Norm Keith: Canada’s freeze on DPAs about to thaw

With Canada coming third in the winter Olympic medal count in Pyeongchang, and the warmer spring just around the corner, there appears to be a thaw in the long frozen idea of DPAs in Canada.

The government of Canada is now seriously talking about introducing a regime of Deferred Prosecution Agreements, for corporate and white collar offenders, in a Report released on February 22.

The Report, certainly gets the discussion to a new level, where there has been little formal policy or political support for DPAs in the past. Between September 25 and December 8, 2017, the government conducted a public consultation to seek input on potential enhancements to the Integrity Regime and on a possible Canadian DPA regime.

Government officials met with over 370 participants and received 75 written submissions. In keeping with the government’s stated commitment to transparency, the Report summarizes the views of those that participated in this consultation process. The Report is here (pdf).

Generally, the Report told stakeholders what they already know — that stakeholder participants were generally supportive of fair, proportional and transparent measures that enable the government to take action against corporate wrongdoing and to hold companies accountable for such misconduct. This should include but not necessarily be limited to DPAs.

The submissions summarized in the Report were generally of the view that DPAs could result in effective, proportionate and dissuasive sanctions, while also meeting other objectives, such as helping to identify corporate and individual criminal liability.

The Report did not seem to identify or focus on the slow pace of the policy discussion about DPAs in Canada, which have been actively discussed for over a decade. While the UK and France have moved ahead on such policy discussions, and the United States has actively wondered what is taking Canada so long to make a decision, the Canadian government was still thinking about what the stakeholders have said.

There was some concern expressed in the Report that DPAs could be viewed as favoring large companies over small companies and individual offenders. Many stakeholders who made submissions said that a Canadian DPA regime should be modeled more on the UK regime rather than the American system. All this while Canada still lags other G20 nations in its active commitment to enforcing existing anti-bribery and corruption laws.

The Report also was somewhat preoccupied by the state and need for change in the government’s “Integrity Regime.” The Regime’s objective is ensuring that the Canadian government does business with ethical suppliers. But the Integrity Regime has been wide criticized as a “toothless polar bear” in the fight against bribery and corruption in procurement with the federal government.

Stakeholders who made submissions expressed a range of views on whether the government should expand the grounds for triggering debarment. Many business participants felt that any expansion of the Regime should only be considered in conjunction with added flexibility in terms of debarment time periods, while most non-governmental organizations supported a broader use of the Regime, including adding additional offenses and new policy objectives. 

Since the Report is the foundation of the Canadian government’s “consultation process,” it will be interesting to see if Justin Trudeau gets to work on DPAs when he gets back from his state visit in India. There is also much interest in the white collar defense and investigation legal community in Canada about whether leave to appeal in the Karigar case will be granted by the Supreme Court of Canada. (See my previous post on the Karigar case). What we do know is that despite the very slow pace of even considering DPAs, Canada has taken a small, but important forward.

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