- First acceptance of responsibility for Section 7 violation
- First guilty plea for Section 7 offence
Although the first deferred prosecution agreement concluded in the United Kingdom related to alleged failure to prevent bribery contrary to Section 7 of the Bribery Act 2010 (for further details please see "First deferred prosecution agreement concluded"), this was not the first acceptance of responsibility for a contravention of Section 7. On September 25 2015 the Scottish Crown Office and Procurator Fiscal Service announced(1) that a company had admitted to a Section 7 violation. The company was not prosecuted as under the self-reporting initiative, launched in Scotland when the act came into force; rather, the case was deemed suitable for civil recovery settlement (the Civil Recovery Unit recovered £212,800 under an agreed civil settlement with the company).
The cabling company accepted that it had benefitted from unlawful conduct by a third party. However, the company had carried out an extensive investigation after becoming aware of the issue through an internal review and had then self-reported in June 2015. The company had also taken steps to implement new policies and training to ensure that no unlawful conduct will take place in future.
The first actual guilty plea to an offence committed contrary to Section 7 came on December 18 2015, when Sweett Group Plc pled guilty to a Section 7 offence at the Southwark Crown Court. The Serious Fraud Office (SFO) had already announced(2) on December 2 2015 – two days after the approval of the first deferred prosecution agreement – that Sweett Group Plc had admitted a Section 7 offence regarding conduct in the Middle East (on July 14 2014 the SFO had opened an investigation into Sweett Group Plc in relation to its activities in the United Arab Emirates and elsewhere). The SFO subsequently announced(3) on December 9 2015 that Sweett Group Plc had that day been charged with the offence. The offence had been committed between December 1 2012 and December 1 2015, and related to the company's failure to prevent the bribing of an individual by an associated person (Cyril Sweett International Limited), its servants and agents. The bribe was used to secure and retain a contract with an insurer for project management and cost consulting services in relation to the building of a hotel in Dubai. Sweett Group Plc was sentenced on February 12 2016.
In September 2015 the SFO gave a prosecutor's perspective to the question of compliance, with particular regard to Section 7 and a company's defence where it can show that it had "adequate procedures" in place to prevent persons associated with it from committing bribery. The SFO welcomed the new compliance culture following passage of the Bribery Act, but said that it could not offer advice or assistance on compliance policies. The SFO further noted that, when it investigates a business, what matters to it is the substance and not the form of the compliance, and that any attempts to justify compliance failure on the basis that bribery is simply the price of doing business in certain jurisdictions will fall on deaf ears.
For further information on this topic please contact Kathleen Harris at Arnold & Porter LLP by telephone (+44 20 7786 6100) or email (firstname.lastname@example.org). The Arnold & Porter website can be accessed at www.arnoldporter.com.
This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.