The much anticipated Criminal Justice (Corruption) Bill (Bill) is listed among the bills to be published in the Government’s legislative programme for Spring-Summer 2015. Once enacted, this Bill will overhaul and strengthen Ireland’s existing bribery laws. In particular, it will impose liability on commercial entities that inadequately supervise their employees or agents.
The likely contours of this new form of liability are already well known, thanks to the Government’s publication of the general scheme of the Bill in 2012. Head 13 of that scheme provides, among other things, for a new offence criminalising both an incorporate and unincorporated body (Body) where a person acting on its behalf, including an employee or agent, commits bribery in order to obtain or retain business, or to retain an advantage in the conduct of business. It is a defence for the Body to prove that it took all reasonable steps and exercised all due diligence to avoid the commission of the offence.
From a domestic legal perspective, the new failure to supervise offence is a highly innovative provision. However, the reality is that most Bodies should already have effective compliance policies in place, at least if they wish to do business abroad, or engage domestically with foreign investors, whether as manufacturers, distributors, agents or in some other capacity.
Both the US and the UK already have bribery laws in place that target commercial entities which fail to take adequate measures to prevent their employees/associates from committing bribery. In both jurisdictions, a commercial entity can avoid liability if it can demonstrate that it has implemented an effective anti-bribery compliance policy. However, a breach of these laws can have serious financial repercussions for the entities involved. In particular, the US authorities have imposed multi-million dollar fines on companies for breaching the US Foreign Corrupt Practices Act (FCPA), including for breaches attributable to the actions of an employee or business associate.
As a result, larger companies are being considerably more circumspect when choosing their business partners and are increasingly likely to require those partners to have robust anti-bribery compliance policies. This is also the case where such companies are considering prospective mergers or acquisitions. Because of the particularly expansive scope of both the FCPA and the UK Bribery Act 2010 this holds true for all companies and not merely US and UK ones. In short, any Irish firm seeking to do business with an international element should already have an anti-bribery compliance policy in place.
Fortunately, there is widespread agreement on what constitutes an effective compliance policy. There is also plenty of readily available information for those Bodies that wish to take a proactive approach to bribery compliance. For example, the US authorities have published a resource guide to the FCPA, which contains a section on corporate compliance programmes. Similarly, the UK Ministry of Justice has issued Guidance on the Bribery Act 2010. The UN and the OECD have also jointly published the Anti-Corruption Ethics and Compliance Handbook for Business.
In short while the Bill will bring about an important change in Irish law, Bodies should seriously consider putting their compliance programmes in place now, if they have not already done so. There are compelling risk and commercial reasons for doing so and information on what is required is readily and freely available.