Client Alert. UK Bribery Act 2010 Analysis of the Guidance on Adequate Procedures and the SFO Prosecution Guidance. Introduction.

Transcription

1 Number May 2011 Client Alert Latham & Watkins Litigation Department The guidance will provide significant assistance, albeit at a high-level, when assessing procedures which organisations can put in place to address their bribery risks. Commercial organisations should re-consider now what procedures they wish to put in place in advance of the 1 July 2011 implementation date. UK Bribery Act 2010 Analysis of the Guidance on Adequate Procedures and the SFO Prosecution Guidance Introduction On 30 March 2011, the UK Ministry of Justice (MoJ) published guidance on procedures which commercial organisations can put in place to prevent bribery (the MoJ Guidance, found here). The MoJ Guidance is important because it steers commercial organisations towards the only defence available to the offence under the Bribery Act 2010 (the Act) of failure to prevent bribery, (the Section 7 Offence) although it provides no safe harbours. The MoJ guidance also set out the MoJ s view on the proper interpretation of various aspects of the Act, although the final arbiter will be the English Courts. The MoJ Guidance also announced that the Act will come into force on 1 July Also on 30 March, the Director of Public Prosecutions (DPP) and the Director of the Serious Fraud Office (SFO) published joint prosecution guidance in respect of offences under the Act (the Prosecution Guidance, found here). This sets out factors which the prosecutors (primarily the SFO) will take into account in deciding whether or not to exercise their discretion to prosecute offences. The Prosecution Guidance will assist organisations in understanding how the SFO will set its enforcement priorities, and how they may best reduce the risk of dealing with enforcement activity. However, the Prosecution Guidance is not entirely in line with the MoJ Guidance. This Client Alert considers the content of the MoJ Guidance and the Prosecution Guidance, and provides some comment on their likely implications. We already know that the Act has extraordinarily broad extra-territorial reach, although its limits are uncertain in places. All commercial organisations worldwide should remain aware of how the Act might apply to them, and what they can do to reduce the risk of investigations and prosecutions. For previous Client Alerts setting out the offences under the Act and other supporting materials on the Act, please visit our website devoted to the topic. If you have any concerns on how the Act might apply to you, please contact one of the authors or your usual Latham & Watkins contact. Key Points The MoJ Guidance emphasises that combating bribery risks is largely about common sense, not burdensome procedures, and its core principle for procedures is proportionality. The SFO reminds Latham & Watkins operates worldwide as a limited liability partnership organized under the laws of the State of Delaware (USA) with affiliated limited liability partnerships conducting the practice in the United Kingdom, France, Italy and Singapore and an affiliated partnership conducting the practice in Hong Kong and Japan. Latham & Watkins practices in Saudi Arabia in association with the Law Office of Mohammed A. Al-Sheikh. Under New York s Code of Professional Responsibility, portions of this communication contain attorney advertising. Prior results do not guarantee a similar outcome. Results depend upon a variety of factors unique to each representation. Please direct all inquiries regarding our conduct under New York s Disciplinary Rules to Latham & Watkins LLP, 885 Third Avenue, New York, NY , Phone: Copyright 2011 Latham & Watkins. All Rights Reserved.

