Companies in Russia may avoid liability in domestic bribery cases if they assist in identifying the offence (e.g. by disclosing information), assist in investigation of the bribe, or if the bribe has been extorted, according to a new law which goes into force on August 14, 2018 (the “Law”).
The Law also allows courts to freeze the property of suspect companies during bribery investigations.
The Law supplements Article 19.28 of the Russian Code of Administrative Offences, which prohibits bribery by companies and which has been broadly applied to prosecute companies for the mere promise of a bribe by any person on behalf or in the interests of the company. Offenders are subject to severe fines of up to 3, 30 or 100 times the amount of the bribe.
Courts may now freeze the property of companies under investigation for bribery up to the maximum amount of any potential fine. They will also be entitled to freeze the bank accounts of a suspect company if they believe it does not have enough property to pay the potential fine. The courts may consider the prosecutor’s request to freeze property or bank accounts without notifying the suspect (who will be subsequently sent a copy of the court order). The accounts will then remain frozen until the company is found not guilty, or until it pays the fine.
It remains to be seen how effective the new leniency grounds will be in facilitating the discovery of, and reducing the amount of, corruption in the conduct of business in Russia. The introduction of freezing orders, however, only reinforces the importance of having a robust anti-bribery program, well documented and effectively enforced.
Global Compliance News | September 3, 2018