Is your business compliant with the Bribery Act 2010?

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Posted in:Banking and Finance, Corporate and Commercial|July 9, 2012 | Join the mailing list

Research out by accountancy firm, Ernst & Young suggests that nearly three-quarters of North West middle managers have not heard of the Bribery Act 2010 ("the Act"). Further, the survey found that nearly half (47%) of those who
had heard of the Act said they had not received enough training to ensure they complied with it when going about their business.

Alison Loveday of Berg comments: "As a commercial law firm, we have been speaking to our clients and contacts for the last year or more about this new piece of legislation and the impact on businesses.

The Act came into force on 1 July 2011 and makes it an offence for a UK citizen or resident to pay or receive a bribe, either directly or indirectly. This includes transactions that take place in the UK and abroad, and both in the public and private sectors.

We have already seen the first conviction for an offence under the Act in October 2011 when a former magistrates’ court clerk received a 3-year sentence after being prosecuted for "requesting and receiving a bribe intending to improperly perform his functions".
In this case, the man admitted to accepting £500 in exchange for omitting to record a traffic offence.

The Act creates four main offences, which replace the common law offences in England and Wales of bribery and embracery (bribery of jurors) including:

•    Giving a bribe;
•    Receiving a bribe;
•    Bribing a foreign public official; and
•    The corporate offence of failing to prevent bribery by an associated person for the organisation’s benefit.

The Act carries a maximum penalty of ten years’ imprisonment for all new offences, except the corporate offence, which carries an unlimited fine. The only defence to the corporate offence will be for organisations to show that they had "adequate procedures"
in place designed to prevent associated persons committing bribery. This will include the organisation proving that it had provided effective training to employees on anti-corruption and the Act itself.

The level of risk faced by a company is central to the creation of the procedures that it needs to have in place to prevent bribery. Any risk assessment undertaken does need to be a credible, properly resourced and a validated process that seeks to identify
and prioritise the corruption risks that an organisation faces, reflecting its sophistication and resources.

One immediate area of concern for a lot of the businesses we have spoken to is the effect of the Act on corporate hospitality and gifts. Importantly, the Act does not criminalise bona fide reasonable and proportionate hospitality and promotional, or other business,
expenditure which is recognised as an established and important part of doing business. However, to be in a position to rebut any allegations of bribery, an organisation will have to be transparent and able to demonstrate what the intention is, by identifying
the reasons for any gifts/corporate hospitality. This makes record-keeping all the more important.

Whatever the size of your organisation, this is a piece of legislation that cannot and should not be ignored. We would strongly recommend that a risk assessment be carried out to identify the bribery and corruption risks facing your business. As a minimum,
your organisation should ensure that a policy dealing with anti-bribery and corruption is implemented, reflecting the risks identified. It is equally important that staff are trained to identify issues as and when they arise and to ensure that they are familiar
with your organisations policies and procedures.

We offer a fixed price Anti-Bribery and Corruption Audit to help your business comply with its obligations. We can also assist in drafting full policies and procedures and provide you with practical advice about tackling these issues in the workplace. We also
provide interactive staff training, so that your staff and managers are fully equipped to deal with issues as and when they arise."

To discuss how we can provide further advice in connection with these issues, please contact Alison Loveday, Managing Partener and Head of Employment Team, by email to
alisonl@berg.co.uk or alternatively you can call Alison on 0161 833 9211.




The information and opinions contained in this article are not intended to be comprehensive or to provide legal advice.  No responsibility for this article’s accuracy or correctness is assumed by Berg or any of its partners or
employees.  Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of the contents of this article.

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