2 us that bribery is a serious offence, and sees the Act as taking a robust approach to tackling commercial bribery. The six principles in the MoJ s draft guidance remain largely intact: Proportionate Procedures, Top-Level Commitment, Risk Assessment, Due Diligence, Communication (including training), and Monitoring and Review. The MoJ sees the section 7 offence of failing to prevent bribery applying only to those with a demonstrable business presence in the UK, and suggests that mere listing would not be enough. The SFO is silent on this. The MoJ sets out guidance on the extent to which an organisation might commit a section 7 offence if it fails to prevent bribery by contractors, joint ventures or subsidiaries. Facilitation payments will remain illegal, just as they are under existing English law. Both the MoJ and SFO recognise that corporate hospitality is an established and important part of doing business, and do not intend reasonable and proportionate expenditure to be prohibited or prosecuted. The SFO will continue to apply its usual two-stage test which permits prosecutions only where (a) there is sufficient evidence, and (b) prosecution is in the public interest. Existing published SFO guidance on corporate prosecutions will continue to apply. The SFO continues to promote selfreporting and remedial action, both of which may tend against a prosecution. The Content of the Guidance The MoJ Guidance comprises: a) A free-standing quick start guide designed to be read as an introduction b) The UK Government s policy on the Act including its views on the proper interpretation of various provisions c) The six principles that should inform the procedures which commercial organisations put in place to prevent bribery d) Case studies which apply the six principles to various scenarios The Prosecution Guidance comprises: a) A discussion of the Act in the wider context of anti-corruption b) The prosecutors views on the Act s provisions c) The factors which prosecutors will take into account in deciding whether there is a public interest in prosecution The section below discusses the key points which arise from these. Government Policy Both sets of guidance set the Act in context. The quotes which follow are important to consider because they set the background against which both sets of guidance should be read, and may inform how some of the less precise language is to be interpreted. The MoJ Guidance describes its view of the purpose of the Act. It is concerned with combating the risks of bribery, which the MoJ sees as [diminishing] the principle of free and fair competition. The Act is directed at making life difficult for the mavericks responsible for corruption, not unduly burdening the vast majority of decent, law-abiding firms. Its objective is not to bring the full force of the criminal law to bear upon well run commercial organisations that experience an isolated incident of bribery on their behalf. The MoJ Guidance also highlights the international nature of the Act. Tackling the scourge is a priority for anyone who cares about the developing world or international trade. The Act creates clarity and a level playing field, helping to align trading nations around decent standards. Addressing bribery is good for business because it created the conditions for free markets to flourish. 2 Number May 2011

3 The Prosecution Guidance echoes this, citing a number of international anti-corruption instruments and quoting the UN Secretary General. The Act, it says, is not intended to penalise ethically run companies that encounter an isolated incident of bribery. The offences are designed to balance corporate responsibility for ensuring ethical conduct in the modern international business environment with the public interest in prosecuting where appropriate. The Six Principles The MoJ Guidance sets out six principles which should inform the procedures which commercial organisations put in place to prevent bribery. The MoJ Guidance acknowledges that the purpose is not to guarantee the elimination of bribery: no bribery prevention regime will be capable of preventing bribery at all times. These principles satisfy the requirement in the Act 1 for the UK Government to publish guidance about procedures. They are commonly referred to as the adequate procedures guidance because following them will go a long way towards establishing the defence of adequate procedures to the Section 7 Offence. However, this label is a misnomer since following them will not guarantee a safe harbour. The MoJ Guidance recognises that only the English Courts can decide whether a particular set of procedures was adequate based on the particular facts and circumstances of the case. The principles are also not prescriptive. They are intended to be flexible and outcome focussed, and the action should be proportionate to the risks you face and to the size of your business. It will be for each commercial organisation to consider for itself what its risks are, and how it will deal with them. Principles Principle 1 Proportionate Procedures: A commercial organisation s procedures to prevent bribery by persons associated with it are proportionate to the bribery risks it faces and to the nature, scale and complexity of the commercial organisation s activities. They are also clear, practical, accessible, effectively implemented and enforced. Details Policies and procedures include the written documents which set out the organisation s general approach to bribery risk mitigation. However, they also include how other functions within the organisation can be used to reduce bribery risks and also to discourage deliberate unethical conduct. Examples given include the use of recruitment procedures, governance of business relationships, financial controls, decisionmaking and conflicts of interest, disciplinary procedures, whistle blowing procedures and training. The principle of proportionality is an element which has been introduced since the draft Guidance was published in This is an important and welcome development, and embeds the purpose of the Act as set out above. Proportionate Procedures are listed as the first principle. However, they should be considered in light of all the other principles, and in particular are likely to be a product of good top-level commitment (principle 2) and a good risk assessment (principle 3). The procedures themselves will in turn contribute towards effective due diligence (principle 4), communication (principle 5) and monitoring and review (principle 6). 3 Number May 2011

