Out with the old...

Using a novel form of drafting (the introduction of “cases” – samples of statutorily-restricted behaviour) the new offences created by the Act reach directors, managers and secretaries of companies as well as the corporate bodies and partnerships themselves. They have very broad jurisdictional reach which can affect any business, or part of a business, in the UK, even if the underlying behaviour does not have any substantive connection with the UK.

Broadly, the Act creates four categories of offence:

• bribing a person (s 1);
• being bribed (s 2);
• bribing foreign public officials (s 6); and
• failure by a commercial organisation or partnership to prevent bribery (s 7).

The latter offence is a strict liability offence for companies and extends to “associated persons” which includes employees, agents or subsidiaries, subject to the defence that the company had in place “adequate procedures” to prevent the bribery.

Following submissions at the review stage of the Bill from, amongst others, the Law Commission, the Secretary of State must publish guidance about procedures that relevant commercial organisations can put in place to prevent persons associated with them from bribing. In England and Wales, no prosecutions under the Act may be instituted without the consent of the DPP, the Director of the SFO, or the Director of HMRC Prosecutions.
Penalties range from fines to imprisonment for up to ten years, or to both and can extend not only to corporate bodies but also to the senior officers of the corporate bodies if the offences were committed with their consent or connivance.

There are defences for certain bribery offences for conduct conducted as part of any function of the intelligence service or any function of the armed forces when engaged on active service.

Territorial scope

Uncontroversially, s 12 of the Act provides that the offences under ss 1, 2 and 6 are committed if any act or omission which forms part of those offences takes place in the UK. More controversially, the Act also criminalises the acts or omissions abroad by individuals with a close connection with the UK if those acts or omissions would form part of the offences if they had been done or made in the UK. “Close connection with the UK” is defined in s 12(4) of the Act but includes a UK citizen, an individual ordinarily resident in the UK and a body incorporated under the law of any part of the UK.

An offence is committed under s 7 of the Act irrespective of where the constituent acts or omissions were made or done. The Act applies to any entity that carries on a business, or even part of a business, in the UK whether the acts or omissions, the constituent elements of the relevant offences took place in the UK or otherwise. This far-reaching territorial scope places the UK’s anti-bribery legislation on a par with the US Foreign Corrupt Practices Act and with the obligations under the OECD Convention, to which the UK is a signatory.

Robert-Jan Temmink is a barrister at Outer Temple Chambers. This is an edited version of an article that first appeared in New Law Journal (3 December 2010).

The different offences

Section 1

The s 1 offence prohibits a person (which includes a body corporate) from offering, promising, or giving a financial or other advantage:

• in order to induce a person improperly to perform a relevant function or duty;
• in order to reward a person for such improper activity; or
• where the person knows or believes that the acceptance of the advantage would itself constitute an improper performance of a function or duty. It does not matter whether the advantage is offered, promised or given by a person directly, or through a third party.

Section 2

The s 2 offence prohibits a person from requesting, agreeing to receive, or accepting a financial or other advantage (“a bribe”) intending that a relevant function should then be performed improperly, either by that person, or by another person at the request of, or with the assent or acquiescence of, the first person. Again, it does not matter whether the bribe is requested, received (or agreed to be received) or accepted directly or through a third party; nor does it matter whether the bribe is, or will be for the first person’s benefit, or for the benefit of another person. Furthermore, it does not matter whether the person requesting or accepting the bribe knows or believes that the performance of the relevant function is improper.

A “function or activity” is “relevant” for the purposes of the Act if it fulfils a number of criteria. First, it has to be:

• any function of a public nature; or
• any activity connected with a business; or
• any activity performed in the course of a person’s employment; or
• any activity performed by or on behalf of a body of persons (whether corporate or incorporate).

The relevant function or activity has also to be performed by a person who is expected to perform it

•  in good faith; or
• impartially; or
• from a position of trust by virtue of performing the function.

Section 6

Section 6 provides that it is an offence for a person (which definition also includes a body corporate) to offer, promise, or give any financial or other advantage to a foreign public official, either directly or through any third party, where the person’s intention is to influence the official in his capacity as a foreign public official and the person intends to obtain or retain either business or an advantage in the conduct of the business. “Foreign public official” is defined in s 6(5) of the Act.

Section 7

Section 7 creates a strict liability offence on commercial organisations where a person associated with the commercial organisation bribes another person (where the associated person commits an offence under ss 1 or 6) intending to obtain or retain either business or an advantage in the conduct of business save where the commercial organisation can prove that it had in place adequate procedures designed to prevent bribery. “Associated person” is defined in s 8 of the Act.