Discussing SFO v Rolls Royce PLC in the Context of an Australian Corporation
The SFO v Rolls Royce PLC case outlines the January 17th 2017 Deferred Prosecution Agreement [DPA] between the SFO and Rolls-Royce approved by Sir Brian Leveson, the President of the Queen’s Bench Division, UK. The case took into consideration Rolls-Royce’s criminal conduct of over three decades in different jurisdictions. The criminal conduct involved three business sectors and cases of bribery and corruption. The implementation of the DPA allowed Rolls-Royce to account for the conduct through payments and the reimbursement of SFO. The application of the case in a scenario where the company was Australian would have been different. Without a DPA scheme in Australia, the prosecution would have to determine criminal conduct by proving beyond reasonable doubt the cases of bribery, corruption, and other conducts breaching the law.
In accordance with the Criminal Code Act 1995, the case would require the determination of criminal liability by outlining corporate criminal responsibility and the element of intention. The element of intention under s. 70.2 Criminal Code Act 1995 outlined that a person has intention with respect to conduct, circumstance or to a result if s/he means to engage in the conduct, s/he believes in the existence or possible existence of the circumstance, or s/he is aware the result will occur or intends to bring it about[1]. The application of the element of intention would require proof that there was intention in regards with agreement to make corrupt payments to agents, concealment or obfuscation of using intermediaries, and in regards to prevention of bribery by intermediaries or employees[2]. The application of the fault element would require the consideration of the employees’ intention with respect to conduct, circumstance, and result. Most importantly, in the case of an Australian company, the case would follow the application of the corporate criminal responsibility as outlined in Part 2.
Part 2.5 outlines corporate criminal responsibility articulately. According to this part of the Act, the Code is applied to bodies corporate the same way it applies to persons to determine criminal liability[3]’[4]. A corporation is found guilty of a crime/offence including offences punishable by imprisonment (offences only punishable by imprisonment have specific penalties outlined by S. 4B of the Crimes Act 1914)[5]. In the case of SFO and Rolls-Royce, Part 2.5 would mean determining corporate criminal responsibilities by proving the employees and agents acted for or on behalf of the company. If the employees, agents, or officers acted within the scope of their employment or within the apparent or actual authority, criminal liability would be attributed to the company. Further, it would have required proof that the corporation, its board of directors, or culture permitted, authorised, or encouraged, tolerated, or led to the commission of the offence, after which the criminal liability would have been attributed to the body corporate[6].
The provisions of the Code deal with the limitations of the common law. Firstly, the provisions attribute criminal liability to the body corporate by determining the senior officers’ culpability[7]. Additionally, the corporate criminal responsibility general principles, physical elements and fault elements outline clearly the issues to consider to determine corporate criminal liability. The extensiveness of the provisions address the limitations of the common law adequately including the view of a corporation as a legal fiction as per the rule of ultra vivres, the inability to appear in court, and the lack of mens rea among others[8].
If Rolls-Royce has pleaded guilty rather than a DPA and with a corporate sanction, the sentencing options may be imposed on the defendant as defined by the relevant offence. The law acknowledged the impossibility of rehabilitating a corporate body and attaches fines and penalties on the sentences. The options may include monetary penalties. A body corporate found guilty of bribery of foreign official(s) may, in accordance with the Criminal Code 70.2, receive a maximum penalty of up to 100,000 penalty units, a penalty three times the benefit obtained, or 10% of the body corporate’s annual turnover for the relevant period[9]. Additionally, other options for a body corporate that pleads guilty of bribing officials and corruption with available corporate sanctions may involve probation with an outlined period of supervision or disqualification from certain activities or disestablishment (an equivalent of capital punishment)[10].
Bibliography
Arlen, Jennifer. Research Handbook on Corporate Crime and Financial Misdealing. Cheltenham, UK: Edward Elgar Publishing, 2018.
Brodowski, Dominik, Manuel Espinoza de los Monteros de la Parra, Klaus Tiedemann, and Joachim Vogel. Regulating Corporate Criminal Liability. Sydney: Springer.
Clough, Jonathan. “Improving the Effectiveness of Corporate Criminal Liability: Old Challenges in a Transnational World.” In New Directions for Law in Australia: Essays in Contemporary Law Reform, edited by Levy Ron, O’brien Molly, Rice Simon, Ridge Pauline, and Thornton Margaret, 163-72. Australia: ANU Press, 2017. HYPERLINK “http://www.jstor.org/stable/j.ctt1ws7wbh.18” http://www.jstor.org/stable/j.ctt1ws7wbh.18
Commonwealth Consolidated Acts. Criminal Code Act 1995. 2018. http://www5.austlii.edu.au/au/legis/cth/consol_act/cca1995115/sch1.html (accessed October 14, 2018).
Federal Register of Legislation. Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999. 2018. https://www.legislation.gov.au/Details/C2004A00434 (accessed October 14, 2018).
Library of Congress. Sentencing Guidelines: Australia. 2018. http://www.loc.gov/law/help/sentencing-guidelines/australia.php (accessed October 14, 2018).
[1] Commonwealth Consolidated Acts. Criminal Code Act 1995. 2018. http://www5.austlii.edu.au/au/legis/cth/consol_act/cca1995115/sch1.html (accessed October 14, 2018).
[2] Ibid.
[3] Commonwealth Consolidated Acts. Criminal Code Act 1995. 2018. http://www5.austlii.edu.au/au/legis/cth/consol_act/cca1995115/sch1.html (accessed October 14, 2018).
[4] Federal Register of Legislation. Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999. 2018. https://www.legislation.gov.au/Details/C2004A00434 (accessed October 14, 2018).
[5] Commonwealth Consolidated Acts. Criminal Code Act 1995. 2018. http://www5.austlii.edu.au/au/legis/cth/consol_act/cca1995115/sch1.html (accessed October 14, 2018).
[6] Arlen, Jennifer. Research Handbook on Corporate Crime and Financial Misdealing. Cheltenham, UK: Edward Elgar Publishing, 2018: 70.
[7] Ibid: 71.
[8] Brodowski, Dominik, Manuel Espinoza de los Monteros de la Parra, Klaus Tiedemann, and Joachim Vogel. Regulating Corporate Criminal Liability. Sydney: Springer, 201.
[9] Clough, Jonathan. “Improving the Effectiveness of Corporate Criminal Liability: Old Challenges in a Transnational World.” In New Directions for Law in Australia: Essays in Contemporary Law Reform, edited by Levy Ron, O’brien Molly, Rice Simon, Ridge Pauline, and Thornton Margaret, 163-72. Australia: ANU Press, 2017. http://www.jstor.org/stable/j.ctt1ws7wbh.18: 165.
[10] Clough, Jonathan. “Improving the Effectiveness of Corporate Criminal Liability: Old Challenges in a Transnational World.” In New Directions for Law in Australia: Essays in Contemporary Law Reform, edited by Levy Ron, O’brien Molly, Rice Simon, Ridge Pauline, and Thornton Margaret, 163-72. Australia: ANU Press, 2017. http://www.jstor.org/stable/j.ctt1ws7wbh.18: 165-166.
