As discussed in our April article, the Bribery Act (the Act) is now in force and applies to all companies which operate their business (or part of their business) in the UK. As a result, to the extent that companies have not already put in place procedures to ensure that they comply with the Act, they must now do so as soon as possible.
As already mentioned, one of the key new offences under the Act is the failure of an organisation to prevent bribery; this is a strict liability offence and the only defence available to companies is to demonstrate that they have adequate procedures in place to prevent bribery which are effectively embedded in the company and monitored.
While 'adequate procedures' is not defined under the Act, the Ministry of Justice has stated that they expect these to be 'reasonable and proportionate' to the size of the company and the risks of bribery that they face; as such, there is no 'one size fits all' approach to adequate procedures and each company must carry out its own risk assessment to establish what is reasonable and proportionate for them.
Adequate procedures can encompass many elements, but could include an anti-bribery policy, the communication of a zero tolerance approach to bribery from senior management and thorough due diligence of third parties acting on behalf of the company (particularly where the entities are located in high risk jurisdictions - see Transparency International's Corruption Perceptions Index).
Finally, much has been made of the effect the Act will have on corporate hospitality. However, reasonable and proportionate business hospitality will fall outside the scope of the Act (for example, taking a client to a sporting event) and companies must continue to exercise their good judgment and common sense as to what is proportionate in the circumstances.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.