Wednesday, July 13, 2011

By Cherrine Chow, LLM candidate 2011

More than 100 people attended a public panel discussion March 29, 2011, called “Recent Developments in Foreign Corrupt Practices Legislation: Implications for Canadian Businesses and International Transactions,” the second in a series of panels hosted by the Faculty of Law’s new Global Professional Master of Laws (GPLLM) program. Given the negative report released recently by the Organization for Economic Cooperation and Development on Canada’s anti-bribery efforts (the OECD cited “significant concerns”), the discussion is a hot topic among Canadian business and legal leaders.  (A webcast of the entire panel discussion will be posted shortly.)

Moderated by the Hon. James Peterson, the former federal Minister of International Trace and Secretary of State, the stellar panel of experts included:  U of T Professor Anita Anand, Philip Urofsky (Shearman and Sterling), Deborah Alexander (Scotiabank), Insp. Gord Drayton (RCMP), and Bronwyn Best (Transparency International Canada) as they discussed the OECD Anti-Bribery Convention and related issues of doing business internationally.

Although Canada has ratified the OECD Convention and implemented the Corruption of Foreign Public Officials Act 1998 (CFPOA), Anand noted that Canada has only one conviction, one active case, and 20 ongoing investigations under this law.  “[Is] this legislation just window dressing, passed for superficial reasons only, or is there perhaps a lower instance of bribery in Canada?”  The bottom line, says Anand, is with only one conviction in Canada, there is probably a lack of enforcement in spite of having a statute in place.

On the other hand, Drayton, in his role at an RCMP unit dedicated to commercial crimes, including international anti-corruption efforts, said funds have been allocated to the Department of Foreign Affairs and International Trade, the Department of Justice, and other agencies to fight international corruption. However, several factors make enforcement very challenging, including a lack of jurisprudence, Charter rights issues, and cross-border complexity when it comes to securing documents and records. Moreover, corruption and bribery are generally not committed blatantly in Canada, making investigations even more difficult.

The panel also focused on the issue of “levelling the playing field” for companies operating globally. Alexander, executive vice-president and general counsel and secretary at Scotiabank,  described Scotiabank’s rigorous anti-corruption compliance practices and noted cultural differences and expectations are important to consider—in addition to the law.  She also described how Canadian companies face a great deal of “peer pressure” when competing with companies from other countries to attract or bid on foreign business and investment. Anti-bribery legislation and international initiatives, such as the OECD Convention, help to level the playing field for corporations globally. Transparency International’s Best, executive director,  added the UN Convention Against Corruption has been ratified by more than 100 countries, and while admittedly there is a question about how much these countries adhere to the Convention, there is “no country in the world that would say that corruption is part of their strategy.”

Transparency International Canada (TI) was formed in 1996 and its purpose is “to be an informed voice that promotes anti-corruption practices and transparency in Canada’s government, business, and civil society.” Best shared TI’s “Anti-Corruption Compliance Checklist” as a tool for Canadian corporations in enhancing their risk-management processes. This checklist is widely disseminated and can be found at: http://www.transparency.ca/New/Files/TI-Canada_Anti-Corruption_Checklist_2011.pdf.

During the question-and-answer period, the group discussed the limited and uncertain scope of the CFPOA in Canada.  For example, the legislation prohibits bribes made to foreign public officials, but does not provide guidance about the family members of such officials. Moreover, Canada faces issues of federalism and jurisdiction that countries like the United States do not.  In the U.S., the SEC is highly involved in assisting investigators of foreign corruption, but provincial securities regulators in Canada are not involved in federal CFPOA investigations.

Watch the webcast of this event.

The GPLLM is an executive-style Master of Laws program for practicing lawyers and business leaders. Applications are now being accepted for the 2011-2012 year. For more information, please visit: http://www.law.utoronto.ca/programs/GPLLM.html.