Describe the elements of the law prohibiting bribery of a foreign public official.
As far as bribery relating to public officials of the EU institutions and of EU member states is concerned, article 322–bis (paragraphs 1 and 2) Italian Criminal Code (ICC) extends to such public officials, and to the private briber, the same bribery offences originally provided for domestic public officials and in particular:
- proper bribery: occurs when the public official, in exchange for performing (or having performed) an act conflicting with the duties of his or her office, or in exchange for omitting or delaying (or having omitted or delayed) an act of his or her office, receives money or other things of value, or accepts a promise of such things (article 319 ICC);
- bribery for the performance of the function: occurs when the public official, in connection with the performance of his or her functions or powers, unduly receives for him or her, or for a third party, money or other items of value or accepts the promise of them (article 318 ICC);
- bribery in judicial acts: occurs when the conduct mentioned under the first two points above is taken for favouring or damaging a party in a civil, criminal or administrative proceeding (article 319-ter ICC);
- unlawful inducement to give or promise anything of value: occurs when the public official, by abusing of his or her quality or powers, induces someone to unlawfully give or promise to him or her or to a third party money or anything of value (article 319-quater ICC); and
- instigation to bribery: occurs when the private party makes an undue offer or promise that is not accepted by the public official, or when the public official solicits an undue promise or payment that is not carried out by the private party (article 322 ICC).
There is no liability for failing to prevent bribery of a foreign public official.
Foreign and international officials
With respect to bribery relating to public officials of foreign states and of international organisations (such as the UN, the OECD, the European Council, etc), article 322-bis (paragraph 2) ICC extends to these situations the application of the mentioned domestic bribery offences, but with the following limitation: only active corruption is punished (namely, only the private briber, on the assumption that the foreign public officials will be punished according to the laws of the relevant jurisdiction).
As of 2000, pursuant to article 322-bis ICC, the reach of bribery offences has been significantly broadened, because it is now immaterial if the functions of the official who receives or is offered a consideration have no connection to Italy. However, in relation to the mentioned offences, Italy has not established a general ‘extraterritorial’ jurisdiction. In fact, the governing principle on the point has remained the territoriality one, according to which Italian courts have jurisdiction only on bribery offences that are considered committed within the Italian territory: namely, when at least a segment of the prohibited conduct (eg, the decision to pay a bribe abroad), or its event, take place in Italy.
This principle suffers derogation in favour of the ‘extraterritorial’ jurisdiction only to a very limited extent, and under stringent requirements (presence in Italy of the suspect, request of the Italian Minister of Justice, unsuccessful extradition proceedings, etc; see articles 9 to 10 ICC).
The mental element required for bribery offences is always intent, including, for the private briber, knowledge and will to carry out an undue payment to a public official.
Definition of a foreign public official
How does your law define a foreign public official, and does that definition include employees of state-owned or state-controlled companies?
Officials of EU institutions
With respect to the officials of the EU institutions, Italian law provides for an express listing of the relevant categories (including members of the European Commission, the European Parliament and the European Court of Justice, and officials of related institutions; article 322-bis, paragraph 1, ICC).
Officials of EU and foreign states, and international organisations
As far as the officials of EU states, foreign states and international organisations are concerned, Italian law makes express reference to the persons who, within these states and organisations, ‘perform functions or activities equivalent to the ones of public officials and of persons in charge of a public service’ (article 322-bis, paragraphs 1 and 2, ICC). In other words, Italian criminal law extends to them the same definitions already provided for domestic officials, according to which:
- ‘public officials’ are such persons ‘who perform a public function, either legislative or judicial or administrative’ (for the same criminal law purposes, ‘an administrative function is public if regulated by the rules of public law and by acts of a public authority and characterised by the forming and manifestation of the public administration’s will or by a procedure involving authority’s powers or powers to certify’; article 357, paragraphs 1 and 2, ICC); and
- ‘persons in charge of a public service’ are ‘those who, under any title, perform a public service’ (for the same criminal law purposes, ‘a public service should be considered an activity governed by the same forms as the public function, but characterised by the lack of its typical powers, and with the exclusion of the carrying out of simple ordinary tasks and merely material work’; article 358, paragraphs 1 and 2, ICC).
