which investigates serious financial crimes, including corruption, and the Central Office for the Fight against Corruption and Financial and Tax Offences (Office Central de Lutte contre la Corruption et les Infractions Financières et Fiscales, OCLCIFF), a specialized police investigative department. Those bodies were granted the powers to employ specific methods of investigation, originally intended to combat organized crime. With the adoption of Law No. 2016-1691 of December 9, 2016 “On Transparency, Fight against Corruption and Modernisation of Economic Life” (Loi n.°2016-1691 du 9 décembre 2016 relative à la transparence, à la lutte contre la corruption et à la modernisation de la vie économique, better known as Sapin II) these anti-corruption bodies performing “punitive” functions were complemented by a body fulfilling “preventive” role, namely the French Anti-Corruption Agency (Agence Française Anticorruption, AFA), which is given, in particular, the powers to control whether organisations adopt appropriate measures to prevent corruption offences by associated persons. It was this law that also introduced in France the possibility to use a Judicial Agreement in the Public Interest (Convention Judiciaire d’Intérêt Public, CJIP) which is equivalent to the U.S. and UK Deferred Prosecution Agreements (DPA). In 2017, along with the extension from 3 to 6 years of the statute of limitations for corruption crimes the possibility to postpone the countdown in the case of crimes that were or are being covered up was introduced. Therefore, over the past few years France has broadened its toolkit for investigation and prevention of corruption crimes, including those relating to bribery of foreign officials (hereinafter, FO), thereby demonstrating to other countries, as the authors of the document put it, its sovereignty over the cases against French companies accused of bribery by the prosecution bodies of other jurisdictions.
The main part of the Circular is divided into four thematic blocks.
1. The central role of the PNF in the fight against international corruption.
The PNF performs the leading role in France as regards the FO bribery offences: the body is in constant contact both with international organisations and law enforcement bodies of other countries, specializing in the fight against serious economic and financial crimes.
In addition, it is highlighted that the PNF continuously interacts with the bodies responsible for monitoring the compliance with the provisions of Law No. 68-678 of July 26, 1968 “On the Transmission of Economic, Commercial, Industrial, Financial or Technical Documents and Information to Foreign Natural or Legal Persons” (Loi n°68-678 du 26 juillet 1968 relative à la communication de documents et renseignements d'ordre économique, commercial, industriel, financier ou technique à des personnes physiques ou morales étrangères), which is known as the “blocking statute” («loi de blocage»). This legal act stipulates that it is necessary to ensure cooperation between judicial authorities of different jurisdictions so as to keep the PNF timely informed about the proceedings against French companies initiated by law enforcement bodies of other countries and, if needed, to launch a parallel investigation.
2. The use of all possible sources of information to detect the facts of international corruption.
According to the Circular, the signs of corruption offences can be detected in the course of activities of:
1) the bodies of financial monitoring, in particular, of the Directorate of Domestic and International Audit (Direction de Vérification Nationale et Internationale, DVNI), which is a division of the General Directorate of Public Finances responsible for the tax audit of major companies and their subsidiaries,
2) AFA, which verifies whether organisations take appropriate anti-corruption measures,
3) the independent administrative authorities, such as the Competition Authority (Autorité de la concurrence), the Prudential Supervision and Resolution Authority (Autorité de contrôle prudentiel et de résolution), the Financial Markets Regulator (Autorité des marchés financiers) and the High Authority for the Transparency of Public Life (Haute Autorité pour la transparence de la vie publique),
4) public or parastatal operators acting as investors on behalf of the State in granting export credits or bilateral development aid, such as Business France, Bpifrance, the French Development Agency (Agence française de développement), the Government Shareholding Agency (Agence des participations de l'Etat) and the Deposits and Consignments Fund (Caisse des dépôts et consignations),
5) multilateral development banks, such as the World Bank Group,
6) the Court of Audit (Cour des comptes) and its territorial units,
7) Tracfin, the financial investigation unit of the Ministry of Finance,
8) the Strategic Information and Economic Security Service (Service de l'information stratégique et de la sécurité economique, SISSE), and intelligence service,
10) individuals fulfilling the functions of administrators and legal agents.
