Author: Azizur Rahman
12 February 2020
3 min read
While Airbus is probably relieved to have avoided prosecution over alleged bribery, the huge amount of money it is having to pay to settle such allegations has generated headlines. But the Airbus settlement is noteworthy for other reasons.
For a start, it marks the first time that the SFO has decided to use the wide territorial reach of the UK’s Bribery Act. Yes, the possibility has always been there but this is the first occasion where it has been fully utilised. Airbus has come under investigation in the UK – and effectively been penalised here - for activity that was not conducted in the UK. The counts on the indictment cover Airbus conduct in Malaysia, Sri Lanka, Taiwan, Indonesia and Ghana. There has been enforcement in the UK by the SFO, not to mention widespread mutual legal assistance between countries. The SFO has been emboldened by the collaboration effort and has shown it is well placed to co-ordinate with others in the investigative process. This accords with many of the soundings that have been growing ever louder from the SFO’s current regime.
Whether this case heralds a new era of post-Brexit cooperation – enquetes sans frontieres, for want of a better phrase - is something that will only become clear with time. But it would not be going too far to say that this is a case that sets the standard for future investigations – and raises the bar high for what is expected of corporations.
Significantly, the SFO examined the internal investigation documents - including interviews with Airbus employees - as Airbus waived legal professional privilege on a limited basis. The SFO also undertook its own independent investigation. This could be seen as an indicator that the SFO is looking to create a culture of companies under investigation waiving privilege.
If that is the case, it is an approach that is being taken in spite of, rather than as a result of, the 2018 Court of Appeal ENRC judgement; which overturned a controversial High Court decision that had narrowed the scope of legal professional privilege in internal investigations. This is arguably not a surprise. In its “Corporate Co-operation Guidance’’ issued last year, the SFO asserted that if an organisation claims privilege it will be expected to provide certification by independent counsel that the material in question is privileged. And before that guidance was issued, some senior SFO figures had talked of the possibility of companies being required to waive privilege in order to show co-operation.
While this settlement emphasises the importance the SFO has come to attach to privilege, it also shows how the wider issue of co-operation carries huge weight in such an investigation. The DPA explains in great detail the lengths Airbus went to in order to assist the investigation. To name just some of its actions, Airbus confirmed the existence of corruption concerns, identified issues that investigators were unaware of, reported conduct that had happened largely overseas and collected more than 30 million documents. In addition, its new board cooperated fully with investigators and created a new company-wide approach to compliance.
There can be little doubt that if Airbus was to receive lenient treatment it had to show a major departure in its workplace culture from the ways it had previously set about obtaining business. The fact that it did this is a feather in its cap. As for individuals, given the sheer amount of documentation it is hard to see how a smoking gun will be found in the arsenal which has been inventoried. It will be a brave decision by the SFO to once again test the strength of its convictions about individuals under investigation, when so far their efforts have led to no convictions at all. And a potential further defeat could take the shine of what is, on the face of it, a stunning victory.
Airbus can, therefore, pat itself on the back, having engineered that all-important escape from prosecution. But this is a case that shows the stringent demands now placed on any corporation that wants to have any chance of avoiding a trial.
On paper, the SFO seems to have secured the silver medal on the podium in terms of the penalty values. However it will perhaps come as no surprise that the US has again raised the stakes with the value of the penalty it has imposed but has graciously allowed the French to take the credit. After all, this is their domain, and therefore their problem. And the fact that Boeing may have issues may have had some bearing on this.
Aziz’s article originally featured on Fraud Intelligence. (Subscription required)
Aziz Rahman is Senior Partner at Rahman Ravelli and its founder. His ability to coordinate national, international and multi-agency defences has led to success in some of the most significant corporate crime cases of this century and top rankings in international legal guides. He is recognised worldwide as one of the most capable legal experts regarding top-level, high-value commercial and financial disputes.