This week’s edition contains two judgments of the Divisional Court and one of the Crown Court. In Director of the Serious Fraud Office v Airbus SE the Crown Court approved a deferred prosecution agreement (DPA) reached between the Serious Fraud Office and Airbus SE. Under the terms of the DPA, Airbus SE agrees to pay a fine and costs amounting to €991m in the UK and €3.6bn in total as part the world’s largest global resolution for bribery. Kalinauskas v Prosecutor General’s Office, Lithuania concerned an extradition request from Lithuania in relation to one offence of supply of 30g of cannabis. The Government of India v Dhir & Anor concerned an appeal by the Government of India of a judgment ordering the discharge of a wife and husband whose extradition to India had been sought for several offences including conspiracy to commit murder.
Director of the Serious Fraud Office v Airbus SE
The judgment, available here, was handed down by Dame Victoria Sharp on 31/1/2020.
This case concerned a deferred prosecution agreement (DPA) reached between the Serious Fraud Office (SFO) and Airbus SE (Airbus).
Mohsin Zaidi was instructed by the Serious Fraud Office.
On 28 January 2020, the Crown Court heard an application in private in which it was asked to make a declaration in preliminary approval of a deferred prosecution agreement (a DPA) reached between the Serious Fraud Office (SFO) and Airbus SE (Airbus). At that hearing, the Court made a declaration that it was likely to be in the interests of justice for such agreement to be made and that its proposed terms were fair, reasonable and proportionate. On 31 January 2020, the Court made a final declaration and Order to that effect at a hearing held in public.
One of the consequences of the Order was that Airbus must pay a total financial sanction of approaching one billion euros (€990,963,712 including costs) to the Consolidated Fund via the SFO within 30 days, made up of the disgorgement of profit of €585,939,740 and a penalty of €398,034,571.
The total sums which Airbus was ordered to pay in a global context however exceeds €3.5 billion. This was because the SFO investigation which has led to this DPA is part of a joint investigation with the French Parquet National Financier (PNF) conducted by a joint investigation team (the JIT) and is parallel to an investigation conducted by the United States Department of Justice (DOJ) and by the United States Department of State (DOS).
The SFO’s investigation related to bribery offences in Malaysia, Sri Lanka, Taiwan, Indonesia and Ghana. The PNF’s investigation related to bribery and corruption offences in China, Colombia, Nepal, South Korea, the United Arab Emirates, Saudi Arabia (Arabsat), Taiwan and Russia. The JIT investigation into Airbus’ conduct in Colombia was led by the SFO but the SFO agreed that this conduct should be included in the French CJIP to reflect French primacy in the JIT investigation. The DOJ investigation related to bribery and corruption offences in China and violations of parts 126.1, 129 and 130 of the US International Traffic in Arms Regulations (ITAR) concerning a number of jurisdictions. The DOS’s investigation related to civil violations of ITAR concerning various jurisdictions. There was to be a simultaneous resolution in all three jurisdictions by way of settlement agreements.
The Court observed that the criminality involved was grave. The SFO’s investigation demonstrated that in order to increase sales, persons associated with Airbus, not exclusively its employees, offered very substantial sums of money by way of bribes to third parties in order to secure the purchase of aircraft, by civil airline companies, in counts 1 to 4; and by the Government of Ghana, in count 5.
It was alleged that those financial advantages were intended to induce those others to improperly perform a relevant function or activity or were intended to reward such improper performance and that Airbus did not prevent, or have in place at the material times adequate procedures designed to prevent those persons associated with Airbus from carrying out such conduct.
Notwithstanding the seriousness of the conduct in this case, the Court considered that the public interest factors against prosecution clearly outweigh those tending in favour of prosecution. In particular, the Court had regard to the exemplary co-operation of Airbus, including its submission to the SFO in respect of conduct overseas and of which the SFO would not otherwise have known.
In addition, on the evidence before the Court, the effects of a prosecution on Airbus and the collateral effects on thousands of innocent third parties, corporate and individual, would be disproportionate notwithstanding the egregious nature of the conduct engaged in (para 87).
The Court concluded that the terms of the DPA were fair, reasonable and proportionate. These terms would be made public. In summary they were as follows. The DPA will come to an end three years from the date of the declaration. Airbus will pay a total financial sanction of €983,974,311 to the SFO for onward transmission to the Consolidated Fund, within 30 days of this declaration. Airbus will continue to make improvements to its ethics and compliance policies and procedures. There would be ongoing cooperation and self-reporting by Airbus and Airbus will pay the reasonable costs of the SFO’s investigation in relation to the alleged offences and the DPA (€6,989,401) (para 88).
