Anti-Corruption Regulationin 50 jurisdictions worldwideContributing editor: Homer E Moyer Jr 2013

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Anti-Corruption Regulation 2013Contributing editor Homer E Moyer Jr Miller & Chevalier Chartered

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Anti-Corruption Regulation 2013 Published by Law Business Research Ltd 87 Lancaster Road London, W11 1QQ, UK Tel: +44 20 7908 1188 Fax: +44 20 7229 6910© Law Business Research Ltd 2013No photocopying: copyright licences do not apply.First published 2007 Seventh edition 2013 ISSN 1754-4874

The information provided in this publication is general and may not apply in a specific situation. Legal advice should always be sought before taking any legal action based on the information provided. This information is not intended to create, nor does receipt of it constitute, a lawyer–client relationship. The publishers and authors accept no responsibility for any acts or omissions contained herein. Although the information provided is accurate as of February 2013, be advised that this is a developing area.

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Global Overview Homer E Moyer Jr Miller & Chevalier Chartered 3

2012 – the advent of collective action Monty Raphael QC Transparency International UK 9

A year of milestones Nicola Bonucci and Patrick Moulette OECD 11

Antigua & Barbuda Edward H Davis Jr and Arnoldo B Lacayo Astigarraga Davis and 12 Nicolette M Doherty Nicolette M Doherty Attorney-at-Law

Argentina Fernando Basch & Guillermo Jorge Guillermo Jorge & Asociados 16

Australia Jane Ellis and Rob Smith Ashurst 23

Bolivia Pablo Rojas CR&F Rojas – Abogados 31

Bosnia & Herzegovina Lea Škrbo, Selma Šehovic and Anisa Tomic Maric & Co Law Firm LLC 36

Brazil Carlos Amadeu Bueno Pereira de Barros Grinberg, Cordovil e Barros Advogados 40

Canada Milos Barutciski Bennett Jones LLP 45

Chile Marcos Ríos and Solange González Carey 52

China Amy L Sommers and Cecillia Dai K&L Gates LLP 58

Costa Rica Robert C van der Putten and Paola Montealegre S Sfera Legal 65

Croatia Natalija Peric Mamic Peric Reberski Rimac 70

Cyprus Panayiotis Neocleous and Costas Stamatiou Andreas Neocleous & Co LLC 74

Czech Republic Radan Kubr and Jan Varecha PRK Partners s.r.o. Attorneys at Law 79

France Stéphane Bonifassi Lebray & Associés 86

Germany Kai Hart-Hoenig Dr Kai Hart-Hoenig Rechtsanwälte 92

Greece Ilias G Anagnostopoulos and Jerina (Gerasimoula) Zapanti Anagnostopoulos Criminal Law & Litigation 97

India Aditya Vikram Bhat and Richa Roy AZB & Partners 102

Indonesia Richard Cornwallis and Farida Yuliasari Makarim & Taira S 111

Ireland Bríd Munnelly, Carina Lawlor and Michael Byrne Matheson 116

Israel Yuval Horn, Ohad Mamann and Alon Harel Horn & Co Law Offices 124

Italy Roberto Pisano Studio Legale Pisano 130

Japan Kenichi Sadaka and Kei Akagawa Anderson Mori & Tomotsune 137

Kenya Godwin Wangong’u and CG Mbugua Mboya Wangong’u & Waiyaki Advocates 143

Korea Kyungsun Kyle Choi and Liz Kyo-Hwa Chung Kim & Chang 149

Lebanon Jihad Rizkallah, Marie-Anne Jabbour and Sarah Fakhry Badri and Salim El Meouchi Law Firm 154

Liechtenstein Siegbert Lampert and Rudolf Schächle Lampert & Schächle Attorneys at Law Ltd 161

Luxembourg Rosario Grasso Kleyr Grasso Associés 166

Mexico Luis Rubio Barnetche, Bertha Alicia Ordaz Avilés and Héctor Cuevas González Greenberg Traurig SC 172

Namibia Peter Frank Koep and Hugo Meyer van den Berg Koep & Partners 178

Netherlands Enide Z Perez and Max JN Vermeij Sjöcrona Van Stigt Advocaten 182

New Zealand Hayden Wilson Kensington Swan 188

Nigeria Babajide O Ogundipe and Chukwuma Ezediaro Sofunde, Osakwe, Ogundipe & Belgore 195

