Negotiating Transnational Corporate Criminality

• Author: Joanna Harrington
• Profession: Professor and Eldon Foote Chair in International Business and Law, Faculty of Law, University of Alberta
• Pages: 322-345

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fourteen

Negotiating Transnational

CorporateCriminality

JOANNA HARRINGTON*

A. INTRODUCTION

In today’s world of global economic interdependence, corporate activ-

ity easily crosses national borders, as may the corporate commission of

serious crime. In theory, a body corporate, whether a partnership, rm,

or company, can commit all sorts of crimes, with the legal ction that a

corporation is a person having long attracted support. In practice, there is

a focus on crimes of a nancial or economic nature that have a connection

to business, such as fraud and false accounting, or tax evasion, price xing,

and insider trading. Corruption is also a key concern, with bribery having

become the standard criminal charge for addressing corruption through

the oering of an undue reward to inuence the behaviour of a public

* Professor and Eldon Foote Chair in International Business and Law, Faculty of

Law, University of Alberta.

 In Canada, s of the Criminal Code, RSC , c C-, as amended, denes “every

one, person and owner” to “include . . . an organization,” which is dened to include

“a body corporate,” “rm,” and “company.” See also Bryant Smith, “Legal Personal-

ity” () : Yale Law Journal  at : “Whene ver society, in the administra-

tion of justice sees t to disregard the individual members of an organization for

a particular purpose, and for that purpose to look upon the organization as a unit,

the organization to that extent or for that purpose becomes a legal person. is is

true even where the group is organized as a partnership or other unincorporated

association.”

Negotiating Transnational CorporateCriminality

323

oce holder. As business transactions crossed borders, so too did crimes

such as bribery, leading to the adoption rst of US legislation, and then

of international treaties, to stimulate a shared transnational eort to crim-

inalize and suppress the bribery of foreign public ocials. So successful

has this eort been to include the commission of corruption and foreign

bribery within the corpus of transnational criminal law that the leading

treaty now attracts  states parties. is treaty also covers embezzlement,

the misappropriation of public funds, and trading in inuence.

A corporation, however, is not your usual criminal defendant, with this

truism necessitating dierent expectations of the criminal justice process.

One obvious reality is that a corporation cannot go to jail. is means that

the main punishment option for an organizational oender is a nancial

sanction, which may be comprised of nes or penalties, orders for cons-

cation and the disgorgement of prots, and possibly a compensation order

for victims, or a requirement to pay the investigation and prosecution costs.

To serve as a deterrent, the nancial sanction must be of a degree that has

an economic consequence, with past practice indicating that the nes can

be steep, particularly in the foreign corruption context, where corporate

defendants have been required to pay nes of many millions of dollars.

Such nes do not, however, guarantee that there will be individual criminal

accountability, prompting criticism that corporate criminal accountability

can serve to shield the individuals involved from prosecution.

With a monetary penalty as the means for securing corporate cr iminal

accountability, pragmatism would suggest that most corporate criminal

 See further Monty Raphael, Bribery: Law and Practice (Oxford: Oxford University

Press, ) at .–.. See also Kevin E. Davis, Between Impunity and Imperialism:

e Regulation of Transnational Bribery (Oxford: Oxford University Press, ).

 Foreign Corrupt Practices Act (United States),  USC §§dd- et seq. See further,

Mike Koehler, “e Stor y of the Foreign Corrupt Practices Act” () : Ohio

State Law Journal .

 See, for example, the Convention on Combating Bribery of Foreign Public Ocials

in International Business Transactions,  December , OECD Doc DAFFE/

IME/BR() (),  ILM  (), Can TS  No  (entered into force 

February , ratied by Canada  December ) [OECD Anti-Bribery Con-

vention]. On Canada’s implementation eorts, see Joanna Harrington, “Addressing

the Corruption of Foreign Public Ocials: Developments and Challenges within

the Canadian Legal Landscape” ()  e Canadian Yearbook of International

Law [Harrington ].

 United Nations Convention Against Corruption, ()  UNTS , Can TS 

No  (entered into force  December , ratied by Canada  October ).