The first-ever acquittal decision under the Corruption of Foreign Public Officials Act (CFPOA) was rendered in R v Arapakota, when Damodar Arapakota was found not guilty of bribing a foreign public official due to insufficient evidence.
Mr. Arapakota was the founder and former CEO of Imex Systems, a software company. After his departure from the company, Imex conducted an internal investigation into Mr. Arapakota’s expenses and contacted the RCMP to report the company’s concern about a $40,000 trip Mr. Arapakota had purchased for Dr. Omponye Coach Kereteletswe, a Botswanan public official.
The RCMP charged Mr. Arapakota with one count of bribery of a foreign public official under section 3(1)(a) of the CFPOA. He was accused of giving Dr. Kereteletswe the trip in exchange for letters confirming Botswana’s intention to engage Imex.
The elements of section 3(1)(a) of the CFPOA
First, the court clarified the elements of section 3(1)(a) of the CFPOA. The Crown must prove beyond a reasonable doubt that the accused:
- directly or indirectly, gave, offered, or agreed to give or offer a loan, reward, benefit, or an advantage
- to a public foreign official (or to any person for the benefit of the public foreign official)
- in order to obtain or retain an advantage in the course of business
- as consideration for an act or omission by the official in connection with the performance of the official’s duties or functions.
The court confirmed that section 3(1)(a) requires proof of subjective fault as the requisite mens rea of the offence. The Crown was therefore required to prove that Mr. Arapakota:
- intentionally offered the benefit,
- had knowledge that Dr. Kereteletswe was a public foreign official, and
- knowingly or intentionally bestowed the benefit as consideration for the official acts done by Dr. Kereteletswe
- for the purpose of obtaining a business advantage.
“Advantages” and “benefits” must be material
Second, the court confirmed that the term “advantage or benefit” in the context of international bribery, as is the case with domestic bribery, is not meant to capture trivial benefits (like a cup of coffee) but rather benefits constituting a “material economic advantage.”
Despite evidence that Dr. Kereteletswe reimbursed Mr. Arapakota USD 15,000, the court concluded the first element of the test was met and the trip was not trivial. Mr. Arapakota paid for flights, meals and accommodation for Dr. Kereteletswe and his family, which went beyond ordinary “hospitality.”
There must be consideration
Third, the court determined that the requirement of “consideration” in section 3(1)(a) of the CFPOA means the Crown must prove there was quid pro quo or “something for something.” The court contrasted this section with section 3(1)(b) of the CFPOA, which has no quid pro quo requirement and therefore potentially captures a broader scope of conduct.
After reviewing the totality of the evidence, the court was not satisfied that the letters amounted to a “material economic advantage” or that Mr. Arapakota arranged the trip “as consideration” for the letters he requested. Among other things, the evidence indicated the arrangements for the trip began well before the Botswanan government decided to offer exclusive bidding rights to the company, and, in any case, Dr. Kereteletswe played no role in the decision.
The limits of circumstantial evidence
Fourth, the court provided a helpful reminder about the limits of circumstantial evidence. In this case, the Crown relied on circumstantial evidence such as the timing of events and the fact the letters were generally helpful to the company and Mr. Arapakota. However, after assessing this evidence in context, the court noted there were other reasonable inferences, inconsistent with guilt, that could be made such that the criminal burden of proof could not be satisfied. The court cautioned against “too readily” drawing inferences of guilt from circumstantial evidence, noting an inference of guilt drawn from circumstantial evidence should be the only reasonable inference that the evidence permits.
This decision will offer helpful guidance for those involved in future prosecutions under the CFPOA. In particular, the clarification of the mens rea and the quid pro quo requirement of section 3(1)(a) is a welcome development. The decision also underlines the importance of examining bribery allegations in their full context. Internal investigations will continue to be an important mechanism for companies to manage risk and ensure compliance with anti-corruption laws.
The author wishes to thank Alexandra Toutant, articling student, for her assistance in preparing this legal update.