In May this year, the Dutch Public Prosecution Service (OM) announced it would be prosecuting Damen Shipyards Gorinchem and Damen Naval Shipyards for bribery, forgery, money laundering and sanctions violations. The trial is starting today, 24 November.
The criminal offences are alleged to have taken place around the sale of ships abroad, according to the prosecution. (Former) board members are also being prosecuted for de facto directing these criminal acts.
Separate criminal investigations
The two criminal investigations are separate. The bribery investigation was conducted by the Fiscal Information and Investigation Service (FIOD), focuses on a period from 2006 to January 2017 and involves the payment of high commissions to agents. Those agents were engaged to sell ships to various countries in Africa, Asia and South America.
These commissions create a substantial risk of paying bribes to officials of the countries with which business was done. Over a series of years, a large quantity of fake documents was presumably drawn up in order to conceal high commission payments to agents and frustrate scrutiny thereof, including in applications for export credit insurance.
The investigation into violation of the Sanctions Act was conducted by the Customs Service and concerns goods and technology that could contribute to Russia’s military and technological strengthening /or to the development of the defence and security sector. This investigation focuses on a period of several months in the second half of 2022. According to Damen, this involves the delivery of several cranes to Russia.
Tension and pressure
If Damen Shipyards is found guilty, under European procurement rules, it will be banned from competing for government orders for four years.
Damen confident in result
The company adds that it is ‘disappointed by the long duration of this investigation and is anticipating a lengthy legal battle.’ However, Damen states it is confident in the result of the legal proceedings and ‘will finally have an opportunity to explain that the suspicions of the Public Prosecution Service are unfounded.’
The company stresses it has a ‘robust compliance procedure in place’ and that this procedure is ‘recognised by external parties’ while the company is also certified according to the standards for integrity and anti-corruption (ISO).
The company concludes that once the hearing begins, it will defend itself fully in court, not in the media.