Norway Erling Grimstad BDO AS 199

Panama Omar Rodriguez & Rodolfo Palma Morgan & Morgan 204

Philippines Francisco Ed Lim and Chrysilla Carissa P Bautista Angara Abello Concepcion Regala & Cruz 209 Law Offices (ACCRALAW)

Poland Jarosław Kruk, Beata Chmielewska and Aleksandra Matwiejko-Demusiak Kruk and Partners Law Firm 215

Russia Vasily Torkanovskiy Ivanyan & Partners 221

Saudi Arabia Robert Thoms and Sultan Al-Hejailan The Law Firm of Salah Al-Hejailan 229

Singapore Wilson Ang Norton Rose (Asia) LLP 233

Spain Laura Martínez-Sanz and Jaime González Gugel Oliva-Ayala Abogados 241

Sweden Peter Utterström and Sofia Karlsson Advokatfirman Delphi 246

Switzerland Peter Burckhardt, Paul Gully-Hart and Roland Ryser Schellenberg Wittmer 252

Thailand Douglas Mancill and Wayu Suthisarnsuntorn Price Sanond Prabhas & Wynne Ltd 259

Trinidad & Tobago Edward H Davis Jr, Arnoldo B Lacayo and Sunita Harrikissoon Astigarraga Davis 266

Turkey Gönenç Gürkaynak and Ç Olgu Kama ELIG, Attorneys-at-Law 272

Ukraine Yaroslav Teklyuk, Viacheslav Pieskov and Valeriia Tryfonova Vasil Kisil & Partners 279

United Arab Emirates Charles Laubach Afridi & Angell 286

United Kingdom Monty Raphael QC Peters & Peters 293

United States Homer E Moyer Jr, James G Tillen, Marc Alain Bohn and Erik B Nielsen Miller & Chevalier Chartered 309

Venezuela Fernando Peláez-Pier and Gerardo Briceño Hoet Peláez Castillo & Duque 317

Appendix Transparency International 322LawBusinessResearch

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204 Getting the Deal Through – Anti-Corruption Regulation 2013

PanamaOmar Rodriguez & Rodolfo Palma

Morgan & Morgan

1 International anti-corruption conventions

To which international anti-corruption conventions is your country a

signatory?

The Republic of Panama has signed the following international anti-corruption conventions:• Inter-American Convention against Corruption of theOrganizationofAmericanStates(OASConvention);and

• theUnitedNationsConventionAgainstCorruption(UNCAC).

2 Foreign and domestic bribery laws

Identify and describe your national laws and regulations prohibiting

bribery of foreign public officials (foreign bribery laws) and domestic

public officials (domestic bribery laws).

The OAS ConventionArticleVI,paragraph1of theOASConventionsetsoutthesitu-ations that are understood as ‘acts of corruption’,with ‘bribery’described as follows:

1 This Convention is applicable to the following acts of corruption:a The solicitation or acceptance, directly or indirectly, by a

public official or a person who performs public functions, of any article of monetary value or other benefit, favor, promise or advantage for himself or for another person or entity in exchange for the performance or omission of any act in their official duties;

b The offering or granting, directly or indirectly, to a public official or a person who performs public functions, of any article of monetary value or other benefit, favor, promise or advantage for himself or for another person or entity in exchange for the performance of any act or omission in the performance of their official duties; ....

This conventionalso expressly refers to ‘transnationalbribery’ inArticleVIII:

Article VIIISubject to its Constitution and the fundamental principles of its legal system, each state party shall prohibit and punish the offering or giving to a public official of another state, directly or indirectly, by its nationals, persons having their habitual residence in its territory, and businesses domiciled there, any article of monetary value or other benefits, such as a gift, favours, promises or advantage, in exchange for the official acting or refraining to act, in the exercise of their pub-lic duties, in relation to an economical or commercial transaction.

Transnationalbriberyisconsideredanactofcorruptionforthepur-posesofthisconvention.

UNCACChapterIII,article16ofthisconvention(Criminalisationandlawenforcement)dealswith‘Briberyofforeignpublicofficialsandoffi-cialsofpublicinternationalorganisations’.

Penal CodeArticle345etseqofbookIIofthePenalCode(entitled‘Crimes’),TitleXdealswith‘Crimesagainstthepublicadministration’;Article345mainlyaddresses‘Corruptionofpublicservants’.Items1and2 of the article in question contain similarwording to the Inter-AmericanConvention.