In accordance with the above definitions, ‘public officials’ includes judges and their consultants, witnesses (from the moment the judge authorises their summons), notaries public, police officers, etc. On the contrary, ‘persons in charge of a public service’ includes state or public administration employees lacking the typical powers of a public authority.
Employees of state-owned or state-controlled companies are not expressly included within the legal definition, but they implicitly fall within the relevant ‘public’ categories on condition that the activity effectively carried out is governed by public law or has a public nature.
Gifts, travel and entertainment
To what extent do your anti-bribery laws restrict providing foreign officials with gifts, travel expenses, meals or entertainment?
Italian criminal provisions do not expressly restrict the giving of gifts, travel expenses, meals or entertainment either to domestic or foreign officials. However, all these advantages could represent the ‘undue consideration’ for a public official prohibited by Italian law (falling within the concept of ‘other things of value’ provided for in relation to bribery offences). In particular, with respect to the offence of ‘bribery for the performance of the function’ (which also includes the carrying out by the public official of an act not conflicting with the duties of the office), the past consolidated case law excluded tout court criminal relevance with respect to gifts of objective ‘small value’, and that could be considered ‘commercial courtesy’ in the concrete case. On the contrary, in relation to ‘proper bribery’ (ie, to perform an act conflicting with the duties of the office), the very strict interpretation of the case law is that the ‘small value’ of the gift never excludes, as such, the criminal responsibility. The crucial criterion for affirming or excluding criminal liability is therefore the relation of quid pro quo between the gift (or other advantage) and the ‘act’ of the public official (ie, to what extent the gift represents a consideration for the carrying out of the mentioned ‘act’).
Furthermore, it should be noted that some Italian non-criminal regulations restrict providing Italian officials with gifts, etc. As of 1 January 2008, Italian government members and their relatives are prohibited from keeping in their personal possession ‘entertainment gifts’, received in official occasions, of a value higher than €300 (prime ministerial Decree of 20 December 2007). Along the same lines, employees of the Italian public administration are prohibited from accepting gifts from persons who could benefit from their decisions, with the exception of gifts of courtesy of small value (Decree of 28 November 2000), and the same prohibition is generally contained in the ethical codes implemented by the various state-owned or state-controlled companies.
According to Law No. 190/2012, the Italian government issued a new code of conduct for employees in public administration, which entered into force on 19 June 2013, specifically aimed at preventing corruption and at ensuring compliance with the public officials’ duties of impartiality and exclusive devotion to the public interest. Pursuant to this code of conduct, the limit on the permissible value of ‘gifts of courtesy of small value’ is equivalent to a maximum of €150.
Do the laws and regulations permit facilitating or ‘grease’ payments to foreign officials?
No, they are prohibited by Italian law.
Payments through intermediaries or third parties
In what circumstances do the laws prohibit payments through intermediaries or third parties to foreign public officials?
Payments amounting to bribery offences are prohibited whether they are carried out directly or indirectly, through intermediaries or third parties. In the event of payments made through intermediaries, Italian prosecutors should prove, and Italian courts should assess, that the payment to the intermediary was made with the knowledge and intent to subsequently bribe the foreign public official.
Individual and corporate liability
Can both individuals and companies be held liable for bribery of a foreign official?
Yes, both individuals and companies can be held liable for bribery of a foreign official. As far as the responsibility of corporations is concerned, as of 2001 prosecutions can be brought against them (both Italian and foreign corporations) also for bribery offences (article 25 of Legislative Decree No. 231/2001). For a corporation to be held responsible, it is necessary that a bribery offence is committed in the interest or for the benefit of the corporation by its managers or employees. The corporation’s responsibility is qualified as an administrative offence, but the matter is dealt with by a criminal court in accordance with the rules of criminal procedure, in proceedings that are usually joined with the criminal proceedings against the corporations’ officers or employees.
