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Bribery Act Guidance Released

By Thomas Fox

The U.K. Ministry of Justice has released its “Consultation on guidance about commercial organisations preventing bribery (section 9 of the Bribery Act 2010).” As required by the Act, it provides guidance to “support businesses in determining the sorts of bribery prevention measures they can put in place.”

Businesses covered by the Bribery Act can be convicted of a criminal offense if they fail to prevent bribery on their behalf. However, the Act provides that if the organization can show that it has adequate bribery prevention procedures in place, such “adequate procedures” are a defense to a prosecution.

The Consultation lists “Six Principles for Bribery Prevention.” The Ministry of Justice believes the principles are good international practices for such adequate procedures and will assist businesses in determining what bribery prevention procedures they can put in place.

The Six Principles for Bribery Prevention are:

1.    Risk Assessment – this is about knowing and keeping up to date with the bribery risks you face in your sector and market.

2.    Top level commitment – this concerns establishing a culture across the organization in which bribery is unacceptable. If your business is small or medium sized this may not require much sophistication but the theme is making the message clear, unambiguous and regularly made to all staff and business partners.

3.    Due diligence – this is about knowing who you do business with; knowing why, when and to whom you are releasing funds and seeking reciprocal anti-bribery agreements; and being in a position to feel confident that business relationships are transparent and ethical.

4.    Clear, Practical and Accessible Policies and Procedures – this concerns applying them to everyone you employ and business partners under your effective control and covering all relevant risks such as political and charitable contributions, gifts and hospitality, promotional expenses, and responding to demands for facilitation demands or when an allegation of bribery comes to light.

5.    Effective implementation – this is about going beyond “paper compliance” to embedding anti-bribery in your organization’s internal controls, recruitment and remuneration policies, operations, communications and training on practical business issues.

6.    Monitoring and review – this relates to auditing and financial controls that are sensitive to bribery and are transparent, considering how regularly you need to review your policies and procedures, and whether external verification would help.

The Consultation invites interested parties to comment on these Principles. The comment period will last eight weeks. The Consultation is a very useful tool for any company wanting to measure its current compliance and ethics program.

While this Consultation (available for download here) only deals with the U.K. Bribery Act’s requirements, it could also be a valuable tool for companies subject to the Foreign Corrupt Practices Act to measure their FCPA compliance policy as well.

Thomas Fox is an attorney in Houston, Texas, specializing in FCPA compliance, risk management and international transactions. His blog can be found here and he can be reached at [email protected].

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1 Comment

  1. Nice piece Thomas.

    Although the UK guidance just published only deals with the UK Bribery Act requirements because of the long arm jurisdiction of the act many companies subject to the FCPA will also be subject to the UK Bribery Act. So it may be necessary to build on top of existing FCPA policies to ensure they are compliant with the new UK Bribery Act.

    All organisations will need to trigger the requirement to comply with the UK law will be to "carry on business" in the UK. A threshold which (like the way the DoJ interpret the equivalent FCPA threshold) the UK regulators anticipate will be easily met.

    On top of the guidance another extremely resource is the comprehensive Guidance on Adequate Procedures under the UK Bribery Act 2010 published by Transparency International UK here which many in the UK consider reflects the likely standard the courts will apply too.

    And while I'm about it, my site is a useful resource and we've been busy aggregating links to relevant content so its all in one place for people.

    Importantly the guidance reveals that joint guidance for prosecutors is currently being drawn up by the Director of Public Prosecutions and Director of the Serious Fraud Office to encourage a broad consistency of approach to the Act between the police, CPS and SFO.

    This will be extremely important as there is a lack of clarity as to when regulators will prosecute in certain circumstances for example in relation to facilitation payments.

    Readers interested in the UK law who would like to learn more tune in to our free webinar on September 30 where we'll be interviewing the General Counsel of the Serious Fraud Office Vivian Robinson QC who will also take questions. Sign up details here

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