Airbus SE (Netherlands)
Relevant Period: April 24, 2015 - December 31, 2020
Deadline: August 31, 2023
Formerly known as the European Aeronautic Defence and Space Company NV (EADS NV), Airbus SE is a Dutch multinational aerospace corporation, operating through its commercial aircraft, defense and space, and helicopter divisions. In terms of revenue, Airbus is the second largest manufacturer of commercial aircraft in the world, slightly behind Boeing, and also manufactures military transports, satellites, and launch vehicles. Airbus shares (ISIN NL0000235190) are listed on the Frankfurt Stock Exchange; the Euronext Paris; and the Spanish stock exchanges in Madrid, Bilbao, Barcelona, and Valencia.
Unbeknownst to investors and the public, from approximately 2008 to 2015, Airbus SE was offering and paying bribes via its employees, executives, and “Business Partners,” to government officials and airline executives around the world in order to obtain illegal business advantages and win orders on hundreds of aircraft. Business Partners were third parties used to increase Airbus’s international footprint and assist Airbus in winning sales to customers in several countries around the world. Airbus disguised and concealed the true purpose of the Business Partners’ engagement in a number of ways, including by creating fake and fraudulent contracts, using fictitious invoices for services that were never performed, creating false activity reports on behalf of Business Partners, and developing certain “special projects” and investment opportunities that were actually designed as elaborate and secret ways to fund Business Partners. In addition, Airbus concealed relationships with certain Business Partners by, among other things, only engaging in oral agreements, using fake non-reimbursable loans, and paying the Business Partners indirectly.
Airbus not only failed to disclose what the Company and its Business Partners were doing from roughly 2008 to 2015, but also falsely assured investors of its performance and ethics compliance in its annual reports and public statements, while promoting a false narrative surrounding its growing international footprint in the relevant emerging markets. The event that led to the external bribery investigations was not initiated by Airbus but rather by the U.K. Export Finance agency (UKEF) on April 24, 2015, when it raised questions to Airbus about the Company’s due diligence procedures and had flagged transactions in Sri Lanka. This eventually led to Airbus disclosing on April 1, 2016 that it had discovered “certain inaccuracies” relating to U.K. export credit financing applications for customer airlines that could result in a disruption in funding, without identifying the nature of the problem.
On August 8, 2016, the U.K. Serious Fraud Office (SFO) announced it had opened a criminal investigation under the U.K. Bribery Act 2010 into allegations of fraud, bribery and corruption in Airbus’s civil aviation business relating to irregularities concerning third party consultants. Thereafter, on March 16, 2017, Airbus announced that the French Parquet National Financier (PNF) had also opened a preliminary investigation into the same subject. Despite these announcements, Airbus continued to assure investors that ethics and compliance was a top priority, and that it had strengthened its anti-corruption programs. On December 20, 2018, it was reported that the U.S. Department of Justice had opened its own investigation based on violations of the Foreign Corrupt Practices Act (FCPA), Arms Export Control Act (AECA), and the International Traffic in Arms Regulations (ITAR) relating to the SFO and PNF’s allegations of corruption against Airbus, raising the stakes of probes already underway in Britain and France.
On January 27, 2020, reports began to emerge of a potential settlement between Airbus and regulators in the U.K., France, and U.S. related to the ongoing bribery and corruption probe, revealing that the Company faced potentially billions of dollars in fines. Then on January 31, 2020, it was reported that Airbus agreed to a deal with all three countries’ agencies to settle the violations for roughly $4 billion total. In return, all three agencies have agreed to suspend prosecution for three years. If Airbus complies with the agreements for the three years (ending January 31, 2023), the prosecutions in each jurisdiction will be discontinued. These disclosures, as well as the reports of potential settlement and the actual settlement, caused Airbus’s stock price and market capitalization to drop significantly.
We are currently analyzing a potential action against Airbus in the Netherlands based on the facts above. For a complimentary and confidential analysis of your transactions in Airbus stock, we are requesting transaction data for ISIN NL0000235190 from April 24, 2015 to December 31, 2020, inclusive, while also including the applicable SEDOL and place of trade.
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