Guide to Business Ethics and Anti-Corruption - Macau laws 

July, 2014 - Carlos D. Simões and Pedro Manero Lemos

Guide to Business Ethics and Anti-Corruption

Macau laws


Transparency International (TI) rankings


Macau is not ranked on the TI CPI 2013. However, it was ranked 46 out of 183 on the TI CPI 2011.

Macau is not ranked on the TI BPI 2011.



International anti-corruption conventions and inter-governmental organisations


The Central Government of the People’s Republic of China has declared that the UNCAC shall apply to Macau. Macau is a Member of ADB/OECD Anti-Corruption Initiative for Asia and the Pacific and a Member of APG.



Key anti-corruption laws


In Macau, the primary anti-corruption statutes which prescribe corruption as a substantive offence are:

• Law 19/2009 on the Prevention and Suppression of Bribery in the Private Sector (PSBPS)

• Penal Code, as amended by Law 17/2009.



Features of bribery offences


PSBPS introduced the crimes of corruption in the private sector, regarding bribery of persons who work in the private sector (including management and directorship), both in its passive (section 3) and active (section 4) forms.

In its passive form, bribery entails that the agent, personally or through a third party with his or her consent or ratification, solicits or accepts, personally or for a third party, a (promised) undue/illegitimate advantage (material or non-material) as a compensation for any act or omission that constitutes a breach of that person’s professional duties.


In its active form, bribery entails, that the agent, personally or through a third party with his or her consent

or ratification, gives or promises to give to a person (as defined in 4.1 above) or to a third party with such person’s knowledge, an undue/illegitimate advantage (material or non-material), for that person to pursue any act or omission that constitutes a breach of his or her professional duties.


Regarding the public sector, the relevant provisions are contained in the Penal Code, namely sections 336 to 339, which relate to crimes of corruption in the public sector.


• In its passive form, public sector corruption is divided into corruption for an unlawful act (when a public

servant, personally or through a third party with the public servant’s consent or ratification, solicits or accepts, personally or for a third party, a (promised) undue/illegitimate advantage (material or nonmaterial)

as a compensation for any act or omission that constitutes a breach of that person’s professional duties (section 337)) and for a lawful act (when a public servant, personally or through a third party with the public servant’s consent or ratification, solicits or accepts, personally or for a third party, a (promised)

undue or illegitimate advantage (material and nonmaterial) as a compensation for any act or omission

that does not constitute a breach of the public servant’s professional duties (section 338)).


• In its active form, bribery involves the situation in which a person, personally or through a third party with his or her consent or ratification, gives or promises to give to a public servant or to a third party with such person’s knowledge, a material or non-material advantage that is not due to such person, to pursue any unlawful or lawful act (as per the above definition) (section 339).



Compliance defence and mitigation

There is no specific provision in Macau that would allow a person to disclaim liability for corruption offences solely based on adequate anti-bribery compliance procedures under the various key statutes pertaining to corruption in Macau.


Section 7 of Law 10/2000 (the law that introduced the Bureau against Corruption (BACL)) provides an “escape exit” for the agents of crimes of corruption, stating that prosecution may not take place when the agent cooperates in obtaining decisive evidence for the crime’s determination, namely by identifying other agents. However, such decision is discretionary.


Having adequate procedures in a company to guard against corruption may be a relevant factor for mitigation, and also may be viewed favourably by regulators and prosecutors when deciding whether to pursue a case against the directors of the company. Further, having such adequate procedures in place could be a defence against liability for a director or officer in respect of civil claims brought by the company or shareholders of the company for breach of fiduciary or other duties or for failing to take steps to guard against corruption.


Under Macau Criminal Law (section 34), an agent acts unwillfully (“without guilt”) when his or her actions are intended to remove an imminent danger, in no other way removable, that threatens values like life, physical integrity, honour or liberty of the agent or a third party, and it is not reasonable to demand under those circumstances, other behaviour. This may include threat or duress, depending on the circumstances and on the level and imminence of the danger. In case the danger threatens values other than the above and the same circumstances apply, the penalty will be substantially reduced.



