Denmark’s Complex Rules on Facilitation Payments and Bribery

Copenhagen - A new report has shed light on Denmark’s complex rules regarding facilitation payments and bribery, leaving many companies struggling to navigate the grey area.

Overview

According to the Ministry of Justice’s 2015 pamphlet “How to Avoid Corruption”, facilitation payments under special circumstances are not covered by Section 122 of the Criminal Code. However, it is generally acknowledged that facilitation payments to public officials will always fall under the scope of Section 122, leaving companies uncertain about whether they can make such payments without facing legal consequences.

Liability for Companies

Both individuals and companies can be held liable for bribery in Denmark.
Companies are subject to fines, ranging from a few thousand to millions of kroner.
The proceeds of a criminal act or a corresponding amount can be confiscated in full or in part.

Defences

There are no specific defences or exceptions available under Denmark’s anti-corruption laws.
General defences such as self-defence and necessity may be applicable in certain circumstances.

Record Keeping and Reporting

Companies must maintain proper record-keeping procedures to comply with Danish law.
A minimum of five years’ retention is required for economic transactions.
Accountants have a duty to report potential violations of anti-corruption regulations if they find that managers are committing or have committed financial crimes.

Penalties for Individuals and Companies

Violations of corruption laws by individuals can result in up to six years’ imprisonment or fines.
Companies face fines and potentially the confiscation of proceeds.
The size of the fine will be determined based on the gravity of the offence, with consideration given to the offender’s capacity to pay and any gains or savings obtained.

Risk Management

Companies operating in Denmark must implement robust compliance procedures and policies to ensure safe harbours from legal liability.
While there are no specific requirements for anti-corruption measures under Danish law, companies may be required to implement such procedures under general fiduciary duties of officers and directors.

Conclusion

The report highlights the need for companies operating in Denmark to have a thorough understanding of the complex rules regarding facilitation payments and bribery. Companies must also ensure that they maintain proper record-keeping procedures and comply with reporting requirements to avoid legal liability.