Feeds

New anti-corruption offences come into force today

No backdown in biz bung crackdown

The Power of One Infographic

New anti-corruption laws come into force today, giving companies more certainty over what constitutes bribery but placing greater obligations on companies to tackle corruption.

A company could be responsible for bribery carried out by its employees without its knowledge or consent under the Bribery Act. It creates a new offence of failure to prevent bribery by people working for or on behalf of a business, but companies can escape liability if they show that they have "adequate procedures" designed to prevent bribery in place.

Under the Act, the maximum penalty for individuals found guilty of bribery will rise from seven to 10 years' imprisonment and an unlimited fine.

Previous anti-corruption laws were criticised as being too complicated and for not giving a clear enough definition of what constitutes bribery. The new law has been welcomed for its clarity.

In addition to creating new obligations for companies to have anti-corruption policies in place, the Act also creates the offence of bribing a foreign public official, even if that person has demanded a bribe.

UK companies and partnerships could be breaking the law no matter where the alleged acts of bribery take place. Foreign companies which operate in the UK could also face prosecution regardless of where the alleged bribery has taken place, unless the suspect activities are permitted locally.

The Act was due to come into force in April, but was delayed to give the government more time to review its guidance (45-page/390KB PDF) on the adequate procedures companies can put in place to prevent people associated with them from bribing.

The guidance provides six essential principles for companies to follow in order to ensure they comply with the new law: proportionate procedures; a top-level commitment ensuring that directors and staff are unified in fighting bribery; undertaking occasional risk assessments; checking out third parties such as intermediaries and subcontractors to ensure that they are honest; communicating anti-bribery policies to staff and providing staff training, monitoring and review.

A company could also be liable for the actions of associated people, which the Bribery Act lists as including recruitment firms, commercial agents, partners, consultants and subcontractors.

Last month a survey by business information company Thomson Reuters revealed that almost 40 per cent of UK businesses think their senior executives and board members are unprepared for the new law.

However, in order to be adequate, a company's procedures need only be proportionate to the risks that business faces as well as its size and resources.

"Much has been written about the draconian effects of the Bribery Act and the risks that it poses to UK businesses," said Barry Vitou, bribery law expert with Pinsent Masons, the law firm behind OUT-LAW.COM. "However, businesses that try their best to comply with the provisions of the Act, and which behave in an ethical manner, will have nothing to fear."

Copyright © 2011, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

Boost IT visibility and business value

More from The Register

next story
Yorkshire cops fail to grasp principle behind BT Fon Wi-Fi network
'Prevent people that are passing by to hook up to your network', pleads plod
UK government officially adopts Open Document Format
Microsoft insurgency fails, earns snarky remark from UK digital services head
Major problems beset UK ISP filth filters: But it's OK, nobody uses them
It's almost as though pr0n was actually rather popular
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
MPs wave through Blighty's 'EMERGENCY' surveillance laws
Only 49 politcos voted against DRIP bill
Help yourself to anyone's photos FOR FREE, suggests UK.gov
Copyright law reforms will keep m'learned friends busy
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.