4 Principles Principle 2 Top Level Commitment: The top level management of a commercial organisation (be it a board of directors, the owners or any other equivalent body or person) are committed to preventing bribery by persons associated with it. They foster a culture within the organisation in which bribery is never acceptable. Principle 3 Risk Assessment: The commercial organisation assesses the nature and extent of its exposure to potential external and internal risks of bribery on its behalf by persons associated with it. The assessment is periodic, informed and documented. Details The MoJ guidance identifies two ways of implementing this principle: first, communication of the organisation s anti-bribery stance (both internal and external), including the consequences of breaching policies, on a regular basis; and secondly, an appropriate degree of involvement in developing bribery prevention procedures. Implementation will differ depending on the size of the organisation, and may involve the top-level management tasking others to design, operate and implement procedures. However, the MoJ Guidance emphasises that top-level management should demonstrate leadership and should be involved in high-profile and critical decisionmaking. Proper risk assessments enable an organisation to accurately identify and to prioritise the risks it faces. Risk assessments are a critical part of the process since if they are badly-conducted then the steps which are taken subsequently might not in fact address the real risks which the organisation faces. This may both increase the risk of bribery and reduce the likely effectiveness of a defence to the Section 7 Offence. Risk assessments should be subject to top-level management oversight and involve resourcing appropriate to the scale of the organisation s business and the need to identify and prioritise all relevant risks. The MoJ Guidance categorises external risks into five broad groups: Country Risk Sectoral Risk Transaction Risk Business Opportunity Risk (e.g. risks arising from high value or multi-party projects, projects) Business Partnership Risk (e.g. the use of intermediaries or agents) 4 Number May 2011

5 Principles Principle 4 Due Diligence: The commercial organisation applies due diligence procedures, taking a proportionate and risk based approach, in respect of persons who perform services for or on behalf of the organisation, in order to mitigate identified bribery risks. Details This principle is the application of procedures to parties who might be associated with an organisation. The purpose of this principle is to ensure that an organisation has put in place procedures which prevent such third parties from bribing other on the organisation s behalf. In this sense, this principle is a specific application of all the other principles to certain types of relationship. The MoJ Guidance identifies situations in which this principle will be applicable such as the use of local agents, and mergers and acquisitions, but the principle will also apply to other situations, for example, throughout the life of joint ventures and other investments including subsidiaries, contractual business partners and employees. Principle 5 Communication (including training): The commercial organisation seeks to ensure that its bribery prevention policies and procedures are embedded and understood throughout the organisation through internal and external communication, including training, that is proportionate to the risks it faces. This principle reflects the fact that businesses are ultimately run by people. It recognises that the procedures in an organisation will only work if people follow them, and their purpose can only be achieved if people understand and accept them. Communication under this principle is reciprocal: an organisation should establish secure, confidential and accessible means for people to raise concerns about bribery and suggest improvements so called speak-up procedures. The communication should also be external as well as internal. Effective training will need to ensure people are educated as to what the organisation s bribery risks are, what behaviour is prohibited, how people can identify bribery risks and what to do when they develop concerns. The training could be a combination of face-to-face sessions and e-learning tools. Principle 6 Monitoring and Review: The commercial organisation monitors and reviews procedures designed to prevent bribery by persons associated with it and makes improvements where necessary. This principle involves assessing whether existing procedures are being followed, and assessing whether they deal adequately with the risks which have been identified, including external verification or assurance. It also covers procedures to detect and investigate bribery, such as auditing or staff feedback. Finally, it covers procedures to ensure that the organisation s procedures as a whole remain alive and are regularly tested. 5 Number May 2011

6 Prosecution Guidance The Prosecution Guidance sets out the prosecutors approach to prosecutorial decision-making in respect of offences under the Act. It is expressly not intended to be exhaustive, and states that prosecutors should be mindful of the wide range of circumstances and culpability which may arise in any particular case. The Prosecution Guidance refers to other published guidance, which should be read in conjunction with the Prosecution Guidance. These are the Guidance on Corporate Prosecutions 2 and the Approach of the SFO to dealing with overseas corruption 3 The Prosecution Guidance deals with each of the offences in turn, and sets out factors which affect the exercise of discretion. The only general factor which appears in the body of the Prosecution Guidance is that of selfreporting: the SFO promotes active engagement with businesses and selfreporting by companies. This is likely to be an important factor in the exercise of the SFO s discretion, and the issue of whether, and if so when, to self-report will be one which corporates will need to consider carefully when potential problems are detected. It also confirms that prosecutors will make decisions in accordance with the usual two-stage test set out in the Code for Crown Prosecutors 4 which permits prosecutions only where (a) there is sufficient evidence, and (b) prosecution is in the public interest. The Prosecution Guidance notes that [a] case which does not pass the evidential stage must not proceed, no matter how serious or sensitive it may be. Where there is sufficient evidence to justify a prosecution, prosecutors must always go on to consider whether a prosecution is required in the public interest. However, the default position, where there is sufficient evidence, will be to prosecute. The Prosecution Guidance confirms that that there is an inherent public interest in bribery being prosecuted and states that prosecution will usually take place unless the prosecutor is sure that there are public interest factors tending against prosecution which outweigh those tending in favour. General offences 5 Factors tending in favour of prosecution are: A conviction is likely to attract a significant sentence Premeditation and corruption of the person bribed Offences committed to facilitate more serious offending Where perpetrators are in positions of authority or trust and take advantage of that position Factors tending against prosecution are: The likely imposition of only a nominal penalty Minor harm as the result of a single incident A genuinely proactive approach involving self-reporting and remedial action The reference to self-reporting and remedial action is of particular importance in the context of bribery since this is the only factor which does not also appear in the Code for Crown Prosecutors. 6 Number May 2011

