Summary and implications

As from April 2011, failure to prevent bribery on the part of commercial organisations will be a criminal offence. Section 7 of the Bribery Act 2010 provides a defence where a commercial organisation can demonstrate that it has put adequate bribery prevention procedures in place. The Ministry of Justice has recently issued its draft guidance on adequate procedures for consultation. The guidance will be of interest to all commercial organisations currently preparing for the new law.

Principles for bribery prevention

The draft guidance is in the form of six principles:

  • Risk assessment: commercial organisations should regularly and comprehensively assess the nature and extent of the risks relating to bribery to which they are exposed.
  • Top level commitment: the top level management of a commercial organisation should be committed to preventing bribery and clearly communicate the commercial organisation’s anti-bribery policy.
  • Due diligence: a commercial organisation should have due diligence policies and procedures which cover all parties with whom the organisation does business.
  • Effective policies and procedures: a commercial organisation’s policies to prevent bribery being committed on its behalf should be clear, practical, accessible and enforceable.
  • Effective implementation: a commercial organisation should effectively implement its anti-bribery policies and procedures and ensure they are embedded throughout the organisation.
  • Monitoring and review: the commercial organisation should institute mechanisms for monitoring and review to ensure compliance with relevant policies and procedures.

The principles are intended to assist commercial organisations in formulating their procedures rather than prescribe what they should do. While much of the guidance is straightforward, commercial organisations do have some decisions to make, for example on what constitutes adequate due diligence on persons with whom they do business. C onsultation on the draft guidance ends on 8 November 2010.