By Mohamad Talaat* (Baker McKenzie Cairo)
1. Domestic bribery (private to public)
1.1 Legal framework
The Egyptian Anti-Bribery Law (the âLawâ) is contained in the Penal Code. Articles 103 to 111 address bribery.
The Law punishes any questionable activity or a payment or promise of payment or benefit to a public official (i.e., public or government employees).
In the light of the Egyptian law, the foundation of an act of bribery requires the following three elements to be present:
(i) The recipient must be a public official (subject to some exceptions set out below).
(ii) There must be a âgift,â a âbenefitâ or a âpromiseâ that will constitute the material/physical element of the crime.
(iii) There must be requisite criminal intent (mens rea).
1.2 Definition of bribery
Articles 103 to 106 of the Law prohibit a public official from ârequesting,â âacceptingâ or âtaking for him/herself or another,â a âpromise,â a âgiftâ or a âbenefit,â whether material or non-material, for âperformingâ or âabstaining from performingâ an inherent function of his or her position, even if he or she mistakenly believes such a function falls within the scope of his or her âofficial duties.â Furthermore, the Law provides that a public official who violates or abuses the duties of his or her position with the intent of being rewarded for his or her behaviour shall be subject to imprisonment.
In light of the foregoing, the Law addresses the âtradingâ or âpeddlingâ a public official in his capacity as such. In this regard, the Law punishes the offeror of the bribe, the recipient and any intermediary, if there is any, (between the briber and the recipient) with the same punishment.
Article 107 states that âany benefit, of whatever value, obtained by the recipient of the bribe or by the person either designated by him for receipt of such (or knowing and agreeing to his or her appointment), shall be considered a promise or a gift.â
It thus appears that the benefit constituting the âbribeâ may be the promise or payment of money (or any tangible benefit) received or requested by an official or the briberâs agreement to discharge a debt of the recipient of the bribe.
Furthermore, the Law does not distinguish between the benefit an official obtains for himself or herself and the benefit requested or accepted for another person. The crime of bribery is in the request itself and is not contingent upon the recipient, whoever he or she was.
The provisions of the Law are so broad that they encompass almost all forms of trading on a position or its duties (or an attempt to do so), regardless of what might be called the âtimingâ of the benefit. An official may be deemed a recipient of a bribe, even though he did not actually accept a payment, and bribery may exist even in the absence of an agreement for such between the official and the other party. As mentioned above, the Law considers the officialâs mere request a complete crime, even if such a request was not accepted by the other party. This is so because an official who offers his position âfor saleâ is no less of a criminal than the one actually completing the bribery transaction.
According to the general principles of criminal intent, the crime of bribery is not deemed to have occurred unless the recipient of the bribe realizes, at the time of the request or acceptance of a promise, or the taking of a gift, that such is the reward for performance, or abstention therefrom, of a duty within the scope of his authority or that he claims or erroneously believes is part thereof.
It should be noted, as well, that it does not matter if the receipt of the benefit was before or after the Act. If an official accepts a gift from a person, believing that it was presented innocently, then the official has not committed bribery. By the same token, if he pretends acceptance of the offer in order to facilitate the offerorâs apprehension, the foundation for the crime of bribery is not met.
1.3 Definition of public official
According to Article 111 of the Law, âpublic officialsâ (for purposes of the Bribery provisions) are considered to include the following:
(i) Employees of government entities or employees working in departments affiliated with the government or those under its supervision
(ii) Members of the general or local legislative assemblies, whether elected or appointed
(iii) Arbitrators and experts, debtorsâ trustees, liquidators and judicial receivers
(iv) Any person entrusted with public service
(v) Members of the board of directors, as well as managers and employees of associations, companies, societies, foundations or establishments if the state or one of its public authorities contributes to its funding at any level and in any form whatsoever
(vi) The Egyptian courts have also decided that certain organizations, as indicated in their articles of association and the like, are âpublicâ and, therefore, workers in such organizations are considered public officials
Under the Egyptian rules on bribery, trading on oneâs position is not deemed to occur unless the relevant act was within the authority of the official. âDuties of the positionâ are understood as any act within the legal scope of the position assumed by the official. This element of the crime of bribery is satisfied even if the official mistakenly believes or claims that the requested/promised act is within the officialâs duties (i.e., âillusory competencyâ).
1.4 Consequences of bribery
(a) For the individuals involved:
- Imprisonment, up to restrictive imprisonment depending on the crime attributed to the accused
- In addition to a fine not less than EGP 1,000, depending on the crime attributed to the accused
- In all cases, the ruling shall order confiscating whatever is paid by the briber or mediator by way of a bribe.
