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Deferred prosecution agreements introduced in Canada

Following the US, UK, France, Brazil, Argentina and Singapore, Canada has introduced the use of Deferred Prosecution Agreements in cases involving corruption offenses. The relevant changes were made to the Criminal Code in September 2018 (Chapter XXII.1).

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The term Deferred Prosecution Agreements (DPAs) is used in the legislation of the United States, the United Kingdom and Singapore, in Brazil such agreements are called Acordo de Leniência (Leniency Agreements), in Argentina Acuerdo de Colaboración Eficaz (Effective Collaboration Agreements), in France Convention Judiciaire D'intérêt Public (Judicial Public Interest Agreements), and in Canada such agreements are called Remediation Agreements' (RAs). In Canada such agreements are called Remediation Agreements' (RAs).

The conditions under which Canadian prosecutors may begin discussions about entering into such an agreement include:

  • Awareness by the prosecutor that there is a reasonable prospect of charges being laid in relation to the offense;
  • an acknowledgement by the prosecutor that the act or omission forming the basis of the offence did not and could not have caused serious bodily injury or death, or damage to national defence or national security, and was not done for the benefit of, at the direction of, or in conspiracy with a criminal organization or terrorist group;
  • The prosecutor's understanding that the negotiation of the agreement is in the public interest and appropriate to the circumstances;
  • the consent of the Attorney General to the negotiation of the agreement.

Factors that prosecutors consider when negotiating a remedial agreement:

  • The conditions under which the act or omission forming the basis of the offense came to the attention of the investigating authorities;
  • the nature and severity of such act or omission and its impact on any victim;
  • the degree of involvement of the organization's management in the commission of such act or omission;
  • the organization taking disciplinary action, including dismissal, against any individuals involved in the commission of such act or omission;
  • the organization's indemnification or other measures to compensate for the harm caused by such act or omission and to prevent similar acts or omissions from occurring in the future;
  • the organization's discovery or statement of intent to discover all persons involved in the commission of the offence in relation to the act or omission in question;
  • the organization or any representatives of the organization have been charged with or sanctioned by regulatory authorities or entered into remediation agreements or other similar agreements, in Canada or elsewhere, in connection with the commission of a similar act or omission;
  • the organization or any representatives of the organization have been charged with any other offences, including those not listed in this Part;
  • Such other factors as the prosecutor considers appropriate.

At the same time, in the case of offenses related to bribery of foreign officials and related violations of accounting rules, the Law prescribes that national economic interests, potential impact on relations with other states, and the personality of the accused should not be taken into account as mitigating factors.

The Law also discloses the content of agreements on elimination of violations, including mandatory (e.g., statement of facts concerning the commission of the crime, admission of guilt by the organization and confirmation of the accuracy of the stated facts, assignment of financial sanctions and other measures of responsibility in relation to the accused organization) and additional items. At that, the additional items include:

  • An undertaking by the organization to implement or improve compliance measures, including internal control and employee training policies and procedures, to prevent future violations;
  • An undertaking by the organization to reimburse all costs associated with the investigation;
  • appointing an independent monitor to assess the organization's compliance or other obligations to implement or improve compliance measures.

It should be noted that, unlike in the United States, where the need for the court to approve agreements between the prosecutor and the organizations is effectively a formality, in Canada a remedial agreement cannot be considered final without the court's approval that it is "in the public interest" and its terms are "fair, reasonable, and proportionate to the offense". In addition, unlike the U.S. version, Canadian law does not impose a "fair, reasonable, and proportionate to the offense.

Since the Criminal Code was amended in Canada, the only attempt to enter into a remedial agreement, however, was unsuccessful. SNC-Lavalin, a Canadian engineering and construction giant accused of bribing Libyan officials between 2001 and 2012 to obtain government contracts, was denied an agreement for "failure to meet the necessary criteria."

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