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Freshfields Risk & Compliance

| 10 minutes read

Cooperation with prosecuting and regulatory authorities

Cooperation with law enforcement agencies and other authorities is an important element of the strategic response to regulatory proceedings, corporate crime investigations and prosecutions. Voluntary cooperation can help to address a wide range of risks, but it is vital to tread carefully so as not to disclose information that could be commercially or legally damaging.   

The process is complicated because the approach to cooperation amongst authorities varies across jurisdictions. This is particularly evident with regard to practice and requirements for deferred prosecution agreements, voluntary disclosure of evidence and the benefits companies receive or can expect for agreeing to them, i.e. reduced sentences. This blog post explores developments in the US, the UK, France, and Germany with a view to helping businesses tackle a complex process.

  1. US 

The US Sentencing Guidelines have long provided for mitigation when a company fully cooperates with the US Department of Justice (“DOJ”) during an investigation. Historically, the DOJ has also published and regularly updated guidance that encourages companies to report potential misconduct proactively. Over the past year, the DOJ has continued this approach, by clarifying the nature and scope of expected cooperation and offering additional incentives. During a May 2023 address, Kenneth Polite, the Assistant Attorney General for the DOJ Criminal Division, reported that these updates have already increased the number of companies coming forward to voluntarily disclose.

The recent increase in voluntary disclosures follows the DOJ releasing a new Criminal Division Corporate Enforcement and Voluntary Self-Disclosure Policy. For the first time, this policy – which historically applied to only some parts of the DOJ, such as the Foreign Corrupt Practice Act Unit – now applies across the Criminal Division. The policy clarifies requirements and increases incentives for cooperation in important ways:

  • Even under aggravating circumstances, a company may qualify for a declination with disgorgement if it (1) voluntarily discloses “immediately upon […] becoming aware of the allegation of misconduct,” (2) has an effective compliance program, (3) provides “extraordinary cooperation,” and (4) undertakes “extraordinary remediation.”
  • In circumstances where the DOJ pursues a criminal resolution, a company that voluntarily self-discloses, cooperates, and remediates can receive a 50 to 75 percent reduction from the low-end of the US Sentencing Guidelines fine range.
  • Under the new policy, a recidivist company may qualify for a reduction.
  • A company that does not voluntarily disclose may receive up to a 50 percent reduction off the low-end of the US Sentencing Guidelines if it later fully cooperates and remediates.

The Criminal Division has alluded to further developments that may be forthcoming, such as increased transparency into enforcement actions, the selection of monitors and individual charging decisions. For a company that is considering whether to disclose, these new incentives should encourage serious discussion about if, when, and how to disclose in the future. Indeed, it appears that this trend is already underway.

  1. UK 

In August 2019, the UK followed the lead of its US counterparts in providing guidance to companies on expected standards of co-operative behaviour, with the Serious Fraud Office (the SFO), the UK’s principal regulator for the investigation and prosecution of serious or complex fraud, bribery, and corruption, publishing an extract of its operational handbook entitled “Corporate Co-operation Guidance” (the SFO Guidance).

The SFO’s operational handbook is the manual that governs how its own staff should operate. As part of this handbook, the SFO Guidance provides an instructive insight into the types of behaviour SFO prosecutors should look for in their interactions with companies that are the subject of investigations or prosecutions.

The SFO Guidance lists several dozen ‘indicators of good practice’ that the SFO may take into account when assessing whether a company is genuinely cooperative. The kinds of behaviours in question are varied and include:

  • providing material to the SFO in a useful, structured way;
  • assisting in identifying material that might reasonably be considered capable of assisting any accused or potential accused or undermining the case of the prosecution;
  • create and maintain an audit trail of the acquisition and handling of hard copy and physical material, and identify a person to provide a witness statement covering continuity;
  • provide records that show relevant money flows;
  • identify potential witnesses including third parties; and
  • make employees and (where possible) agents available for SFO interviews, including arranging for them to return to the UK if necessary.

Importantly, the list is neither exhaustive nor prescriptive, with the extract headed by a health warning that the document is “for guidance only”, with decisions in a particular case “turn[ing] on the particular facts and circumstances of that case”.

