India: A White-Collar Crime & Corporate Investigations Overview
The Evolution of Cross-Border Legal Co-Operation: Current Trends in MLATs and the Path Forward
As criminal activity becomes increasingly sophisticated and evidence has become more scattered across cloud platforms, Mutual Legal Assistance Treaties (MLATs) have evolved from diplomatic niceties into essential tools for the modern legal system.
The most significant trends reshaping cross-border legal assistance are the digitalisation of evidence, cloud computing, and data localisation. Where investigators once sought physical documents and local witnesses, they now pursue data stored in cloud servers spanning multiple continents, cryptocurrency transactions recorded on distributed ledgers, and communications flowing through encrypted messaging platforms. This shift has fundamentally altered the nature of cross-border requests, transforming them from discrete, location-specific inquiries into complex, multi-jurisdictional puzzles. Combined with data localisation, often prosecutors, while supporting investigations, find themselves requesting evidence located abroad.
The challenge is not merely technical but also legal. A single email investigation may require evidence from servers in Ireland (where many tech companies host European data), the US (where the companies are headquartered), and Singapore, China or Japan (where Asian operations may be managed). Each jurisdiction brings its own data protection laws, blocking statutes, and procedural requirements which result in a legal labyrinth that may take years to navigate.
This labyrinth allows sophisticated criminal organisations to deliberately structure their operations to exploit gaps in international co-operation, routing communications through countries with weak MLAT networks or storing proceeds in jurisdictions with bank secrecy laws. Conversely, investigators increasingly focus their efforts on “chokepoint jurisdictions” where critical evidence or assets are likely to be found, regardless of where the underlying criminal activity occurred.
The rise of alternative mechanisms
As with physical evidence getting destroyed, digital evidence can also be deleted instantly upon notice of an investigation or regulatory action. Even co-operative witnesses and defendants may find themselves prevented from sharing evidence with foreign authorities due to data-blocking statutes. Data-blocking statutes often restrict or even prohibit sharing information outside the jurisdiction where such data is located.
Navigating these challenges with traditional MLAT timelines, which can span months or years, is impractical. The need for faster access to digital evidence requires alternative bilateral or multilateral routes such as mutual data sharing arrangements, or frameworks for enabling co-operation between law enforcement agencies.
Perhaps more significantly, there has been a marked shift towards hybrid approaches that combine formal MLAT procedures with informal co-operation mechanisms. Investigators now routinely use voluntary preservation requests to secure evidence whilst formal treaty requests are pending, engage in parallel proceedings across multiple jurisdictions, and co-ordinate charging decisions to maximise the impact of limited evidence. However, there is also a risk that evidence obtained via non-MLAT routes may violate local privilege or evidence admissibility rules.
Emergency procedures, which are typically reversed for terrorism cases, are now routinely invoked to assist cybercrime and financial investigations. For instance, the Council of Europe’s Budapest Convention on Cybercrime has pioneered a 24/7 contact point that enables real-time co-ordination between law enforcement agencies, whilst bilateral agreements increasingly include expedited procedures for time-sensitive requests.
A major trend in international co-operation is the development of direct access mechanisms that bypass traditional government-to-government channels. The US CLOUD Act enables US law enforcement to compel disclosure of data held by US companies regardless of where it is stored. Similar initiatives are emerging in other jurisdictions, creating a complex web of overlapping and sometimes conflicting legal authorities.
Though these alternative mechanisms offer speed and efficiency, they also raise questions about sovereignty and due process. It can be argued that these alternate channels undermine the careful balance of interests that MLATs were designed to protect. There may be concerns regarding respect for sovereignty while enabling states to circumvent the legal protections of smaller jurisdictions.
In this regard, the EU’s response has been characteristically cautious but innovative. Rather than asserting extraterritorial jurisdiction, the EU has focused on strengthening regional co-operation mechanisms and negotiating bilateral agreements that preserve sovereignty whilst enabling rapid evidence sharing. The EU–US agreement on cross-border access to electronic evidence, currently under negotiation, may provide a template for future co-operation frameworks.
Overcoming blocking statutes and data protection barriers
Another significant challenge faced by practitioners while relying on MLATs is the proliferation of blocking statutes and data protection laws that restrict cross-border disclosure. Jurisdictions such as the EU, France and China have strict data security laws that restrict data transfers abroad, impose heightened security measures on the transfer of data, and, in some cases, also impose criminal penalties for unauthorised disclosure to foreign authorities, creating a legal minefield for multinational corporations and their counsel(s).
To address the issues posed by blocking statutes, counsels rely on increasingly sophisticated and structured requests to ensure compliance with multiple parallel regulatory regimes simultaneously. This typically means a complex sequencing of voluntary co-operation, formal treaty requests, and regulatory notifications, all designed to satisfy the applicable legal requirements whilst minimising delay and duplication.
Developments in data security and encryption technology such as advanced encryption and secure transfer protocols now enable evidence to be shared across borders while maintaining the chain of custody and satisfying data protection requirements. Blockchain-based evidence management systems are being piloted to create tamper-proof records of cross-border transfers, whilst artificial intelligence tools are being deployed to identify and redact sensitive information automatically.
The co-operation dividend
Though still subject to data-blocking statutes, voluntary co-operation and sharing of information by corporate defendants and witnesses has also increased. Such practice is encouraged by disclosure-friendly corporate enforcement policies that encourage corporate transparency in exchange for a declination or leniency in sentencing. Several reductions granted to corporate defendants over the years highlight the value of voluntary co-operation. The possibility of reduction or leniency is a powerful incentive for both companies and individuals to engage proactively with investigations, often securing evidence more quickly and comprehensively than formal treaty procedures.
Voluntary disclosures require a well-structured investigation and co-operation plan, sharing of non-sensitive and sensitive documents, as well as facilitating interviews with key witnesses. This allows investigators to obtain evidence that would otherwise take months via traditional and alternate mechanisms, while allowing defendants an opportunity to demonstrate good faith and secure more favourable treatment. This translates most favourably in corporate investigations, where the stakes are high, and the evidence is often voluminous. Companies that engage early and comprehensively, frequently secure reduced penalties, whilst those that resist co-operation face the full force of formal treaty procedures and maximum sanctions.
Conclusion: the enduring relevance of MLATs in a digital age
Whilst MLATs may seem slow and old-fashioned, they remain the most reliable way to share evidence across borders. Law enforcement agencies worldwide continue to use these treaty frameworks because they provide legal certainty and procedural safeguards that informal co-operation simply cannot match.
Cross-border evidence sharing is changing because our understanding of sovereignty and jurisdiction is changing. Digital evidence is not bound by physical borders as new technologies create fresh complications in the post-pandemic world where remote procedures have gained wider acceptance from both courts and law enforcement authorities. The way forward is to adapt MLATs to address continued innovation in both technology and procedure, while ensuring careful protection of due process and sovereignty, from both a technological and legal standpoint.