Legislation To Come Into Force In July

A leading business lawyer at Irwin Mitchell has raised major concerns over how useful new guidance released by the Ministry of Justice in relation to the Bribery Act will prove to both firms in the UK and abroad.

Justice Secretary Kenneth Clarke has published the information on the legislation, which is designed safeguard businesses from the threat of corruption and expected to come into force on July 1st.

The government hopes the legislation will provide a useful benchmark for firms on how they can help the UK successfully counter the threat of bribery.

However, Kevin Robinson, who specialises in fraud and corporate crime at Irwin Mitchell’s London office, has criticised the latest information released and warned that it “goes far beyond” what the Act envisages.

Discussing his concerns, he said: “Under S9, the Secretary of State is required to publish guidance about procedures that relevant commercial organisations can put in place to give them a defence to proceedings brought against them. It is meant to be S7 specific.

“Instead, what has emerged today is a document which purports to set out the Government policy on the whole of the Act, not just guidance on S7 compliance. Therefore the first point which emerges is that this part of the Guidance may have no validity whatsoever if somebody or some corporation seeks to rely on it in any prosecution.”

Kevin added that the section on Government Policy clearly highlights the impact of “intense lobbying” from major commercial interests.

He outlined: “The interpretation of the words ‘relevant commercial organisation’ as it applies to non-UK corporations shows an astonishing degree of row back from what was intended when the Act was originally drafted. To suggest that a foreign corporation with a UK subsidiary may not be carrying out some part of its business here stretches credulity.

“Similarly the concession that in a contractual chain there need only be due diligence and adequate procedures in place between immediate counterparties gives a clear steer as to how to engage in Nelsonian blindness about what may be occurring elsewhere in the chain. The latitude also given to Joint Venture arrangements could quite easily produce a similar scenario.”

However, Kevin added that he has plenty of other concerns over this newly published guidance.

He explained: “The failure to recognise that the S6 offence of bribing a Foreign Public Official can be complete without there being any corruption envisaged or actual is a major flaw in the Act and needs to catered for with sensible advice.

“The lack of advice as to how to deal with a situation where there may be bribery with no corrupt intent is a major failing in the Guidance. Also, the manner in which the issue of facilitation payments is brushed aside with a few platitudinous phrases is deeply disappointing. In the real world in which businesses operate, the criminalisation of facility payments is the single most significant obstacle the Act places in the way of commerce.

“The failure to help businesses which trade abroad deal with this real rather than theoretical problem may be regarded by those businesses as an abdication of responsibility.”