The Bribery Act 2010 came into force on 1 July 2011 and established rigorous anti-bribery laws which apply to all types and sizes of businesses in the UK.
The Act introduced four new offences:
- Offering a bribe
- Accepting a bribe
- Bribing a foreign public official; and
- Failing to prevent a bribe being paid on an organisation’s behalf
Offering a Bribe (Section 1) - this offence means the giving, offering or promising of a bribe.
Accepting a bribe (Section 2) - this offence includes requesting, agreeing to receive or accepting a bribe. Please note that it is not needed for a company or an individual to actually receive a bribe for the offence to be committed under the Act.
Bribing a foreign public official (Section 6) - this offence refers to “facilitation payments” to foreign officials. A "facilitation payment" is the practice of paying a small sum of money to public officials as a way of ensuring that they perform their duty more promptly.
Failing to prevent a bribe being paid on an organisation’s behalf (Section 7) - this is the so called “corporate offence” and it represents key consideration for all businesses. Under this offence an organisation can be found liable if it fails to prevent persons performing services on its behalf from committing bribery.
A company will be guilty of this offence if a person who performs services on behalf of the organisation, (the so called “associated person” which can be an individual or an unincorporated body. Therefore, it includes employees, agents, subsidiaries and contractors), bribes another person, intending either to obtain or retain business for the company, or to obtain or retain an advantage in the conduct of the company's business.
The “corporate offence” under Section 7 of the Act applies to all “relevant commercial organizations”. The term “relevant commercial organisations” is broad in scope and includes a wide range of entities. It covers any type of body which is incorporated under the law of any part of the United Kingdom and which carries on a business (whether there or elsewhere), as well as a partnership, trade or profession.
The offence can be committed in the UK or overseas. If a company is found guilty of corporate bribery, both the company and its directors could be subject to criminal sanctions and/or fines.
The Bribery Act 2010 provides for a defence under Section 7(2) under which the company could escape liability if it can show that it had in place “adequate procedures” designed to prevent those persons performing services on its behalf from committing bribery. Thus, if it is proved that a bribe was paid on a company's behalf with the intention to obtain or retain business for the company, an offence will have been committed for which the company will be liable, subject to the “adequate procedures” defence.
Therefore UK businesses must have “adequate procedures” in place to prevent bribery in order to have a defence.
The Ministry of Justice has developed Guidance which sets out how businesses should act and clarifies what is meant by “adequate procedures”.
Under the Guidance businesses must have a Policy in place which articulates what the organisation will do regarding anti-bribery, both internally and externally. This means that every business should have an Anti-Bribery and Corruption Policy in place which is compliant with the Act and the Guidance issued by the UK Government.
This Anti-Bribery and Corruption Policy template complies with the Bribery Act 2010 and follows the Guidance issued by the Ministry of Justice. The Policy sets out the procedures that the company has in place for dealing with the risk of bribery. It is written in plain English and can be adapted to meet your particular circumstances which will depend on the size and nature of your business and the areas of the world in which you operate.
Here is a summary of the main points raised by the Bribery Act 2010:
- Under the Bribery Act both individuals and commercial entities can be prosecuted for corruption.
- The first step that businesses must take in order to comply with the Act is to determine whether or not there is a risk that an employee, agent, subsidiary, partner or other person performing services for or on behalf of the business may carry out an act which falls within the four offences. If there is a risk of bribery businesses must implement “adequate procedures” in order to deal with the risk.
- Under the new legislation a company could be liable if a director or employee commits a bribery offence and it could also be liable if an employee or agent pays a bribe specifically to get business, keep business or gain a business advantage for the company. Section 7 of the Act creates a new offence of failure to prevent the giving or receiving of a bribe. The new offence of failing to prevent bribery means that a corporate entity can be prosecuted in respect of bribery even if senior management were entirely unaware that the bribery had taken place, and even if the bribery was committed by a third party acting on its behalf.
- Under the Bribery Act 2010 corporate hospitality becomes a significant bribery risk. However, the Bribery Act does not outlaw corporate hospitality altogether but this needs to be proportionate and reasonable. UK businesses will have to decide on a case by case basis how much hospitality is too much. It is recommended that businesses carefully record business related gifts and/or hospitality, both given and received, and monitor the expenses of any “associated person”.
- The Act covers corruption abroad as well as at home. Thus UK businesses can be prosecuted for bribery even if the offence has been committed abroad.
- The Act provides for significant penalties on conviction for any of the bribery offences: up to 10 years’ imprisonment and/or an unlimited fine for an individual; or an unlimited fine for a company. Directors convicted of bribery offences are likely to be disqualified from acting as directors for substantial periods.
This Anti-Bribery and Corruption Policy is in Microsoft Word format, written in plain English, easy to use and edit.