UK Bribery Act enters into force; companies urged to implement anti-corruption programmes
This article was originally published in SRA
The UK Bribery Act comes into force today, marking the start of a new era in enforcement1,2.
"Any company that carries on a business in the UK can now incur liability for the corrupt actions of rogue employees or associated third parties, even if the company's management knew nothing about the bribery," said Robert Amaee, of counsel at law firm Covington & Burling, and former head of anti-corruption at the Serious Fraud Office3.
"Many companies with existing strong anti-corruption policies and procedures already have made adjustments in order to meet their obligations under the Bribery Act," Mr Amaee noted. "Those yet to complete the process will need to ensure that they act now to identify their business risks and to put in place proportionate measures to deter, detect and deal with any wrongful acts being performed in the name of the company by rogue employees or third parties."
Legal experts giving a series of presentations at the 11th European Forum on Anti-Corruption organised by think tank C5 in London, UK, on 28-30 June, also urged compliance teams at companies to engage in reviewing their anti-corruption programmes to ensure they include measures to avoid violation of the new legislation4.
The Bribery Act introduces a corporate offence of failure to prevent bribery by persons working on behalf of a business. The act makes it a criminal offence to give, promise or offer a bribe and to request, agree to receive or accept a bribe either in the UK or abroad. The measures cover all bribery, not just bribery that involves public officials, and a company can avoid conviction only if it can show it had "adequate procedures" in place to prevent bribery. In March, the government published final guidance on the "adequate procedures" that companies should have in place to prevent bribery5.
"The company may be called upon to explain to a prosecutor or, in the worst case, to a jury what steps it had taken to prevent bribes from being paid," said Mr Amaee. "The good news is that if the company can show that those steps amounted to 'adequate procedures' designed to prevent bribery, this will afford it a complete defence."
At a one-day session at the anti-corruption forum dedicated to the pharma and medtech industry, in-house counsel, senior compliance officers and legal practitioners in the life-sciences sector provided practical experiences and solutions on implementing an effective anti-corruption policy. For example, advice was given on encompassing third parties into compliance programmes; developing risk-based priorities; maintaining risk-based compliance programmes; and remaining compliant in multiple jurisdictions. How to monitor and restrict corruption risks in clinical trials were also discussed at the forum.
Mr Amaee noted that the fact that a bribe is paid will not in and of itself necessarily mean that a company’s policies and procedures are inadequate. "There will be cases of rogue employees or third parties who are determined to circumvent the company’s best efforts," he said, adding that this has been recognised by the Ministry of Justice guidance, which states that "no bribery prevention regime will be capable of preventing bribery at all times".
The SFO has signalled its intention to establish a dialogue with companies that are working hard to meet the high standards set by the Bribery Act, Mr Amaee said. "There is a recognition that practices such as the making of facilitation payments may, in some cases, not be brought to an end overnight. Rather, the SFO will expect companies to demonstrate that they are on a timetabled journey to full compliance." Mr Amaee noted that the SFO had published six factors that it would take into consideration as part of its decision on whether or not prosecute a particular case involving alleged facilitation payments.
References
1. Ministry of Justice, Bribery Act 2010, http://webarchive.nationalarchives.gov.uk/+/http://www.justice.gov.uk/publications/bribery-bill.htm
2. UK Bribery Act to apply from July, adequate procedures guide published, Regulatory Affairs Pharma, 31 March 2011
3. Personal communication, Covington & Burling, 30 June 2011
4. C5, 11th European Forum on Anti-Corruption, 28-30 June 2011
5. See Reference 2