Facilitation payments


In Macau there is no concept of a “facilitating payment”. However, in most cases such a payment would violate Macau laws and may be considered under the Macau Criminal Code as an “active corruption to a lawful act”.
There is no express provision in Macau law regarding the criminalisation of bribery acts committed outside of Macau.



Gifts and entertainment


According to the Guidelines on the Professional Ethics and Conduct issued by the Commission Against Corruption, public officials should never accept any gifts and/or souvenirs. In the event that they do accept such gifts or souvenirs, these should be of symbolic value. Public officials should also consider the purpose of the offer and evaluate if it is reasonable and appropriate. In any case, the offer will be accepted on behalf of the department or institution and must be reported to the superior.



Corporate liability for the acts of intermediaries


There is no provision that relates to the liability of legal entities. Regarding bribery, the various provisions of the BACL and the Penal Code set out certain offences which may be committed by a “person”, which in principle will entail only physical persons. As further developed below, legal entities are subject to fines for acts or omissions relating to their failure to comply with anti-money laundering laws.



Liability of individual directors and officers


As there is no criminal liability for legal entities or corporations under anti-corruption laws, individual directors and officers of a company will not be held liable for an offence if they were not personally and

individually responsible for, or otherwise involved in, that particular offence.


The directors and officers who are personally involved in the corrupt activities may be liable beyond bribery offences for breach of fiduciary duties and could potentially be exposed to civil liability arising from the same corrupt acts.



Penalties


Passive corruption in the private sector is punishable with imprisonment of up to one year or with a fine. The penalty is up to two years if it entails unfair competition, or three years if harmful to health or security of third parties. Active corruption in the private sector is punishable with imprisonment of up to six months or with a fine. The penalty is up to one year’s imprisonment if it entails unfair competition, or two years’ imprisonment if harmful to health or security. All these acts are also punishable with a fine of up to MOP 3.6 million (approximately US$450,800).


Passive corruption in the public sector for unlawful acts is punishable with imprisonment ranging from one to eight years. If the act is not carried out (but a mere attempt), the official shall be punished with imprisonment of up to three years or with a fine of up to MOP 3.6 million (approximately US$450,800). The punishment shall not be imposed if the official, before the act is carried out, voluntarily repudiates

the offer or promise accepted, or returns the advantage or (in case of a consumable good) its value.


Passive corruption for a lawful act in the public sector is punishable with imprisonment up to two years or a fine of up to MOP 2.4 million (approximately US$300,500).


Active corruption in the public sector may be punished with imprisonment of up to three years or with a fine

of up to MOP 3.6 million (approximately US$450,800). Active corruption for a lawful act may be punished with imprisonment of up to six months or with a fine of up to MOP 600,000 (approximately US$75,000).


All the monetary penalties are determined according to the economic situation of the agent, their degree of guilt and other criteria.



Enforcement agencies


The main Government enforcement agency is the Bureau against Corruption (BAC), whose establishment is provided for in Macau’s Basic Law (section 59) and was effectively established by Law 10/2000 (BACL). This BAC is an independent public entity which has as its mission to prevent, investigate and repress corruption and fraudrelated crimes, both in the public and private sectors.


BAC has broad investigative powers, without prejudice to the specific competences of the Public Prosecution powers, namely to:

• investigate suspicions or facts that create rightful suspicion of corruption-related crimes in the public sector

• conduct site inspections, with or without previous notice, in any public entities, examining documents, conducting interviews with public servants or requiring information deemed useful

• conduct inquiries on the lawfulness of administrative proceedings and of public procurement proceedings

• propose legislation to the Legislative Assembly and to the Chief Executive

• issue recommendations directly to public entities with regard to the correction of unlawful or unfair acts or

proceedings, or to the practice of legally due actions.



Anti-money laundering laws

In Macau, the primary anti-money laundering statutes are Law No. 2/2006 − Anti-Money Laundering Law (AML Law), Administrative Regulation 7/2006 (AR 7/2006) and Warning 1/2010 of the Economic Services Department, which regulates the preventive and suppressive measures for anti-money laundering. These prescribe various reporting obligations on all the entities subject to these rules (such as credit institutions, gaming corporations, merchants of high-value goods like jewellery, real estate mediators and service providers, among others).


