The Bribery Act 2010: An Overview

Updated September 2011

The Bribery Act 2010 came into force on 1 July 2011. The Act repeals previous legislation and creates the personal and corporate offences of:

• Giving, promising or offering a bribe
• Asking for or agreeing to receive a bribe
• Bribery of a foreign public official
• Failure of a commercial organisation to prevent bribery

Key provisions for businesses

Failure of a commercial organisation to prevent bribery

The Act creates a new strict liability offence for failure of an organisation to prevent bribery by persons "associated" with it. This offence applies to all companies, partnerships and business organisations formed in England, Wales, Scotland or Northern Ireland, wherever they do business in the world. It also applies to companies or partnerships formed abroad but which carry on business in the UK.

An associated person has a wide definition and may include employees, agents, subsidiaries, suppliers and joint venture partners. Commercial organisations will only have a defence if they can show they have "adequate procedures" in place to prevent bribery.

Adequate procedures

"Adequate procedures" are not defined in the Act but the Government has published guidance to assist businesses to understand what will constitute adequate procedures.

The guidance sets out the following six principles of compliance:

• Proportionate Procedures;
• Top-Level Commitment;
• Assessment of Risk;
• Due Diligence;
• Communication (including training); and
• Monitoring and Review.

It is up to each organisation to implement policies and procedures that will minimise bribery risk, taking into account the main risk areas of the organisation and its global presence. The higher the risks the more an organisation will need to do.

Ensuring the above criteria are properly followed and implemented will help organisations show they have taken the bribery risk seriously. For many companies this will mean:

• new policies;
• new or improved training throughout the organisation (including training for all employees and intermediaries); and
• a more thorough approach to tackling the risk of bribery in the UK and abroad.

These should all be approved and led at a board level.

Criminal penalties

If convicted of a bribery offence:

• individuals can be jailed for up to ten years and/or receive an unlimited fine.
• companies can receive unlimited fines.

Directors convicted of bribery offences may be disqualified for up to 15 years.

"Senior officers" (broadly defined to include directors, managers and Company Secretaries) of a commercial organisation may also be personally liable if a bribery offence is found to have been committed with their consent or connivance.

Debarment from public contracts

Organisations involved in public work, such as PFI projects, should take particular care to avoid being prosecuted for a bribery offence as Public Authorities will have the discretion to exclude convicted companies from public contracts.

How can TLT help?

TLT regularly advises domestic and international clients on anti-corruption issues. Businesses should focus on conducting a risk assessment, implementing proportionate policies and procedures, training their staff and ensuring reporting/monitoring procedures are in place.

We can review any existing policies to ensure compliance with the Act or, if necessary, assist with drafting and implementing new polices and procedures including:

• Risk assessments
• Due diligence systems
• Board level policy statements
• Bespoke policies focusing on such areas as facilitation payments, gifts and hospitality and whistle blowing
• Drafting appropriate contractual provisions in agreements commonly with employees, agents and suppliers

We can also offer in-house training tailored to suit your business requirements.

For more information or further advice on the Bribery Act please contact Kerry Gwyther, Head of Regulatory at TLT.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at September 2011. Specific advice should be sought for specific cases; we cannot be held responsible for any action (or decision not to take action) made in reliance upon the content of this publication.

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