April 2010 saw the long awaited Bribery Act receiving Royal Assent. The Act is a consolidation and reform of the previously disparate laws on bribery.

In summary the Act creates four new offences

- promising or offering a bribe

- requesting or agreeing to receive a bribe

- bribing a foreign official

- a corporate offence of failing to prevent bribery

Of particular note for corporate clients is the new corporate offence, which will apply to all "commercial organisations". This definition covers all organisations which are either registered in the UK or have any operation in the UK. The corporate offence is strict liability and will be committed where a commercial organisation fails to prevent an "associated person" from bribing another person with the intention of obtaining business or advantage for that commercial organisation. The penalty for committing this offence is a fine up to an unlimited amount and where applicable disbarment from participation in public services contracts.

Whether a person is an "associated person" is a question of fact and will depend on the circumstances. However, this definition is likely to include employees, agents and subsidiaries.

The Act provides a defence where an organisation can demonstrate that it has "adequate procedures" in place to prevent bribery.

The Government is due to issue guidance on what will amount to "adequate procedures" and it is likely this will encompass an anti-bribery policy for every organisation although the detail of such a policy is likely to depend on the size of the relevant organisation and the particular nature of its business.

The Government has announced that consultation on this guidance is to begin in September 2010 and it is anticipated that the Act will come into force in April 2011. Between the publication of the Government's guidance and the Act coming into force organisations will need to update their existing compliance programmes. Organisations should therefore be reviewing their compliance policies now to ensure that they are ready to take the benefit of the Government guidance when given.

Best practices appear likely to include:

- a clear anti-bribery and corruption compliance policy, published internally and overseen by a designated person at board level;

- documented due diligence of associated third parties who are "associated";

- training programmes for all staff;

- policy on corporate hospitality;

- anti bribery clauses in commercial contracts;

- whistle blower facility;

- procedure for investigating and resolving problems;

- financial controls with transparent record procedures to ensure company funds are properly accounted for.

The Act also makes changes to the way in which senior officers of a company can become individually liable for bribery offences committed by a company. A senior official may now be personally liable where it can be shown that bribery has taken place with that official's "consent or connivance". The penalty for such offences may be up to a maximum of ten years in prison.