The Bribery Act 2010
27/10/2010
By Henar Dyson, Senior Associate in Corporate & Commercial
The Bribery Act 2010 is an attempt to ensure that bribery is tackled more effectively in the United Kingdom. It is expected to come into force in April 2011.
Bribery is a threat to economic progress and development around the world. Instead of businesses competing on a level playing field, they might be competing, unfairly, against the biggest backhander. Until now, the United Kingdom has been much less aggressive in dealing with bribery than other national authorities, most notably in the United States. This is soon to change with the introduction of four offences:
- bribing another person in connection with a business involving either a private or public commercial organisation
- accepting a bribe
- bribing a foreign public official
- failing to prevent bribery - this is the most controversial offence as it makes a commercial organisation liable for bribery carried out by a person associated with it, whether or not it was aware of the bribe. A commercial organisation will include any business, including partnerships and companies. Associated persons will include employees, agents and third parties involved with the business. A consultation exercise is underway in relation to Ministry of Justice guidance on how businesses can help to prevent bribery. The draft guidance is expected to be finalised early in 2011.
There are criminal penalties for these offences. The maximum jail term will be ten years and fines for commercial organisations convicted of failing to prevent bribery will be unlimited.
Although the Act is not radical, it would be naïve of businesses to ignore this opportunity to ensure that they have adequate anti-bribery policies in place.
We suggest that these are the basic and sensible steps for all businesses to take:
- ensure that high level management understands the implications of the new Act and is encouraged to foster a culture that will not accept bribery
- write a bribery policy and build in anti-bribery provisions into your employee handbook and employment contracts
- carry out a risk assessment of the business. Consider the possible risks based on the type of work that you do and the countries in which you operate
- ensure that your policy extends to third parties that you deal with - know your customers, agents and distributors and carry out due diligence on third parties at the beginning of the relationship
- consider setting up a committee responsible for compliance with the new Act and vet supplier chains and third parties
- provide training to your staff in relation to the Act and its implications for them
- review your policies relating to political or charitable donations, gifts, and entertaining
- keep up to date on the upcoming guidance from the Government. It should be reviewed and changes made to your policy if necessary.