Compliance | Broadened extraterritorial reach of Norwegian anti-corruption laws
The extraterritorial reach of the Norwegian Penal Code
The Norwegian Penal Code of 2005 is, in principle, only applicable to offences committed in Norway. Under certain circumstances, the Norwegian Penal Code has however extraterritorial reach and is applicable to criminal offences committed outside of Norway. Such extraterritorial reach usually requires i) a personal nexus to Norway, and ii) fulfilment of the principle of double criminality (Nw. dobbel straffbarhet). These requirements can be summarised as follows:
A personal nexus to Norway is typically established when the person committing a criminal offence is a Norwegian citizen, resident, or an offence is committed by a person acting on behalf a company registered in Norway. Persons that are neither Norwegian citizens, residents nor acting on behalf of a Norwegian companies are thus typically not subject to Norwegian jurisdiction for offences committed outside of Norway, unless they are present in Norway when the investigation is initiated.
The principle of double criminality requires that the relevant activities constitute a criminal offence in both the country they were conducted as well as in Norway. There are however a number of exceptions to this rule in relation to offences such as war crimes, terrorism and offences against the Norwegian state.
Since the implementation of the revised Norwegian Penal Code in 2005 and up until 1 July 2020, both a personal nexus and double criminality were required in order to establish Norwegian jurisdiction for foreign corruption. This has been criticised for mainly two reasons:
- Norwegian officials that are neither citizens, residents nor otherwise present in Norway and that commit corruption as part of their official duties outside of Norway might not have been subject to Norwegian jurisdiction.
- The requirement of double criminality complicated and/or hindered the investigation and prosecution of corrupt activities committed by Norwegian persons or companies abroad, in particular in relation to countries with weaker, ambiguous or complex anti-corruption laws.
What is new?
Double criminality is no longer a requirement for prosecution of foreign corruption
As of 1 July 2020, double criminality is no longer a requirement in order to establish criminal jurisdiction in Norway for corruption committed abroad. Norwegian citizens, residents and companies registered in Norway can thus as a result be prosecuted for corruption pursuant to the Norwegian Penal Code even when a corrupt activity is committed abroad and such activity is not regarded as a criminal offence under local law.
The new exception from the principle of double criminality is meant to broaden the extraterritorial reach of the corruption provisions of the Norwegian Penal Code and to ease the administrative burden on Norwegian authorities when prosecuting foreign corruption. It will no longer be required to verify whether local law criminalises an activity in order to establish Norwegian jurisdiction. This will in turn facilitate the investigation and prosecution of foreign corruption where local anti-corruption laws are weak, complex or ambiguous.
Norwegian jurisdiction for foreign persons acting on behalf of a Norwegian company abroad
The extraterritorial reach of the Norwegian Penal Code has moreover been expanded to include persons acting on behalf of a company registered in Norway that are neither Norwegian citizens, residents nor otherwise present in Norway. Offences with a maximum custodial sentence of at least three years pursuant to the Norwegian Penal Code apply to foreign citizens acting on behalf of a company registered in Norway abroad, even if they have no other connection to Norway. In addition to generally broadening the extraterritorial reach of the Norwegian Penal Code for persons acting on behalf of Norwegian companies, these changes are also intended to clarify that Norwegian companies can be prosecuted for violations of Norwegian anti-corruption provisions when an offence is committed by a foreign national acting abroad.
Criminal offences committed outside of Norway’s territory shall however only be prosecuted in Norway if this is in the public interest. Norwegian authorities have wide discretion when assessing whether or not to prosecute offences committed on foreign territory.
The amendments described above lead to an expansion of the extraterritorial reach of the Norwegian Penal Code. Norwegian corruption laws are often stricter than the laws of the jurisdictions Norwegian companies are operating in. Going forward, Norwegian authorities will be able to investigate and prosecute activities abroad which are prohibited under Norwegian anti-corruption laws, but are considered lawful locally.
Companies registered in Norway should therefore make sure that the corruption provisions of the Norwegian Penal Code are complied with in all their business operations around the globe. Anti-corruption programmes should be evaluated and, if necessary, improved on a regular basis in order to ensure compliance with Norwegian law. Effective anti-corruption programmes are to be tailored specifically to address the corruption risks a company is confronted with in its daily operations.