by Michael Kelly , Ken Casey July-27-2018 in Litigation & Dispute Resolution, Corporate
This Act was signed into law in June 2018 and it introduces important powers to combat corruption and bribery in Ireland.
The purpose of the Act is to amend and consolidate the law¹ relating to the prevention of corruption in respect of public officials. It also heralds the arrival of anti-bribery and corruption laws in relation to bodies corporate and in doing so gives effect to a number of European and International instruments relating to corruption offences.
Part 1 – Preliminary and General
The term “corruptly” is defined broadly as “…acting with an improper purpose personally or by influencing another person….”
The terms Foreign Official and Irish Official are also given very broad definitions. The term Irish Official will include elected representatives as well as any other person acting in the public administration of the State.
Part 2 - Corruption Offences
Section 5 of the Act sets out of the offences of active and passive corruption, defined as either directly or indirectly corruptly offering/giving or corruptly requesting/accepting “a gift, consideration or advantage” as an inducement or reward for “any person doing an act in relation to his or her office of employment, position or business”.
Section 6 creates the offence of active and passive trading in influence, defined as either offering/giving or requesting/accepting a gift, consideration or advantage to a third party to exert an improper influence over an official in relation to their position. Interestingly, this section states that the offence shall still exist regardless of whether the ability to exert an improper influence ever existed.
Section 7 sets out an offence for corruption in relation to office, employment, position or business. It creates an offence for an Irish Official who does any act in relation to their position for the purpose of corruptly obtaining a gift, consideration or advantage for himself or for any other person. It also creates an offence for an Irish official who uses confidential information for the same purpose.
Given the broad definition of Irish Official this could potentially have far reaching consequences. Indeed the classic situation of a local TD assisting with a contentious planning permission could be covered by this section.
Section 8 creates an offence for giving a gift, consideration or advantage that may be used to facilitate an offence under this Act. This section essentially creates an offence for funding corruption and is based on the knowledge of the person giving the gift, consideration or advantage.
Section 9 creates an offence for creating or using a false document for corrupt purposes.
Section 10 creates an offence for directly or indirectly threatening to harm another person with the intention of corruptly influencing that person or another person to do an act in relation to the person’s position. It sets out a broad definition of harm to include loss, disadvantage or injury of any kind.
Part 3 - Corruption occurring partly in or outside the State
Section 11 describes the offence of corruption occurring partly in the State. It confirms that a person will have committed a corruption offence in the State if any one or more of the acts constituting the offence are committed in the State notwithstanding the fact that other alleged aspects of the offence were committed outside the State.
Section 12 describes the offence of corruption occurring outside the State. It states that where a person commits an act outside the State that if done in the State would constitute an offence, the person will be guilty of an offence subject to certain qualifications such as Irish citizenship/residency.
Section 13 states that proceedings for an offence under Section 12 may be brought anywhere in the State.
Part 4 - Presumptions relating to corruption
Section 14 sets out a presumption of corruption for gifts, considerations or advantage. It states that where a gift, consideration or advantage has been given to an official and the person who gave the gift had an interest in the discharge by the official of their functions there will be a shift in the burden of proof and the advantage will be presumed to have been given and received corruptly unless the contrary is proven.
Section 15 sets out a presumption of corrupt donation with regard to the giving or receiving of donations. It provides that where it can be proved that a person received a donation of a certain type or exceeding a certain amount² and the person failed to return the donation or notify the authorities and the donor had an interest in the person’s position the donations shall be presumed to have been given and received corruptly unless the contrary is proven.
Section 16 sets out the presumption of corrupt enrichment. It states in any proceeding against an Irish official where it can be proved that he owns land or owned land or had an interest in land or property that was required to be declared in a statement of registerable interests but was not so declared it shall be presumed that the land or property derives either directly or indirectly from a gift or consideration or advantage of an inducement unless the contrary is proven.
This section is particularly interesting when one considers the contents of the 2015 RTÉ Primetime documentary which reported large scale lack of compliance with declaration of interest forms by public officials.
Part 5 - Penalties and Enforcement
Section 17 sets out the penalties for offences under the Act. A person guilty of an offence under Section 6 shall be liable on summary conviction to a class A fine and imprisonment for a term not exceeding twelve months or alternatively on indictment subject to a fine or imprisonment for a term not exceeding five years.
A person guilty of any other offence (other than section 6 or section 18(1)) shall be liable on summary conviction to a class A fine and imprisonment for a term not exceeding twelve months or alternatively on indictment subject to a fine or imprisonment for a term not exceeding ten years.
The section also provides for the forfeiture of the gift or advantage.
Under this section the courts may order forfeiture of a positon by a person found guilty of an offence under the Act and prohibit that person from holding certain non-elected positions for up to ten years.
Section 18 sets out offences under this Act by bodies corporate. The body corporate itself shall be guilty of an offence under this section if an offence under this Act is committed by either a director, manager, secretary or other officer of the body corporate, or a person purporting to act in that capacity, with the intention of retaining business for the body corporate or an advantage in the conduct of the business for the body corporate. This section provides a defence for the body corporate if it can prove that it took all reasonable steps and exercised all due diligence to avoid the commission of the offence.
This section also creates an offence for an officer of a company who by their consent or wilful neglect allowed the body corporate to commit an offence under this act.
Practically speaking from the enactment of the Act it will be essential that all bodies corporate have a detailed anticorruption & bribery policy to avoid running afoul of section 18 of the Act.
Section 20 sets out the powers of seizure for a suspected bribe. It provides that a member of An Garda Síochána may seize and detain land, cash or other property that the member has reasonable grounds for suspecting is a gift or consideration used or intended to be used for the purposes of an offence under Section 5, 6, 7 or 8 for 72 hours.
Section 21 sets out the powers for forfeiture of anything seized under section 20 by way of Circuit Court Order.
Commentary
The Act introduces important powers to combat corruption and bribery in the State. The efficacy of the measures introduced will depend largely on the level of investment, funding and resources put toward investigating and prosecuting this type of crime.
For further information, please contact Michael Kelly mjkelly@hayes-solicitors.ie or Ken Casey kcasey@hayes-solicitors.ie at Hayes solicitors.
¹ Prevention of Corruption Acts 1989 to 2010 will be repealed and replaced by this Act.
² As defined in Electoral Act of 1997 and the Local Elections Disclosure of Donations and Expenditure Act 1999
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About the Authors
Michael Kelly
Michael is an senior associate solicitor in the Commercial Litigation & Dispute Resolution team at Hayes. He has experience advising commercial clients with respect to a wide variety of issues, in particular restructuring and insolvency cases. He regularly acts for receivers, liquidators and examiners in High Court and Commercial Court proceedings.
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Ken Casey
Ken is Head of the Corporate team and has built a practice in acquisitions, disposals, and capital markets transactions across various industry sectors; joint ventures and corporate re-organisations of publicly quoted and private companies; and advises on corporate governance and general corporate law. He has extensive expertise in the financial services, aviation, gaming, technology, media and sports sectors.