MDO | ALERTS

MDO | ALERTS

Airbus to Pay $4 Billion to Resolve Global Bribery Charges

■ ■ ■  February 20, 2020

On January 31, 2020, Airbus SE, a multinational aerospace and the world's second-largest airplane manufacturer (Airbus), agreed to pay a total of $4 billion in penalties for charges of transnational bribery, including violations of the Foreign Corrupt Practices Act (FCPA) and the Arms Export Control Act (AECA) implemented by the International Traffic in Arms Regulations. The settlement was part of the terms of the deferred prosecution agreement (DPA) they entered in order to avoid criminal prosecution. The fine was paid out as follows, $1.1 billion to the U.K.'s Serious Fraud Office (SFO), $2.33 billion to France's Parquet National Financier, and $583 million to the U.S. Department of Justice and U.S. Department of State.

 

The bribery charges were brought against Airbus due to its use of intermediaries to bribe government officials and airline executives between 2008 and 2015 in order to win high-value contracts in 20 countries around the world, including China, Sri Lanka, Malaysia, Taiwan, Indonesia, and Ghana. The Airbus executives concealed payments through loan schemes and mischaracterized payments in the company's books and records in order to make the bribes. The DPA will be in force until January 31, 2023, and requires, Airbus to make improvements to its ethics and compliance policies and procedures. Airbus must also adopt comprehensive initiatives aimed at changing the Airbus culture.

In an effort to change its culture, Airbus has replaced senior management executives, including the CEO, CFO, and General Counsel. Furthermore, it has created a subcommittee of the board, titled the Ethics and Compliance Committee, which will provide oversight of the company's compliance program. Airbus has also revised its Code of Conduct and hired external compliance professionals to help the new subcommittee with the culture change. Apart from these steps, Airbus must also cooperate fully and honestly with all pre-investigations, investigations, and prosecutions brought by U.K.'s SFO.
 
With increasingly aggressive enforcement efforts and record-setting fines, MDO Partners encourages companies to establish strong Anti-Corruption Compliance Programs to mitigate the risk of FCPA violations. MDO Partners advises companies on global compliance programs. Our attorneys and advisors have extensive experience advising clients on the FCPA and effective Anti-Corruption Compliance Programs in over 30 countries.

About MDO Partners

 

MDO Partners is a boutique law firm that focuses on Corporate, International, and Real Estate Law, as well as Global Compliance and Business Ethics. The firm is comprised of a solid team of attorneys and advisors with more than 100 years of combined experience who are committed to the business goals and best interests of their clients. The firm delivers value-added services of the highest caliber, and serves as a trusted advisor to its clients with a practical and business-savvy approach. For more information on MDO Partners, please visit www.mdopartners.com

 

If you have questions or comments regarding this Alert, please contact one of the attorney's or advisor's listed below.

 

Richard Montes de Oca

Managing Partner

305.704.8452

rmontes@mdopartners.com

Claudia Herbello

Associate Counsel

305.704.8456

cherbello@mdopartners.com

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