Consider whether to self-report to responsible public authorities

Consider the range of possible reporting options in each relevant jurisdiction, identifying the bodies you must make reports to and whether reporting would be voluntary or mandatory.

The organisation needs to consider whether to self-report to regulators. The rules on self-reporting differ greatly across jurisdictions. In some jurisdictions and for some sectors, there may be self-reporting obligations at a very early stage in the investigation. For example, in the UK the financial services sector has to deal with the Financial Conduct Authority (FCA) in an open and co-operative way, and must tell the FCA promptly if there is anything about which it should be aware.

In other countries where self-reporting systems are available, there may be strong incentives to self-report. These include much-reduced sanctions or even complete immunity from civil fines or criminal prosecution in cartel cases. In the US, for example, a company might choose to self-report bribery and corruption violations to the Department of Justice (DoJ) and enter a Deferred Prosecution Agreement (DPA). DPAs are also available in the UK.

In some jurisdictions, there may be a risk that assurances of lenience will not be honoured by the courts when sentencing and so you should seek local guidance.

Consider the risks associated with making, or not making, a report in each case. In particular, consider:

  • how a particular regulator or prosecutor may respond to the matter being reported
  • the risk of third parties (such as a bank or a contractual counter-party) making a disclosure, and plan accordingly. If you deem the risk significant you may wish to make a pre-emptive disclosure
  • the likelihood that a report made to one authority in one jurisdiction would be circulated to other authorities in other jurisdictions. Information-sharing between regulators and prosecutors is very common, both at the domestic and the international levels

If you have not already sought external legal advice it may be appropriate at this stage. The decision whether to report is potentially very significant and in most cases external legal advice will be of appreciable value.