SWITZERLAND Trends and Developments Contributed by: Marc Hassberger and Jeffrey Connor, Chabrier Avocats LLC
The enforcement arc: Gunvor, Glencore and Trafigura A modern turning point for Article 102 of the SCC came in October 2019, when the OAG issued a sum - mary penalty order against Gunvor for organisational failings related to bribery in the Republic of Congo and Côte d’Ivoire. The order required the Geneva- based trading company to pay almost CHF94 mil - lion, including a CHF4 million fine, after prosecutors concluded the company had not taken the necessary and reasonable organisational measures to prevent its employees and agents from bribing public officials to gain access to petroleum markets. The decision placed commodity traders – a long-recognised area of compliance risk – squarely within Swiss corporate enforcement. In March 2024, the OAG sanctioned Gunvor again – this time for bribery linked to PetroEcuador between 2013 and 2017. In a summary penalty order dated 1 March 2024, the OAG required the company to pay almost CHF86.7 million, including a CHF4.3 million fine and the rest as compensation. On the same day, the US Department of Justice announced a USD661 million settlement with Gunvor under the Foreign Corrupt Practices Act (FCPA). The timing of the two actions highlighted how closely Swiss and US pros - ecutors now co-ordinate and showed that corporate compliance programmes must be strong enough to meet expectations in multiple jurisdictions at once – even if the mechanisms of co-operation remain con - siderably opaque. Later that year, on 5 August 2024, the OAG issued a summary penalty order against Glencore arising from conduct in the Democratic Republic of Congo in 2011. Prosecutors ordered a CHF2 million fine and a USD150 million compensation order. Notably, the OAG recorded that it did not identify any Glencore employees as having had knowledge of the bribery carried out by the local third-party business partner or agent, yet still found the company criminally liable for organisational failings. The resolution confirmed that under Article 102 of the SCC, corporate liability can attach even where no natural person’s knowledge is proven, which raises the bar for preventive systems designed to intercept misconduct before it occurs.
CHF5 million cap on the corporate fine applies in both routes. For more than a decade after its introduction, Arti - cle 102 of the SCC was applied sparingly, and com - mentators questioned its practical impact – especially given the apparent modesty of the fine cap by com - parison to the turnover of multinational companies. In practice, however, the fine cap has proved far less important than critics assumed. No company has ever been fined the maximum; most fines have fallen between CHF2 million and CHF4.3 million. The real financial impact has come from compensation orders ( Ersatzforderung ), which require companies to give up profits made through misconduct. In recent headline cases, these orders have reached between USD90 million and USD150 million, far exceeding the capped fines. The Glencore resolution in August 2024 illus - trates the point: a CHF2 million fine was paired with a USD150 million compensation order in a case tied to third-party misconduct. Similarly, in October 2019 Gunvor received a CHF4 million fine alongside having to pay nearly CHF90 million in compensation. Academic debate has therefore focused less on the fine cap and more on the elusive standard of “ade - quate organisation”. Some scholars argue the concept is vague, while others warn that, if interpreted expan - sively, it risks holding companies liable for unforesee - able misconduct. Even so, several corporate cases were brought before 2019, showing that the provision was never entirely dormant – just under-used. Swiss policymakers have periodically examined (and are currently examining) whether to expand the toolkit – most notably through discussion of deferred pros - ecution agreements (DPA) and stronger self-report - ing incentives, as well as debate over the corporate fine cap. Switzerland does not currently have a DPA regime, and proposals have encountered political reservations although there is a clear desire by many actors that such instruments would be welcome; the OAG has recently reiterated its support for additional instruments in complex corporate cases. Even with - out legislative change, however, recent practice dem - onstrates that the existing framework of Article 102 of the SCC is not insufficient to produce significant outcomes.
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