While the list is not exhaustive, for companies who find themselves the subject of an SFO investigation or prosecution, the SFO Guidance enables them (and their legal advisors) to better understand what standard of co-operative behaviour the SFO will expect from them in the course of the investigation and/or prosecution, therefore giving them the tools to decide whether, and to what extent, they wish to adapt their behaviour to meet those expectations. These considerations are important to ensure companies can obtain the potential full benefit of reduction in financial penalties typically expected in return for cooperation from the outset; with recent cases suggesting reductions of up to 50% following Deferred Prosecution Agreements, with seven of the ten UK DPAs published to date illustrating this range of reduction. For example, in the Rolls-Royce case the SFO offered, and the court approved, a DPA with the one-third discount that is the equivalent of what is usually available for an early guilty plea plus an additional 16.7 per cent discount in recognition of Rolls-Royce’s ‘extraordinary co-operation’ (SFO v. Rolls-Royce (Case No. U20170036) [2017] Lloyd’s Rep FC 249, para. 19).

While we have focused here on cooperation with the SFO, it is important to remember that there are numerous other agencies in the UK with which a company may need to cooperate, depending on the sector in which they operate and the issues at hand. For example, there is separate active criminal investigation from HMRC, the Financial Conduct Authority (FCA), the National Crime Agency (the NCA), the Crown Prosecution Service (the CPS), the Information Commissioner’s Office (ICO) and more. The level and type of cooperation expected from each of these agencies is not standardised. While it is likely that similar key principles will apply, if a company finds itself dealing with a new government agency, identifying those with direct experience of the expectations and real-life practice of that agency will be essential.  There has been some clarification on the potential approach of the Courts when considering cooperation with these authorities. With a recent criminal fine against a leading retail bank for Anti-Money Laundering failings reduced by the Court in light of the bank self-reporting and cooperation, albeit not as significantly as could have been achieved if the prosecuting authority, the FCA, had not needed to obtain certain information by compulsion. 

  1. France 

The French Financial Public Prosecutor (PNF) has released, in cooperation with the French Anti-corruption Agency (AFA), new guidelines on 16 January 2023 (the Guidelines) related to the implementation of plea-bargaining arrangements available. The Guidelines provide a clearer overview of the approach expected by authorities in the context of the negotiations and performance of a plea bargain.

These Guidelines notably point out that, although the implementation of a plea-bargain is handled and driven by the public prosecutor's office in charge of the investigations, the legal entity wishing to obtain any benefit from the arrangement should proactively offer self-disclosure and cooperate in good faith during the negotiation process with the authorities.

In the context of the calculation of fines in light of plea bargains, the French Criminal Procedure Code gives limited guidance as to how the fines are in practice calculated by the authorities. Simply providing that the amount of the pecuniary fine must (1) be set in proportion to the benefits derived from the offences identified, up to a maximum of 30% of the average turnover achieved by the legal entity over the past three years, and (2) have both a restorative and a punitive component, the latter being ascertained on the basis of mitigating or aggravating factors).

In this context, one of the major new features of the Guidelines is that they give useful information on how these mitigating and aggravating factors are taken into account by the authorities in the calculation of the fine, notably by providing ceilings for the said factors, as set forth below:

Aggravating factors


Mitigating factors


Any form of obstruction in the investigations


Spontaneous disclosure


Large company


Single occurrence of the offence


Deficiencies of the compliance program (for companies subject to the mandatory implementation of such program as set forth in Article 17 of the Sapin II Act


Relevance of internal investigations


Repetitiveness of the actions


Active cooperation


Judicial, tax or regulatory history


Corrective measures


Use of the company’s resources to conceal


Effectiveness of the whistleblowing system of alert


Creation of tools to conceal


Straightforward recognition of the facts


Involvement of a public official


Prior compensation of the victim


Serious disturbance of public order


The AFA and the PNF have also recently published a guide dedicated to managing internal investigations. 

An internal anti-corruption investigation triggered by a warning and carried out at the company's initiative may, where appropriate, facilitate the implementation of a negotiated criminal response with relevant prosecuting authorities.  