Judicial CodeArticle2153oftheJudicialCodedescribeshowthepreventivearrestprocessofpublicofficials,whilearticles2463to2537regulatethequestionof‘specialprocesses’,andarticles2464to2477dealwith‘proceedingsagainstpublicservants’.

Other related legislation• ExecutiveDecree7of22January2002,whichestablishesthePresidentialCommissiontoFightCorruption.

• Law6of22January2002,whichlaysdownrulesfortrans-parency inpublic administrationand establishes thehabeas data.

• ExecutiveDecree 179of 27October 2004,which creates theNationalCouncilofTransparencyagainstCorruption(amendedbyExecutiveDecrees110of2007and232of2009).

Foreign bribery

3 Legal framework

Describe the elements of the law prohibiting bribery of a foreign public

official.

Section350ofthePenalCodereferstotransnationalbribery,con-sistentwithArticleVIIIoftheOASConvention:

Article 350: When any of the conduct described in articles 345, 346, and 347 of this Code shall be conducted on a public servant of another state or public international organisation official, for that official or server to perform, omit or delay any act in violation of its obligations, or to perform any act of his own office, or as a result of any acts concluded, the penalty is five to eight years’ imprisonment.

Article345contemplatesactsof‘corruption’ingeneralterms,whilearticle346dealswithcorruptionexercisedbyapublicservanthold-inganyofficeintheadministrationofjustice,andArticle347referstobribery ‘exertedby aparticular’,which extends to individualswho take part in an act of corruption by offering, promising ordeliveringdifferentundertakingstopublicofficials.Article350talks

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about ‘bribery’ in termsofa ‘public servantorofficerofanotherpublicinternationalorganisation’.Last,Article254ofthePenalCoderegulatesmoneylaundering

andstatesthattheoffenceof‘internationalbribery’mayleadtothecrimeofmoneylaundering:

Article 254: Any person who, personally or through another per-son, receives, deposits, trades, transfers or converts monies, securities, property and other financial resources, reasonably foreseeing that they come from activities related to interna-tional bribery offenses against the law of copyright and related rights, the rights of industrial property or against humanity, drug trafficking, conspiracy to commit drug offenses, quali-fied fraud, financial crimes, illegal arms trafficking, human trafficking, kidnapping, extortion, embezzlement, murder for money or reward, against the environment, corruption of pub-lic officials, illicit enrichment, acts of terrorism, financing of terrorism, pornography and corruption of minors, trafficking and commercial sexual exploitation, international trafficking of stolen vehicles or with an order to hide, disguise or conceal its illicit origin, or help evade the legal consequences of such offencs will be punishable by 5–12 years in prison.

4 Definition of a foreign public official

How does your law define a foreign public official?

Article2(b)ofUNCACdefines‘foreignpublicofficial’asfollows:[…] any person holding a legislative, executive, administrative or judicial office of a foreign country, whether appointed or elected, and any person exercising a public function for a foreign country, even for a public agency or public enterprise; ....

Transnationalbribery canapply to a ‘foreignpublicofficial’, butalsotoan‘officialofapublicinternationalorganisation’,definedinarticle2(c)as‘aninternationalcivilservantoranypersonauthorisedbythatorganisationtoactontheirbehalf’.InPanama,theConstitutiondoesnotdescribeworkerswhoare

paidbythestateas‘officials’,butdesignatesthemas‘publicserv-ants’(titleXI(sections299etseq)).

5 Travel and entertainment restrictions

To what extent do your anti-bribery laws restrict providing foreign

officials with gifts, travel expenses, meals or entertainment?

Gifts,travelexpenses,mealsorentertainmentcanbeunderstoodtomean‘anybenefitoradvantage,giftsorfavours’.Penaltiesarepro-vided for both the proposer of the act and for the person accepting theproposal.Article345ofthePenalCodeprovides:

Article 345: [The following s]hall be punished with imprisonment of two to four years the public servant who, personally or through another person, commits any of the following behaviors:• Accepts,receivesorrequestsadonation,pledge,moneyor

any other benefit, to perform, omit or delay an act in viola-tion of their obligations, or who accepts them as a result of having missed them.

• Accepts,receivesorrequestsadonation,pledge,moneyorany improper advantage or benefit, to make a proper act of his office or employment, without neglecting his duties, or as a result of the act already performed.

