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Petroleum industry

Global Freight Forwarding Company and Oil and Gas Service Companies to Pay $156.5 Million to Resolve Foreign Corrupt Practices Act (FCPA) Violations

Strategic Insights

— 2 min read

A global freight forwarding company, Panalpina World Transport (Holding) Ltd., and five oil and gas service companies and subsidiaries have agreed to resolve investigations of Foreign Corrupt Practices Act (FCPA) violations, with a total of $156,565,000 in criminal penalties. The investigations, led by the Department of Justice and the U.S. Securities and Exchange Commission (SEC), focused on allegations of foreign bribery in the oil field services industry. The companies involved have admitted to engaging in schemes to pay bribes to foreign officials on behalf of their customers.

Key Takeaways:

  • Panalpina World Transport, a global freight forwarding and logistics services firm, and its U.S.-based subsidiary, Panalpina Inc., admitted to paying bribes to numerous foreign officials on behalf of their customers in the oil and gas industry between 2002 and 2007, totaling at least $27 million in seven countries, including Angola, Azerbaijan, Brazil, Kazakhstan, Nigeria, Russia, and Turkmenistan.
  • Shell Nigeria Exploration and Production Company Ltd. (SNEPCO), a Nigerian subsidiary of Royal Dutch Shell plc, admitted to paying approximately $2 million in bribes to Nigerian customs officials through Panalpina.
  • Transocean Inc., a Caymans Island subsidiary of Transocean Ltd., admitted to paying approximately $90,000 in bribes to Nigerian customs officials to circumvent Nigerian customs regulations.
  • Tidewater Marine International Inc., a Cayman Island subsidiary of Tidewater Inc., admitted to paying approximately $160,000 in bribes to tax inspectors in Azerbaijan and approximately $1.6 million in bribes to Nigerian customs officials through Panalpina.
  • Pride International Inc. and Pride Forasol S.A.S. admitted to paying a total of approximately $800,000 in bribes directly and indirectly to government officials in Venezuela, India, and Mexico.
  • Noble Corporation, a Swiss corporation, admitted to paying approximately $74,000 to a Nigerian freight forwarding agent, and agreed to pay a $2.59 million criminal penalty.

Statistics:

  • $156,565,000: Total amount of criminal penalties paid by the companies involved.
  • $27 million: Total amount of bribes paid by Panalpina World Transport and its subsidiary.
  • $2 million: Amount of bribes paid by Shell Nigeria Exploration and Production Company Ltd.
  • $90,000: Amount of bribes paid by Transocean Inc.
  • $160,000: Amount of bribes paid by Tidewater Marine International Inc. to tax inspectors in Azerbaijan.
  • $1.6 million: Amount of bribes paid by Tidewater Marine International Inc. to Nigerian customs officials through Panalpina.
  • $800,000: Total amount of bribes paid by Pride International Inc. and Pride Forasol S.A.S. to government officials in Venezuela, India, and Mexico.
  • $74,000: Amount of bribes paid by Noble Corporation to a Nigerian freight forwarding agent.

Sources:

  • United States Department of Justice
  • U.S. Securities and Exchange Commission (SEC)

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