UK offers guidance for new bribery law

By OGJ editors
HOUSTON, Mar. 30
-- Companies will have full defense against in bribery cases brought under a new British law if they have “adequate procedures” in place to prevent the offense, according to the UK Ministry of Justice.

“But you do not need to put bribery prevention procedures in place if there is no risk of bribery on your behalf,” says a ministry guidance document on the Bribery Act of 2010, which takes effect July 1.

Factors of bribery risk include country, business sector and type, and people.

“Your organization may be liable for failing to prevent a person from bribing on your behalf but only if that person performs services for you in business,” the ministry stresses. “It is very unlikely, therefore, that you will be liable for the actions of someone who simply supplies goods to you.”

The law does not prohibit hospitality or promotional expenditure “which is proportionate and reasonable given the sort of business you do,” the ministry says.

The act treats facilitation payments, small amounts paid to expedite routine government action, as illegal bribes.

Guidance principles
The ministry offers these principles to help companies determine what “adequate procedures” to have in place to prevent bribery and defend themselves in cases brought under the new law:

Proportionality. The action you take should be proportionate to the risks you face and to the size of your business. So you might need to do more to prevent bribery if your organization is large or if you are operating in an overseas market where bribery is known to be commonplace, compared to what you might do if your organization is small, or is operating in markets where bribery is not prevalent.

Top-level commitment. Those at the top of an organization are in the best position to ensure their organization conducts business without bribery. If you are running a business, you will want to show that you have been active in making sure that your staff (including any middle management) and the key people who do business with you and for you understand that you do not tolerate bribery. You may also want to get personally involved in taking the necessary proportionate action to address any bribery risks.

Risk assessment. Think about the bribery risks you might face. For example, you might want to do some research into the markets you operate in and the people you deal with, especially if you are entering into new business arrangements and new markets overseas.

Due diligence. Knowing exactly who you are dealing with can help to protect your organization from taking on people who might be less than trustworthy. You may therefore want to ask a few questions and do a few checks before engaging others to represent you in business dealings.

Communication. Communicating your policies and procedures to staff and to others who will perform services for you enhances awareness and helps to deter bribery by making clear the basis on which your organization does business. You may, therefore, want to think about whether additional training or awareness-raising would be appropriate or proportionate to the size and type of your business.

Monitoring and review. The risks you face and the effectiveness of your procedures may change over time. You may want, therefore, to keep an eye on the antibribery steps you have taken so that they keep pace with any changes in the bribery risks you face when, for example, you enter new markets.

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