- The accused shall be subject to Ancillary Penalties, which are:
(A) Depriving the accused of the rights and privileges prescribed in Article 25 of the Penal Code, which are:
- Acceptance in any service with the government, whether direct, or in the quality of an entrepreneur or concessionaire, whatever the importance of the service
- Decoration with a rank or medal
- Testifying before the courts for the period of penalty, unless it is for evidentiary fact- finding
- Managing his works concerning his funds and property during the period of his arrest
- Remaining, from the day of the final ruling against him, as a member of the probate councils, the councils of the Directorates, the municipality or local councils, or any general committee
- His or her eligibility to be, ever, a member of one of the bodies indicated in the fifth clause, or an expert or witness on contracts, if a rigid imprisonment penalty is ruled finally against him or her
(B) Removal from governmental positions
(C) Being placed under surveillance by the police
(D) Confiscation of the substance of the bribe.
In addition to the above, in pursuance of Article 89 of the Companies Law No. 159 of 1981, he or she shall not be eligible to be a board member in a joint stock company or a manager of a limited liability company.
(b) For the company/legal entity:
The Law does not adopt the principle of criminal responsibility of legal entities such as corporations, except with respect to specific financial crimes that are not relevant to the crime of bribery. The Egyptian Court of Cassation has traditionally ruled that, âLegal entities are not criminally responsible for crimes committed by their representatives; the persons who commit the crime are the ones who are personally responsible.â
1.5 Political contributions
Pursuant to Article 111 of the Law, âpublic officialsâ (for purposes of the bribery provisions) include members of the general or local legislative assemblies, whether elected or appointed.
In addition, Law No. 40 of 1977 regulates the incorporation of political parties and their financial resources. To this end, the said law provides that such resources are formed out of the subscriptions, donations and investment in non-trading activities.
Furthermore, the said law provides that the funds of the political parties are considered particularly public funds in pursuance of the same meaning provided under the Law and the managers of the party and its employees are considered public officials as provided in the definition of a âpublic officialâ in Article 111 of the Law.
1.6 Limitation applicable to hospitality expenses (gifts, travel, meals, entertainment, amongst others)
In principal, the Law does not distinguish if the value of a gift is small or large. Any amount, however small, is subject to the Law.
Therefore, âgreaseâ or facilitation payments are strictly regarded as bribes.
However, entertainment expenses and small gifts given in certain occasions may be received, provided that they are not given or received for the purpose of corrupting a government official.
By and large, the amount spent on business entertainment should be reasonable in light of what is customary and appropriate in the context in which the entertainment takes place. A customary business lunch or dinner that is neither lavish nor frequent in nature would be unlikely to give rise to any inference of an improper purpose or corrupt intent.
However, it is not appropriate, and thus not recommended, to invite public officials for meals at restaurants that are not frequented by ordinary businessmen or, after a review of the facts and circumstances, to a restaurant that is considered extravagant in light of the public officialâs ordinary practices.
In general, inexpensive gifts, such as calendars, pens, notebooks, cigarette lighters and samples of the companyâs products bearing the companyâs logos are not typically regarded as prohibited under the anti-bribery provisions, especially when given on occasions such as the New Year or Bayram.
The foregoing limits apply to both public and private officials. It should be highlighted that the Prime Ministerial Decree No. 1883 of 1993 sets out the conditions for any governmental agency to receive any gifts, grants or donations. Such conditions provide that any such entity must obtain the approval of the relevant Minister before accepting any in-kind or monetary gift from foreign or international entities that has a value of more than EGP 10,000 up to EGP 150,000. If such a giftâs value exceeds EGP 150,000, then the approval of the Prime Minister must be obtained.
Kindly note also that if such business courtesy is unrelated to the business of the governmental agency, then its nature might raise suspicion.
Based on the foregoing, if any of the gifts is to fall within the above scope, then the governmental agency must obtain approval.
2. Domestic bribery (private to private)
2.1 Legal framework
The Law also regulates bribes offered to employees in the private sector, in addition to those offered to the board members, directors or employees of joint stock companies in Egypt.
2.2 Definition of private bribery
The wording of Article 106 of the Egyptian Penal Code provides that the definition of bribery has been expanded to include bribes given to private corporate officials to obtain an interest or other advantages, which are against company policy and which are without the knowledge of the employer or his consent. The wording of the said article clearly states in relevant part that, âany EMPLOYEE (The Code usually uses the word Public Official) who requests for himself or herself, or any third person, or accepts a payment or a promise of payment without his or her employerâs consent or knowledge in consideration of performing any act that is considered part of his or her job should be guilty of bribery.â
In light of the above, it is our belief that Article 106 prohibits commercial bribery. Aside from that, the wording of Article 106 bis applies the bribery rules also to board members, directors or employees of joint stock companies in Egypt.
2.3 Consequences of private bribery
(a) For the individuals involved:
- Any employee who demands for himself or herself, or for a third party, or accepts or takes a promise or donation without the knowledge or consent of his master (employer), in order to perform or refrain from performing work or the duties he or she is charged with to fulfil, shall be considered a bribe-taker and shall be punished with imprisonment for a period not exceeding two years and a fine of not less than EGP 200 and not exceeding EGP 500, or either penalty.