7 Bribery of a foreign public official 6 Factors tending in favour of prosecution are: Large or repeated payments are more likely to attract a significant sentence Facilitation payments that are planned or accepted as part of a standard way of conducting business may indicate premeditation Payment indicating an element of active corruption of the official Where an individual has not followed a clear and appropriate policy set out by a commercial organisation Factors tending against prosecution are: A single small payment likely to result in only a nominal penalty The payment coming to light as a result of a genuinely proactive approach involving self-reporting and remedial action Where a commercial organisation has a clear and appropriate policy which has been correctly followed The payer was in a vulnerable position arising from the circumstances in which the payment was demanded Specific issues The MoJ Guidance sets out the MoJ s view on the application particular provisions of the Act in specific situations. Although these are within the MoJ Guidance, it is not clear in what sense they are guidance about procedures. They appear to deal instead with the prior questions of who might be liable to commit various offences, and what might constitute a bribery offence. The Prosecution Guidance also sets out the prosecutors views on some of these situations. As to the interaction between the two sets of guidance, it is not clear to what extent the prosecutors would take the MoJ Guidance into account. Thus the Prosecution Guidance states, in relation to the Government policy and the specific issues, that prosecutors may find this helpful when reviewing cases involving commercial bribery. This is not a strong endorsement of the MoJ Guidance. However, the Prosecution Guidance states that prosecutors must take it [the MoJ Guidance] into account when considering whether the procedures put in place by commercial organisations are adequate to prevent persons performing services for or on their behalf are adequate (emphasis added). The reference to procedures may be significant: it appears to be an indication on the part of the prosecutors that they distance themselves from aspects of the MoJ Guidance other than procedures. In any case, where the views expressed in the MoJ Guidance on these issues differs from the SFO s position, relying on the former might involve risk. Hospitality and Promotional Expenditure The MoJ Guidance recognises that bona fide hospitality and promotional or other business expenditure is an established and important part of doing business and it is not the intention of the Act to criminalise such behaviour, provided the activity seeks to improve the image of a commercial organisation, better to present products and services, or establish cordial relations. The MoJ Guidance also states that The Government does not intend for the Act to prohibit reasonable and proportionate hospitality. The Prosecution Guidance contains similar language. The MoJ Guidance further states that the prosecution must show a sufficient connection between the advantage and the intention to influence, which will in many cases depend on the 7 Number May 2011

8 type and level of advantage offered, the manner and form in which the advantage is provided, and the level of influence the particular foreign public official has over awarding business. The Prosecution Guidance states that factors includes the lavishness on the expenditure, whether it was clearly connected with legitimate business activity or was concealed. Although this language is not precise, the tone of the language should provide welcome clarification for industry. Nevertheless, this language itself creates a further layer of uncertainty, in particular what the hospitality must be proportionate to. This is not legalistic pedantry, but a critical issue which will inform procedures: could it be proportionate to the importance of the products or services, or of the relationship? Could it be proportionate to the seniority of the individual, or the value of the contract? There is a clue in the quick start guide, which states: you can continue to provide tickets to sporting events, take clients to dinner, offer gifts to clients as a reflection of your good relations, or pay for reasonable travel expenses in order to demonstrate your goods or services to clients if that is reasonable and proportionate for your business. But does this really mean that if the decision relates to a valuable piece of business then a proportionately high spend will be permissible? The examples given are less helpful than the general language, in that they present truisms or circular definitions: flights and accommodation for genuine mutual convenience are unlikely to raise the necessary inferences of an intention to influence, for example, while a five-star holiday which is unrelated to a demonstration of the organisation s services will be far more likely to raise the necessary inference. These examples are obvious, and do not deal with the cases between the extremes. However, helpfully, the MoJ Guidance does state that costs which would otherwise be borne by the relevant government, rather than the official might not amount to a financial or other advantage. Interestingly, both the MoJ Guidance and the Prosecution Guidance focus on hospitality and promotional expenditure only as a sub-section of a discussion of the offence of bribing a foreign public official. It is unclear whether the MoJ or the prosecutors would take the same view in relation to the general offences of bribing or being bribed. This omission could be significant, and is unhelpful since it will leave organisations in a position of considerable uncertainty as to their conduct in the private sphere. Jurisdiction of the Section 7 Offence The Section 7 Offence will apply to any relevant commercial organisation, defined as including any company or partnership which carries on a business or part of a business in the UK. The meaning of this has been an issue of considerable uncertainty. It is an important issue, since it will in effect determine whether an organisation might be exposed to criminal liability for not having adequate procedures in place, potentially in respect of bribery within businesses which have no connection with the UK. The MoJ Guidance seeks to provide some clarification on this issue, stating that organisations that do not have a demonstrable business presence in the UK would not be caught. Two examples are given. First, the mere fact that a company s securities have been admitted to the UK Listing Authority s Official List and therefore admitted to trading on the London Stock Exchange would not constitute carrying on part of a business in the UK. This clarification should provide some reassurance to businesses. However, there are clearly questions to be raised regarding the general requirement of a demonstrable business presence. For example, what does it add to require that a presence be demonstrable? Secondly having a UK subsidiary will not, in itself, mean that a parent 8 Number May 2011