The sources of information also include complaints of persons considered as whistleblowers in accordance with the provisions of Law No. 2016-1691, appeals of anti-corruption associations, and information about alleged facts of FO bribery, voluntarily disclosed by private sector organisations.
In addition to receiving information from external sources, the PNF prosecutors should autonomously analyse all requests of mutual legal assistance in the cases regarding French companies (under the “blocking statute”), news published by the domestic and foreign media and the data received through the channels for the exchange of information between the participants of the OECD Working Group on Bribery in International Business Transactions, particularly those concerning corruption-prone sectors: construction, transport, telecommunications, pharmaceutics, energy and defence.
The prosecutors, as the document stresses, should also systematically verify whether a certain foreign organisation, involved in an international corruption scheme, falls under French jurisdiction. According to the French Criminal Code, national anti-corruption legislation can be applied to the cases of bribery that took place abroad if they were committed by the persons living or fully or partly operating on the French territory. According to the explanations provided by the Circular this definition applies as a minimum to those foreign organisations that have subsidiaries, branches, trade offices or other entities in France.
3. The use of the investigative strategy aimed at rapid and comprehensive detection of corruption schemes and all parties involved in them.
According to the Circular, the investigation into international corruption is aimed at detecting the schemes of transfer of illicit rewards, identifying all natural persons, involved in the corruption scheme, and determining the degree of their participation. It may seem easier for prosecutors to focus on the active party to bribery (the company which falls under French jurisdiction), as the passive one is a foreign entity. However, the authors of the document recommend not overlooking the analysis of the information on whether the passive side has any assets/property in France which may be related to its involvement in corruption schemes and forfeited by the French law enforcement bodies under respective proceedings.
At the same time, they remind prosecutors of the fact that bribery does not necessarily imply direct transfer of money or other benefits to FOs. The authors of the document underline that bribery occurs as soon as the active side offered or the passive side requested a reward regardless of whether it was transferred/received in the end: this is why French criminal legislation does not provide for the corpus delicti for the cases of “attempted bribery”.
Prosecutors are also encouraged to pay attention to some secondary crimes that can be easier to prove in order to use the unveiled facts to investigate corruption.
1) For instance, a confirmed crime of money laundering can be a reason for initiating proceedings against predicate corruption offences: article 324-1-1 of the French Criminal Code provides for a peculiar “presumption of unlawfulness”: if material, legal and financial conditions of an operation to invest, conceal or convert money have no justification other than to conceal their origin or beneficial owner, this property or benefit will be considered as direct or indirect proceeds of a crime/offence.
2) Besides that, the receipt of such profit can be a reason for holding accountable those who owe or benefit from the property, being aware of the fact that it proceeds from corruption offences.
3) Prosecutors can also refer to the crime of misuse of company property by the managers of public limited companies (société anonyme, SA) and limited liability companies (société à responsabilité limitée, SARL) under articles 241-3 and 242-6 of the French Commercial Code. According to the case law, the use of the assets of a company will be considered as illicit if its purposes are illicit. Therefore, in the event that it is impossible to prove that they are used solely in the public interest, it is possible to presume their concealed use in personal interests of the management. If the misuse of company property implies the use of foreign accounts or contracts signed abroad or the participation of natural or legal persons established abroad, this will be an aggravating factor when a fine is imposed. In the case of the companies, which this offence cannot be applied to (general partnership, limited liability partnership, etc.), prosecutors can refer to such corpus delicti as breach of trust.
4) Another crime that prosecutors can refer to is inaccurate annual financial reporting, applied to SA and SARL managers (articles 241-3, part 3, 242-6, part 2, and 242-30 of the French Commercial Code) who intend to cover up the information about concealed benefits. In the case of other organisations, which it cannot be applied to, charges of fraud or falsification of documents can be brought.
5) Finally, the payment of concealed benefits to FOs can be regarded as tax fraud under article 1741 of the French Tax Code.