If the internal investigation takes place at the same time as a criminal investigation, the report may be made available to the judicial authorities and thereby demonstrating the company's willingness to cooperate making it possible to consider concluding a plea bargain. Where the conclusion of a plea bargain is contemplated at the same time as an internal investigation, care should be taken to ensure that the negotiations do not interfere with the ongoing criminal investigations.  

  1. Germany 

The trend towards increasing cooperation is also evident in Germany, although, Germany does not provide for comparable rules or even guidelines that are available in other jurisdictions. Against this backdrop, companies, and their management face legal uncertainties, as they usually have to decide at the very beginning of an investigation to what extent the company is willing to cooperate with the authorities.

In comparison with other jurisdictions, law enforcement authorities in Germany often put severe pressure on companies to cooperate. Contrary to the situation under a DPA or NPA, companies in Germany receive no granted return for their cooperation. Even when a company is fully cooperating, i.e. conducting an investigation with a scope which has been aligned with authorities, law enforcement may still impose coercive measures such as dawn raids.

The legal situation in Germany also differs from other jurisdictions regarding legal privilege ('Beschlagnahmeschutz'). While legal privilege is significantly limited, the decision to cooperate does not have any impact on legal privilege under German law. The concept of waiver of privilege does not exist. Though, when cooperating in Germany, companies are always to assess the impacts such cooperation may have on legal privilege in other jurisdictions. Therefore, it is advisable to request authorities to formally issue a seizure order for the compiled documents.

Other than that, companies have no legal certainty that their – sometimes decisive – contribution to the complete investigation of a matter by the authorities will later also be sufficiently taken into account when the authority determines penalties. However, there are potential developments that may change this picture. The Corporate Sanctions Act (‘Verbandssanktionengesetz’), which ultimately failed to pass through parliament in 2021, was intended to introduce a corporate criminal liability regime in Germany for the first time. The law would have provided for sentence reductions in recognition for evidence of compliance measures as well as for cooperation with authorities. Although these proposals collapsed, the current government is on track to modify the legal framework for administrative proceedings which may turn back to provide long-awaited guidance in this area.


Whether a company should voluntarily display any or all of the identified “cooperative” behaviours is not a simple mechanical exercise. While cooperation can be beneficial for a number of reasons (for example, reduction in financial penalties can typically be expected in return for broad and effective cooperation from the outset), it requires an exercise in judgment, calibrated by the specific features of a given case and its surrounding circumstances, as well as the particularities of the applicable law.  

Relevant factors that might be important to a particular company when deciding if – and to what extent – it should prioritise trying to meet the prosecutor’s expectations may include:

  • the company’s assessment of its potential liability on the basis of the evidence it has available to it;
  • the likelihood of evidence of misconduct by the investigating authority;
  • the quality of the existing relationship it has with the relevant investigation team;
  • the strategy it wishes to deploy regarding defending its position;
  • the manner in which its wishes to present itself publicly in relation to the fact of being investigated (desire to be perceived as a good corporate citizen);
  • the relative cost of meeting the cooperation steps (as balanced against the likely impact these steps will have, for example whether it will materially shorten what is likely to be an expensive investigation);
  • the collateral impact of taking a particular step (for example, a privilege waiver if there are connected civil litigation proceedings or investigations in other jurisdictions which could be impacted); and
  • the value it places on achieving a particular outcome to the investigation (for example, a DPA instead of a guilty plea, if the evidence indicates some form of resolution is likely to be appropriate).

In our experience, effective cooperation requires a balancing of all of the above factors – it doesn’t mean a company should complete a tick-box exercise and take every potential cooperative step or meet every type of behaviour listed in guidance by a particular authority (where available) without giving adequate reasoned thought to the intended aim and likely impact of taking those steps. If desirable, a high-quality relationship can be cultivated with the prosecuting authorities that allows for two-way dialogue around the reasons for taking or not taking certain steps that seeks to balance all of a company’s objectives, rather than automatically taking steps in the context of its participation in a criminal investigation that materially (and potentially disproportionately) harm other legitimate interests it has. However, developing and maintaining such a relationship is usually a finely balanced task that requires sensitivity and experience to ensure that engagement is authentic, fair and properly understood.


global investigations, global enforcement & compliance 2023, corporate crime