The DPA included a provision for the disgorgement of €585,939,740, representing the gross profit of conduct covered by the five counts on the indictment (para 97). It was also agreed that the gross profit earned prior to implementation of the Bribery Act 2010 on 1 July 2011 does not fall to be disgorged and that only profit from deliveries which have occurred by 31 March 2020 should be included. Airbus asserted that it is difficult to forecast profitability accurately beyond this point and the SFO accepted that for industry-specific reasons, there is declining certainty of delivery over time (para 98).
The DPA brought to a close the SFO’s investigation into Airbus and its controlled subsidiaries, other than a separate investigation into GPT (SPM) Ltd. The SFO also indicated that it has no intention of conducting any further investigation or prosecution of Airbus SE and its controlled subsidiaries (other than GPT) for the matters disclosed to it prior to this DPA and in the agreements reached with the PNF, DOJ and DOS (para 118).
The Court observed that the DPA requires Airbus to pay a significant financial penalty, thereby sending an important deterrent message to corporate wrongdoers. It also recognised and rewarded what Airbus had done to address the problem by discounting that financial penalty by 50 percent. The DPA had, in addition, given Airbus the opportunity to demonstrate its corporate rehabilitation and commitment to effective compliance over the period of the DPA, without facing the potential consequences of a criminal conviction. This ensured that a major UK employer continues to operate according to high ethical and compliance standards. By entering into the DPA, the SFO avoided the significant expenditure in time and money inherent in any prosecution of Airbus, and it can use its limited resources in other important work. The Court considered that the DPA was likely to provide an incentive for the exposure and self-reporting of organisations in similar situations to Airbus. As the SFO submitted, this is of vital importance in the context of complex corporate crime (para 119).
Kalinauskas v Prosecutor General’s Office, Lithuania  EWHC 191 (Admin)
The judgment, available here, was handed down by Mr Justice Supperstone on 6/2/2020.
This case concerned an extradition request from Lithuania in relation to one offence of supply of 30g of cannabis.
Jonathan Hall acted for the appellant.
The Appellant was a Lithuanian national sought to be returned pursuant to a European Arrest Warrant (“EAW”) for one offence of supply of 30g of cannabis on 9 April 2014 in Lithuania for 750 LTL which was approximately £185.
On 16 August 2017 District Judge Qureshi (“DJ”) at the Westminster Magistrates’ Court ordered the Appellant’s extradition to Lithuania.
On 14 December 2017 King J granted permission to appeal on two grounds: (1) extradition would be a disproportionate interference with the Appellant’s Article 8 ECHR rights, contrary to s.21A(1)(a) of the Extradition Act 2003 (“EA”); and (2) extradition would not be proportionate, contrary to s.21A(1)(b) EA.
On 30 January 2019 Ouseley J granted permission to appeal on an additional ground that, if extradited, there is an arguable real risk of detention in inhuman and/or degrading conditions in Lithuanian Correction Houses, contrary to s.21A(1)(a) EA and Article 3 ECHR (“the Article 3 ECHR ground”).
The Court allowed the Appellant’s appeal on grounds of proportionality under s.21A(1)(b) EA, and quashed the order for the Appellant’s extradition pursuant to s.27(5)(b) EA. It was not therefore necessary to determine either the Article 8 ECHR ground of appeal or the Article 3 ground.
The DJ was satisfied that the Appellant’s extradition would be proportionate. He so concluded for the following reasons:
“44. The conduct alleged is serious offending involving selling drugs to other individuals. I find that this type of offending does not come within the categorisation in [Part 50A of the Criminal] Practice Direction. The table makes no reference to supplying of drugs. Whilst there is no indication from the JA [judicial authority] of the likely sentence in a case of this type, the Sentencing Guidelines in the UK for offences of this type have a starting point of 12 months in custody with a range of 12 months to 3 years. The RP [requested person] has convictions in Lithuania, including sentences of detention, and a relevant previous conviction for possession of drugs. If convicted it is clear the RP would face a custodial sentence of some length.
45. The possibility of the JA taking measures that would be less coercive than the extradition of RP have been considered by the JA and rejected. …”
The Court was left in no doubt that if the Appellant was to be sentenced now for the offending, he would be immediately released. Therefore, in all the circumstances of this case, having regard to their assessment of the seriousness of the Appellant’s conduct and the fact that he had served in excess of any sentence that could have been imposed for his conduct, his extradition would be disproportionate (paras 20 and 21).
As a result, the Court allowed the appeal, quashed the order for extradition and ordered that the Appellant be discharged pursuant to Section 27(5) EA.
The Government of India v Dhir & Anor  EWHC 200 (Admin)
The judgment, available here, was handed down by Lord Justice Dingemans on 6/2/2020.
