Today Airbus Industrie, a Toulouse based aircraft manufacturer, agreed to pay £3Bn (€3.6Bn) to investigating authorities in France, the UK and the US. The settlement concludes a three year investigation into allegations involving bribery and corruption on the part of the French company. The Settlement will need to be approved by senior courts in the jurisdictions concerned. The Courts concerned heard the application on 31st January.
In effect, the allegations centred on the use of what have been described as “middlemen” in aircraft sales. Introducers were used to facilitate sales involving government export credits. Such credits allow airlines that perhaps could not otherwise afford a new Airbus to make a purchase on a credit arrangement. Airbus failed to disclose the use of these middlemen. It must be stressed that the use of government export credits is a normal convention and most governments use them to support domestic exporters. The US authorities requested information on whether export regulations were violated.
A spokesperson for the company stated: "Airbus confirms that it has reached agreement in principle with the French Parquet National Financier, the UK Serious Fraud Office and the US authorities”.
Investigations started in 2016 after the company referred itself to the SFO and its French counter part. Since the commencement of the investigation in August 2016, the company has taken steps to restructure its sales operations. The CEO, The COO and Chief Sales Officer have left the company.
Frankly, the company directors will be heaving a sigh of relief. This could have been worse. The financial penalty could have been £2Bn more than was agreed. Prosecutions will be avoided, as will all the accompanying publicity.
So, Airbus has some rebuilding of its reputation, but it now feels that having reported itself to the authorities and received a financial penalty, it can move on…
The investigating authorities in relation to foreign corrupt practices are increasingly co-operating. Companies are more and more aware of their obligations in terms of international trade.
Jonathan Compton LLB LLM Solicitor Barrister MCIArb