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GRUNDLAGE Greiner EN - Greiner Compliance - English

Workshop
by

Michael Sinnhuber [mcprezi.com]

on 21 September 2017

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Transcript of GRUNDLAGE Greiner EN - Greiner Compliance - English

Compliance
Antitrust
Corruption
Why Compliance?
Legal basis?
Code of Conduct
Compliance Management
Competition law or antitrust law is part of business law.

Competition law includes all legal provisions aimed at maintaining effective and undistorted competition.

The personal risk has no relation to the
perceived success for the company.

Commitment to
fair competition
Prohibition of all forms
of bribery and corruption
Ensuring compliance with the
statutory regulations and
internal company policies
by staff / employees & the company!
What can happen?
Fines and prison sentences
Fines and prison sentences
Fines in the millions
Blacklisting for public tenders
Beer
€ 274 million
Lift
€ 992 million
Vitamins
€ 790 million
+ $ 1,5 billion!
Cement
€ 661 million
"We don't have many rules here,
but we strongly enforce them!"
Greiner
Code of Conduct
I.
We are committed to compliance
with all legal standards and to
value-oriented corporate action.
II.
We respect our employees as essential partners for the business development of our Corporate Group.
III.
We promote fair and free competition.
IV.
We are opposed to any form of
corruption.
V.
We are committed to handling our own property and the property of others responsibly.
VI.
We separate professional
and private interests.
VII.
We ensure the economic, social and environmental sustainability of our corporate actions.
SAFELY
Work
&
do business
Goal?
Focus?
What?
statutory regulations and
internal company policies
What once were trivial
offences are now
prosecuted and punished
Specialisation within the
judiciary has improved
the effectiveness
of operations
Public opinion pressure through media coverage
Empty state
coffers
Judicial authorities worldwide have increased pressure on businesses
CORRUPTION
VS
COMPETITION
WHY?
Austrian Act Against Unfair Competition
National
Criminal
Code
Austrian Corporate
Criminal
Liability Act

Antitrust laws
and EU
competition rules
FCPA
Foreign Corrupt
Pratices Act
EU
Competition-
rules
UK Bribery Act
Do these issues affect us?
No one will
find out!
NOT TRUE!
Kazakhstan

An official from a public water utility company is given money to “motivate” him to enable water supply for the branch establishment.
Kenya

During export of a product to an African country, the shipment gets stuck at customs; an official is paid money
to “facilitate” processing.
China

Money is paid to an employee of a Chinese state-owned enterprise for initiating a business transaction; as a result, the deal is signed because of this payment.
Systematic collection of information
e.g. by embassies (US)
Anonymous
complaints
Change in Management
Audits by financial authorities (red flags)
Changes in political situations abroad
Investigations by
foreign authorities
Commissioner
"Chance"
Voluntary disclosure by someone involved
Newspaper articles
At a golf tournament Kurti, the managing director of foam manufacturer A, and Peter, the managing director of foam manufacturer B, are coincidentally grouped in the same flight. Before tee, Kurti reminds Peter that they cannot talk about their selling prices despite the economic crisis. Peter replies, "I totally agree" and adds:

“You know, Kurti, I have no university degree or any other title. I only increase my selling prices by 5% if we have a full moon on a Sunday.”

Kurti then mutters: “That's an interesting approach.”

At the next full moon on a Sunday, Peter increases his selling prices by 5%. The next day, Kurti also increases his prices in order to align them with Peter’s selling prices.

Does this involve an infringement of competition law?
Kurti is the sales manager of packaging manufacturer A. One day, he meets Peter at the flea market; Peter is the new sales manager of packaging manufacturer B. As a friendly gesture, Kurti invites Peter to the weekly poker game with his friends from sales. Peter loves poker and becomes a permanent member at the poker game. Last Friday, the stake was upped, with customer groups and sales territories being played for instead of money. As a result, Peter could not sleep the whole weekend owing to a guilty conscience because he lost everything, and went straight to his boss, Mr Müller, on Monday morning to tell him everything. Mr Müller's response should be:

1. Peter, that was just a game! You should not come to me over every little thing. Now get back to work!

2. Peter, you have a wonderful future in sales before you, but you must not stay a scaredy-cat all your life. These poker games are a good idea; you can keep an eye on the others and win everything back next Friday.

