"The Albanese government is taking action on foreign bribery by Australian companies after 10 years of nothing happening. This is about accountability and the value of accountability, which we hold high. This is about having no tolerance for corruption."

Address to the House of Representatives, Bills - Crimes Legislation Amendment (Combatting Foreign Bribery) Bill 2023

Tuesday 5 September 2023

The Albanese government has no tolerance for corruption of any kind, whether in the public sector or in the private sector. Since coming to office just over a year ago, we have walked the walk and we have got on with the job through action. With the support of this parliament, we are restoring integrity, honesty and accountability to government with the commencement of the National Anti-Corruption Commission. During the 2022 federal election, Australians were clear that they wanted a national anticorruption watchdog and they wanted a government that they could trust. Indeed, the electors of my electorate in Bean were very clear in wanting the National Anti-Corruption Commission, many of them spending much of their careers in public administration. They clearly put integrity on the ballot, and they voted accordingly.

The measures in the Crimes Legislation Amendment (Combatting Foreign Bribery) Bill 2023 address challenges with detecting, investigating and prosecuting foreign bribery in Australia. These measures build on our work to date in tackling corruption. Foreign bribery is another form of corruption, and it's an insidious problem across the world. Bribery, in particular, harms investment and economic growth. It distorts markets, artificially inflates prices and leads to substandard products being procured. Further, it undermines efforts against poverty and disease and facilitates serious transnational crimes. Bribery corrodes good governance and contributes to social and economic inequality in local communities where it occurs. It is rightly the business of this parliament to be addressing these issues.

Thankfully, Australia is party to a number of international instruments aimed at fighting corruption including bribery. These include the United Nations Convention Against Corruption, the United Nations Convention Against Transnational Organized Crime, the Organisation for Economic Co-operation and Development, the OECD, and the Convention on Combatting Bribery of Foreign Public Officials in International Business Transactions. In addition, Australia's also engaged in the following regional and international forums and initiatives: the G20 Anti-Corruption Working Group, the OECD Working Group on Bribery in International Business Transactions, the Anti-Corruption and Transparency Experts Working Group and the ADB-OECD Anti-Corruption Initiative for Asia-Pacific.

Undetected and unpunished, bribery undermines the reputation of all Australian business and negatively impacts business and government relations. The Australian government has a zero-tolerance policy in relation to foreign bribery and supports ethical business practices. This bill is both welcome and overdue. Bribery by its very nature is incredibly difficult to investigate and prosecute. It is both opaque and sophisticated. Sadly, as other speakers have already said, there have been relatively few foreign bribery prosecutions in Australia. The current foreign bribery defence in division 70 of the Commonwealth Criminal Code has been overly prescriptive and difficult to use. The bill seeks to address this issue. It does so by replacing the existing foreign bribery offence with a new, carefully developed offence. For example, the prosecution needs to show that both the bribe and the business advantage were 'not legitimately due'. This wording presents difficulties for prosecutors, so it will be replaced with 'improperly influencing a foreign public official'.

This bill also broadens the scope of the foreign bribery offence so that it will now capture bribery conducted to obtain personal advantage. This is because experience shows that bribes can include a range of benefits, including personal honours, the processing of visa or immigration requests, or reducing personal tax liability. Further, this bill seeks to prevent foreign bribery in the first place by implementing a new indictable corporate offence. This is in order to overcome the problem of companies that wilfully turn a blind eye to misconduct by their employees. These provisions will apply to companies when an associate bribes a foreign public official for the profit or gain of the corporation. Importantly, the offence would not apply if a body corporate was able to demonstrate that it had adequate procedures in place to prevent the bribe in the first instance. In a positive sense, this new provision will provide an incentive to companies to be proactive about preventing bribery. I know many Australian companies already have rigorous procedures in place to combat bribery, and I commend them on this. To assist those companies that may not have the necessary procedures in place, guidance material on what constitutes adequate procedures will be produced.

The measures in this bill may sound very familiar to those opposite. That's because they're virtually identical to the amendments introduced by those opposite in 2017 and then reintroduced in 2019. Both times, under the watch of those opposite, those bills were allowed to lapse, failing to even be debated. The previous government had years to bring the measures forward for debate and pass them. It didn't. On these matters of corruption and bribery, there can be no leeway. We must be vigilant. The stakes are too high. Australia's international reputation for world-leading corporate governance, including antibribery provisions, must be protected, and this bill does that. Indeed, the fact that this bill will help the government to crack down on bribes that are built into seemingly legitimate contractual arrangements is a particular positive.

