Are facilitation payments regulated? If not, what is the general approach to such payments?
Bribery & Corruption
One of the defences to a charge of bribing a foreign public official is that the bribe or corrupting benefit constituted a facilitation payment. To successfully raise the defence, three elements must be established:
- the benefit must be of a minor nature;
- the benefit must have been offered for the sole or dominant purpose of expediting or securing the performance of a routine government action of a minor nature; and
- the provider of the benefit must have made a signed written record of the relevant conduct as soon as practicable. The record must include, among other things, the date on which the conduct occurred, value of the benefit concerned, the identity of the foreign official and/or the person receiving the benefit, and particulars of the routine government action sought.
Under Australian law, lawfully-made facilitation payments may be considered legitimate business expenses for the purposes of reducing a company’s taxable income.
Polish law does not regulate facilitation payments. There is no exemption in Poland for facilitation payments, and such payments are likely to fall under the statutory definition of an offence of bribery.
There is no distinction drawn in Irish law between facilitation payments and other types of corrupt payments. As such, facilitation payments will be illegal if they fulfil the elements of the relevant offences.
No. Brazilian laws and regulations do not provide for facilitation payments. The making of any facilitation payment, to the extent not provided for expressly in the laws and regulations, would be considered a violation.
A facilitation payment refers to the practice of paying a small sum of money to a public official as a way of ensuring that they perform their routine, non-discretionary duties, either promptly or at all.
Facilitation payments are illegal under the Bribery Act. Nevertheless, the UK government has recognised “the problems that commercial organisations face in some parts of the world and in certain sectors”. Although the UK’s Joint Committee has recommended that there be guidance as to the circumstances in which facilitation payments will be prosecuted, the government has made it clear that this should be policed by prosecutorial discretion exercised in the public interest. This leaves the position uncertain. Even if prosecutions do not take place, the continuing illegality of facilitation payments causes issues from a money laundering point of view.
Yes, they are regulated. Article 234 and Article 237 of the code will again come into play here. The code was updated in 2016 to allow for the inclusion of foreign public officials specifically to combat such issues. The penalties as described in question 7 will apply in this case as well.
Facilitation payments are not specifically regulated in Singapore – in particular there is no exemption or defence applicable to such payments similar to that provided, for example, by the United States Foreign Corrupt Practices Act 1977 (FCPA). As such, the payment of a facilitation payment would constitute an act of bribery under Singapore law.
here is no official definition for facilitation payments in China. Any payment that is made in exchange for illegal business opportunities, advantages or other interests could be potentially deemed as bribery. One relevant exception is in regards to small advertising gifts that are permitted by the Provisional Regulations on the Prohibition of Commercial Bribery, which is usually less than RMB 200 in practice. Other than that, article 83 of the Discipline Rules for the Communist Party of China stipulates that payment, cash, or shopping cards that might potentially influence their execution of duty, would be strictly forbidden, which seems to set aside an exception for such payment in a relatively small amount, with less likelihood of being deemed as bribery.
No, as opposed to other jurisdictions and foreign laws (such as FCPA), there are no provisions specifically regulating facilitation payments, nor any exception allowing facilitation payments; therefore, pursuant to Article 66 of the LGRA and Article 222 of the CPF, such payments would be considered as bribery.
Facilitation payments are prohibited. They are considered illegal not only in respect to anti-corruption laws and regulations but also in respect to taxation laws and regulations. These types of payments may not be registered in the books and records of a company, since they are not recognised by law.
Facilitation payments made to a public servant (unless permitted under their rules of service) are considered as gratification, attracting prosecution and penal provisions under PCA and other anti-corruption legislations (as detailed above) depending amount the nature of the offence and the transaction involved.
Facilitation payments are included in the concept of attribution of undue advantages and are, therefore, considered a crime under Angolan legal framework.
See our answer 7.
See: answer to question 7.
Under Danish law, no distinction is made between “regular” bribery and facilitation payments in the Criminal Code and as such facilitation payments fall within the scope of the Criminal Code’s bribery provisions.
It is stated in the legislative history of section 122 of the Criminal Code that special circumstances in foreign countries may cause facilitation payments to fall outside the scope of the Criminal Code’s bribery provisions. There is no published case law on facilitation payments.
Facilitation payments fall within the applicability of the Criminal Code. Therefore, the law contains no exemption from criminal liability for granting or receiving facilitation payments in relation to German or European public officials, German judges or arbitrators, international Criminal Court judges, members of an EU court or members of the German Federal Armed Forces according to sections 331, 333, 335a (2) and (3) of the Criminal Code.
The bribing of a non-European foreign public official is only punishable if the official violates an official duty, in addition to receiving a bribe (sections 332, 334 and 335a (1) of the Criminal Code). Therefore, if an official has not violated his duties, a punishable crime has not been committed.
Facilitation payments in favour of a public official (or person in charge of a public service) are prohibited as they fall under the offence of ‘bribery for the performance of the function’ pursuant to article 318 of the Criminal Code. Such crime occurs when a public official (or a person in charge of a public service) unduly receives (or accept the promise to be given), for himself or herself or for a third party, money or other benefits to perform his or her functions or powers (i.e. to do something that the public person was anyway supposed to do).
Please see our comments to question 7.
HRA: Facilitation payments are not specifically regulated for the purposes of bribery and corruption, and shall fall within the general regime.
Bribery regulations in Japan have no specific clauses as for facilitation payments. In practice, facilitation payments are reviewed with regard to any quid pro quo in relation to the official duty of the bribe taker.
Transparency International defines facilitation payments as unofficial payments of small amounts intended to facilitate or ensure the conduct of simple procedures or necessary acts that the payer is entitled to expect, whether on a legal or other basis. These may be small amounts requested by service providers to provide or ‘facilitate’ the services that may be expected of them, or which may be offered to Customs, immigration or other officials to expedite the provision of services or permits. These payments can therefore be made to both private and public sector workers. According to the AFA guidelines the French Codes of Conduct should explicitly prohibit facilitation payments.
There are no specific regulations on facilitation payments, but they may fall under the prohibition of granting or accepting undue advantages. Hence, facilitation payments are unlikely to be considered offences, unless they involve Swiss public officials, see question no. 3 above.
The FCPA has a narrow exception for ‘any facilitating or expediting payment to a foreign official, political party, or party official the purpose of which is to expedite or to secure the performance of a routine governmental action by a foreign official, political party, or party official’. 18 USC section 78dd-1(b). This exception applies only to non-discretionary government acts and includes ‘routine governmental action’ such as ‘processing visas, providing police protection or mail service, and supplying utilities like phone service, power, and water’. DOJ and SEC, A Resource Guide to the U.S. Foreign Corrupt Practices Act at 25 [2012, updated 2015].