Categorized | Case Law, Criminal Justice

Bribery and corruption

Bribery and corruption

Bribery and corruption, as a subject, is much in the air at the moment with the current focus on betting scams in cricket and other sports. So it is perhaps appropriate that legislation is set for a radical change when the Bribery Act 2010, which received Royal Assent in April as one of the last pieces of business by the previous government, comes into force on 1 October.

The new Act is widely seen as a response to the BAE Systems case, where the prosecution against the defence company was dropped after the intervention of Lord Goldsmith, then attorney general. Earlier this year, BAE agreed to pay £300m in fines after signing up to a plea bargain with Britain’s Serious Fraud Office and the US department of justice. But the case has had a long-term impact on Britain’s reputation as its position in the international “corruption index” has slipped to 17th, behind Japan, Hong Kong and Austria. A survey in 2006 by Control Risks, a consultancy, estimated that a quarter of UK-based international companies have lost business to corrupt competitors in recent years, while figures from the World Bank suggest that bribery adds up to 10% to the total cost of doing business globally.

The Act is intended to make it significantly easier for enforcement agencies to bring successful prosecutions, including against UK corporate entities, in respect of corruption offences committed at home and abroad. The Act introduces four new statutory offences – giving or receiving bribes, bribery of foreign public officials and failure of a commercial organisation to prevent bribery by persons working on their behalf. This last offence is entirely new and is a strict liability offence. The Act will have a considerable impact on foreign companies who do business in the UK, particularly those which have a place of business in the UK and/or UK employees. It is not limited to acts of bribery committed in the UK by British citizens or commercial organisations. It extends to acts committed anywhere in the world by UK corporates or individuals if the act of bribery would amount to an offence in the UK.

Penalties for individuals under the Act will be more severe than they are at present. The maximum term of imprisonment is increased from seven to ten years, in line with other fraud offences. There is also the prospect of an unlimited fine for individuals or commercial organisations convicted of the two general bribery offences or the offence of bribing a foreign public official and for organisations convicted of the offence of failure to prevent bribery. The only defence to a corporate entity’s liability for bribery committed by an individual acting on its behalf is that “adequate procedures” designed to prevent bribery are in place. The Secretary of State will issue guidance as to what “adequate procedures” are.

The current laws, contained in a combination of statutes dating back to the 19th Century and the common law, will be abolished when the new Act is brought into force. The Act, however, does not have retrospective effect so will apply only to offences committed after it comes into force. In the meantime the old bribery laws will have continuing relevance.

The full text of Bribery Act 2010 can be found at:

http://www.legislation.gov.uk/ukpga/2010/23/contents

Explanatory Notes are at:

http://www.legislation.gov.uk/ukpga/2010/23/pdfs/ukpgaen_20100023_en.pdf

This post was written by:

- who has written 460 posts on Upper Case – The Anya Legal Journal.

Mike Gribbin is a retired Civil Servant with wide experience, including the drafting and implementation of Parliamentary legislation and regulations. He is the editor of “Criminal Offences Handbook”, a uniquely comprehensive guide to more than one thousand ways to fall foul of UK criminal law. He is Editor of the Upper Case Legal Journal and has been writing blog posts for the past eight years.

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