CFPOA: Canada’s Secret Commission Offense

The CFPOA, Canada’s Corruption of Foreign Public Officials Act, may be supplemented by Canada’s secret commission offense in situations where the conduct commonly referred to as private or commercial bribery may be involved and is subject to Canada’s territorial jurisdiction.1  The secret commission offense is apt to be particularly applicable in situations where the facts may not be entirely clear as to whether an entity is a parastatal or government-owned or -controlled and thereby subject to the CFPOA.

The secret commission offense is premised on “the importance of the agency relationship and the necessity of preserving the integrity of that relationship.”2  In order for there to be a violation, proof of “corrupt intent” is required on the part of the person seeking to improperly induce an agent.3  In the particular context of the offense, “corruptly . . . designates secrecy as the corrupting element of the offence.  It is the failure to disclose that makes it impossible for the principal to determine whether to act upon the advice of the agent or accept the actions of the agent.  It is the non‑disclosure which makes the receipt of the commission or reward corrupt.”4

In addition, much like Section 1 of the UK Bribery Act or what is commonly referred to as the Travel Act under U.S. law, the secret commission offense dictates that entities subject to Canada’s territorial jurisdiction need to exercise care to ensure that their compliance programs address and deter the prospect that anyone acting on their behalf may engage in a form of private or commercial bribery.

 


1Criminal Code, R.S.C. 1985, c. C-46, § 426 (Can.).  In the sentencing associated with the first prosecution brought under the CFPOA, R. v. Watts, [2005] A.J. No. 568; 2005 AB.C. LEXIS 613, ¶ 140 (Can. Alta. Q.B.), the Crown made specific reference to the similarities between the CFPOA and the secret commission offence. “[T]he sentencing principles to be considered [under the CFPOA] are akin to those under the [secret commission offence].” Id.

2R. v. Kelly, [1992] 2 S.C.R. 170 (Can.). “‘The legislative history of [the secret commission offence] demonstrates that the purpose and intent of it is to criminalize an agent’s or employee’s act of accepting “secret commissions” for showing favour or disfavor to any person with relation to the affairs or business of his principal.'”  Id. (quoting from R. v. Morris (1988), 64 Sask. R. 98, 116 (Sask. C.A. Can.)).

3R. v. Kelly, supra note 2.

4Id.

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