04/09/2010 02:57:00 PM EST
UK Bribery Bill Update
It appears that
the UK Bribery Bill, introduced in March 2009, made it out of Parliament before
the upcoming general election. The Bribery Bill is a significant departure for
the UK in the area of foreign anti-corruption. It is significantly stronger
than the FCPA. Many internationally focused US companies have offices in the UK
or employ UK citizens in their world-wide operations. This legislation could
open them to prosecution in the UK under a law similar to, but stronger than,
the relevant US legislation.
amendments were recently introduced by the Tory Party which would have allowed
allow facilitation payments that were 'reasonable in amount', 'customary in the
situation' or the 'only reasonable alternative in the situation'. Writing in
the blog doingggoodbiz.wordpress.com, Alan Holroyd reported that
Clair Ward, the Parliamentary Under-Secretary of State for Justice, stated that
such exceptions would have 'driven a coach and horses through the policy
objectives of the bill'.
brings up one of several differences between the FPCA and the Bribery Bill.
- The Bribery Bill has no exception for
The Bribery Bill creates strict liability of corporate offense for the
failure of a corporate official to prevent bribery.
The Bribery Bill specifically prohibits bribery of private citizens, not just
The Bribery Bill has criminal penalties of up to 10 years per offense not 5
years as under the FCPA.
There is one
affirmative defense listed in the Bribery Bill and it is listed as the
'adequate procedures' defense. The Explanatory Notes to the Bribery Bill
indicate that this narrow defense would allow a corporation to put forward
credible evidence that it had adequate procedures in place to prevent persons
associated from committing bribery offences. The legislation requires Secretary
of State for Justice to publish guidance on procedures that relevant commercial
organizations can put in place to prevent bribery by persons associated with
Other than this
commentary, the Bill provides no further information on what might constitute
'adequate procedures' as a defense but the Government has signaled that it will
work with the UK business community to provide appropriate guidance to this
critical component of the Bribery Bill. The UK law firm KattenMuchin has
indicated that they expect the Government will apply a test regarding the
'adequate procedures' defense "with regard to the size of the company, its
business sector and the degree to which it operates in high risk markets." The
law firm of Covington and Burling, in a client
advisory dated March 31, 2010, has opined that the Bribery Bill will not come
into force until late 2010 because it will take the UK government until then to
issue guidance on what may constitute 'adequate procedures'.
R. Fox, 2010
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