How Sapin II can affect Mauritians with French Dual Nationality or Mauritian Companies of French Nationals?
Frauds and money laundering are continuously on the increase and laws keep getting tougher under the aegis of prevention.
In France, for example, as from the 1st June 2017, it became obligatory to have an anti- corruption policy for your company if you were part of a French group with at least 500 employees worldwide and a gross revenue of more than EUR 100 million.
For French citizens, and Mauritians with dual French nationality, one of the most important changes introduced by the Sapin II Law of 9th December 2016 (“Loi Sapin II pour la transparence de la vie économique”) is the extension of French authorities’ powers to prosecute corruption offences committed overseas by French citizens and legal entities.
Sapin legislation provides that there is no need for the usual ‘dual criminality’. No one needs to file a complaint for the authorities to investigate! A simple tip off or anonymous letter, and the Mauritian French Dual National (MFDN) or the Mauritian Company set up by a French National can expect action!
For those who manage a company in Mauritius and are majority shareholders or directors on their boards; with the above criteria, you may fall fowl of the Sapin legislation if you have not implemented specific compliance programs against corruption and trading in influence. What does that mean?
According to the Sapin II Law of 9th December 2016 every anti-corruption program must meet the following requirements:
1. Code of Conduct: The code of conduct is the foundation upon which an effective compliance program is built. This code should define and illustrate the behaviors which constitute acts of corruption to be prevented. It must be clear, concise, accessible to all employees and to those conducting business on the company’s behalf (available in the local language so that employees in foreign subsidiaries can access and understand it).
2. Internal Whistleblower Reporting Systems: An effective anti-corruption policy should include a mechanism for an organization’s employees and others to report suspected or actual misconduct or violations of the company’s code of conduct and policies on a confidential and anonymous basis and without fear of retaliation. Sapin II Law strengthen whistleblowers protection. Companies must guarantee the anonymity of the whistleblowers and the confidentiality of the information.
3. Risk Assessment: The company should assess the nature and extent of its exposure to potential external and internal risks of bribery on its behalf by persons associated with it. There are five broad groups of risk that should be assess by the company: country, sectoral, transaction, business opportunity and business partnership.
4. Due Diligence of Third Parties: The company should apply due diligence procedures in respect of persons who perform or will perform services for or on behalf of the organization (such as agents, intermediaries, consultants, intermediaries, or other third parties) in order to mitigate identified bribery risks.
5. Accounting Controls: Commercial organizations should establish accounting controls to strengthen the accuracy of the corporate books, records and accounts that, in reasonable detail, fairly reflect a company’s transactions and dispositions of a company’s assets.
6. Training Sessions for Employees: A company should take steps to ensure that relevant policies and procedures have been communicated throughout the organization (to all directors, officers, relevant employees, and, where appropriate, agents and business partners). This training must be periodically tested and reviewed. It should cover; company policies and procedures, instruction on applicable laws, practical advice to address real-life scenarios.
7. Disciplinary Measures: Companies should establish a disciplinary system that properly penalizes infringement of the code of conduct and policies. It must necessarily include a reaction plan or protocol for action when a crime is committed and the system of rules penalizing crime.
8. Internal Controls: An organization should take the time to review its potential weaknesses and risk areas as well as reassessing its auditing systems.
Unlike other international antibribery regulations (such us the Bribery Act 2010 and the FCPA), under the Sapin II law companies can be held administratively liable for failing to implement an efficient anti-corruption compliance program, even when no corrupt activities have taken place:
- Individuals are subject to a fine up to € 200,000 for failing to implement compliance programs to prevent and detect corruption offences.
- Legal entities are subject to a fine up to € 1 million for breaching the obligation of implementing an efficient and effective anti-corruption program.
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Cristina de Andrés
Cristina de Andrés graduated in law and political sciences and public administration from the Universidad Autónoma of Madrid (2011) and has been a member of the Madrid Bar Association since 2011.
Before joining Geroudis she worked as a criminal lawyer specialising in white-collar crime and corporate compliance at the prestigious multinational law firm Baker & McKenzie and at Spanish firm De Pedraza Abogados. She also worked at the Spanish Central Administrative and Criminal Court. She holds a master’s degree in business crime from the Universidad Rey Juan Carlos of Madrid (2013) and a Program in Compliance from IE Law School Executive-Education (2015).
Ms. de Andrés has been responsible for the management of cases relating to white-collar crime (both national and international), of extradition proceedings and of other matters concerning international mutual legal assistance (MLA). She has also had an active role in the implementation of corporate compliance programmes, in antibribery and anti-money laundering training and in corporate investigations.
Cristina de Andres has been recognised as a leading lawyer by various publications such as Global Legal Group Ltd, Law Business Research Ltd. And Financier Worldwide.