9 company is carrying on a business in the UK, since a subsidiary may act independently of its parent or other group companies. This is potentially extremely concerning, since it indicates that a parent might be treated as carrying on business in the UK merely because the subsidiary does not act independently. Establishing a coherent test of independence for a subsidiary might be difficult since by definition the parent will have some degree of control. It would be unfortunate if the proper interpretation of this provision were effectively to pierce the corporate veil between a UK subsidiary and its parent, in particular in circumstances where it is indisputable that one entity (the subsidiary) would be within the jurisdictional reach of the Section 7 Offence in any case. The Prosecution Guidance is silent on the issue of jurisdiction. This omission is significant, because the SFO has also stated on numerous occasions that it would be prepared to use the extraterritorial jurisdiction of the Section 7 Offence to prosecute foreign companies, and may take a broader view on the proper interpretation of this provision. In these circumstances, it might not be prudent for organisations to rely on the MoJ Guidance on this issue. Associated Person The Section 7 Offence will be triggered by bribery on the part of a person associated with the relevant commercial organisation 7. This is defined a person who performs services for or on behalf of the organisation, for example employees, agents or subsidiaries 8. The MoJ Guidance states that this is intended to give the Section 7 Offence broad scope so as to embrace the whole range of persons connected to an organisation who might be capable of committing bribery on the organisation s behalf. The MoJ Guidance also sets out the MoJ s view in two specific areas. First, in relation to supply chains, it is likely that persons who contract with [a] counterparty will be performing services for that counterparty and not for other persons in the contractual chain. The reason behind this is that an organisation is likely only to exercise control over its relationship with its contractual counterparty. This has been criticised as establishing a loophole for an organisation that might try to include an additional link in a supply chain in order to disclaim responsibility for conduct some way down the chain. However, the recognition that there are circumstances in which an organisation cannot control the conduct of those who indirectly perform services for it is to be welcomed, and provides valuable guidance on the limits to the application of Principle 4 (due diligence). Secondly, in relation to joint ventures, the concept of control is also used: the degree of control that a participant has over that arrangement is likely to be one of the relevant circumstances to be taken into account. Accordingly, a bribe paid on behalf of the joint venture entity by one of its employees or agents will [ ] not trigger liability for members of the joint venture simply by virtue of them benefiting indirectly from the bribe through their investment in or ownership of the joint venture. The use of the concept of control is to be welcomed, in particular in relation to existing joint ventures. Areas of uncertainty still remain in relation to future joint ventures however, where control over a joint venture may itself be a negotiable issue, and so something which is ultimately in the organisation s control. How hard would one be expected to negotiate to retain the ability to control the relevant bribery risks? This might not be practically possible, in particular with more than two joint venture partners. The MoJ Guidance also discusses whether an indirect benefit, such as a flow of dividends through a corporate structure, would be sufficient for a parent to commit a Section 7 Offence through its subsidiary s bribery. The Act expressly contemplates that a subsidiary may be associated with its parent 9, but does not specify the circumstances more precisely. The MoJ Guidance, unhelpfully, does not give guidance on this issue. Instead it highlights the 9 Number May 2011

