The Bribery Act - September 2010 update
22/09/2010
By Henar Dyson, Senior Associate in Corporate and Commercial.
The Ministry of Justice has confirmed that the Bribery Act 2010 is due to take effect from April 2011. This means that businesses need to prepare themselves.
Read our previous article on the Bribery Act which sets out the basic features and offences in the Act.
Businesses should be particularly interested in the draft guidance issued by the Ministry on what to do to prevent bribery. The draft was opened to consultation on 14 September, with the final guidance expected early in 2011.
The draft guidance sets out six broad management principles. These principles are intended to be flexible enough for each business decide what procedures are right for it:
- Risk assessment - a regular and comprehensive assessment of the risks of bribery occurring in the business. By understanding the risks, the business can then consider the most effective policies to have in place.
For example, risks can be greater where the business trades with an at-risk country or is involved in complex transactions.
- Top level commitment - the highest level of management should be committed to the prevention of bribery and be involved in the development of policies.
- Due diligence - this means having procedures which vet the parties with which the business works.
For example, you may need to consider whether a business partner is offering market prices and has a legitimate objective.
- Clear, practical and accessible policies - this will require businesses to create policies that allow all levels of staff to implement them properly.
- Effective implementation - it will not be sufficient to have a policy if it is not implemented throughout the business.
For example, training will need to be given to staff in relation to the risks and the policies of the business.
- Monitoring and review - this is necessary to ensure ongoing compliance and modification if improvements are identified.
The most interesting part of the consultation is an annex including five scenarios which put these principles into context. These cover difficult areas such as accepting hospitality and making charitable donations. They show how easy it could be to accept or making a bribe, without realising it.
Although the draft guidance can be modified by the results of the consultation, it does already give a broad indication of the current thinking of the Ministry. The guidance will certainly be helpful to smaller businesses who are looking to develop or upgrade their anti-bribery policies and procedures. It should be considered carefully.
If you need help in developing or updating your anti-bribery policies, please contact Henar Dyson or James Herbert.