3. Peter, nothing's happened yet. But I forbid you from taking part in such poker games in the future.

4. Now it's time to call our lawyers again ...
One of our main suppliers has invited our company’s purchasing managers to a visit of its facilities. Our competitors' purchasing managers are also invited. During the evening programme, everyone is in a lively mood. I notice that at the next table, there’s an animated discussion going on about current purchasing prices, price ranges, and sales prices for certain products, with specific figures being mentioned. They’re also discussing tips for purchasing and selling strategies. What should I do?

1. I take a seat at the table and listen closely. They’re sharing important marketing information.

2. I leave the event since I find these discussions odd and don't want to be associated with them.

3. I say nothing since I'm not sitting at that table and thus don't want to judge the situation incorrectly.

4. I go over to the table and tell everyone that they shouldn’t be having this discussion here and I leave the event.
Kurti (managing director) and Peter (managing director) are employed by competitors in Austria. Kurti meets Peter in a car park in front of the shopping centre. He tells him that he is now falling in line with the industry and will also be shortening the early payment discount term to 30 days due to the non-payment practices of customers. He also said that he does not want to include any additional production shift in his company for water containers for 5 litres despite high demand. Peter says: "I see. If only we produced water containers for 10 litres.” Both start to laugh.

Does this alone constitute a cartel agreement?

1. Yes
2. No

Kurti and Peter are competitors. The city of Linz issues a call for tenders regarding furniture upholstery for furniture belonging to public institutions (city hall, court, tax office, etc.). Kurti calls Peter and arranges a meeting in the car park behind the gym. At the meeting, Kurti asks Peter whether he will put in a bid for this tender.

Scenario 1: Peter says yes and gives Kurti a copy of the draft for the bid.

Scenario 2: Peter says yes and says he'll keep the price level from last year, but then does not submit a bid.

Scenario 3: Peter says no, but submits a bid nonetheless.

Scenario 4: It is a private call for tenders.

Does this alone constitute a cartel agreement?

For certain products, we have only one major competitor, who has had very good relations with certain customers for years and has been supplying them for a very long time. Conversely, we also cultivate long-term business relationships with individual large customers. Recently, a call for tenders was announced by a customer of our competitor for a very attractive large contract.

1. Since our competitor has held back from calls for tenders from our customers in the past, we consider not submitting a bid. Ultimately, we are free to choose who we want to win as customers.

2. Of course, we will take this opportunity and put together an attractive bid.

3. I contact the sales manager of the competitor that I know from trade fair exhibitions. I suggest to him that we do not participate in this tender on condition that he too does not submit an attractive bid in an upcoming call for tenders from our customer.

4. We take part in the tender, which we estimate will generate very high margins.

Kurti and Peter are competitors. Axel is entering into the market for cosmetics packaging in Upper Austria and buys own-branded products from both Kurti and Peter. Axel is a very nice guy and starts selling these own-branded products below the price of Kurti and Peter. To give the "nice guy" Axel a clear message, Kurti and Peter decide to no longer sell own-branded individual products to him.

Does this alone constitute a cartel agreement?

1. Yes
2. No
Company A:
“Transport costs have already risen again! We have to do something!”

Company B:
“We will just take this into consideration on a 1:1 basis when making our next price increase.”

“Sounds good. We'll do the same.” - Company C, however, does not keep to this when making its next price increase.

Company D: Just nods.

Company E:
Remains silent. Company E does not keep to this when making its next price increase.

Kurti and Peter are competitors in the market for baby bottles. Peter reads in the newspaper that Kurti intends to increase his prices next month by 8% due to rising inflation. Peter feels similar pressure in that his profit margin barely exists anymore, and decides to also raise his prices by 8%.

Does this alone constitute a cartel agreement?

Yes
No
Company B, manufacturer of insulating mats for cars, promises dealer A a discount if a pre-determined sales target of 5000 units is reached at the end of the year. Since this target was narrowly missed, A receives no discount at the end of the year.


Has a law been breached here?