This case concerned an appeal by the Government of the Republic of India (“the Government”) from the judgment of Senior District Judge (Chief Magistrate) Arbuthnot (“the Chief Magistrate”) dated 2 July 2019 ordering the discharge of a wife and husband whose extradition to India had been sought for offences of conspiracy to commit murder; murder; attempting to commit murder; kidnapping; and abduction for the purpose of committing murder and abetting a crime.
The allegations against Ms Dhir and Mr Raijada are that they arranged for Ms Dhir to adopt an 11 year old boy known as Gopal Sejani (“Gopal”), who lived on a smallholding in a village in the State of Gujarat with members of his family including his sister and her husband Mr Kardani. Ms Dhir and Mr Raijada then arranged for a Wealth Builder policy to be taken out for Gopal, which included life insurance of 10 times the annual premium in the event of his death.
On 8 February 2017 Gopal travelled with his brother-in-law Mr Kardani to Rajkot to prepare visa papers. After the visit on 8 February 2017 Gopal and Mr Kardani were taken back by Mr Mund, who knew Mr Raijada’s father, to the village in a car with a driver. Two men approached on a motorbike and seized Gopal. Mr Kardani tried to intervene but was stabbed in the stomach. Gopal was taken away by the two men and was later found with stab wounds in his stomach. He died in hospital on 11 February 2017. Mr Kardani was taken to hospital where he made two statements before he also died on 17 February 2017. Mr Mund, who was also arrested and charged for his part in the matter, made statements to the effect that he had been recruited by Ms Dhir and Mr Raijada and coerced by them to arrange the murder of Gopal.
Some 45 minutes before the Chief Magistrate was due to give judgment and without any prior warning, an email was sent by the CPS attaching an assurance from the Government dated 2 July 2019. The letter from the Joint Secretary to the Government assured the court that if extradited and convicted and sentenced to life imprisonment Ms Dhir and Mr Raijada would be eligible to apply for remission, notwithstanding the written State policy relating to a case of double murder.
The appeal raised the issue of whether the Chief Magistrate was wrong to refuse to adjourn the proceedings to consider an assurance provided by the Government on 2 July 2019, which was the day on which the Chief Magistrate handed down her reserved judgment following a final hearing on 14 June 2019.
The Court refused the appeal.
The starting point was to consider the Criminal Procedure Rules which emphasise “expedition at all times” and that “compliance with these directions is essential to ensure that extradition proceedings are dealt with expeditiously”. It is of the “utmost importance” that parties obey directions. These rules were implemented against a background where, before the 2003 Act, delays in extradition proceedings had become notorious and justice for all the relevant parties was being delayed (para 40).
The Court noted that the Chief Magistrate did not give any directions requiring an assurance to be provided at any time, but it is also right to note that it does not appear to have been suggested by the Government that they were able to provide any relevant assurance which would meet the irreducible life sentence point. It is important to note from the chronology of the proceedings set out above that two extradition hearings were adjourned because of delays by the Government in complying with directions, and the third and final extradition hearing was adjourned part heard to enable the Government to deal with the irreducible life sentence point. If the Government had considered it could provide an assurance it should have sought directions providing a timetable for the service of an assurance, and served an assurance in accordance with that timetable (para 43).
The Court accepted that there would be financial consequences of discharging Ms Dhir and Mr Raijada and requiring the Government to start extradition proceedings again. However, had the adjournment been granted by the Chief Magistrate there would have been financial consequences caused by the fact that the assurance provided by the Government needed to be assessed by the Court and parties. Those financial consequences were brought about by the Government’s failure to obtain directions in relation to the assurance or to provide the assurance at an earlier stage (para 45).
The Court also accepted that this was a serious case, as was apparent from the careful analysis of the facts carried out by the Chief Magistrate when determining that there was a prima facie case on the offences against both Ms Dhir and Mr Raijada. However that meant that the Government should have complied with directions from the court to avoid unnecessary delays. In all these circumstances the Court was unable to say that the Chief Magistrate was wrong to refuse to adjourn the extradition proceedings (para 46).
Sentencing and release provisions in relation to terrorism offences
Guidance by the Independent Reviewer of Terrorism Legislation sets out the current custodial sentencing and release provisions applicable to adult terrorist offenders as at 7 February 2020. It covers: standard determinate sentences; extended determinate sentences for dangerous offenders; special custodial sentences for offenders of particular concern; and life sentences.
The full piece can be read here.
Chairman of the Grenfell Tower inquiry asks for undertaking that witnesses’ evidence will not be used in prosecution
Sir Martin Moore-Bick, the chairman of the Grenfell Tower inquiry, has asked the Attorney General to pledge that evidence given by certain witnesses will not be used to incriminate them, despite protests from bereaved families and residents. He asserted that it would be impossible to establish the cause of the fire that killed 72 residents in June 2017 without such an undertaking being given.
The full piece can be read here.