The Bribery Act 2010 : Is Your Business at Risk?

As from April 2011, Employers will be liable to criminal prosecution for the actions of employees involved in bribery, irrespective of whether they were aware of it, unless they can show that they had in place adequate measures to prevent bribery.

This is a short article aimed at small to medium sized businesses who are unlikely to have the benefit of in house legal advisors but who need to be aware of the provisions of the Bribery Act 2010, which comes into force next April.

1. Introduction

   The Bribery Act differs from most forms of legislation because it can render a business liable to prosecution as a consequence of the behaviour of it's employees – even if the Directors had no knowledge of such behaviour! The Act creates what is known as a 'reverse burden of proof ' in that it is a criminal offence for a commercial organisation to fail to prevent bribery (by it's employees) unless the organisation can demonstrate that it had adequate bribery prevention procedures in place. Ordinarily we have a presumption of innocence. Under the Bribery Act there is a case for saying that the opposite applies. It need not matter whether the company had actual knowledge of the actions of employees involved in bribery. The emphasis is upon whether the company had adequate measures in place to prevent bribery.

2. Main provisions

   There are four types of offence that can be committed; i. offering, promising or giving a bribe ii. requesting, agreeing to receive or accepting a bribe iii. bribing a foreign public official iv. failure by a commercial organisation to prevent a bribe being paid for or on it's behalf.

3. Sentences

   Upon conviction in the Crown Court any offence committed under the Act is punishable by an unlimited fine and/or up to 10 years imprisonment. What's more the court can impose Confiscation and Civil Recovery orders under the Proceeds of Crime Act 2002. Confiscation is a highly controversial area. Take the following scenario. A bribe of £10,000 is paid by a senior member of a sales team. The business then secures say £1,000,000 worth of business, with profits of say £100,000. Upon conviction in the Crown Court the company could be liable for a confiscation order in the sum of £1,000,000 even though the company had no actual knowledge of the actions of the bribing sales representative! This is because under The Bribery Act, the company will be guilty unless adequate...