Article346dealswithmalfeasance,andprovidesthat:[Any] public servant who, serving as a member of the judiciary or prosecutors, administrative authority, arbitrator or any charge that should decide an issue of his knowledge or competence, in person or by proxy, accepts, receives or requests a donation, pledge, money, benefit or advantage to harm or favour one of the parties in the

process, or as a result of having harmed or favoured one of them, shall be punished with imprisonment from four to eight years.

The same penalty applies to the official court or the AttorneyGeneral who:• by collusion or by other fraudulent means, utters resolutionmanifestly contrary to theConstitution or the law, so that itwouldbeprejudicial;

• bycollusionorbyotherfraudulentmeans,receivesorgiveslegaladvicetoeitherparty,sothatitwouldbeprejudicial;and

• slowsdownprocessmaliciouslythataresubmittedtohim.

Iftheconductdescribedinthisarticleistheconvictionofaninno-centperson,thepenaltywillbefiveto10yearsinprison.Articles347dealswithbribery:Any person who, in any form, offer, promise,or gives public any public servant a donation, money, promise or any benefit or advan-tage to perform, delay or omit any act pertaining to their own office or employment in violation of his duties, shall be punished with imprisonment of three to six years.

Article347forseessanctionsonlyforthosepublicservantsthatpro-posethebriberyact,notthosethatacceptthegiftsoffered,promisedorgiven,tothedetrimentofthepublicadministration.Obviously,a public servant who accepts such offering will still be liable under articles345and346mentionedabove.Article350providesthatwhensuchbehaviourtakesplace,the

followingofficialswithinPanamanian territory,maybepenalisedwithimprisonmentoffivetoeightyears:

Article 350: When any of the conducts described in Articles 345, 346 and 347 of this Code shall be conducted by a public serv-ant of another state or public international organisation offi-cial, for that official or server to perform, omit or delay any act in violation of its obligations, or to perform any act of his own office, or as a result of any acts concluded, the pressure penalty is five to eight years.

6 Facilitating payments

Do the laws and regulations permit facilitating or ‘grease’ payments?

Panamanianlawdoesnotmentionfacilitatingpaymentsor‘grease’payments,oranythingofasimilarnature.

7 Payments through intermediaries or third parties

In what circumstances do the laws prohibit payments through

intermediaries or third parties to foreign public officials?

Aspreviouslymentioned, article 345 of the PenalCode containsthephrase:‘personallyorthroughanotherperson’.Article346alsocontainsthisphrase,andinthiscasethepenaltyofimprisonmentisforfourtoeightyears.

8 Individual and corporate liability

Can both individuals and companies be held liable for bribery of a

foreign official?

AccordingtothePenalCode,althoughit isonlypossibletoholdindividualsliable,inestablishingpenalties–whichisadifferentcon-cept–it ispossibleforindividualsandcorporationstobesubjecttothem,aslongastheyarecreatedorusedtointhecommissionofcrimes.Forcorporations,thesanctionsthatmaybeappliedareas follows:

Article 51. When a legal entity is created to be used to commit crime or wherever benefits it, any of the following sanctions may be implemented:

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206 Getting the Deal Through – Anti-Corruption Regulation 2013

1 Cancellation or suspension of licence or registration for a term not exceeding five years.

2 Fines of not less than five thousand dollars and not more than twice the injury or assets. Total or partial loss of tax benefits.

3 Disqualification from engaging in contracts with the state, directly and indirectly, for a term not exceeding five years, which will be imposed along with any of the above.

4 Dissolution of the company.

9 Civil and criminal enforcement

Is there civil and criminal enforcement of your country’s foreign bribery

laws?

Yes, there isbothcivilandcriminalenforcementof internationalbribery.We have seen that international bribery itself is indeedcoveredbythePanamaniancriminallegalregulations,bothinthePenalCode(Article350)andtheOASConvention.Inthatsense,inthecaseofcivilproceedings,article1969oftheJudicialCodestates:

Article 1969: From every offence, civil action for restitution of the thing and compensation for damages caused by the offence, against the author or participants and, in its case against the liable, is born. In the latter case, the action may be tried in criminal or civil proceedings. The civil action within the pro-cess can only be presented by the victim of the crime that has become a plaintiff, as provided by law.

