Keith Wolahan (Menzies, Liberal Party) Share this | Hansard source

I rise to speak on the Crimes Legislation Amendment (Combatting Foreign Bribery) Bill. We will support this bill, but there are flaws in the bill, and that is what I would like to speak on.

Foreign bribery is a serious offence. It is insidious and it undermines our reputation as a nation that values democracy, the rule of law and freedom, and it undermines those concepts internationally, as well. Right now, democracy in many parts of the world is fighting for its existence. Wherever we can as a nation, including our corporate entities, we must not be strengthening the arm of those who seek to undermine democracy, which is what foreign bribery does. We must always hold ourselves to a higher standard. As someone who served overseas, I was proud that we held ourselves to a higher standard, as we should have, and we hold ourselves to account for that. The same should apply in how our corporate entities conduct themselves. So the coalition support this bill but are committed to moving amendments to add a deferred prosecution scheme. That is the area of difference and debate that we have seen from the other speakers.

What did the Attorney-General and the Labor government say about this specific issue? I enjoy reading second reading speeches by the Attorney-General. They are usually well crafted and ones we should listen to. So let's look at what the Attorney-General said on this bill. He said:

The purpose of a deferred prosecution scheme is to strike a balance between encouraging companies to self-report serious offending and holding companies to account for serious corporate crime. However, given that there is universal agreement that the existing foreign bribery offences in the Criminal Code are grossly inadequate, it is premature to entertain the introduction of a deferred prosecution scheme.

He added this:

The introduction of such a scheme should only be entertained after the measures in this bill have been enacted and given time to work.

In that part of the speech the Attorney-General acknowledged that there are benefits in a deferred prosecution scheme but he would prefer to kick the can down the road and not actually deal with it as it is before the House now. The Attorney-General knows full well that when this side was last in government and introduced those changes, the explanation was given that, across the OECD, foreign bribery cases took an average of 7.3 years to be concluded.

After my experiences in uniform and overseas, I had an experience in courtrooms. Those who have been involved in litigation, whether as solicitors or barristers or in any other capacity, will know it is resource intensive and time intensive and has enormous delays. When you add on cross-jurisdictional and international factors, it gets monumental. We have to be careful about how resources are managed, particularly if in a firm the key people, the key witnesses, move on, move overseas. Let's remember that we're probably talking more often than not about large corporations, where some of the staff might not be Australian citizens. To not deal with these in a timely way undermines confidence and doesn't deal with an issue as it comes before us. Again, when we're talking about foreign bribery and the effect that has on reinforcing corruption and undermining democracy, delay is not something we should build into the system.

What is a deferred prosecution agreement, or a DPA, for those who like acronyms? It allows a prosecuting body to have another tool in their kitbag. It allows them to negotiate conditions with a defendant in exchange for a deferral of a prosecution, potentially indefinitely. They often involve paying a significant fine and making changes to the way business is done in the here and now. If those opportunities are lost in a potential prosecution and trial that will take years then other damage can be done if there is a problem with the culture of a particular company or particular individuals. It isn't a set-and-forget scheme—sign here and all is forgiven—it's not a confessional. It is something that hangs like an anvil over the individual's and the corporation's head. The prosecution could be enlivened at any time.

A normal prosecution requires intensive investigation—again, from limited resources. They involve paper trails across jurisdictional boundaries. If we can find a way to deal with the issue in the immediate and short term then we should grasp it. It's important, because when we think of prosecutions there are goals that have to be met not just for the individuals and the corporations that are in the eyes of the investigators and the prosecutors but also because of the message it sends to others who may consider doing the same. There is a punitive element, there is a corrective element and there is a deterrent element. We often speak of specific and general deterrence—and both matter—and all of them can be achieved through a DPA or deferred prosecution agreement. Everything that you'd achieve in a successful criminal prosecution—punishment, prevention and deterrence—can be achieved with a method that is more timely and more sensitive to our limited resources.

By cutting these agreements away from this bill, Labor is saying that, rather than achieving similar results at a fraction of the cost, risk and time, we would prefer that these resources are tied up, potentially for years. The example has been given by other speakers of the Airbus, where a deferred prosecution agreement saw the payment of US$3.9 billion in global penalties for foreign bribery, shared amongst multiple jurisdictions. That is a significant fine for any corporate entity, and achieves all of those purposes. That lesson was learnt not only by Airbus but also any other corporate entity that engages in that field or others. So why wouldn't we embrace that with both hands and deal with it right now?

Deferred prosecution agreements are the cornerstone of foreign bribery prosecutions. We're not alone. We're not reinventing the wheel here, which when we do as a nation sometimes doesn't end well. We're learning from the examples and mistakes of others, including our partners and allies the United States and the United Kingdom. What they have found—and we get to look at the experience there—is that there is a very important incentive in deferred prosecution agreements. They incentivise self-reporting, and it's not hard to imagine how. You can imagine how a corporate head office might become aware of corruption at middle-management level and seek to cooperate with authorities to clean house. That was the experience in the UK and the example of the ICBC standard bank case. These agreements allow for companies to improve their businesses, deal with bad actors whether they're internal employees or contractors, and have certainty rather than having to face courts year on year. I've been in cases before state and federal courts that have involved corporate entities where almost none of the key witnesses work there any more. They've all moved on and it makes it so much harder—and that's just in civil cases. It gets even harder in criminal cases, with all of the additional evidentiary standards that come with that. The experience from other jurisdictions is one we should take seriously and we should learn from, and the experience is clear: the evidence before this parliament is that these agreements lead to an increase in prosecution and an increase in fines. That's what Australians want in this area, and that's what an amendment like that would achieve.

They're also subject to overriding safeguards. There maybe a concern by some that if we are taking decision-making away from judges and juries and the courts, what's happening behind closed doors doesn't have sunlight providing that disinfectant. There is sunlight providing that disinfectant, and there are safeguards. Our proposal included a requirement that, before an agreement could be executed, a former judge would need to be satisfied that the terms of the agreement were fair, reasonable, proportionate and in the interests of justice.

The Attorney-General made clear that this bill is meant to enhance the implementation of the OECD anti-bribery convention, and it's noteworthy that he referenced that. However, in 2021, the OECD Council itself expressly recommended that member countries consider using non-trial resolutions to improve the prosecution of foreign bribery. These were the words of the OECD in offering that as a mechanism:

Non-trial resolutions refer to mechanisms developed and used to resolve matters without a full court or administrative proceeding, based on a negotiated agreement with a natural or legal person and a prosecuting or other authority.

In other words, the governing body responsible for the convention, the OECD, says foreign bribery measures should be accompanied by mechanisms like DPA schemes. Don't just take our word for it. In other debates, whether it's the drafting of the Voice or other issues, we like to say: 'What does corporate Australia say? What does the Law Council say? What does Transparency International Australia say?' Very rarely do they tweet or provide posts that are in line with this side of the House, but they are here. Each of them made submissions in support of the introduction of a deferred prosecution agreement scheme. Even Austrade, a government agency, called for measures to encourage self-reporting and cooperation.

I conclude with this: we take foreign bribery seriously. It goes to the heart of who we are and what we stand for, and it goes to the heart of the struggle between democracies and autocracies. Democracies need all the help they can get right now. Foreign bribery undermines democracy, and we should stamp it out wherever we can. We should do it in the short and medium term, not kick the can down the road, as has been proposed in this bill.

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