Changing Obligations for Corporations under Investigation by the Serious Fraud Office: R (KBR Inc) v Director of the Serious Fraud Office [2018] EWHC 2368 (Admin)

Date01 February 2019
DOI10.1177/0022018319831090
Published date01 February 2019
AuthorMark Baldock
Subject MatterCase Notes
Case Note
Changing Obligations
for Corporations under
Investigation by the Serious
Fraud Office
R (KBR Inc) v Director of the Serious Fraud Office [2018] EWHC
2368 (Admin)
The claimant in these proceedings, KBR Inc., was a company incorporated in the USA (‘KBR’). The
Serious Fraud Office (‘SFO’) were investigating one of its UK subsidiaries (KBR Ltd) on account of a
large number of suspected corrupt payments. Under his powers under s. 2(3) of the Criminal Justice Act
1987 (‘CJA’), the Director of the SFO issued a notice requiring KBR to produce certain documents. That
notice was given to an agent of KBR, Ms Akerson (‘MA’), the executive vice president, general counsel
and corporate secretary of KBR, who was at the time present within the jurisdiction to attend voluntarily
a meeting with the SFO to aid them in their investigation into KBR Ltd. In response to the s. 2(3) notice,
KBR refused to provide the requested documents as they were located on a server outside of the UK in
the USA.
KBR Inc. sought to challenge the s. 2(3) notice by way of judicial review on three grounds:
i. Jurisdiction. It was KBR’s case that the notice should be quashed as it requested material held
outside the UK from a company incorporated in the USA; on its true construction, s. 2(3) had no
extraterritorial effect (‘the Jurisdiction Ground’).
ii. Discretion. KBR asserted that it was an error of law for the Director of the SFO to exercise his
powers to issue a notice as he did; he should, rather, have sought to pursue the request for
documentation under his power to seek Mutual Legal Ass istance (‘MLA’) (‘the Discretion
Ground’).
iii. Service. KBR argued that the notice was not effectively served by the SFO by handing it to a
senior officer of the company (‘the Service Ground’).
Held, dismissing the claim, in respect of the Jurisdiction Ground, the s. 2(3) notice was not ultra
vires as KBR, having a sufficient connection to the UK, fell within the extraterritorial reach of s. 2(3)
CJA (at [79]–[84]). In respect of the Discretion Ground, the MLA provisions give the Director additional
powers which do not curtail his discretion to use the separate compulsory powers available to him under
s. 2 CJA and therefore it was not unlawful for him to have proceeded by a s. 2(3) notice (at [93]–[96]).
Finally, in respect of the Service Ground, KBR was present within the jurisdiction and the giving of the
notice to MA was sufficient for the purposes of s. 2(3) (at [97]–[101]).
The jurisdiction ground
Whether s. 2(3) CJA had extraterritorial effect was a question of construction (at [25]). The starting point
was that, ‘[u]nless the contrary intention appears ...an enactment applies to all persons and matters
within the territory to which it extends, but not to any other persons and matters’ (Masri v Consolidated
The Journal of Criminal Law
2019, Vol. 83(1) 24–26
ªThe Author(s) 2019
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DOI: 10.1177/0022018319831090
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