SBM Offshore has reached an out-of-court settlement with the Dutch Public Prosecutor’s Office (Openbaar Ministerie) over the inquiry into alleged improper payments, the company said in a news release.

Furthermore, the U.S. Department of Justice has informed SBM Offshore that it is not prosecuting the company and has closed its inquiry into the matter. The settlement with the Openbaar Ministerie and the U.S. Department of Justice’s decision relate to payments to sales agents in Equatorial Guinea, Angola and Brazil in the period from 2007 through 2011, the release said.

The out-of-court settlement consists of a payment by SBM Offshore to the Openbaar Ministerie of US $240 million. SBM Offshore will pay this amount out of its own funds and has already provided for it in the first half 2014 results, according to the release. Payment will be made in three installments, the first of which ($100 million) has been paid. The two further installments of $70 million each will be due respectively on Dec. 1, 2015, and Dec. 1, 2016. The company will not claim any tax relief over the settlement amount.

While it is not yet certain how the various investigations in Brazil will affect SBM Offshore, the company said it will soon reinstate its dialogue with Petrobras about the future of their relationship.

The settlement with the Openbaar Ministerie is a result of the discussions between the Openbaar Ministerie and SBM Offshore, which started after SBM Offshore voluntarily informed the Openbaar Ministerie and the Department of Justice of its self-initiated internal investigation in the spring of 2012. The findings of the internal investigation were communicated in SBM Offshore’s press release of April 2, 2014. SBM Offshore said it fully cooperated with the Openbaar Ministerie and the Department of Justice.

With its voluntary reporting of the internal investigation to the Openbaar Ministerie, the Department of Justice and the market in April 2012, SBM Offshore made it clear that it wants to conduct its business transparently, the company said in the release. The supervisory board appointed a new management board that took office in the first half of 2012. The new management board has repeatedly stressed the importance of compliance inside and outside the organization. The company, with the assistance of its advisors, enhanced its anti-corruption compliance program and related internal controls. The company shared these measures with the Openbaar Ministerie and the Department of Justice. The measures include:

  • The appointment of Sietze Hepkema as chief governance and compliance officer, a newly created management board position;
  • The appointment of a seasoned compliance professional as compliance director, another newly created position;
  • The enhancement of anti-corruption related policies and procedures designed to ensure compliance by company employees as well as third parties;
  • At the inception of the internal investigation, a review of all sales agents who were active at that time;
  • A decision to no longer use sales agents in those countries where the company itself has a substantial presence;
  • The enhancement of compliance procedures related to the retention of sales agents, other intermediaries and joint venture partners;
  • The launch of a significant training effort for employees in compliance-sensitive positions;
  • The enhancement of mechanisms to report potential wrongdoing;
  • The enhancement of the company’s internal financial controls related to anti-corruption compliance and internal audit processes; and
  • Disciplinary actions against employees who were involved in or had knowledge of possible improper payments, including termination of employment agreements, the release said.