• Duty of identification: obligation to identify customers or their representatives when, in one transaction, an

amount equal or above MOP 100,000 (approximately US$12,500) is paid:

  • when, within a period of 30 days, one customer makes transactions that overall, go above MOP100,000 (approximately US$12,500)
  • when, from an examination of the transaction, or by any other means, there arises the suspicion of money laundering or financial aid to terrorism
    in addition, all the details involved in these transactions must also be identified – type of goods purchased, exchanged, etc

• Duty of refusal: when the necessary elements for the fulfilling of the duties referred to under (a) above are not provided by the customer or its representative(s), there is a duty for the person/entity to refuse such transaction(s).

• Duty of conservation of the documents relating to customer identification, for a minimum period of

five years.

• Duty of communication: when a person suspects money laundering or financial aid to terrorism, the

person must, within a maximum of two working days, report to the authorities.

• Duty of cooperation: the person/entity has the duty to cooperate with the competent authorities on prevention and suppression of the crime of money laundering and financial aid to terrorism.


Corporate entities may be criminally liable for money laundering when the crime is committed in their name

and corporate interest: (a) by their corporate bodies or representatives; or (b) by a person under their authority, when the crime became possible by virtue of an unlawful breach of the vigilance or control duties imposed on such corporation. This liability does not exclude the individual responsibility of the agent. If the corporate entity is convicted of this offence, it may be subject to: (a) a fine and/or (b) judicial winding-up. The fine is fixed in days, with a minimum of 100 and a maximum of 1,000. Each day of the fine corresponds to an amount between MOP 100 (approximately US$12) and MOP 20,000 (approximately

US$2,500).



Whistleblowing


Macau currently has no whistleblowing legislation.


Section 7 of the BACL provides for an “escape exit” for the agents of crimes of corruption, stating that prosecution may not take place when the agent cooperates in obtaining decisive evidence of the crime’s unveiling or determination, namely by identifying other agents.

 

Data privacy


Personal data is protected in Macau by Law No. 8/2005, the Personal Data Protection Law (PDPL). The PDPL aims to provide a comprehensive data protection regime. Personal data must be processed in a transparent way and in strict respect for the privacy of private life as well as the personal rights, liberties and guarantees established in Macau’s legislation and international conventions in force in Macau (section 2, PDPL).


The PDPL requires that personal data (section 5) be processed lawfully, be obtained for specific, legitimate

and pre-determined purposes directly related to the data processor’s activity, and be adequate and not excessive in relation to their purpose. It must be maintained in such form as to enable identification of its holders only during the necessary period required for its relevant purpose.


Banks and their employees are subject to privilege regarding the names and other information related to

customers, deposit accounts and their movements, funding applications and other banking transactions.


This duty comprises facts or elements of the customer’s relations with the institution and may be granted only by the customer’s consent or by court order pursuant to the criminal law or criminal procedure.



Disclosure and privilege


In Macau, client-attorney privilege exists as a fundamental duty and right of the lawyer. This privilege has a broad scope (eg, independently of whether the lawyer represents the client in judicial proceedings or not), comprises the revelation of facts and documents and extends to all that work with the lawyer. It is in principle shielded against any interference by public authorities. Such privilege could be waived under authorisation of the Macau Bar and the duty can be removed if the Bar association allows the waiver

(by request of the lawyer), otherwise any proof obtained in breach of such duty could be deemed invalid. However, documents held, drafted or processed by lawyers could be apprehended, under a specific court warrant, if they are deemed to be the object or an element of the crime.


In addition, the lawyer can refuse to testify to such facts unless such disclosure is deemed to be essential to the finding of the truth (this has to be decided by a high court).



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Contacts


Carlos D. Simões

Managing Partner

DSL Lawyers

[email protected]


Pedro Manero Lemos

Junior associate

DSL Lawyers

[email protected]



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