The Bribery Act comes into force on 1 July having received Royal Assent in April 2010. Its aim is to replace antiquated law on this subject and to ensure that the UK comes into line with the majority of other countries’ anti-bribery legislation. The accountancy firm Chantrey Vellacott DFK writes.
The provisions of the Act will affect all commercial businesses. It not only reiterates the illegality of paying and receiving bribes, but also requires businesses to take steps to prevent its occurrence in connection with their businesses anywhere in the world.<br><br>There are four criminal offences under the act:<br><br>a. Paying bribes (s.1)<br>b. Receiving bribes (s.2)<br>c. Bribery of a foreign public official (s.6)<br>d. Failure of a commercial organisation to prevent bribery (s.7)<br><br>A corporate body found guilty of one of the above offences may face an unlimited fine. An individual found guilty may face imprisonment for up to ten years, an unlimited fine, or both.<br><br>Meanwhile, from audit firm Deloittes, comments:<br><br>Nic Carrington, partner in Deloitte’s Forensic & Dispute Services team:<br><br>“One of the most significant issues facing companies in their implementation of an effective anti-bribery programme will be to ensure that their management and staff in overseas operations properly understand that local custom and practice will be no defence under the new UK law and that consequently their actions may give rise to significant corporate and individual liabilities back in the UK.<br><br>Unless properly trained and followed through, it may be easy for management and staff to dismiss new policy documents as not relevant to their local operations and what they perceive as the realities of conducting business on the ground. A meaningful anti-bribery risk assessment must therefore fully engage with overseas operations to identify all the risk areas that are faced and an effective training programme will be critical.”<br><br>Kirsty Searles, partner in Deloitte’s Anti Bribery and Corruption Controls team:<br><br>“Larger corporates with in-house legal and compliance teams have made good progress on implementing structured programmes to achieve Bribery Act compliance. However, our experience suggests that mid cap (FTSE 250) and smaller sized entities are not making such rapid progress, which may be expected given the typical lack of such capabilities in-house. There will be a comparatively greater burden on these companies to get up to speed on compliance. It is likely that many of these businesses will not have established “Adequate Procedures” by 1 July 2011, and, therefore, will be looking at a period of time without a defence if prosecuted for the corporate offence under the Bribery Act.<br><br>“For those taking their first steps, the key will be to undertake a risk assessment to understand where exposures lie in the organisation, and then implement appropriate policies and processes to ensure compliance. These measures should be proportionate to the size of the organisation and the specific risk exposures in line with the Bribery Act’s guidelines. Senior management need to clearly communicate the organisation’s lack of tolerance for bribery and corruption, and the requirement that all staff must be aware of, and comply with, anti-bribery and corruption policies and procedures.”
Brent McDaniel, UK head of Anti-bribery & Corruption at audit firm KPMG, warned: “Despite the crescendoing noise and continued speculation around the Bribery Act, a third of all UK companies remain unprepared for today’s implementation, risking a jail sentence or unlimited fine. In fact 71 percent believe there are some places in the World where business cannot be done without engaging in bribery and corruption.
“While many corporates are already tackling the Act head on, the fear is whether training and policy are extending to global partnerships and overseas third parties.
“For those enjoying corporate hospitality this week, proportionality sits at the heart of this legislation. The SFO are likely to have little interest in prosecuting over a bottle of wine or a day at the races. The mandate is to stamp out grand scale corruption in high risk countries, but evidence of companies undertaking thorough risk assessments and training is vital to evade prosecution.
“In a crowded regulatory world the Bribery Act is but one element and should not be tackled in isolation, but must be the catalyst for company boards to overhaul the entire compliance agenda.”