Mr Müller is the managing director of foam manufacturer A, a leader in the market for punched parts from composite and newly produced foam for cars. Given that a new competitor is pushing into the market, Mr Müller decides to sell his products at “predatory pricing” to “make life hard” for the newcomer. A has in any case earned enough in recent years to allow it to “see through this strategy for one winter”.


Has a law been breached here?


A is an unwelcome competitor of B. The suppliers of B were therefore expressly asked not to supply A, under the threat of losing the (lucrative) contracts of B.

Is this an infringement of competition law?

1. Yes
2. No

I’m an engineer at one of our company’s plants. I’m on very good terms – almost friends – with one of our suppliers. Just before Christmas, he calls me and says that he wants to give me a special thank you for my efforts. He says that he’d like to send me coupons to my home address for a wellness weekend. The coupons are worth EUR 199.
What should I do?

1. I decline, since the value and all this secrecy make me uneasy.

2. I thank him for the present and donate the coupons for the Christmas raffle.

3. I ask my supervisor/the Compliance Helpdesk if I can accept the gift.

4. I gratefully accept and spend a relaxing weekend with my wife, since the coupons essentially came from a friend, and you don’t just refuse a gift from a friend.

A is a sales representative for a major customer of the Greiner Group. One day, A turns to you with the following offer: A can ensure that the Greiner Group is awarded the contract, but a 40% "commission" will be due in return.

1. I accept the offer; at least the Greiner Group is awarded the contract, and I can accommodate the commission when invoicing.

2. I try negotiating the commission down to ensure that the business deal is even more profitable for the Greiner Group.

3. I reach an agreement with A so that he will let me in on half the commission. We should of course both benefit from the business deal.

4. I reject the offer and inform the CO.

A is a sales representative for a major customer of the Greiner Group. One day, A turns to you with the following offer: A can ensure that the Greiner Group is awarded the contract, but a 10% "commission" will be due in return, which is to be transferred directly to the private company of A using a fictitious invoice.

1. I find the fictitious invoice somewhat strange. Nevertheless, I go into business with A; after all, the Greiner Group are also benefiting of course. How A accommodates that in their accounting processes need not worry me.

2. I insist this is invoiced correctly, without a fictitious invoice.

3. I reject the offer and inform the CO.

An intermediary approaches you and offers his services. He boasts that the Greiner Group can in any case get the desired contract because he is good friends with the sales representative of the potential customer. 20% of the contract price will be due as commission.

1. I use the good contacts of the intermediary and do not begrudge him the 20% commission. Such friendships need to be maintained after all.

2. I try negotiating the commission down and agree to the deal at 10%.

3. I want to save myself the 20% commission and try to go into business with the sales representative directly.

4. I notify the CO.

You use the services of an intermediary. The business mediated also actually materialises. During your research, however, you find that the company for which the intermediary has apparently been working is a mere shell company domiciled in the Cayman Islands. The commission payment is due to be settled via this company.

1. The intermediary has carried out his services, hence he is also entitled to the commission agreed. The fact that he wants the payment settled through a shell company does not worry me.

2. The whole thing takes place abroad in any case; they won’t catch me in Austria.

3. I inform the CO and clarify with them as to how to proceed.

You use the services of an intermediary. The business mediated also actually materialises. For his services, the intermediary ultimately charges 20% of the contract value without breaking down in more detail the services rendered by him. In addition, the commission is to be paid to a bank account in a country other than the headquarters of the intermediary.

1. I am not a stickler when it comes to the missing service documentation; the intermediary was successful after all. I don’t query why the intermediary chooses a bank account in another country. It is probably for tax reasons and does not concern me.

2. The entire process feels somehow strange to me and I decide to stop the payment for the time being. Finally, the intermediary persuades me to continue processing the payment.

The representative of the local football club, who is also the mayor, turns to you to ask whether the Greiner Group would be willing to sponsor the football kits of his players. You are generous and promise an amount of EUR 5,000.

1. I have no reservations; after all, the sponsorship is for a good cause and the Greiner Group also gets to advertise on the kits. The fact that the Mayor is behind the club is another positive. Perhaps, we might need him one day in another matter.

