As the UK Bribery Act will come into force in April 2011, corporate entities (including partnerships) which carry on part of their business in the UK need to ensure that by that date they have in place adequate procedures which may provide a defence to the strict liability offence of failure to prevent bribery.
On 14 September 2010 the UK Ministry of Justice (MOJ) launched its consultation on the form and content of the proposed guidance about procedures which commercial organisations can put in place to prevent bribery. The consultation period will end on 8 November 2010 and the government proposes to publish the guidance under section 9 of the Act early in the New Year.
The new offence for corporate entities of failure to prevent bribery being carried out on their behalf is an offence of strict liability. That is to say if a corrupt act is carried out by the corporate or on its behalf by someone performing services for it the corporate will automatically be guilty of the offence. The offence is very wide because it applies to all corporates who carry on business or part of their business in the UK. This can be through a subsidiary, a branch or through third parties engaged to operate on their behalf in the UK. The offence applies to any corrupt conduct which occurs either in or outside the UK. All that is required is that the corporate carries on part of its business in the UK.
The only defence to this offence is to show that the corporate had adequate procedures in place designed to prevent bribery being carried out on its behalf. It is therefore of paramount importance that corporates have adequate procedures in place.
The Consultation Process
The MOJ in its consultation paper on the proposed guidance states that a failure to prevent bribery under section 7 of the Act “reflects a general recognition that there is an important role to be played by business itself in ensuring that commerce is undertaken in an open and transparent manner. The new law will introduce a clear and robust approach and is intended to encourage commercial organisations to take steps to address the risks of bribery”.
Adequate Procedures, Guidance and Consultation Update
Our London office has published an update on the consultation process and the “Six Principles for Bribery Prevention” formulated by the government. That can be viewed here.
Responses to the consultation paper can be made direct to the MOJ and we are happy to assist with those responses. The MOJ will also be holding a number of open discussion seminars to discuss views on the form and content of the proposed guidance. The only seminar to take place in London will be on 4 October 2010. It will be hosted by Norton Rose LLP and Transparency International UK together with the Ministry of Justice. Further details of this seminar and other seminars can be obtained from the MOJ website.