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new wide ranging powers against international and domestic bribery

13 April 2010
Last week, Parliament approved the Bribery Bill. Following Royal Assent, this will become the Bribery Act 2010. The new Act addresses the UKs previously weak anti-corruption legislation, which had attracted international criticism. The Act, which is expected to come into force later this year, means that the UK will have some of the toughest anti-bribery laws in the world. Individuals now face the prospect of long prison sentences and companies face the prospect of unlimited fines.

What does the Act say?

Under the Bribery Act there are four key offences:

  • Bribing another person
  • Accepting a bribe
  • Bribing a foreign public official
  • Failing to prevent bribery (in the case of a corporate)

Key points to note

  • The Act can apply to acts and omissions that take place in the UK and overseas.
  • Unlike the US Foreign Corrupt Practices Act, "facilitation" or "grease" payments are not exempt from the scope of the Act. There is no de minimis level and, for example, even a small payment to a foreign official to "expedite" customs requirements could be caught (unless the payment is a legal requirement).
  • There is strict liability for a corporate where one of its employees or an associated person has engaged in bribery. The only defence is for the company to show that it has adequate procedures in place to prevent bribery. The Government is now required to issue guidance on this.
  • Individuals can be sent to prison and both individuals and companies can face unlimited fines.
  • Corporates convicted of failing to prevent bribery may be debarred from participating in public contracts.

What do you need to do?

There is no set list of actions that a business should take and appropriate measures will depend upon factors such as business size, the countries and sectors in which the business operates and the third parties that it deals with. For some businesses, the risks may be relatively low and, accordingly, the procedures that they need to put in place may not be onerous.

Steps to consider include:

  • Reviewing and putting in place clear policies and procedures to deal with bribery and corruption. If the company has anti-bribery policies and procedures in place that reflect the position under U.S. law then these may need to be amended. Unlike U.S. law, facilitation payments, for example, are not permitted under the new Act.
  • Staff training and guidance, particularly on difficult areas such as facilitation payments, commissions, gifts and hospitality.
  • Appointing a senior officer to take responsibility for compliance.
  • Monitoring and internal controls including auditing compliance with the law.
  • Procedures for the appointment of third parties such as agents.

To discuss the impact of the new legislation further, please get in touch with our team.

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The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

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