Where the bribery offence is committed by an ‘employee’, the corporation can avoid liability by proving that it had implemented effective ‘compliance programmes’ designed to prevent the commission of that type of offence (article 7 of Legislative Decree No. 231/2001). Where the bribery offence is committed by ‘senior managers’, the implementation of effective ‘compliance programmes’ does not suffice, and the responsibility is avoidable only by proving that the perpetrator acted in ‘fraudulent breach’ of corporate compliance controls (article 6 of Legislative Decree No. 231/2001).
Private commercial bribery
To what extent do your foreign anti-bribery laws also prohibit private commercial bribery?
Private commercial bribery is prohibited by the Italian domestic anti-bribery laws, but not by the foreign anti-bribery laws.
What defences and exemptions are available to those accused of foreign bribery violations?
The elements of the relevant criminal offences are the same as the ones of the domestic bribery (with the exception that, under Italian law, the foreign public official is not punishable) and therefore the same defences are available. In essence, they mainly refer to the fact of not having wilfully contributed to make an undue payment to a public official.
What government agencies enforce the foreign bribery laws and regulations?
Bribery laws are enforced by public prosecutors, who, in the Italian legal system, are not government agents but magistrates who, as judges, are independent from the executive.
In 2004, a new body called the Anti-Corruption High Commission was set up, provided with rather limited powers such as making inquiries on the causes of corruption, and making studies on the adequacy of the Italian system to fight against corruption. In 2008, the functions of the high commission were transferred to the Anti-Corruption and Transparency Service, an internal body within the Ministry for the Public Function.
Law Decree No. 90 of 24 June 2014 has attributed significant new powers to the National Anti-Corruption Authority (ANAC), in an effort to counteract bribery conduct by providing effective coordination and exchange of information between that body and the various Prosecutor’s Offices investigating cases of corruption, as well as providing ANAC with effective powers of supervision over relevant public tenders.
Patterns in enforcement
Describe any recent shifts in the patterns of enforcement of the foreign bribery rules.
The most significant shift concerns the implementation into the Italian legal system, by Law No. 300/2000 (article 322-bis ICC), of both the 1997 EU Convention and the 1997 OECD Convention. As explained, since then the scope of bribery offences has been significantly extended.
Another relevant development is the one consisting of the extension to Italian and foreign corporations, as of 2001, of the responsibility for bribery offences relating to domestic and foreign officials (article 25 of Legislative Decree No. 231/2001).
Finally, the latest recent developments are the implementation, by Law No. 116/2009, of the UNCAC, with the consequent broadening of the reach of foreign bribery offences; and the ratification in June 2012 of both the Council of Europe Civil and Criminal Conventions on Corruption of 1999.
Prosecution of foreign companies
In what circumstances can foreign companies be prosecuted for foreign bribery?
Since 2000 the scope of bribery offences has been extended to include the bribery of foreign officials, but Italy has not established, in that respect, a general ‘extra-territorial’ jurisdiction. The governing principle on the point has remained the territoriality one, according to which Italian courts have jurisdiction only on bribery offences that are considered to have been committed within the Italian territory, namely, when at least a segment of the prohibited conduct (ie, the decision to pay a bribe abroad), or its event, take place in Italy. This principle suffers derogation in favour of the ‘extraterritorial’ jurisdiction only to a very limited extent, and under stringent requirements (presence in Italy of the suspect, request of the Italian minister of justice, unsuccessful extradition proceedings, etc; see articles 9 to 10 ICC).
In accordance with the mentioned territoriality principle, therefore, foreign corporations can be prosecuted in Italy for foreign bribery on condition that at least a segment of the prohibited conduct takes place in Italy; and, in addition, that all other requirements for the corporation’s responsibility are fulfilled. In essence, the bribery offence must have been committed in the interest or for the benefit of the corporation by its managers or employees, and effective ‘compliance programmes’ were not implemented at the time of the offence.
