A recently published decision of the Swiss Federal Criminal Court sheds light on the concept of foreign public officials in the context of Swiss anti-bribery provisions. The case concerns payments in the range of EUR 40 million which a former high-ranking executive of a Canadian engineering and construction company had channelled to Saadi Gaddafi, one of the sons of former Libyan dictator Muammar Gaddafi. The payments were made between 2001 and 2007 to obtain contracts for construction projects in Libya, and were directed to bank accounts of Saadi Gaddafi in Switzerland, which were later blocked. Subsequently, the former executive was arrested in Switzerland and ultimately sentenced to a three-year suspended prison term for bribery of foreign public officials, money laundering and fraudulent mismanagement. From a Swiss legal perspective, the case is of particular interest because Saadi Gaddafi did not hold an official government role in Libya at the time when the payments were made. In truth, Muammar Gaddafi controlled all political power together with his close entourage. The political institutions of Libya constituted a mere façade, with all government members and institutions being directly dependent on the Gaddafi family. As was found by the Federal Criminal Court, Saadi Gaddafi was for many years part of his father’s entourage and was in particular involved in the choice of contractors for international projects. Considering Saadi Gaddafi’s de facto economic and political influence, as evidenced by the fact that he had on several occasions represented Libya nationally and internationally, was holding a high position in Libyan military and travelled on a diplomatic passport, the Federal Criminal Court came to the conclusion that he was, from a functional perspective, a foreign public official in the sense of Article 322septies Swiss Penal Code. This was also acknowledged by the accused himself. As he was cooperating with the Swiss prosecutor, the Federal Criminal Court could handle the case in summary proceedings, without having to analyse in detail how Saadi Gaddafi’s powers and competencies may have evolved over time. Although it may be difficult to make a similar showing in situations where the accused person does not cooperate with the prosecution, the case sets an important precedent with respect to the legal qualification of family and clan members in dictatorial systems. Companies doing business in dictatorial or authoritarian regimes can consequently not limit their compliance efforts to formal government officials, but must ensure that the family and clan structures on which such regimes often rely are also given proper attention.
Dr. Anne-Catherine Hahn is a partner in Baker McKenzie's Dispute Resolution and Commercial Law practice groups in Zurich. She also serves as lecturer at the University of Fribourg in Switzerland. Ms. Hahn's practice focuses on international commercial arbitration, commercial litigation, and non-contentious commercial matters. She regularly represents international and domestic clients in disputes before international arbitral tribunals and Swiss courts, particularly with respect to manufacturing, supply and distribution structures, infrastructure projects (with a particular focus on emerging markets), as well as M&A and other financial disputes. She also advises clients on the set-up and negotiation of commercial agreements and related compliance questions. Her working languages are German, English and French.
Tabea Kunz is working as a Law Clerk at Baker & McKenzie Zürich. She recently graduated from the University of Zurich and is now preparing to take the bar exam. During her Master’s program, she has studied at Hong Kong University for two semesters.