ThePenalCodeitselfreferstothistopicinArticles128,129and130,andtheCivilCodeisclear inthethirdparagraphofArticle1645whichwetranscribe:

Article 1645: ... The State, decentralized institutions of the state and the municipality are responsible when the damage is caused through one of their corresponding officials who was in charge of properly managing their practice, within the scope of their practice.

10 Agency enforcement

What government agencies enforce the foreign bribery laws and

regulations?

Underarticle4oftheConstitutionoftheRepublic,Panamaabidesbytherulesofinternationallaw,includingtheinstrumentsandinter-nationalconventions,inthiscasethoseagainstbribery,incorporat-ingthemintothestatutelawbymeansofordinarylaws.Therefore, enforcing these laws and regulations falls to the

Prosecutor’sOfficeasinvestigativeagencyforcrimesandthejudgeswhoexercisethejurisdictionalfunction.

11 Leniency

Is there a mechanism for companies to disclose violations in

exchange for lesser penalties?

Formally,thereisnospecificlaworaccessorywiththemainpur-pose of dealing with mechanisms in which companies disclose ‘vio-lations’ in exchange for lesser penalties.Any company, however,thatself-reportsviolationsoflegalandregulatoryprovisions–espe-ciallyofacriminalnature–takingplaceduringthecourseofitsbusinessmightbetreatedwithsomeleniencyasaresultofcasuistricargument.Article51ofthePenalCodeprovidesthatleniencymightalso

apply to corporations; for example, instead of operating permitsbeingcancelled,theymaybesuspendedforlessthanfiveyears(arti-cle51(1)),orinsteadofatotallossoftaxbenefits,theymayreceiveonlyapartialloss(article51(3)).

Anotherexamplewouldbewhenacompanyisproventohaveengagedinunfaircompetition,accordingtoarticle282ofthePenalCode,insteadofpunishingitsrepresentativewithimprisonmentof18monthstothreeyears,theequivalentisappliedinday-finesorarrestweekends(consistentwitharticles15ofLaw5of2007and1957oftheJudicialCode).Finally,thebenefitoflesserpenaltiesdependsonthesituation

andthescaleoftheoffence.

12 Dispute resolution

Can enforcement matters be resolved through plea agreements,

settlement agreements, prosecutorial discretion or similar means

without a trial?

Conflicts of this nature cannot be resolved through any of thesemethodsunlessoneofthepassivesubjectsofthecrimeisthestate,thusimpairingtheproperperformanceofthepublicadministration.So,onceacriminalinvestigationisstartedregardingacorruptionoffence, noother settlementmechanism is available other than ajudgmentfollowingajudicialprocess.Therearealternativemeansofconflictresolution,butinPanama

theseareonlyappliedtocrimesthatsupportthewithdrawalofthepunitive pretension as an exceptional termination of the process;however, offences against public administration are included onthisexhaustivelistofcrimesthatsupportwithdrawal,accordingtoArticle1965oftheJudicialCode.

13 Patterns in enforcement

Describe any recent shifts in the patterns of enforcement of the

foreign bribery rules.

Innotinganyrecentchangesinthepatternsoftheapplicationoftherulesofforeignbriberyfromtheconventionsreferredtoinquestion1,itshouldbeborneinmindthatwhentheywereratifiedbytheRepublicofPanama,the1982PenalCodewasstillinforce(accord-ingtowhichintentandguiltaretheonlyformsofguilt).ThiscodenolongerappliesinPanamaasaresultoftheenactmentofLaw14of18May2007;thisnewPenalCode’sprevailingphilosophytakesthe circumstances of each case into account when imposing penalties ontheaccused.AnotherrecentchangeisthefactthatPanamapassedLaw63of

28August2008,adoptingtheCodeofCriminalProcedure,leavingbehindtheinquisitorialsystem,toventureintotheadversarialsys-tem(systemthathasdevelopedgraduallyinPanama).Thus,theapplicationoftherulesonforeignbriberyandenforce-

ment thereof must observe the guidelines established in these two newcodesinPanama.

14 Prosecution of foreign companies

In what circumstances can foreign companies be prosecuted for

foreign bribery?

