Ecuador Takes Tough Stance on Corporate Bribery: New Penalties and No Leniency
QUITO, ECUADOR - Ecuador’s Criminal Code has been amended to impose stiff penalties on companies found guilty of bribery. This move is aimed at cracking down on corporate corruption and ensuring that companies operating in the country take immediate action to prevent such activities.
Stiff Penalties for Corporate Bribery
Under the new law, corporate entities that engage in bribery will face fines ranging from $200,000 to $400,000. In addition, the entity may be ordered to dissolve and liquidate itself or compensate the Ecuadorian State and society with its property.
No Defense Against Bribery Charges
Having a compliance program in place does not constitute a defense against bribery charges. Companies must ensure that their programs are robust enough to prevent bribery and other corrupt activities from occurring.
No Leniency Agreements for Corporations
Unlike individuals who can benefit from leniency agreements or deferred prosecution deals for cooperating with authorities, corporations are out of luck. There is no provision for such agreements under Ecuadorian law.
Background
The new penalties come after a general referendum held in 2018, which amended several laws to create additional criminal, civil, and administrative penalties for individuals and entities found guilty of bribery, influence peddling, and other corruption-related crimes.
What This Means for Companies Operating in Ecuador
It’s clear that the government is taking a tough stance on corporate corruption. Companies must take immediate action to ensure they have robust compliance programs in place to prevent bribery and other corrupt activities. Failure to do so could result in severe penalties, including fines and even dissolution of the company.
Key Takeaways
- Corporate entities found guilty of bribery can face fines ranging from $200,000 to $400,000
- Companies may also be dissolved and liquidated or ordered to compensate the Ecuadorian State and society with their property
- Having a compliance program in place is not a defense against bribery charges
- There are no deferred prosecution agreements or leniency agreements available for corporations that cooperate or self-disclose a violation
- The government has taken a tough stance on corporate corruption, emphasizing the importance of robust compliance programs to prevent bribery and other corrupt activities.