Bribery and Corruption
The draft Bribery Bill has now received its first reading in Parliament and has largely received cross-party support. It is therefore expected that the post-general election government will pass the Bill later this year, bringing this anti-corruption legislation in force throughout the UK.
For corporate bodies or partnerships conducting business in the UK, the Bill creates a new strict liability offence of failing to prevent bribery within an organisation, wherever it may be registered. The offence similarly applies to the non-UK operations of all UK registered organisations. The extra-territorial effect of this proposed offence, coupled with hardening global anti-corruption standards, will reinforce the increased sensibility of organisations to the commercial and reputational damage that can result from bribery and corruption allegations and charges.
The UK is amongst several countries which have been criticised historically by Transparency International for failing to pursue any significant prosecutions for corporate bribery offences. But even before the new Bill is passed, this approach appears to have been changing. A series of recent, high profile bribery investigations clearly demonstrates the gravity of bribery and corruption allegations and highlights the importance of the forthcoming new statute in the UK.
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Last summer, bridge builders Mabey and Johnson became the first large British company to be fined for foreign bribery, following payments to a number of foreign ministers and officials to secure export orders.
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Alstom, the French transport and infrastructure group, has recently become the object of the largest ever investigation by the Serious Fraud Office in a corruption case. The SFO investigation led to a public acknowledgement that Alstom employees have been questioned following allegations of suspected bribery to win lucrative contracts in foreign markets.
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Innospec, a Cheshire-based chemical company, has also been fined £8.5 million after admitting to bribing Indonesian officials in order to boost the sales of a chemical that had been banned from general sale in the UK.
Such cases represent the mounting pro-activity of UK officials in combating corruption and set precedents for coordinated, cross-jurisdiction action. In its current state, the Bill is unclear as to whether a corporate body convicted of a bribery offence will be officially debarred from participating in future public contracts under the EU Public Procurement Directive. This potential consequence of conviction, together with the considerable fines and inevitable reputational damage which can result, are clear warnings to organisations to expedite risk management procedures to defend against bribery and corruption in the global marketplace.
FOR FURTHER INFORMATION PLEASE CONTACT: BILL FOWLER
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