Anti-Bribery and Corruption

• Posted onNovember 15, 2017

The Bribery Act

The Bribery Act came into force on 1 July 2011.  However, it is only relatively recently that the number of investigations and prosecutions has started to increase and come to the attention of the business community.

The Bribery Act extended the crime of bribery to cover all private sector transactions (previously bribery offences were confined to transactions involving public officials and agents).  The Act contains a new strict liability offence of failing to prevent bribery.  The only defence to this offence is if the business can show that it had “adequate procedures” in place to prevent bribery.  It should also be noted that the scope of the Act is extensive and actions taken in a foreign country (which may be “normal” practice in such countries) may still constitute an offence.  The penalties are severe: for individuals: a prison sentence of up to 10 years and/or an unlimited fine and for companies: an unlimited fine.  You could also be disqualified from acting as a director for up to 15 years.

It is, therefore, essential that every business can prove it has “adequate procedures”.  Unfortunately “adequate procedures” are not defined in the Act but the Ministry of Justice has published guidance setting out 6 principles:

• Proportionate procedures
• Top level commitment
• Risk assessment
• Due diligence
• Communication
• Monitoring and review

Common areas of risk are corporate hospitality and gifts (lavish hospitality should be avoided, both giving and receiving) and so called facilitation payments (bribes in common parlance) which may be demanded by Government officials.  These are common place in many jurisdictions.  The making of any such payment, regardless of how small, is an offence under the Act.  Our advice is to risk assess your business; review anti-corruption policies and procedures; conduct due diligence on customers, suppliers and agents; appoint and properly train a compliance officer and ensure all employees receive appropriate training; adopt a robust anti-corruption stance at the highest level and ensure that your policies are clearly published and accessible, both internally and externally.

Make an appointment to discuss The Bribery Act act with a member of our specialist Commercial Law team.

Or read other articles on Commercial Law here.