InPanamaa‘foreigncompany’isunderstoodasonethathasbeenincorporated and registered under the laws of other countries or states.Ifaforeigncompanyistobeprosecutedforforeignbribery,itmustbebymeansofextraditiononareciprocalbasis,combiningarticle44ofUNCACwiththeextraditionrulesfromtheJudicialCode(article2500etseq).Toproceedwithextraditionproceedingsitisnecessarythatthe

acts constituting the offence for which the person has been pros-ecutedhadtakenplaceinthejurisdictionoftherequestingstateandhavedesignatedacustodialsentence,bothinlegislationofthatstateandinPanama.

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15 Sanctions

What are the sanctions for individuals and companies violating the

foreign bribery rules?

Incaseofindividuals,publicofficialsthatcommitactsviolatingfor-eignbriberyrulesmaybepunishedwithapenaltyfromtwotofouryears’imprisonment,whileifthepublicofficialsserveasmembersofthejudiciary,theProsecutor’sOfficeoradministrativeauthorities,orasarbitrator,commitcomparableoffences,thepenaltywillbefourtoeightyears’imprisonment.Whenabribe is for thebenefitofa foreignpublicofficialor

officialfromapublicinternationalorganisation,thepenaltywillbefromfivetoeightyears’imprisonment,inadditiontotheaccessorypenaltiesthatthejudgeisempoweredtoaddinaccordancewiththearticle50ofthePenalCode.

16 Recent decisions and investigations

Identify and summarise recent landmark decisions or investigations

involving foreign bribery.

Therearenocurrentcasesthatmaybediscussedthatarenotsubjudice.

Financial record keeping

17 Laws and regulations

What legal rules require accurate corporate books and records,

effective internal company controls, periodic financial statements or

external auditing?

The Commercial Code states the obligations of businessmen insection34.Specifically,theitems(4)and(5)refertothisquestion.Consider:

Article 34: The merchants assume by virtue of being them, the obli-gation to comply with the provisions of the merchant law, and are particularly obliged to:

[…]4 Keep accounts and maintain commercial correspondence and

books relevant to its business, and,5 Be held accountable as set out in Article 96.

Article34isconsistentwitharticle71oftheCommercialCode,andarticle96isconsistentwiththepreviousbyproviding:

Article 96: It is mandatory for all merchants to present their accounts when requested by the applicant. These are to be in accordance with the entries in the books of whoever it is that presented them and duly verified.

18 Disclosure of violations or irregularities

To what extent must companies disclose violations of anti-bribery laws

or associated accounting irregularities?

Anynaturalorlegalpersonwithinformationconcerningviolationsofcriminallawmustnotifythecompetentauthoritiesofthenotitia criminissoaninvestigationcanstartimmediately.Incertaincases,theFinancialAnalysisUnitwillintervenes.

19 Prosecution under financial record keeping legislation

Are such laws used to prosecute domestic or foreign bribery?

Intermsofdomesticbribery, theCriminalCodeclearly, inarticle254,referstomoneylaundering(seequestion3).

20 Sanctions for accounting violations

What are the sanctions for violations of the accounting rules

associated with the payment of bribes?

Regarding penalties for accounting standards per se, articles 244and245ofthePenalCodestate:

Article 244: Whoever destroys, conceals or falsifies the books, other accounting records, financial statements or other finan-cial information of an individual or corporation, in order to obtain, maintain or extend a credit facility or capital of a bank, finance company or another that captures or mediates with public funds or that have been committed to it, so that it results in harm, shall be punished with imprisonment of six to eight years. The same penalty shall apply to anyone who uses coun-terfeit financial documents or derives benefit out of the destruc-tion, concealment or falsification of these.

Article 245: Whoever destroys, conceals or falsifies any books or records for accounting, financial reporting or record notes or custody accounts of an issuer registered in the National Securities Commission, or those that operate as brokerage, investment advisors, investment company, investment man-ager, or an intermediary or a self-regulatory organization or a member of a self-regulatory organization, so that it results in harm, shall be punished with imprisonment of six to eight years. There are no explicit rules that make reference to penal-ties for violations of the accounting rules relating to the pay-ment of bribes.

21 Tax-deductibility of domestic or foreign bribes

Do your country’s tax laws prohibit the deductibility of domestic or

foreign bribes?

The Panamanian Tax Code clearly states what items are to bededucted;neitherdomesticnorinternationalbriberyislistedherein,sothebanisimplied.

Domestic bribery

22 Legal framework

Describe the individual elements of the law prohibiting bribery of a

domestic public official.