The Circular highlights that in addition to the conventional methods of investigation (conclusions, scrutiny of open and private databases, analysis of documents, hearing of witnesses, police detention, searchers, audit and tax investigations, etc.) in the cases of FO corruption and trading in influence prosecutors can apply special methods of investigation provided for by articles 706-80 – 706-87 and 706-95 – 706-102-5 of the French Code of Criminal Procedure (undercover operations for example).
4. Definition of the appropriate method for solving a case so as to impose effective, proportionate and deterrent sanctions.
The authors of the document note that according to the data of the research conducted by the OECD, almost in every second case of FO bribery the benefit is paid or is approved by high-ranking managers of a company and three of the four cases of transfer of benefit see the involvement of intermediaries (they are, as a rule, commercial agents, distributors or local brokers). In this context it is important that when investigating a case prosecutors take into consideration not only illicit activities of employees of a company, directly involved in giving a bribe, but also of other parties involved. The document also highlights that these persons will include, in particular, intermediaries or legal consultants who knowingly submit the information that makes it possible to reach an agreement and pay illicit benefit through a foreign company in order to conceal an offence.
As regards legal persons, prosecutors are encouraged to explore whether there are any facts permitting to justify prosecution of legal persons in the event of FO bribery or trading in influence if they are considered either as direct perpetrators/co-perpetrators or accomplices, in particular, in the event that an offence is committed by their foreign subsidiaries, intermediaries or suppliers. As stated in the document, the existing case law shows that it is possible to adopt a flexible approach towards determining the conditions for criminal prosecution of legal persons.
After the decision to prosecute an organisation is taken it is necessary to determine the appropriate way to solve the case. In this context the factors in favour of the conclusion of CJIP are:
- the legal person has no criminal record;
- it voluntarily discloses information about alleged corruption offences;
- the degree of cooperation with the investigation, in particular, in the identification of the natural persons involved in the corruption scheme.
When concluding a CJIP, particular attention should be paid to the need to adopt or improve the corporate anti-corruption compliance programme as well as the amount of the fine (which is imposed in line with the principles formulated in the Circular of January 31, 2018 on the enforcement of the criminal law provisions provided for by Law No. 2016-1691 of December 9, 2016 “On Transparency, Fight against Corruption and Modernisation of Economic Life”).
In the event that the conditions for concluding a CJIP are not fulfilled, a Prior Admission of Guilt Agreement (Comparution sur reconnaissance préalable de culpabilité, CRPC) may be concluded with the organisation.
The resolution of a case in court may be appropriate for the most serious or systemic cases of corruption as well as in a situation when the accused organisation refuses to cooperate and/or plead guilty. In such a case, in addition to imposing a fine the court may decide to publicly disclose the conviction, close down one or several of the divisions/subsidiaries of the company, confiscate its property and/or exclude the organisation form participation in public contracts.
The Annex to the document also contains consolidated information about the penalties for FO bribery and trading in influence, as well as about special methods of investigation that can be employed in such cases and the conditions for their adoption.
Until recently, it was the United States that was the key player in the field of prosecuting organisations for the foreign bribery. Its aggressive enforcement of the Foreign Corrupt Practices Act (FCPA) has resulted in multimillion and even multibillion fines being imposed on organisations from other jurisdictions. For instance, back in 2013 the French company Total paid almost 400 million USD to the US authorities, whereas in the outcome of the investigations into the same corruption practices in France in 2016 the company paid only around 830,000 USD (750,000 EUR). The case against the French company Alstom in 2014 resulted in the payment of one of the biggest fines under the FCPA, which amounted to 772 million USD.
However, the recent developments have shown that France has moved from simple resentment to vigorous actions and now claims to have an important if not a leading role in the foreign bribery cases. In particular, in early 2020 the Franco-Dutch company Airbus was held liable by the British, French and US law enforcement bodies for foreign bribery. The total amount of sanctions exceeded 3.6 billion USD, most of which, namely 2 billion USD, was paid to France. The Circular seems to be yet another proof of the fact that France intends to strengthen its stance in the proceedings against international corruption, regarding not only French but also foreign companies accused of FO bribery, which clearly results from the content of the document. It is likely that France is planning to adopt in future as aggressive an approach towards preventing corruption as that of the United States, which means holding liable those foreign companies that have at least a minimum connection with the territory of the country.