2. No, I should in any case consult the CO before a final promise is made.

The representative of the local band, who is also the managing director of a major customer of the Greiner Group, asks if you want to sponsor some new musical instruments. He says he cannot however offer anything in return, i.e. advertising for the Greiner Group. You nevertheless pledge your sponsorship equal to EUR 5,000.

1. The pledge is all in order as far as I’m concerned. EUR 5,000 is not much and maybe Greiner will get the next contract. The fact that the Group gets nothing in return does not bother me; after all, it is indeed a mere donation and not a sponsorship.

2. Before I make the pledge, I discuss it with the CO.

As purchasing manager, I can choose which supplier I want to procure products from. In getting a bid from a wood-processing business, they make me the following offer: If I commit to buy a certain amount at the purchase price of EUR 1,000 per unit (10% below the competitive price), they’ll sell me personally the wood for the new house I’m building at EUR 800 per unit. Since my financial situation is stretched anyway because of the new house, I start to think it over.

What should I do?

1. I accept, since it’s a good deal for all involved. After all, the price I got for the company is 10% below the competitive price.

2. I ask other suppliers if they can offer me an even better “concession”.

3. I ask the supplier to make me a better offer on the whole, and I decline to accept the private sale.

4. I reject the bid and choose a different supplier.

I’m responsible for handling a wide variety of major projects at our company. Recently, one of our construction companies that wasn't awarded the bid for the last few tenders invited me to visit its facilities in Hamburg. The construction company will pay for the flight and lodging expenses. The visit is scheduled for Friday to Sunday. Can I accept the offer?

1. Since the trip involves a company visit, I accept the offer. The Friday I’m off. For this reason, I must not inform my superiors.

2. I take part in the visit, but I insist that my company pay the expenses, and I take an official business trip.

3. I’m not completely comfortable with the whole thing. So, I recommend to a colleague who should accept the invitation.

4. I decide that it’s OK for the construction company to pay for my trip, including the expenses for Friday. But I prefer to pay the weekend lodging costs myself.

You are purchasing manager in a unit of the Greiner Group. Over the years, you have developed a very good relationship with some suppliers, with whom you are almost friends, and you repeatedly award them corresponding contracts. In return, you sometimes get tickets for the opera, are invited to motor sports events or can enjoy a few days in a spa with your family at the expense of the supplier.

1. I accept the gifts with thanks; after all, no one gets hurt. I always opt for the best offer regardless.

2. As long as no money is gifted, I don’t need to worry as everything is above board.

3. I accept the gifts and share them among my staff.

4. Once a gift is offered to me, I consult the CO.

Your Russian business partner requests that you issue a higher invoice to – as he says – obtain correspondingly higher financial support in his home country. You are expected to then transfer the amount paid in excess to the private account of this business partner.

1. I am naturally happy to grant the request of the business partner; after all, no harm will come to the Greiner Group.

2. I have a bad feeling about the whole thing; at the end of the day, however, only the business partner is liable for prosecution. In any case, the whole thing takes place abroad.

3. I issue an invoice in the amount of the agreed work actually performed and inform the CO.

The Greiner Group intends to build a new plant in the Ukraine. The permit for the business premises is still pending. The responsible official tells you that he could help a little with this. The permit would cost $30,000.

1. I accept the offer with thanks, pay the $30,000 and get the permit two weeks later.

2. I have an uneasy feeling about the whole thing but nevertheless pay the $30,000; after all, nothing can happen to me as the whole takes place abroad. I just can no longer travel to the Ukraine.

3. I decline and inform the CO.

Every employee can end up
in a situation in which they must
make a decision as to how to
respond to invitations, gifts, civil servants, public officials.

