In an effort to transform the business environment in India, the Union Cabinet agreed to move forward in making ‘Cabinet Amendments’ to the PoCA Amendment Bill, which will need approval from the Indian Parliament to become part of the country’s anti-corruption law. According to Global Compliance News the Law Commission’s amendments follow guidance taken from the U.K. Bribery Act and it provides guidelines on “adequate procedures” that companies should follow, which includes executive commitment, due diligence, training and monitoring and review.
“For the first time in India, the supply side of bribery is being tackled,” says Suhas Tuljapurkar, managing partner, India-based Legasis, a provider of compliance and ethics solutions. “Around 2009 the Courts in India became proactive and virtually started monitoring the cases relating to prevention of corruption making it difficult for the law enforcement agencies to drag their feet or shelf the investigations—this resulted in large companies virtually folding up.”
Other amendments supported by the Union Cabinet include moving corruption to the “heinous crime category” and increasing maximum sentencing time from five years to seven and minimum six months to three years. Also, the average trial time under PoCA in the last four years remains above 8 years and the Union Cabinet, therefore proposed speedy trials to be completed within two years.
The earlier drafts of PoCA bills put the burden of proof on accused-corporate executives to prove that they had no knowledge of corruption. Under PoCA, if an offense of corruption is committed by a corporate, the director, manager, secretary or other officer will only be liable if the offence "is proved to have been committed with consent or connivance" of such an officer.
Some major companies in India that have folded due to the lack of stringent regulations around corruption are Kingfisher Airlines, Sahara Group and Satyam.