Gheorghe Buta and Madalin Enache of Muşat & Asociaţii in Bucharest provide insight in to the anti-corruption regime in Romania.
SECTION 1: LEGAL LANDSCAPE
1.1 What is the scope of bribe payors and bribe recipients covered by your jurisdiction's anti-corruption laws?
Romanian anti-corruption laws refer to all individuals, citizens and residents within the national jurisdiction, natural and moral persons alike. In case of moral persons, they are criminally liable should the crime be perpetrated within the scope of their activity. Furthermore, the laws sanction corruption for both public officials and other persons, with the only difference being the degree of punishment.
1.2 What conduct directly related to bribery is prohibited by anti-corruption laws?
Corruption is defined as conduct which involves - directly or indirectly and for oneself or another - receiving money, other goods and benefits, facilitating payments or the promise of such, in order for the official or private party to perform, not to perform, to delay or to expedite a duty. Corruption crimes require the existence of criminal intent and the conditionality factor, which have to be proven.
1.3 What conduct related to internal controls and to books and records is covered by the anti-corruption laws?
Considered as secondary anti-corruption legislation, numerous texts incriminate conduct not compliant with the general rules of maintaining books and records (accountancy). Furthermore, auditing and internal controls are extensively regulated in the national legislation with a rather severe (criminal) sanctioning system, as well as for forgeries of any kind (especially of documents), which can itself be a crime. These crimes all imply both the criminal and civil liability of the participants.
SECTION 2: POTENTIAL PENALTIES
2.1 What is the range of direct financial consequences for a company engaged in a prohibited anti-bribery offence?
Romanian anti-corruption laws punish moral persons who have been involved in corrupt practices through a wide range of sanctions, both civil and criminal. The latter are mainly fines, with complementary sanctions such as: the dissolution of the moral person; the suspension of activities and closing down of business locations for between three months and three years; the prohibition to participate in public acquisitions for between one and three years; the placement of the moral person under judicial supervision; and the display or broadcast of the condemnation decision.
2.2 What is the range of collateral consequences for a company adjudicated to have engaged in prohibited anti-bribery offences?
The above-mentioned complementary sanctions which a court can impose upon a moral person in a criminal trial for corruption crimes can be doubled by other collateral consequences, such as the dissolution of all corrupt acts concluded (including contracts and agreements) and the annulment of affected procedures (including public acquisitions). Additionally, separate civil lawsuits can be launched by interested parties that have been affected by the perpetration of the corrupt practices (including competitors and shareholders).
2.3 What are the typical punishments of individuals prosecuted for paying or accepting bribes?
As per the annual reports of the National Anti-corruption Directorate, the sentences for active and passive corruption crimes for individuals who have been found guilty by the courts of law have been consistent over the last years. The vast majority (70-80%) of jail sentences have ranged from four months to three years, with the odd case exceeding five years' imprisonment. Furthermore, the benefits and proceeds of corruption crimes are confiscated by the state (or equivalent).
SECTION 3: INVESTIGATION
3.1 What is the role of self-investigation at the remedial stages of an anti-corruption matter?
Self-investigation is not yet expressly provided by the national anti-corruption laws. If controls are performed and corruption data and indications are encountered, then it is mandatory for the controllers to inform the criminal investigation authorities (the omission being itself a crime) and, further, to preserve as much evidence as possible. In addition, if the bribe payor or buyer of influence denounces themselves before the authorities are informed of the crime, the deed is not punished.
3.2 With respect to anti-corruption compliance programmes, what are the regulatory expectations if a business wants to receive credit or leniency during an investigation into corrupt behaviour by company personnel?
Anti-corruption compliance programmes implemented by moral persons do not represent, by effect of law, a source of leniency or credit in case of an anti-corruption investigation. Further, the law does not provide guidance in relation to any such policies. However, the existence of anti-corruption compliance programmes can be used as a favourable argument in a company's defence strategy in showing the good faith of the moral person and, consequently, distinguishing itself from its possible corrupt agents or employees. As above, the denunciation of active bribery (before the authorities are informed of the crime) represents a case of non-punishment.
3.3 What resources are available to regulators to investigate and prosecute anti-corruption offences?
Since the mid-2000s, when the National Anti-corruption Directorate was established in Romania as a separate structure within the Prosecutors' Office, specialised in investigating corruption and corruption-related criminality, the field has become increasingly important in Romanian society and governance. Anti-corruption cases are now a high priority (as seen in the cooperation and verification mechanism – CVM – report prepared yearly for the EU), which in turn translates into important human and financial resources being allocated for the relevant authorities.
3.4 What are the customary forms of resolution of individual and corporate regulatory actions?
The Romanian criminal legislation allows suspects and defendants to negotiate a settlement for the admission of guilt in certain criminal investigation cases. The most important condition is that the maximum sanction for the crime cannot exceed seven years. For the settlement to take effect, it must be submitted for approval by a specific judge.
SECTION 4: ADJUDICATION
4.1 What is the perception with respect to the fairness of regulators and the judicial system in addressing anti-corruption?
Even with other factors at play (such as politics) influencing investigations and prosecutions, the anti-corruption reports of relevant authorities (especially in the EU) and monitoring bodies (such as the Superior Council of Magistrates, and non-governmental organisations) have been favourable and positive, considering that the judicial system generally acts independently.
First published by our sister publication IFLR magazine. Take your free trial today.
Deputy managing partner
Muşat & Asociaţii
About the author
Gheorghe Buta is the deputy managing partner at Musat & Asociatii. He heads the litigation and arbitration practice, and is one of the most well-known and respected experts in commercial, civil and criminal disputes in Romania. In his outstanding judicial career, spanning over three decades, he has gathered extensive trial experience, first as prosecutor, then as judge in courts of all levels, including with the High Court of Cassation and Justice for six years. In addition, he has held the position of chairperson of Bistrita Nasaud Tribunal and of Cluj Court of Appeal, and towards the end of his career as magistrate, he was esteemed President of the High Court of Cassation and Justice – Commercial Division. His thorough knowledge and extended expertise cover the fields of business law, civil law, civil procedure, administrative litigation and criminal law and procedure. Further, Buta is an arbitrator on the panel of the International Commercial Arbitration Court attached to the Chamber of Commerce and Industry of Romania.
Muşat & Asociaţii
About the author
Madalin Enache is a partner at Musat & Asociatii, and is recognised as one of the rising-star practitioners in criminal law (particularly white-collar crimes). He represents multinational companies and individuals in criminal law cases, in areas such as IT and telecoms, banking and finance, pharmaceuticals, capital markets, energy and public utilities. Enache has been directly involved as lead legal counsel in criminal files dealing with white-collar crime, infringements of special laws, IT crime or corruption cases, legal consultancy to private companies in criminal law or administrative matters, financial and fiscal frauds, corporate miss-administration, shareholder disputes and business litigations.