plus prosecution in the respective country!
Association
Responsibility
Law
Laws do NOT stop at borders!
Local Compliance Officers
plus local lawyers
93
Division
Compliance Officers
5
Group
Compliance Officer
1
Processes
Inquiries
Emergency
Management
Training
Audit
Inquiry
Access to information /
System Global
Compliance Navigator
Initiate contact via
greiner@
global-compliance.info
Assign inquiry
for processing
Inquiry answered and recorded
in the system!
Make a copy of the search warrant
Solicitor comes to the branch
Transfer information
about official inquiry
to solicitor
and GCO
Information of the
individuals who need to
be informed via
Greiner-emergency@
global-compliance.info
Official procedure overseen by the local solicitor
Set date and prepare the audit
Delivery
of the
Audits
Create audit record
with actions
LCO and/or
DCO implement
measures
Creation of overall report and information for the Management Board and the Supervisory Board (GCO)
Automatic or manual
call for training
Delivery of the
training respectively
the 3 modules
Take the exam
(8 weeks)
Update of the
EnTraS database
Create automatic quarterly training record and send to the help desk
Unexpected
regulatory
intervention
Create
annual
audit plan
Training
trigger
Answer
(in the system)
& respond (email)
How to
recognize
a cartel?
Manufacturer of concrete paving tiles

The product does not differentiate itself due to complexity or technology; it is not specialized or specific. It also involves intensive transportation costs.
Sugar manufacturer

There was an oversupply; the EU had introduced a quota regime for sugar at that moment; the product has no distinguishing characteristics (sugar is sugar everywhere)
Manufacturer of fire trucks and fire engines with turntable ladders

Few providers in the market, manufacturing is expensive; many regulatory standards for the manufacture of fire trucks; financial pressure in the communities that buy these vehicles.

Confectionery manufacturers

Higher prices of raw materials at a certain time (note from the Federal Cartel Office: "No effort to find a commercial solution")
Manufacturer of household utensils

traditional and old industry, the increase in the VAT was exploited; the cartels reported economic difficulties in the industry
Pharmacies in Hildesheim, Germany
New low-cost provider in the market


Advertising time marketer
Advertising market is highly volatile, advertising customers leave very quickly; in times of crisis ads are the first thing one tries to save money on
Pharmaceutical wholesaler
The same products


Spice manufacturers
The same raw materials

THIS IS HOW
YOU IDENTIFY
CORRUPTION
Suspicious cash payments
Claim that payments are to be made immediately or before the agreed time schedule.
Payments that come from a third country.
An unusually high commission rate was paid to an agent. The money may have been transferred to the same agent via two different accounts, which often lie in two different jurisdictions.
Invoices were accepted without apparent reason after expiration of the contract, whereby documents and records regarding the meeting and decisions are no longer available.
A person shows an unexplained preference for a contract partner in the period of the tender, avoids independent checks in the ongoing phase of the tender or the contract signing process.
A person in certain cases accepts a bypass of the decision process for contracts that is to the detriment of the company.
A person makes unexpected or illogical decisions, by accepting certain projects or contracts.
An unusually smooth ongoing process in cases where a person does not have the necessary knowledge or expertise.
A person who never takes a break, neither in the case of illness nor holidays/vacation. Person who insists that only they can communicate with the other business side.
To: volker@schaumstoffhandel.at
Subject: Online prices


Dear Volker,

We request that you match your online prices to the prices that we agreed upon for the purchase on location.

If this doesn't happen by 01/07, we will have to raise the price for goods purchased online to 5%.

Kind regards,
Peter

Handling of property
of the Greiner Group
and of our
business partners
Handling business relationships and separation of interests
I work at a large plant, where I perform a variety of repairs. One day, I notice a co-worker putting a drill in his bag at the end of the shift. He sees me looking at him suspiciously and says that he’s currently renovating his house and that yesterday his drill broke. He says that’s why he’s borrowing this drill but that of course he’ll return it once he’s finished.

What should I do?

1. I do nothing. After all, the co-worker is borrowing the drill for just a couple of days.

2. I decide to keep an eye on the co-worker and make sure that he returns the drill. If he doesn’t, I’ll confront him.

3. I immediately inform my supervisor.



Now that her maternity leave is ending, my wife is looking for a suitable part-time job. While speaking with one of our most important suppliers, we happen to start talking about this very topic. He tells me that he has in fact been looking for a reliable part-time employee for quite some time. He says that my wife should stop by for an interview – perhaps something will come of it.

1. I decline the offer.

2. I thank him for the offer and schedule an interview for my wife for the very next day.

3. I first ask my supervisor what he thinks of the matter.

4. I ask the supplier if he could hire my wife in one of his other companies, one with which I don’t have any ongoing business.
Full transcript