With respect to the very limited extent of the Italian ‘extraterritorial’ jurisdiction concerning corporations, Italian law provides that it does apply only to corporations having their main seat in Italy, and on condition that the bribery offence is not prosecuted by the state where it was committed (article 4 of Legislative Decree No. 231/2001).
What are the sanctions for individuals and companies violating the foreign bribery rules?
With respect to individuals, sentences for bribery offences (domestic and foreign ones) vary depending on the nature of the offence. In particular:
- for ‘proper bribery’ (act conflicting with the duties of the office), punishment is imprisonment of six to 10 years, and it can be increased owing to ‘aggravating circumstances’;
- for ‘bribery for the performance of the function’, punishment is imprisonment of three to eight years, and it can be increased because of ‘aggravating circumstances’;
- for ‘bribery in judicial acts’, punishment is imprisonment of six to 12 years, and it can be increased because of ‘aggravating circumstances’;
- for ‘unlawful inducement to give or promise anything of value’, punishment is imprisonment of six to 10.5 months for the public official, and up to three years for the private briber, and they can be increased because of ‘aggravating circumstances’; and
- for ‘instigation to bribery’, the punishments provided for ‘proper’ bribery and for ‘bribery for the performance of the function’ apply, reduced by one-third.
In addition, in the event of conviction, confiscation of the ‘profit’ or of the ‘price’ of the bribery offence has to be applied (even ‘for equivalent’, on assets of the offender for a value corresponding to the profit or price of the offence; article 322–ter ICC).
As far as corporations are concerned, they are subject to sanctions consisting of fines, disqualifications and confiscation. Disqualifications can be particularly damaging, because they can include the suspension or revocation of government concessions, debarment, exclusion from government financing and even a prohibition from carrying on business activities (articles 9 to 13 of Legislative Decree No. 231/2001). Such sanctions can also be applied at a pretrial stage, as interim coercive measures. In the event of conviction, confiscation of the ‘profit’ or of the ‘price’ of the offence has to be applied, even by confiscating ‘for equivalent’ the assets of the corporation (article 19 of Legislative Decree No. 231/2001). At a pretrial stage, prosecutors can request the competent judge to grant freezing of the ‘profit’ or ‘price’ of the bribery offence (article 45 of Legislative Decree No. 231/2001).
Recent decisions and investigations
Identify and summarise recent landmark decisions or investigations involving foreign bribery.
In relation to foreign bribery offences, the Italian authorities have conducted several investigations and prosecutions in recent years, the most significant of which are the following.
The Oil-for-Food programme
With respect to the mismanagement of the Oil-for-Food programme, on 10 March 2009 the Milan court of first instance sentenced three Italian individuals acting, directly or indirectly, for an Italian oil company to two years’ imprisonment for the charge of foreign bribery, under the assumption that they paid bribes to officials of a state-owned Iraqi company. On 15 April 2010, the Milan Court of Appeal acquitted all co-defendants owing to the charges being time-barred.
Nigeria Bonny Island
The Nigeria Bonny Island case concerns an investigation conducted by the Milan Prosecutor’s Office against the companies ENI SpA and Saipem SpA in relation to the offence of foreign bribery allegedly committed by the companies’ officers (in the frame of the international consortium Tskj, involving the US company KBR-Halliburton, the Japanese Igc and the French Technip), and allegedly consisting of significant payments made to Nigerian public officials in the period 1994 to 2004 to win gas supply contracts.
On 17 November 2009, the Milan judge for the preliminary investigations rejected the prosecutors’ application for applying to ENI SpA and Saipem SpA the pretrial ‘interim measure’ of prohibition to enter into contracts with the Nigerian National Petroleum Corporation, owing to lack of Italian jurisdiction. The case against ENI SpA was subsequently dismissed, and on 5 April 2012, the case against five officers of Saipem SpA was also dismissed because of the time bar.
