Facilitation Payments: A Gray Area in Danish Law
A recent report by the Ministry of Justice has highlighted the ambiguity surrounding facilitation payments in Denmark, highlighting concerns about transparency and accountability.
Distinction between Facilitation Payments and Bribery
Under Danish law, both individuals and companies can be held liable for bribery offenses. However, it remains unclear whether facilitation payments can occur without being covered by Section 122 of the Criminal Code, which criminalizes bribery.
Whistleblowing and Self-Reporting
- Denmark lacks a comprehensive whistleblower protection law.
- Some financial undertakings have implemented internal mechanisms to facilitate reporting.
- The Financial Business Act provides limited protection for whistleblowers in the financial sector.
- Self-reporting is not a recognized practice in Denmark, but companies may be expected to do so as part of their general fiduciary duties.
Risk Management
- Companies can put in place compliance procedures and policies to create safe harbours for themselves.
- However, there are no specific regulations or guidelines governing anti-corruption risk management in Denmark.
Record Keeping and Reporting
- The Book-Keeping Act and Annual Reports Act govern the requirements for record keeping and accounting in Denmark.
- Companies must maintain accurate and secure records of economic transactions for at least five years.
- There are no specific reporting requirements for companies regarding potential violations of anti-corruption regulations.
- Accountants have a duty to report suspected financial crimes to the authorities if management fails to take corrective action.
Penalties
- Individuals found guilty of corruption offenses can face imprisonment or fines, with penalties ranging from six months to six years in prison or fines up to DKK 150,000 (approximately EUR 20,000).
- Companies can be fined for corruption offenses, and the size of the fine will depend on the gravity of the offense.
- Companies may also have their assets confiscated as part of the penalty.
In conclusion, while Denmark has made progress in combating corruption, there remain areas of ambiguity and uncertainty. Companies operating in Denmark must carefully consider their compliance obligations to avoid potential legal and reputational risks.