This post, the second of two parts, is based on an article that first appeared in the Magazine of the Deutsch-Amerkanische Juristen-Vereinigung by T. Markus Funk.
In Part 1 of this series introduced Germany’s foreign anti-corruption efforts, particularly its bribery laws and enforcement actions.
Like other countries that cooperate with the United States on bribery prosecutions, Germany will punish transnational conduct that violates its own domestic laws, sometimes after the offender has admitted to wrongful conduct in an earlier proceeding in the United States.
Many companies have endured carbon-copy prosecutions, facing penalties for conduct that is illegal under separate national laws but arising out of the same common facts. Siemens, discussed in the first post, is an example, as are KBR, BAE Systems, Snamprogetti/ENI, among others.
With multiple countries using the same facts and admissions to bring their own enforcement actions, companies should strive to implement best practices that will be adequate under multiple legal regimes.
Markus Funk offers best-practice recommendations comprised of five general steps:
- Conduct a comprehensive risk assessment. Design one that assesses external risks that the company could be exposed to and one that analyzes the internal risks as well.
- Design and implement an anti-corruption compliance program. Policies and procedures should cover ethics, gifts, charitable giving, entertainment policies and international travel, as well as distributor/sales agent policies.
- Develop a risk-based third party vetting program. Prepare vetting and monitoring procedures for third-party intermediaries whose conduct may be imputed to the company, including a questionnaire for the intermediaries. Review existing contracts and draft anti-corruption provisions for standard contracts. Prepare guidelines and procedures for anti-corruption due diligence in connection with third-party transactions.
- Monitor and train appropriate staff. Assess accounting, controls and monitoring compliance, identifying areas for improvement. Prepare training programs tailored to specific groups of employees and hold training sessions that promote active learning, such as “train the trainer” classes.
- Implement a reporting mechanism for personnel and investigation protocols. Make the reporting confidential and emphasize the need to be proactive in investigations of possible corruption. Encourage employees to contact the appropriate members of the company with their suspicions or questions. In collecting and investigating these reports, pay attention to each jurisdiction’s privacy laws.
Julie DiMauro is the executive editor of FCPA Blog and can be reached here.