However, in July 2013 the company Saipem SpA was sentenced by the Milan court of first instance to a fine of €600,000 and confiscation of €24.5 million, pursuant to Legislative Decree No. 231/2001. In February 2015, the conviction of Saipem SpA was confirmed by the Milan Court of Appeal, and in February 2016 the Court of Cassation issued the final judgment of conviction against Saipem SpA.
The Finmeccanica–AgustaWestland case concerns a prosecution conducted by the Prosecutor’s Office of Busto Arsizio (an area close to Milan) against the companies Finmeccanica and AgustaWestland and their top managers in relation to the offence of foreign bribery allegedly committed in 2010 in connection with the supply to the Indian government of 12 helicopters.
In 2014, the prosecutors discontinued the investigations against Finmeccanica in the light of the assessment that the company was not involved in the alleged wrongdoing and had implemented adequate compliance programmes to prevent corruption offences. In the same period, AgustaWestland SpA and AgustaWestland International Ltd entered into a plea bargain with the Prosecutor’s Office. On 9 October 2014, the court of first instance of Busto Arsizio acquitted the top managers of both companies from the charge of foreign corruption, and sentenced them to two years’ imprisonment for the different charge of tax fraud.
In April 2016, the Milan Court of Appeal overturned the acquittal of the two managers and sentenced them to respectively four years, and four years and six months’ imprisonment. In December 2016, the Court of Cassation annulled the aforementioned conviction, and ordered the case to be retried before the Milan Court of Appeal, which acquitted the two managers on 8 January 2018. In May 2019, the Court of Cassation confirmed the final acquittal of the two managers.
The Milan Prosecution’s Office started a criminal investigation in 2013 against the companies ENI Spa and its subsidiary at the time Saipem Spa, some of their top managers and foreign agents, in relation to the alleged offence of bribery of Algerian public officials, with respect to the adjudication of seven tenders in Algeria in the period 2007 to 2010.
On 2 October 2015, the preliminaty hearing Milan judge acquitted ENI and its top managers on all charges and committed to trial Saipem Spa and its top managers, and the foreign agents, for international corruption and tax fraud. The acquittal of ENI and its top managers was subsequently annulled by the Court of Cassation in February 2016, subsequent to an appeal made by the prosecutors, and on 27 July 2016, they were all committed to trial.
The trial before the Milan court of first instance ended in September 2018 with the acquittal of ENI and its top managers, and with the conviction of Saipem and its top managers and agents, to sentences up to five years and six months’ imprisonment. Appellate proceedings before the Milan Court of Appeal took place in 2019, and on 15 January 2020 the Court issued a judgment of acquittal for all defendants. The acquittal for all defendants was finally confirmed by the Court of Cassation in December 2020.
Appeals for alleged foreign bribery are currently pending against the companies ENI, Shell and their managers, in relation to the adjudication of a licence in Nigeria. The following is particularly noteworthy.
On November 2013, the Milan Prosecution’s Office started a criminal investigation against the company ENI Spa, its top managers, the former minister of petroleum of Nigeria and some Italian and foreign individuals, in relation to the alleged offence of bribery of Nigerian top public officials, namely, the former president, attorney general and minister of petroleum of Nigeria. The allegations concerned the granting by the Nigerian government to the subsidiaries of ENI and Shell of an oil-prospecting licence for an oil field located in the offshore territorial waters of Nigeria.
The prosecutors concluded the investigations in December 2016, also adding the company Shell and some of its managers to the list of suspects. In February 2017, the prosecutors requested a committal for trial for all suspects, and in December 2017 the Milan judge for the preliminary hearing issued a decree of committal for trial for all suspects, with the trial starting in March 2018. On 17 March 2021, the Milan court of first instance issued a judgment of full acquittal on the merits for all defendants. Further to an appeal by the Prosecution’s Office, appellate proceedings will take place in the course of 2022.
Two defendants who opted for the summary trial were orginally sentenced to four years’ imprisonment in September 2018, but they were subsequently fully acquitted on the merits by the Milan court of appeal on 24 June 2021, and this acquittal has become res iudicata.