10 requirement of intention on the part of the subsidiary: the bribery must take place in order to obtain or retain business or an advantage in the conduct of business 10. The MoJ Guidance states that the fact that an organisation benefits indirectly from a bribe is very unlikely, in itself, to amount to proof of the specific intention required by the offence [ ] liability will not accrue through simple corporate ownership or investment, or through the payment of dividends or provision of loans by a subsidiary to its parent. This guidance might be helpful in the event of an investigation, since it provides corporates with a further legitimate line of defence to a Section 7 Offence in addition to contending that a subsidiary is not associated. However, the question of intention will always be case-specific and likely fact-intensive, and so this guidance will likely not allow corporates to know the extent of their responsibilities, and plan accordingly. The Prosecution Guidance does not contain any discussion on associated persons. Facilitation Payments The MoJ Guidance confirms that there is no exemption under the Act for facilitation payments, i.e. small bribes paid to facilitate routine government action. The MoJ Guidance confirms that the government does recognise the problems that commercial organisations face in some parts of the world and in certain sectors. There is also an express reference to the Prosecution Guidance. The Prosecution Guidance sets out its position on facilitation payments in the discussion on the factors relevant to a prosecution under section 6 (see above). This guidance is not wholly satisfactory, as in many countries certain minor payments are necessary to doing business, and for which there are exceptions under local law. It is not clear how such law would be taken into account. The MoJ Guidance also discusses whether facilitation payments made in times of need might be treated differently under the Act. The MoJ Guidance recognises that the common law defence of duress is very likely to be available in circumstances in which individuals are left with no alternative but to make payments in order to protect against loss of life, limb or liberty. It appears that, where this applies, there would be no bribery offence and, by extension, the Section 7 Offence would not be triggered. Case Studies The MoJ appends eleven case studies to the MoJ Guidance, which are decribed as illustrative and intended to complement the guidance. they deal with situations such as facilitation payments; proportionate procedures; joint ventures; hospitality and promotional expenditure; assessing risks; due diligence of agents; communicating and training; community benefits and charitable donations; due diligence of agents; and top-level commitment. Each of the case studies does not describe what procedures would be adequate in each situation. Instead they set out a number of (non-exhaustive and non-prescriptive) questions that the commercial organisation could consider in relation to each situation. The case studies are helpful to a limited extent as illustrations, but provide very little in the way of substantive guidance. 10 Number May 2011

11 Next Steps Commercial organisations worldwide should review the MoJ Guidance and the Prosecution Guidance to determine what risks they face of being investigated or prosecuted under the Act. The guidance will provide significant assistance, albeit at a high-level, when assessing procedures which organisations can put in place to address their bribery risks. Commercial organisations should re-consider now what procedures they wish to put in place in advance of the 1 July 2011 implementation date. If you have any questions about this Client Alert, or would like to discuss any matters arising in relation to the Act 2010, please contact one of the authors listed below or the Latham attorney with whom you normally consult. You can also visit our dedicated Bribery Act website. If you have any questions about this Client Alert, please contact one of the authors listed below or the Latham attorney with whom you normally consult: John Hull john.hull@lw.com London Marc Hansen marc.hansen@lw.com London Dan Smith daniel.smith@lw.com London Omar S. Shah omar.shah@lw.com London Endnotes 1 Section 9 2 Guidance on Corporate Prosecutions 3 Approach of the SFO to dealing with oversees corruption 4 Code for Crown Prosectutors 5 Sections 1 and 2 6 Section 6 7 Section 7(1) 8 Section 8(1) 9 Section 8(3) 10 Section 7(1)(a), (b) 11 Number May 2011

12 Client Alert is published by Latham & Watkins as a news reporting service to clients and other friends. The information contained in this publication should not be construed as legal advice. Should further analysis or explanation of the subject matter be required, please contact the attorney with whom you normally consult. A complete list of our Client Alerts can be found on our website at If you wish to update your contact details or customise the information you receive from Latham & Watkins, please visit to subscribe to our global client mailings program. Abu Dhabi Barcelona Beijing Boston Brussels Chicago Doha Dubai Frankfurt Hamburg Hong Kong Houston London Los Angeles Madrid Milan Moscow Munich New Jersey New York Orange County Paris Riyadh* Rome San Diego San Francisco Shanghai Silicon Valley Singapore Tokyo Washington, D.C. * In association with the Law Office of Mohammed A. Al-Sheikh 12 Number May 2011