Airbus, international cooperation and the rise of Deferred Prosecution Agreements

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Aziz Rahman
Rahman Ravelli, London


Airbus has agreed to pay global fines of €3.6bn in reaching a settlement with the United Kingdom, United States and French authorities regarding the use of bribery to secure contracts.

The UK element of the January 2020 settlement saw Airbus conclude a deferred prosecution agreement (DPA) with the Serious Fraud Office (SFO).[1] This DPA is bigger than all the UK’s six previous DPAs put together, with Airbus paying a total of €991m, of which approximately 60 per cent is disgorgement of profits in relation to failure to prevent bribery under the 2010 Bribery Act. In France, Airbus has agreed to pay almost €2.08bn and in the US more than US$525m.[2]

The fines imposed in France and the UK are the largest ever for those countries, which make them notable in their own right. But the case of Airbus, which is the world’s largest aircraft manufacturer, is of significance for other reasons.

The degree of cooperation

While the figures are huge, the fact that the agreements were all approved by courts in each of the three countries on the same day indicates the level of international cooperation involved in this investigation.

It was an investigation which began in the UK in 2016 and then led to the SFO entering into a joint investigation team agreement the following year with France’s Parquet National Financier (PNF). This agreement saw the French authorities controlling the supply of documents to the SFO to comply with the French blocking statute.[3] The blocking statute is a criminal statute prohibiting anyone from engaging in discovery under a foreign judicial system without using the cooperation mechanisms provided for by The Hague Evidence Convention. France enacted this to protect French nationals against US discovery procedures; with the PNF requiring the US Department of Justice (DOJ) to sign an agreement before it would work with the US agency. The DOJ joined the investigation in 2018 after it had formally agreed to comply with the French blocking statute – accepting the primacy of the PNF investigation and agreeing to focus only on alleged violations of the US Foreign Corrupt Practices Act.

It could be argued that Airbus benefitted from this approach. There was a clear division of the penalties rather than any possibility that the company would be penalised more than once for the same misdemeanour. From the investigators’ point of view such international coordination has the benefit of removing the possibility of a company under investigation going ‘forum shopping’ to find the country in which it would be treated the most leniently.

From an impartial onlooker’s perspective, the investigation showed both the degree of cooperation that investigating countries are capable of and willing to enter into, as well as the results that can be achieved. It remains to be seen if the conclusion of the Airbus investigation is an indicator of greater future international cooperation. But it has certainly set a standard. This was a high-stakes investigation over four years. As Dame Victoria Sharp noted in the UK High Court judgement, ‘the conduct took place over many years. It is no exaggeration to describe the investigation it gave rise to as worldwide, extending into every continent in which Airbus operates. The number of countries subject to intense criminal investigation by the various agencies, and the scale and scope of the wrongdoing disclosed in the Statement of Facts, demonstrate that bribery was to the extent indicated, endemic.’[4] The simultaneous court hearings in three nations to conclude the investigation were just one sign of the extent of the cooperation and coordination involved in this case.

Negotiated settlements

As the conclusion of the investigation resulted in DPAs being approved in the UK, US and French courtrooms, it is worth examining the increasing popularity of such arrangements.

Prior to its agreement with Airbus, the SFO’s track record stood at six DPAs concluded with companies and no conviction of a senior executive from any of those companies. The criticism that can be levelled at the handling of the Airbus case – and it has been made in the UK – is that it is another example of a large corporate player opening their wallet and jumping through hoops to dodge a conviction that would have restricted commercial prospects. But it would be wrong to view the case solely from that perspective. As we have mentioned, the level of international teamwork alone makes it noteworthy.

While there will always be critics of DPAs, the role of the settlements in what was a huge multinational investigation cannot be ignored and neither can the appeal of such settlements to the authorities. In the wake of the Airbus case, Transparency International and Spotlight on Corruptions sent a joint letter to the SFO, calling on it to ensure consistency and fairness in DPAs and that they are a genuine deterrent to corporate criminality. Whether DPAs encourage self-reporting, the need to differentiate penalties for those that self-report and those who do not, the application of compensation principles and the transparency of the process were among the concerns highlighted in the organisations’ letter to SFO Director Lisa Osofsky.[5]

Quite what effect the letter will have on the SFO remains to be seen. Regardless of this, however, the Airbus case is an indicator of the increasing importance of negotiated settlements around the world. Of the three countries involved in this case, the US has had DPAs for almost 30 years, the UK’s SFO and Crown Prosecution Service have had DPAs available to them since 2014 and France has had its equivalent, the convention judiciaire d’intérêt public (CJIP), in place for three years. All three saw fit to go down the settlement route, due in no small part to the level of cooperation shown by Airbus, which arguably indicates that no case is too large to be concluded in such a way. The size of the penalties imposed would tend to support this argument.

The appeal of DPAs

The rise in DPAs can be attributed to a variety of factors. Their supporters will argue that they can act as an incentive to self-report and can lead to corporates being compelled to put right the wrongs that sparked either an internal investigation and/or investigation by an enforcement agency. For the investigating agency, a DPA is also a means of ‘securing a result’ without the cost and uncertainty of a criminal prosecution, especially as payment of an agency’s costs can be one of the terms of the DPA.

