1. Main concepts and definitions
Compliance – conformity of the activity of the Company and the OAO KAMAZ Group of Companies (hereinafter as Company) as well as Company employees with the requirements of international, Russian and, in case of activity outside the Russian Federation, applicable foreign law as well as internal policies and procedures, and with the decisions of the Company's managerial bodies.
Company's compliance system - the totality of elements of the corporate culture, organizational structure, rules and procedures regulated by the Company's internal guidelines and ensuring adherence to the principles of compliance by Company employees regardless of their position.
In the development of a compliance system the Company's priorities lie in countermeasures against corruption and the laundering of illegally obtained proceeds.
Corruption - abuse of employment status; giving bribes; taking bribes; serving as an intermediary in bribery; abuse of power; commercial bribery; unlawful transfer, offer or promise of compensation on behalf and in the interest of the Company, or other unlawful use by the Company Employee of his or her position in violation of the Company's lawful interests for the purpose of obtaining gain in the form of money, valuables, services, paid entertainment, vacation, transportation expenses, other property or pecuniary services, other proprietary interests for oneself or third parties, or unlawful provision of such a gain to the said individual by other natural persons as well as committing these deeds in the name and interest of the Company.
"A person associated with the State" - a) State, (b) public bodies, (c) public official, (d) close relative of a public official or a person specified in item (e) and (f) of this paragraph, (e) ultimate beneficiary (owner of more than 20% of shares), officer and employee* of private entity that is directly or indirectly controlled by the government or public body, or (f) an employee*, director of non-profit organization founded by (or including in its members) state, public bodies or public official , (g) private entity with an ultimate beneficiary or director (including members of Board of Directors or other similar governing body) being a person referred to in items (a), (b ), (c), (d), (e) and (f) owning more than 20% of the private entity’s shares.
“Control" means the right to ensure that strategic, financial and operational decisions are being made in accordance with instructions of controlling person:
(A) based on shareholding of the equity of this or any other legal entity or exercising the rights to vote in respect of this or any other legal entity, or
(B) based on any powers conferred by the constituent, internal or statutory documents governing the activities of this or any other legal entity, or any other documents.
"Public Official" – a person* elected to the representative body of any level; judge; person performing management, administrative and governing functions in any public body permanently, temporarily or by special authorization, as well as candidates for position of a Public Official.
"Public bodies” - (а) Russian Federation federal and regional government authorities and other government bodies formed in accordance with the Law of the Russian Federation and regions of the Russian Federation, including legislative, judicial and executive (including Law Enforcement Authorities, Armed Forces of the Russian Federation, other troops, military formations and bodies); (b) elected directly by the population or formed by representative or executive body of the municipal authorities vested with the authority to settle local issues; (c) government authorities of a foreign state, which are formed and recognized thereof in accordance with the laws of a foreign country including but not limited to legislative, executive, judicial and other bodies, as well as political parties and social organizations; (d) international public organizations; (e) political parties and social organizations (f) non-profit organizations if shareholders/founders include a person associated with the State.
"International public organization" - an association created by joint action of members from different countries to protect their common interests and to achieve the statutory goals of civil, political, cultural, social and economic areas.
* permanently, temporarily or by special authorization performing management functions.
Management functions include, for example, team leadership, recruitment and appointment of personnel, organization of work or duty of employees, maintenance of discipline, the application of incentives and disciplinary actions. As management functions can be considered, in particular, the authority to manage and administrate the assets and funds which are on the balance sheet and bank accounts of organizations and entities, military units, as well as performing other functions: decision-making on salaries, wages, payouts, control of cashflow and other assets etc.
2. Principles of a compliance system:
2.1. Zero tolerance towards corruption in any of its manifestations
The Company deems inadmissible any and all occurrences of corruption during its productive, investment and any other activity.
Zero tolerance towards corruption means strictly forbidding any and all persons acting on behalf of the Company and in its interests, directly or indirectly, personally or through any type of mediation, to participate in corruption, regardless of the business practices in any given country.
2.2. Unconditional adherence
All Company employees must unconditionally and unfailingly meet the requirements of the applicable law and internal policies and procedures, regardless of their position, length of service, status and other relationships with the Company.
2.3. Inevitable punishment
The Company will make all possible, reasonable and lawful effort to achieve quick and inevitable prosecution of corrupt acts and other breaches of international, Russian and, in case of activity outside the Russian Federation, applicable foreign law as well as internal policies and procedures in the area of compliance, regardless of the size and form of such breaches.
The Company reserves the right to disclose information about persons held liable for corrupt acts in accordance with established procedure.
3. Fundamental elements of the compliance system
3.1. Relationships with employees
The Company expects all of its employees to share Company principles as mentioned in this Policy and in the Code of Ethics of OAO KAMAZ, and to meet without reserve all requirements of current law and internal policies and procedures of the Company.
The Company guarantees that no punitive measures will be taken against employees who refuse to carry out an action that by law can be deemed as corrupt even if in the result of such a refusal the Company does not receive additional tangible or intangible benefits and/or suffers losses which could be avoided only with violation of legislation or this Policy.
The Company is opposed to unlawful retaliatory measures taken within the Company against employees who voluntarily report an alleged act of corruption carried out by another employee or vis-a-vis a Company employee, and will strive to identify and preclude such measures in a prompt manner.
3.2. Relationships with counterparts
The Company prefers working relationships with business partners who have the same values as the OAO KAMAZ Group of Companies.
To realize such a declaration, the Company exercises due diligence when seeking counterparts and gives notification about the requirements of this policy.
3.3. Relationships with public officials and state-related persons
The Company is opposed to paying or compensating for any expenses of public officials and/or state-related persons or public authorities, giving them or for their benefit any material or other gains, for the direct or indirect purpose of obtaining any type of unlawful advantage in the performance of its business.
3.4. Entertainment costs and gifts
The Company is opposed to covering entertainment costs, gifting and receiving gifts if these costs or gifts directly or indirectly influence public officials and/or state-related persons to make decisions that give unlawful advantages to the OAO KAMAZ Group of Companies.
Covering entertainment costs and giving business gifts are only allowed if they do not contradict the norms of international, Russian and, in case of activity outside the Russian Federation, applicable foreign law as well as internal policies and procedures of OAO KAMAZ, and especially the Compliance Policy and the Code of Ethics of OAO KAMAZ.
3.5. Participation in charity and sponsorship activity
The Company does not participate in philanthropic and sponsorship projects, and political activity with the direct or indirect goal of influencing public officials, state-related persons and public authorities to make decisions that give unlawful advantages to the OAO KAMAZ Group of Companies.
Information about all Company expenses on the provision of charity and sponsorship aid as well as expenses on political activity is publicly available.
3.6. Bookkeeping and management accounting
All financial and business transactions and deals are entered accurately, correctly and with sufficiently level of detail in the books, are documented and accessible for audit purposes in accordance with the legally established procedure.
The Company does not allow the performance of business transactions that are not entered in the books, or the distortion and falsification of data from accounting, managerial accounting or other types of record-keeping or supporting documentation.
3.7. Evaluation of compliance system risks
The Company regularly evaluates compliance system risks for the prompt monitoring of business processes that are potentially subject to risk of corruption.
The Company acknowledges the need to manage the risk of being entangled in corrupt activities, regardless of the magnitude of the potential breaches.
Employees and third parties can report possible breaches confidentially and, if desired, anonymously by calling its hotline at +7 (8552) 371-837 or by directly contacting the head of the Internal Audit and Compliance Service.