Regulatory & Investigations
Following closely on from International Anti-Corruption Day, our Global Team have produced a series of papers on issues that directly impact clients across the Marine, Trade and Energy sectors. The newsletter contains input from our experts across Asia, Europe, the Middle East, Africa, the UK and the Americas.
The featured articles discuss developments in legislation and case law, as well as challenges and considerations relating to regulatory compliance and investigations, which have been identified by our Global Team as significant. At this time, our clients in the Energy, Marine and Natural Resources industries are facing unprecedented regulatory scrutiny of their international operations.
In this edition we visit themes on data privacy, international sanctions, supply chain due diligence, whistleblowing, private prosecutions, and deferred prosecution agreements, amongst other subjects.
We hope you and your compliance teams find the articles useful and we welcome any feedback on the content and format that might help us with future editions. You are welcome to get in touch with us if you would like to discuss in more detail any of the issues covered in this issue.
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Data privacy issues can be critical in investigations and can be particularly complex for organisations such as those relating to the maritime sector or international trade. Organisations engaged in global activities who are facing such investigations should be mindful, at all times, of both their potentially competing obligations and responsibilities towards the individuals who are the subject of the personal data under the data privacy laws of the multiple jurisdictions they are associated with, and the requirement to cooperate with the authority that has the conduct of the investigation.
The Civil Procedure Rules in England and Wales stipulate that, except where a Court otherwise gives permission, disclosed documents may be used “only for the purpose of the proceedings in which [they were] disclosed”. However, there will be occasions where the use of disclosed documents is desirable for the purposes of a new claim involving the same party, or another party, or relating to satellite litigation elsewhere in the world. A careful litigation strategy may help gain permission to use the documents in question.
In July 2021, the High Court approved the UK’s tenth, eleventh and twelfth Deferred Prosecution Agreements (DPAs) between the Serious Fraud Office (SFO) and three separate companies. To date, no further DPAs have been approved by the Court, this year. Nevertheless, given that the SFO’s Annual Report for 2020–2021 estimated that DPAs have delivered GBP 1.6 billion to the public purse since 2014, one would expect to see the SFO continue to make good use of what is an increasingly lucrative prosecutorial tool over the coming months.
After a decade of insureds benefitting from a fall in D&O insurance rates on a year-on-year basis, D&O insurance premium rates in the UK have been steadily rising the past couple of years, and appear set to increase further as the UK relaxes restrictions imposed to deal with the COVID-19 pandemic. A number of factors stand behind the rises, both in terms of the situation prior to, and as a result of the COVID-19 pandemic. A comparative analysis with Germany helps to further understand the particularity of the UK market.
Timely with the publication of the Pandora papers, on 1 April 2022, a new Scottish register will be introduced, known as the Register of Persons Holding a Controlled Interest in Land (RCI). The RCI register addresses some of the concerns raised by the Pandora papers, by creating transparency via a register of interests of those who have decision making control or control of land in Scotland.
In recent months, the Biden administration promulgated new economic sanctions, issued a notable enforcement action, and published advisories on the risks posed to U.S. businesses operating in specified sectors. This brief roundup of the latest developments highlights the diverse threats against which the U.S. has deployed economic sanctions, and discusses, amongst other events, the enforcement action against UAE-headquartered Mashreqbank, OFAC’s designation of companies and individuals supporting Iran’s Unmanned Aerial Vehicle program, and a Cambodia Business Advisory on High-Risk Investments and Interactions.
Criminal proceedings in Canada are typically instigated by the Crown. However, private citizens, as complainants, have a similar statutory right. Prosecution of certain offences, under the public regime, may proceed very slowly for lack of resources, or not at all. Private prosecutions, therefore, provide a valuable opportunity for corporations and individuals to redress legal wrongs. Fraud, forgery, or theft of intellectual property, among many other forms of criminal activity that can occur in the corporate context, may all lend themselves to private prosecutions. However, these can be difficult undertakings that require expertise.
The new Personal Information Protection Law (PIPL) of the People’s Republic of China (PRC), which came into effect on 1 November 2021, is the country’s first comprehensive law in the area of personal information protection. The PIPL strengthens the existing data security and cyber security regulatory framework in the PRC by providing individuals with a comprehensive set of rights in relation to their personal information. This article discusses the restrictions which the PIPL may impose on cross-border data transfer and international investigations.
Putting in place an effective whistleblowing mechanism is an important component of good corporate governance and, when underpinned by a strong compliance culture, can act as an early warning system for adverse behaviours or activities and emerging risks. However, if a whistleblower disclosure is not followed up by a competent and timely investigation, it can cause significant problems further down the line. This article sets out 10 of the most common traps that companies can fall into when investigating whistleblowing allegations.
The importance of companies understanding who they are doing business with cannot be understated and, whilst it is fair to say that many companies do perform some degree of customer due diligence, what is less clear is the extent to which companies conduct due diligence on the third parties they engage with during the course of operating their business. When effective due diligence has not been performed, a number of risks could go unidentified. Three of the most significant areas where due diligence can assist an organisation are discussed in the article.
As the year draws to a close, we focus on some of the key corruption cases brought by regulators in some of our jurisdictions. These are of specific interest to the Energy, Marine and Extractives industry which has been very challenged by these issues. It is particularly noteworthy that in view of the current zeitgeist, highly mindful of Environmental, Social and Governance factors (ESG), ESG features in some of the more significant decisions.