What makes this bill particularly critical is recent reports of millions of taxpayer dollars allegedly being paid to foreign officials through suspicious contracts between private companies and subcontractors engaged by the Department of Home Affairs on Nauru and in Papua New Guinea. These are allegations of suspicious contracts during the time when the now Leader of the Opposition was the Minister for Immigration and Border Protection and the Minister for Home Affairs. He was in charge. He knew what was going on, one would assume. Reports suggest that the Department of Home Affairs may have disregarded what was effectively a bribe disguised as a legitimate contractual arrangement. This happened, as I said, when the now Leader of the Opposition was the Minister for Home Affairs. He had responsibility. Furthermore, when the now Leader of the Opposition was in his role as the Minister for Home Affairs, he knew that his department had a multimillion-dollar regional processing contract with a man who'd been charged by the AFP with foreign bribery. Even if the Leader of the Opposition claims that he did not know about the bribery at the time, these contracts became a matter of public record in September 2018. In September 2018 Mr Bhojani, who was associated with Radiance International, was charged by the AFP for foreign bribery. In August 2020 he was convicted, after pleading guilty. The department continued to pay Mr Bhojani millions of taxpayer dollars and extended contracts with his company during this period.

One of the companies related to suspicious contracts on Nauru was Canstruct International. A contract was awarded to this company to provide welfare and garrison services on Nauru, despite the company not having any experience of providing either of these services to vulnerable people. The contract between the department and Canstruct International was extended many times, without a competitive tender. This was a shelf company with no relevant experience, getting a $1.8 billion contract, without a competitive tender, from the former government. We also know that the Leader of the Opposition knows this company very well. Executives of Canstruct enjoyed exclusive access to the now Leader of the Opposition during this period. These sorts of arrangements are exactly what this government intends to target through amendments to this bill.

I will say that the corporates in this case, in respect of this bill, will be protected where they can show that they have followed adequate procedures that are in place to prevent foreign bribery by an associate. As I said before, we're going to have guidance material for the corporations. They can follow that guidance material and then make sure that they're above reproach. The UK has utilised a similar offence to prosecute companies in a few cases of foreign bribery. These are reforms that ensure that a company cannot simply ignore bribery conducted by its employees or contractors where it results in benefits for their business. They cannot pretend that it's business as usual.

Companies can currently avoid criminal liability under existing offences in the Criminal Code even if they know or strongly suspect foreign bribery is occurring. These companies have been able to remain wilfully blind to the activities of their associates, including through the use of third-party agents located offshore. These reforms will enable bribery by an associate of a corporation to trigger corporate liability.

The reforms will also create a new offence—that is certainly true—for corporations that fail to prevent foreign bribery. The maximum penalty will be $27.5 million or higher. Companies can also be held directly liable for the foreign bribery activities of their employees, external contractors, agents and subsidiaries, unless a business can demonstrate that they had adequate procedures in place. That is eminently fair. You are responsible, as an entity, for the operations that you are conducting as a corporate entity. These reforms are about ensuring accountability, something that was very far away from the minds of the opposition when they were in government, with respect to sitting on this bill and doing nothing for so many years. We know that prosecuting for foreign bribery is currently so challenging. As I said earlier, that's why we are making the changes to the definitions in division 70 of the Commonwealth Criminal Code.

As part of this bill, the existing foreign bribery offence will be replaced to ensure that it better captures typical cases of foreign bribery identified by law enforcement. Prosecutors currently need to show that both the bribe and the business advantage it sought were 'not legitimately due', which is difficult in cases where bribes are disguised as legitimate payments. This bill replaces the need for this and instead requires prosecutors to demonstrate the improper influencing of a foreign public official. It also broadens the scope of the foreign bribery offence to include bribery conducted that involves a personal advantage, not just a business advantage. It modifies the definition of 'foreign public official' to include candidates for public office—quite rightly. The bill also introduces a new corporate offence of failure to prevent foreign bribery. This relates to cases where an associate of a body corporate has committed bribery for the benefit of the body corporate.

The Albanese government is taking action on foreign bribery by Australian companies after 10 years of nothing happening. This is about accountability and the value of accountability, which we hold high. This is about having no tolerance for corruption. That is why we are pushing ahead with this bill, despite the empty protestations of some of the speakers opposite and the do-nothing attitude that was emblematic of the opposition when they were in government. It's time for us to take action. It's time for us to pass this bill through the House.