Publicservantsareforbiddentoactonbehalfofothers,undercrimi-nalpenalty,inreturnforacceptingorreceiving,requestingmoneyorbenefitsofanykind–evenonlyinpromise–inordertobenefitothers with acts performed under their duties:

Penal Code, chapter II: Corruption of public officialsArticle 345: Shall be punished with imprisonment of two to four

years the public servant who, in person or by proxy, incurs in the following conduct:1 Accepts, receives or requests a donation, pledge, money or

any benefit or advantage, to perform, omit or delay an act in violation of their obligations, or who accept them as a result of having missed them.

2 Accepts, receives or requests a donation, pledge, money or any improper advantage or benefit, to perform and act pertaining his office or employment, without neglecting his duties, or as a result of the act already performed.

23 Prohibitions

Does the law prohibit both the paying and receiving of a bribe?

Aswehavementionedinpreviousanswers,Panamaniancriminallawdoesnotallowbriberyandispunishableaccordingtochapter

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IIofthePenalCodeonthecorruptionofpublicservants,section345referstothereceiverofthebribe,andsection347referstotheofferor.

24 Public officials

How does your law define a public official and does that definition

include employees of state-owned or state-controlled companies?

TheConstitution listswhoqualifiesasapublicofficialorpublicservant,accordingtoarticle299,butitisnotthenamethatisrele-vant,ratherthefunctionthatisequivalenttoapublicofficial.

Article 299: Public servants are those appointed persons temporar-ily or permanently in charge of the executive, legislative and judicial branches; autonomous or semiautonomous municipali-ties; and in general, those who receive state compensation.

If the company is controlled by the state, employees are considered public employees (civil servants).

25 Public official participation in commercial activities

Can a public official participate in commercial activities while serving

as a public official?

InPanama,whetherapublicofficialcanparticipateincommercialactivitieswhileservingasapublicofficialdependsonthefunctionorpositiontobeexercised.Forexample,ifofficersdonotperformdutieswithauthorityoverinformationofnationalimportance,theycan exercise their profession or business as long as there is no con-flictofinterestwiththeirrolesorthejurisdictionexercisedbytheinstitutionswheretheywork.

26 Travel and entertainment

Describe any restrictions on providing domestic officials with gifts,

travel expenses, meals or entertainment. Do the restrictions apply to

both the providing and receiving of such benefits?

ThecodesofethicsofthevariousinstitutionsinPanamaexplicitlyprohibitprovidinggiftsofanykindtonationalofficials.Eachinsti-tutionhasitsownrules,butallmakeexplicitprohibitionsinreceiv-inggiftsinorderofbenefitingindividualsorcorporations.

27 Gifts and gratuities

Are certain types of gifts and gratuities permissible under your

domestic bribery laws and, if so, what types?

Nogiftsorgratuitiestopublicofficialsareallowed.

28 Private commercial bribery

Does your country also prohibit private commercial bribery?

Thereisnoruleagainstprivatecommercialbribery;however,manycompanies–oratleastthemostprominentones–withintheirownstandardsofethicsandcorporatesocialresponsibilitymaintainreg-ulationsandpoliciesthatprevent,prohibitandpunishthispractice.

29 Penalties and enforcement

What are the sanctions for individuals and companies violating the

domestic bribery rules?

Section 347 of the Penal Code establishes the sanctions that areapplicable to individuals or companies who violate national regula-tionsonbribery.

Article 347: Whoever, in any form, offers, promises or gives a public officer a donation, promise, money or any benefit or advan-tage to perform, delay or omit any act of their own office or employment or in violation of their duties shall be punished with imprisonment three to six years.

30 Facilitating payments

Have the domestic bribery laws been enforced with respect to

facilitating or ‘grease’ payments?

Inrecent times,noruleshavebeenagreedunder theseadditionaltrendstothosementionedbythelatestPenalCodein2010.

31 Recent decisions and investigations

Identify and summarise recent landmark decisions and investigations

involving domestic bribery laws, including any investigations or

decisions involving foreign companies.

Notapplicable.

Omar Rodriguez omar.rodriguez@morimor.com Rodolfo Palma rodolfo.palma@morimor.com

MMG Tower, 16th floor Tel: +507 265 7777

53rd E Street, Marbella Fax: +507 265 7700

Panama City www.morimor.com

Republic of Panama info@morimor.com

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