Today, 1 July, the UK’s new Bribery Act 2010 comes into force. Criminal acts which take place on or after 1 July 2011, will be prosecuted under the new legislation, while crimes committed up to 30 June 2011 will be prosecuted under the old laws.
The UK Bribery Act is widely regarded as the toughest anticorruption legislation anywhere in the world. Since it received royal assent from the Queen on 8 June 2010, the Serious Fraud Office (the main prosecuting body for this type of financial crime in the UK) and the UK Ministry of Justice (MOJ) have been on the lecture circuit around the world spreading the message about the new offences to raise awareness of the need to take action to prevent the risk of corruption.
On 27 June, just as the new Act is about to come into force, the MOJ helpfully issued a circular about the Act, summarising its provisions. Previously, on 30 March 2011 the MOJ issued its guidance under Section 9 of the Bribery Act. This guidance document is about 40 pages long and contains many examples of situations which might amount to one of the offences under the Act.
Key points for corporations are:
- The new corporate offence under Section 7 of the Act, which provides unlimited fines for organisations which fail to prevent bribery.
- Organisations are liable for all “associated persons,” i.e., all those performing services on its behalf, which is a very wide class of persons.
- A robust compliance programme is the only defence to a Section 7 offence; otherwise, it is a strict liability offence.
- Senior officers of the company who knew of or connived in the criminal acts are also personally liable. Sentencing for senior officers can include imprisonment of up to 10 years and an unlimited fine, together with debarment from holding office as a director of any company.
- Foreign companies are susceptible to prosecution in the UK if they have even a small amount of business in the UK or any legal or physical presence in the UK.
The Serious Fraud Office expects all organisations to have already started work on their compliance programmes before 1 July. Those organisations which have not yet formulated even a plan for a new compliance programme will be at risk of investigation and prosecution with no defence available to them if one of their “associated persons” has committed an offence, even if the corporation had no knowledge whatsoever of the criminal acts he or she had committed.