- Any board member of a joint stock company, a cooperative association or a union established according to the rules prescribed legally, or of any establishment or association that is legally considered a public utility, and any director or employee of these bodies who demands for himself or herself, or for a third party, accepts or takes a promise or donation to perform or refrain from performing work or duties inherent to his or her position, or which he or she erroneously believes or alleges to be part of the duties of his or her position, or to default on the duties of the position shall be considered a bribe-taker and shall be liable to imprisonment for a period not exceeding seven years and a fine of not less than EGP 500 and not exceeding what he or she was given or promised to be given, even if the felon has in mind not to effect the work, or not to refrain from it, or not to default on the duties of his or her position. In this event, it should be noted that he or she shall not be eligible to be a board member in a joint stock company or a manager of a limited liability company.
- In all cases, the ruling shall order confiscating whatever is paid by the briber or mediator by way of a bribe, according to the previous articles.
(b) For the company/legal entity:
The Law does not adopt the principle of criminal responsibility of legal entities such as corporations, except with respect to specific financial crimes that are not relevant to the bribery crime. The Egyptian Court of Cassation has traditionally ruled that, âlegal entities are not criminally responsible for crimes committed by their representatives; the persons who commit the crime are the ones who are personally responsible.â
2.4 Limitation applicable to hospitality expenses (gifts, travel, meals, entertainment, amongst others)
Although there are no specific, similar guidelines for private employees, we recommend that the gift or business courtesy fall within the above-mentioned ranges in Section 1.6. This is so since, as previously mentioned, the language of Article 106 provides that any employee who requests or receives any unlawful payments of promises of payments shall be guilty of bribery. In light of that, it is our belief, from an interpretive perspective, that the general rules of bribery apply to both public and private officials.
3. Corruption of foreign public officials
3.1 Legal framework
The Egyptian Penal Code does not explicitly recognize nor regulate the corruption of foreign public officials. However, it recognizes the concept of extraterritoriality.
According to Article 2(1) of the Law, the Egyptian Penal Code applies to âany person who commits, outside the country, an act that makes him a principal or an accessory in a crime committed wholly or partially in Egypt.â
Therefore, where the elements of the crime were perpetrated, as defined in the Egyptian Penal Code, will not have any impact on its qualification as bribery.
3.2 Definition of corruption of foreign public officials
N/A
3.3 Definition of foreign public official
N/A
3.4 Consequences of corruption of foreign public officials
N/A
3.5 For the individuals involved
N/A
3.6 For the legal entity
N/A
3.7 Limitation applicable to hospitality expenses (gifts, travel, meals, entertainment, amongst others)
N/A
4. Facilitation payments
In principal, the Law does not distinguish if the value of a gift is small or large. Any amount, however small, is subject to the Law.
Therefore, âgreaseâ or facilitation payments are strictly regarded as bribes.
However, pursuant to customary practice, facilitation payments should not be regarded as bribery in light of what is customary and appropriate, as long as they are not given or received for purposes of corrupting a public official, otherwise, such payments shall fall within the definition of bribery under the Law.
In accordance therewith, a gift payment to public employees, according to the courts, is not deemed bribery, so long as it does not meet the parameters of bribery under criminal law.
5. Compliance programmes
5.1 Value of the compliance programme in mitigating/eliminating the criminal liability of companies
As previously provided, the Law does not adopt the principle of criminal responsibility of legal entities such as corporations, except with respect to specific financial crimes that are not relevant to the bribery crime. The Egyptian Court of Cassation has traditionally ruled that: âLegal entities are not criminally responsible for crimes committed by their representatives; the persons who commit the crime are the ones who are personally responsible.â
Thus, the Egyptian Penal Code does not require compliance programs as instruments to mitigate or eliminate the liability of legal entities before the crime of corruption has been committed.
5.2 Absence of a compliance program as a criminal offense
A compliance program is not required by the law.
5.3 Elements of a compliance programme
A compliance program is not required by the law.
6. Regulator with jurisdiction to prosecute corruption
The general provisions of the Criminal Procedures Code do not indicate a specific regulator with exclusive responsibilities to prosecute corruption cases. Yet, in pursuance of the General Instructions issued by the General Prosecutor, a division named State Prosecution was established, which specializes – among other crimes- on prosecuting bribery cases.
In this respect, it is worth noting that in practice, any prosecutor may handle the interrogation on bribery cases in the event that such cases are of less importance in terms of the amount of the bribe, the parties, and the governmental authority for which the public officer works.
Yet, once a prosecutor finalizes the interrogations, all cases shall be mandatory referred to the State Prosecution, which will issue a decision on the case. In other words, the State Prosecutor will decide whether to shelve the case or refer it to the criminal court.
|
