The Bribery Act 2010 (the Act) came into force on 1 July this year. Whilst the Act largely consolidates the UK’s existing bribery regime, it also extends that regime in a number of ways – most notably with the addition of the new corporate offence of failing to prevent bribery. This strict liability offence has caused much controversy and, arguably, led to the delay in the Act’s implementation.
Already the first prosecution under the Act is due to be brought next month. This case is against an individual, a court clerk accused of accepting a bribe to perform his functions improperly. The willingness of the DPP to use the Act so swiftly after implementation in order to prosecute the receipt of a relatively small sum (£500) suggests that businesses would do well to review their commercial arrangements in order to avoid prosecution under the Act.
You may recall that the Act introduces:
- two general offences – one targeting the payer of a bribe (sometimes referred to as active bribery) and the other offence which targets the recipient of a bribe (referred to sometimes as passive bribery);
- a specific offence prohibiting the bribery of foreign public officials; and
- the corporate offence of failing to prevent bribery.
Companies should note that the two general offences and the offence relating to the bribery of foreign public officials do not just apply to individuals – certain corporate entities can also be guilty of the general offences and the specified offence of the bribery of a foreign public official, if a ‘senior officer’ of that organisation commits one of those offences.
In respect of the corporate offence of failing to prevent bribery (which is a separate offence to the two general offences and the specific offence of bribing a foreign public official), businesses can benefit from a defence under the Act if they can show that they had ‘adequate procedures’ in place to prevent bribery.
In considering their adequate procedures, businesses must do more than go through the motions. Government guidance makes clear that the steps a company puts in place are not just generic but must be appropriate in respect of the risks that have been identified in that particular business. Separate guidance issued by the SFO makes clear that where a potential offence has been discovered it will expect a company seeking to avoid prosecution to be able to show it has a genuinely pro-active and effective corporate compliance program. Each business will therefore have to develop its own policies with the range and emphasis tailored for the risks inherent in the nature of its business and the geographic area in which it works.
In some countries it is known already that there is a culture of expectation on the part of public officials that foreign companies should give facilitation payments if they want a smooth passage and in others the receipt of a gift is considered normal at a level that would be seen as excessive elsewhere.