The 14 companies, including Renault Trucks, Legrand and Schneider Electric, signed contracts with Iraq through the United Nations Oil-for-Food Programme that ran between 1996 and 2003.
The programme was designed to help civilians suffering under sanctions imposed on Iraq over the 1990 invasion of Kuwait, by allowing the government to sell oil on the world market, under UN supervision, in exchange for food, medicine and humanitarian needs.
As the programme evolved, contracts were awarded based on companies’ willingness to pay 10-percent surcharges presented as “transport costs” or “after-sales services”, but which in fact went into the pockets of corrupt UN officials or to the Iraqi state coffers.
A UN inquiry concluded in 2005 that some 2,200 companies around the world, including 180 in France, made more than 1.5 billion euros’ worth of corrupt payments to win or maintain contracts.
However, the 14 French companies were let off the hook for a first set of charges in a 2015 trial, because the situation did not match the offenses that French anti-corruption law is designed to prosecute.
“Usually in corruption, the corrupted person takes money for himself and doesn’t give it to the state, so this case is quite special in this sense,” said Juliette Lelieur, a law professor at the University of Strasbourg.
Companies knew of illegal money
During that trial, the companies did not deny taking part in the programme, and some said they made payments in all transparency and with the knowledge of French officials.
“They knew that this 10 percent was illegal money,” said Juliette Lelieur, a law professor at the University of Strasbourg.
“The deal was they would pay more for the first barrels of oil in exchange for the illegal opportunity to get more barrels.”
The court’s decision to dismiss charges was based on a 2013 acquittal of French oil company Total and former government minister Charles Pasqua.
However, in 2016, the Court of Appeal of Paris found Total guilty of “bribery of a foreign public official” in 2016 and ordered it to pay a 750,000 euro fine.
Swiss-based Dutch oil group Vitol, which has already been condemned to pay 17.5 million dollars (15 million euros) in the US, was fined 300,000 euros, and former French ambassador to the UN Jean-Bernard Merimee and former diplomat Serge Boidevaix were also ordered pay fines of 50,000 and 75,000 euros, respectively.
It is possible the court will take a similar view in regards to the 14 companies.
“You have active corruption and passive corruption,” Lelieur said.
“I think it is right to say that there was active corruption if the companies knew the money was not legal, even if the Iraqi agents were not corrupt, in the legal sense.”
The trial is expected to last until 30 November.