But the attractiveness of DPAs goes beyond them being seen as a ‘quick fix’ to a problem. Airbus is just one of many corporates that is international in its outlook and operations. If such a company is suspected of wrongdoing, any resulting investigation will have to cross borders and involve a large amount of multijurisdictional cooperation and coordination. Such an approach is necessary in both the investigation itself and in the agreeing on an outcome. DPAs are a way for countries to achieve a commonly-agreed outcome and avoid the risks of forum shopping mentioned earlier. While no two countries have identical statutes or legal systems, any multinational investigation could, in theory at least, lead to disagreements between investigating authorities about where any trial should be held. The use of DPAs removes that potential problem as each country can impose its own penalties with no need for a ‘tug-of-war’ over where justice should be seen to be done.

As cooperation levels between countries’ investigating agencies rises and we witness more cross-border investigations, it is inevitable that the DPA will become a tool that is increasingly used by the authorities. A DPA is also likely to be a popular option for those corporates that are investigated. It offers a quick conclusion to an investigation and will probably bring less financial and reputational damage than would accompany a criminal conviction. A DPA gives the company the opportunity to put right the wrongs in each jurisdiction where wrongdoing has been found. Companies entering a DPA can also plan for the future with greater certainty once the size of any fines and the conditions that are being imposed are known. The value of this could be seen clearly with Airbus, its share price rose once its DPA was announced.

Increased use of DPAs

At the time of writing, we appear to be in a period where more countries are looking to DPAs as the way to tackle corporate crime.

In Singapore, the passing of the Criminal Justice Reform Act 2018 introduced the framework for the public prosecutor to enter into DPAs.[6] Singapore’s approach is based on the UK DPA system. But its approach is most notable for marking the country’s shift in emphasis away from personal liability and the prosecution of individuals, towards an examination of the culpability of corporates.

December 2019 saw the Australian government table the Crimes Legislation Amendment (Combatting Corporate Crime) Bill in the country’s Senate.[7] The Bill is intended to update Australia’s foreign bribery legislation and corporate crime enforcement regime by introducing DPAs into the country’s legal system for a range of corporate crimes. The government hopes this will provide an incentive for corporates to self-report and cooperate with enforcement agencies.

In September 2018, Canada amended its Criminal Code to establish a DPA regime for corporate wrongdoing.[8] The regime talks specifically of ‘remediation agreements’, which are essentially DPAs. Prosecutors are allowed to negotiate agreements for certain criminal offences of an economic nature if it is in the public interest to do so. As a result, bribery, fraud, municipal corruption, fraudulent manipulation of stock exchange transactions and money laundering can now be the subject of a remediation agreement.

In March 2018, a new law came into force in Argentina. Act 27,401 on Criminal Liability of Legal Entities created corporate liability for bribery and introduced DPAs into Argentinian law.[9] To be eligible for a DPA, companies must actively cooperate with an investigation; which means disclosing accurate, useful and verifiable information leading to the clarification or explanation of facts, the recovery of assets or the identification of individual offenders.

When Japan’s criminal proceeding bargaining system was introduced in 2018 it allowed for lenient treatment of those accused of certain crimes if they provided information that helped with the investigation or charging of others.[10] It was initially assumed by many that the system would be used solely to enter into agreements with members of criminal organisations. But prosecutors will now use it in the same way the UK and US use their DPA regimes for corporate crime.

The approach of such countries indicates an increased awareness of the benefits of negotiated settlements. While, in the UK at least, such settlements are not without their critics they are increasingly being viewed as a vital tool in penalising corporate crime. As Airbus has shown, such settlements can be particularly effective in multinational investigations.


[1] Details of the UK High Court Judgment, 31 January 2020, are available at: www.judiciary.uk/wp-content/uploads/2020/01/Director-of-the-Serious-Fraud-Office-v-Airbus-SE-1.pdf, last accessed 26 February 2020.

[2] ‘SFO enters into €991m Deferred Prosecution Agreement with Airbus as part of a €3.6bn global resolution’, Serious Fraud Office news release, 31 January 2020, available at: www.sfo.gov.uk/2020/01/31/sfo-enters-into-e991m-deferred-prosecution-agreement-with-airbus-as-part-of-a-e3-6bn-global-resolution/, last accessed 26 February 2020.

[3] ‘The impact of blocking statutes on cross-border internal investigations’, expert briefing, Financier Worldwide, August 2019, available at: www.financierworldwide.com/the-impact-of-blocking-statutes-on-cross-border-internal-investigations#.XlOlj252vIU/, last accessed 26 February 2020.

[4] Op cit, n 2.

[5] Letter published on Transparency International UK’s website, February 2020, available at: www.transparency.org.uk/corruption/ti-uk-publications/, last accessed 26 February 2020.

[6] Criminal Justice Reform Act 2018, Singapore statutes online, available at: sso.agc.gov.sg/Act/CJRA2018?TransactionDate=20180914235959, last accessed 26 February 2020.

[7] Parliament of Australia, Crimes Legislation Amendment (Combatting Corporate Crime) Bill 2019, available at: www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=s1246, last accessed 26 February 2020.

[8] Public Prosecution Service of Canada, Remediation Agreements, 19 September 2018, available at https://ppsc-sppc.gc.ca/eng/tra/tr/22.html, last accessed 26 February 2020.

[9] ‘Argentina: New Law on Corporate Criminal Liability approved’, Global Compliance News, 12 March 2018, available at: https://globalcompliancenews.com/argentina-corporate-criminal-liability-20180312/, last accessed 26 February 2020.

[10] Sakura Murakami, ‘Japanese-style plea bargaining debuts but authorities fear spread of false testimony’, Japan Times, 31 May 2018, available at: www.japantimes.co.jp/news/2018/05/31/national/crime-legal/japanese-style-plea-bargaining-debuts-authorities-fear-spread-false-testimony/#.XlOqj252vIU/, last accessed 26 February 2020.