Statutory Leniency for Bribe-Givers in Egypt: Revolutionary or Reprehensible?

Bribery and other forms of collusive corruption are notoriously difficult to detect. In many cases, the only people who even know that a crime has been committed are the perpetrators. To address the inherent difficulty of proving bribery, many countries use so-called leniency agreements, in which the government offers some form of sanction reduction or exemption to parties who voluntarily self-report and provide evidence against co-conspirators. Most of these leniency programs are designed and implemented by prosecutors’ offices (though they may be authorized by statute). Prosecutors exercise discretion in deciding whether and to what degree to offer sanction reductions to cooperating parties. Under the typical anticorruption leniency program, a self-reporting bribe-giver cannot claim, as a matter of law, an entitlement to any sort of sanction exemption.

Egypt is different. Unusually, and perhaps uniquely, Egypt’s antibribery law (Article 107bis of the Penal Code No. 58 of 1937) offers a full and absolute exemption from sanctions for any bribe-giver who self-reports and gives evidence against the culpable bribe-taker.

This approach is misguided, for several reasons: Continue reading

Fixing the Brazilian Anticorruption Leniency Program

When the Brazilian Anticorruption Law came into force in 2014, pundits celebrated the enactment of a statute that finally authorized action against corporations and other legal entities involved in public corruption, and that provided for substantial penalties. The statute’s most important innovations, however, were not so much its substantive provisions but rather the procedural reforms it introduced, chief among them the Anticorruption Leniency Program, which, alongside the criminal plea bargains for accomplice cooperation created by the Organized Crime Act (enacted on the same day as the Anticorruption Law), authorizes enforcement agencies to settle corruption-related cases.

            The Anticorruption Leniency Program largely reproduces the key features of Brazil’s Antitrust Leniency Program, which, in turn, was inspired by the amnesty program adopted by the U.S. Department of Justice’s Antitrust Division. To qualify for a leniency agreement, a company must be the first among those involved in a corruption scheme to state its interest in cooperating, admit its participation in the wrongdoing, cease any further involvement, cooperate fully with the investigation, and agree to pay compensation for any harm caused to the Public Administration. In exchange, the qualifying company can receive a significant reduction in the administrative fine, as well as protection against debarment or suspension from doing business with the Public Administration. (In contrast to the Antitrust Leniency Program, however, an Anticorruption Leniency agreement does not shield individuals associated with the qualifying company from criminal prosecution.)

Despite its importance in high-profile investigations such as the Lava Jato investigation (Operation Car Wash), critics have emphasized shortcomings of the Anticorruption Leniency Program. Coordination – or rather the lack thereof – between different enforcement agencies is often considered the most significant weak point of the program. However, I want to suggest a different source for the relative ineffectiveness (so far) of the Anticorruption Leniency Program: the requirement that, in order to be eligible for leniency, a company must admit its participation in the wrongdoing. Importantly, this requirement is not (merely) that the company accepts legal responsibility; rather, the program requires admissions of facts—facts that the company cannot subsequently dispute in other proceedings, which, from an enforcement standpoint, is precisely what creates the need for coordination between agencies. But such admissions can also entail additional collateral consequences:

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