Swiss company SICPA disagrees with grounds of Sh210 billion fine

Dar es Salaam. One week after the Swiss corporation SICPA was fined 81 million Swiss Francs (approximately Sh210 billion) by the Office of the Attorney General of Switzerland (OAG) in a corporate criminal liability case, the company reacted to the judgement yesterday.

On April 27, 2023, the Office of the Swiss Attorney General (OAG) ordered SICPA SA to pay CHF 81 million (about Sh210 billion) for corporate criminal liability in connection with acts of corruption.

The OAG also handed a conditional prison sentence of 170 days to a former sales manager of SICPA.

In a statement released yesterday, the company said that it has accepted the sanction; however, it strongly disagrees with the grounds of the conviction due to the absence of penal measures in the countries where the offences were allegedly committed.

The OAG finally concluded its investigation and produced a summary penalty order sanctioning SICPA for “organisational deficiencies” between 2008 and 2015.

“SICPA has since established a strong compliance management system to ensure that the activities conducted on its behalf are carried out in accordance with business ethics and the highest degree of integrity,” reads a statement issued by the firm.

In its side letter, the OAG has shed light on the grounds that “the company’s responsibility does not mean that SICPA SA itself committed these infringements perpetrated by former employees or consultants.”

The statement further added: “SICPA was not aware of such illegal acts before they were notified, and as soon as they were brought to its attention, SICPA sanctioned those responsible.”

According to the company, in Brazil, the individuals whose convictions had required SICPA to execute a leniency agreement in 2021 were acquitted on June 8, 2022, whereas in the other two countries referred to in the OAG’s decision, SICPA was never prosecuted or even informed of any offence. The long-lasting uncertainty into which this procedure had put SICPA motivated the company not to oppose this decision.

SICPA added that allegations of systemic illegal practices had tainted its reputation in several countries and were even a personal responsibility of its Chief Executive Officer, Philippe Amon, who has been totally cleared by the OAG, calling for the damaging process to be terminated.

The company says that the said organisational deficiencies have been remedied by the comprehensive restructuring of the compliance department to prevent breaches of business ethics. Commenting on the conviction and best business practices, Philippe Amon, the company’s chairman and CEO, said compliance with the law and doing business with integrity are not optional.

“They are crucial as a basis for trust, which is at the heart of what we do,” he said.

The company, which is set to celebrate its centenary soon, says its employees can now fully focus on their mission of protecting the interests of government and industry clients who have trusted its physical and digital technologies to fight illicit trade.

SICPA also has a presence in Tanzania as the supplier of the Electronic Tax Stamps (ETS) to the Tanzania Revenue Authority (TRA).

Speaking to The Citizen, TRA’s director of taxpayer education, Richard Kayombo, said they had seen the statement in the news, but as far as they were concerned, it did not affect their jurisdiction (Tanzania).

“We have had a smooth operation with SICPA ever since they started their operations, and we have recorded considerable growth and compliance during their time with us,” said Mr Kayombo.

For his part, SICPA’s country managing director, Ahmed Khamis, said that ever since January 2019, when the ETS was rolled out, they have recorded commendable growth in tax collection, transparency, and compliance.

He, too, says they have had a smooth working relationship in making sure TRA attains its objective in tax collection from the over 500 products that have been registered so far.

However, the issue of ETS remains a contentious subject in Tanzania due to complaints of high costs raised by manufacturers. Mr Kayombo said that the government is still waiting for manufacturers to propose an alternative ‘cheaper’ supplier of the digital tax system after lengthy dialogue on solving the cost implications.