The new Bribery Act to be enforced by UK law from 1st July 2011 is not something for companies to ignore. It has been described as the toughest anti bribery legislation in the world.
It provides severe penalties for companies and their directors
The penalties for committing a crime under the Act are a maximum of 10 years’ imprisonment, along with an unlimited fine, and the potential for the confiscation of property under the Proceeds of Crime Act 2002 as well as the disqualification of directors under the Company Directors Disqualification Act 1986. The Act has international jurisdiction, allowing for the prosecution of an individual or company with links to the United Kingdom, regardless of where the crime occurred. Described as “the toughest anti-corruption legislation in the world”.
Historically a company was only likely to be guilty of a bribery offence if very senior management were involved in the commission of the offence. The 2010 Act reverses this position. Now the company may be guilty if someone working for the company (the “associated” person) commits one of the individual offences, even if no one within the company knew of the bribery. What is more, the person “associated” doesn’t have to be an employee; he could also be an agent (someone who provides services on behalf of the principal) or even an external third party, possibly even operating in a different jurisdiction.
Accordingly, there is now a significant duty on an organisation to ensure that their anti-bribery procedures are robust if they are to prevent being exposed.
The Act sets out four key offences:
(i) A general offence targeting the payer of a bribe;
(ii) A general offence targeting the recipient of a bribe;
(iii) A specific offence prohibiting the bribery of foreign public officials; and
(iv) a new offence of failure by a commercial organisation to prevent a bribe being paid for or on its behalf.
The first three of these offences can be committed by an individual person and/or a body corporate. A senior officer of a company (defined as a director, manager, secretary or other similar officer) may not be prosecuted under the Act for the fourth corporate offence of failing to prevent bribery, but he/she may be prosecuted of the first three offences if they have British nationality or are ordinarily resident in the U.K. and the company committed a bribery offence with their consent or connivance (i.e. passive acquiescence will be sufficient to incur liability)
It will be an offence to offer or give a “financial or other advantage” with the intention of inducing a person to perform a “relevant function or activity… improperly” or to reward a person for doing so.
It will be an offence to request, agree to receive or receive a financial or other advantage intending that “a relevant function or activity” should be performed “improperly” as a result.
Lack of criminal intent or indeed lack of knowledge of the new legislation will be no defence.
It is essential that all UK companies and government departments now take steps to ensure that they comply as existing commercial practices may indeed fall within the scope of the act.