On 30 July 2018, the Minister for Justice and Equality, Charlie Flanagan, announced that the Criminal Justice (Corruption Offences) Act 2018 has come into force. The Act which was signed into law by the President on 5 June 2018, overhauls existing anti-corruption laws and introduces a number of new offences.
One of the most important developments is the new corporate liability offence which allows for a corporate body to be held liable for the corrupt actions committed for its benefit by any director, manager, secretary, employee, agent or subsidiary under section 18 of the Act. The single defence available to corporates for this offence is demonstrating that the company took "all reasonable steps and exercised all due diligence" to avoid the offence being committed.
The government has not issued any guidance to date on what will be considered to be 'reasonable steps' for the purposes of this defence however guidance issued by the UK government on the similar defence under the UK's Bribery Act 2010 can offer some assistance. These principles are internationally accepted as the key factors of an effective anti-corruption programme and it is likely that adherence to them will ensure corporates are best placed to avail of the defence, but further guidance from the Irish government would be welcomed. Our expert team have experience in assisting numerous clients in preparing and implementing anti-bribery and corruption policies and procedures, along with providing bespoke training to a large number of clients which incorporate these principles:
- Proportionate procedures – proportionate to the risk it faces and the scale / complexity of the organisation's activities;
- Top-level commitment – the board and senior management are committed to preventing bribery;
- Risk assessment – assessing the nature and extent of exposure to risks of bribery (internal and external) on its behalf;
- Due diligence – applying due diligence procedures in respect of persons who perform services on its behalf;
- Communication (including training) – ensuring prevention polices are embedded throughout organisation; and
- Monitoring and review – monitoring and reviewing procedures and making improvements where necessary.
What can companies do to show that it has taken reasonable steps to avoid the offence being committed? There is no "one-size-fits-all" and it really will depend on the particular company but reasonable steps would include:
- Every company will have a different risk profile and therefore should undertake a risk assessment to determine the policies and procedures which are appropriate for the company.
- Ensure anti-bribery and corruption compliance policies are robust and meet best practice guidelines.
- Appoint a compliance manager who will be responsible for rolling out the policies and procedures and ensuring compliance with same.
- Ensure corporate gifts and hospitality are monitored and recorded in a register. Corporate gifts and hospitality will need to be reviewed to ensure they are reasonable and not excessive.
- Ensure training on the policies and procedures is rolled-out and provided to all directors, employees and relevant third parties.
Our Regulatory & Investigations team are available to assist you in ensuring compliance with, and avoiding any liability under the Act.
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.