GAB is pleased to welcome back Frederick Davis, a lawyer in the Paris office of Debevoise & Plimpton, who contributes the following guest post:
The Supreme Court of France recently reversed two criminal judgments on the application of the international double jeopardy principle (or ne bis in idem, as the principle is known in Europe and elsewhere) in transnational bribery cases (and others). Taken together with some other recent developments, these developments suggest a renewed determination in France to regain leadership from US prosecutors in enforcing international bribery norms in France.
The ne bis in idem principle limits prosecutors’ power to pursue individuals or companies already convicted or acquitted elsewhere, including in other countries. Several European countries have domestic laws endorsing this principle; in France, the prosecutor is not bound by non-French outcomes if the French prosecution is “territorial” (that is, if an element of the offense took place on French soil) but cannot prosecute a defendant already pursued elsewhere if the only French basis for prosecution would be so-called “extraterritorial” principles (such as French citizenship of the perpetrator or the victim). Separately, a number of Europe-wide treaties, the most effective of which is the Convention Implementing the Schengen Agreement (CISA), have provisions that, with some exceptions, basically mean that no one can be prosecuted twice in Europe for the same offense.
But these provisions do not apply to US prosecutors, who are by far the most aggressive and effective pursuers of cross-border crimes such as overseas bribery. US courts interpret the Double Jeopardy clause of the Fifth Amendment to mean only that a single sovereign cannot prosecute the same defendant twice for the same offense. Some have argued that the US position creates a tension with Article 4.3 of the OECD Anti-Bribery Convention, which provides that when more than one country is competent to prosecute, they must consult to “determin[e] the most appropriate jurisdiction for prosecution,” clearly contemplating that only one country prosecute a given defendant for the same acts. But for reasons I have explored elsewhere, as well as in this space here and here, US prosecutors have not followed the spirit of Article 4.3, instead acting as the “final arbiter” of outcomes around the world, not hesitating to bring actions if they deem non-US outcomes insufficient.
Two formally unrelated decisions of the Paris Court of Appeals in 2016 – the ones that the French Supreme Court just vacated – seemed to complicate matter still further:
- One decision involved the so-called Oil-for-Food prosecutions where French prosecutors, applying laws very similar to the US Foreign Corrupt Practices Act, pursued individuals and companies alleged to have violated UN rules on doing business with the Iraqi regime of Saddam Hussein. One of the companies so pursued, Swiss energy company Vitol SA, had previously pled guilty in New York state court to charges derived from the same facts. The trial court ruled that since both France and the United States were signatories to the International Covenant on Civil and Political Rights (ICCPR), the ne bis in idem provision of Article 14(7) of the ICCPR protected against a French prosecution. The Paris Court of Appeals reversed this dismissal, and convicted Vitol under French procedures permitting an appellate court to do so. But the appellate court’s reasoning was limited: Vitol’s problem, the court ruled, was that the ICCPR protects against multiple prosecutions for the same “offense” (whereas some of the European and other treaties prohibit multiple prosecution based on the same “acts”), and Vitol’s guilty plea in New York had been for grand larceny rather than corruption. The court’s language seemed to suggest that the ICCPR would bar re-prosecution in France after an earlier US conviction for the same offense.
- Later in 2016, the Court of Appeals decided the Tesler case, and seemed to offer further protection against re-prosecution after a US guilty plea. The defendant, Mr. Tesler, was a British national who pled guilty in the US to FCPA violations, and then was prosecuted under French law for the same offense. Tesler argued this re-prosecution was barred by the ICCPR—a conclusion that language in the Oil-for-Food appellate opinion seemed to endorse. While both the trial court and the Court of Appeals agreed that the French prosecution was barred, the reasoning was different: The courts held that Mr. Tesler’s US guilty plea deprived him of his right to self-defense under the European Convention on Human Rights. To reach this conclusion, the courts first held that the plea had been “involuntary,” in the relevant legal sense, because of the “decades-long” sentence Mr. Tesler would have suffered if he had not pled guilty. The French courts then observed that according to the terms of the plea agreement, if Mr. Tesler were to subsequently deny responsibility for the violation—including in the context of defending himself in a French prosecution—he would be subjected to the risk of further prosecution in the United States.
Taken together, the two decisions created an odd asymmetry: They offered some limited but clear protections to individuals and companies that negotiated outcomes in the United States, but provided no relief against US prosecution if a French outcome were obtained first. As noted above, US prosecutors recognize no double jeopardy limit based on outcomes from a different sovereign, and also the ICCPR has been systematically interpreted in the United States to be a “non-self-executing treaty” that does not create personal rights. But earlier this year the French Supreme Court vacated both decisions. In Oil-for-Food, the Court ruled that the ICCPR only limits the acts of a single sovereign, which is consistent with the prevailing view on this issue. In Tesler, the Court simply said, without elaboration, that the US outcome would have no impact on the French proceedings.
These results may be viewed as doing no more than removing somewhat odd decisions that had created anomalies and asymmetries in cross-border investigations. They come, however, at a time when it is clear that French lawmakers and prosecutors are focusing their attention on the fact that French companies are routinely prosecuted by US authorities – iconic French companies have paid more the US$2 billion in payments to US authorities on FCPA cases that easily could have been brought in France – and are determined to rectify this imbalance. In December 2016, France finally adopted the Loi Sapin II, which for the first time permits prosecutors to negotiate the equivalent of a Deferred Prosecution Agreement, and now three such agreements (two involving corruption) have been published. The National Financial Prosecutor of France clearly views the new law as encouraging her to “repatriate” bribery and other prosecutions that take place on French soil or involve French interests, and a number of investigations are pending that may give her opportunities to do so. This shift has not been lost on French editorialists: The Oil-for-Food decision was recently highlighted by France’s most important business daily, Les Echos, as heralding a new era when French prosecutors will not only prosecute French companies so that the fines are payable in France, but might also pursue American companies and thereby redress a perceived imbalance and slight to French sovereign interests.
The clarification of French law on international double jeopardy brings it in line with other countries and eliminates an asymmetry that might have encouraged resort first to US prosecutors to preclude a French prosecution. The apparent commitment of France’s National Financial Prosecutor to use newly available tools to prosecute French companies reflects a determination to reassert responsibility for enforcing international norms applicable to French companies in France, and not in the United States. The next step will be to see if US prosecutors find future outcomes reached in France to be sufficient and will defer to them. As a compromise, French and American prosecutors might agree to joint investigations and share in the fines. While imperfect from a French perspective, it would be a welcome step forward for French taxpayers, since in the four sizeable FCPA outcomes negotiated by the US Department of Justice (DOJ) with French companies to date, the US prosecutors thanked their French counterparts for their cooperation– but kept 100% of the proceeds.