Think piece: What does the Bribery Act mean for business?



Implementation of the Bribery Act 2010 was meant to occur in April 2011, but has been delayed for a second time: is it now just a matter of time before it comes into effect? This think piece argues that the act itself will make Britain uncompetitive, and should be radically overhauled to prevent shifting undue responsibility onto businesses.

The Bribery Act 2010 may put Britain in a difficult position. The Act will require companies with a UK connection to put in place what the Act vaguely describes as “adequate procedures" to prevent bribery. The extent and costs of these procedures are unclear. The worst case scenario is that multinational firms and organizations, for legal reasons, may be wary of having any connection with the UK in order to avoid this strict liability offence (ie, no proof of intention required) and the associated costs and reputational damage of having to defend if prosecuted..

The problem is the scope of the Act and its significant implications for businesses with a UK connection. One of the offences created is "failure to prevent bribery". This may be committed by a company which "carries on a business or part of a business" (a term which is not defined in the Act) in the UK. The Act also applies to any person or company that commits a bribery offence outside the UK as long as they are a British citizen or resident, or a body incorporated under the law of any part of the UK.

The offence may apply to bribery conducted anywhere in the world by a person with no connection to the UK as long as they are "associated with the company". A person is "associated with a company" if they perform services on behalf of or for the company - this has the potential catching a company's agents, employees, subsidiaries, intermediaries, jotint venture partners and suppliers. [Continue reading]