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Bribery outside Hong Kong may still constitute an offence
Daniel, as a senior credit officer of a local bank, had the responsibility of verifying information submitted by customers regarding the application for credit facilities. One of his customers, Calvin, was the owner of a factory located in Dongguan, Guangdong.
When Calvin applied for hire purchase facilities of $4.3 million to secure a set of new machines, Daniel and his supervisor, Michael, were assigned to conduct a site visit in Dongguan to verify the application information and inspect the new machines.
Upon the inspection, however, they found that the machines seemed to have already been in use for several years. Suspecting a potentially bogus transaction, Daniel raised his concerns with Calvin, who, in the hope of encouraging them to turn a blind eye, presented both Daniel and Michael with an expensive watch. To help smooth Daniel's feathers, Calvin also pointed out that, technically speaking, they would not breach the anti-corruption laws in Hong Kong as the transaction was conducted outside the city.
While Daniel still hesitated over Calvin's offer, Michael accepted the watch graciously. Michael sensed Daniel's discomfort at the situation and whispered to him that refusing such a token gift would merely cause embarrassment to all concerned. Hearing such assurances from his supervisor, Daniel finally accepted the watch.
Case Analysis
If Daniel and Michael did not obtain their principal's permission to accept the advantage, both of them and Calvin would be in breach of Section 9 of the Prevention of Bribery Ordinance. It also constituted a breach of Section 124 of the Banking Ordinance. In this case, Daniel should clarify with his bank as his principal rather than follow his supervisor's advice.
Although the corrupt transaction happens outside Hong Kong, both of them commit a corruption offence in Hong Kong since the application of credit facilities is processed in Hong Kong. The location where the acceptance or offering of an advantage takes place is only one of the factors to be considered for prosecution.
They may also violate the Code of Conduct of their bank by accepting personal benefits from a customer. They should have actively discouraged their customer from offering them personal benefits of any kind.