Is a commercial organization
(regardless of where the entity is incorporated or organized);
Supplies goods or services;
Has a global turnover of at least
Ł36 million per year; and
Carries on a business or part of its
business in the U.K.
"Turnover" means the amount derived from the sales or
other provision of goods and services falling within the ordinary
activities of the commercial organization or subsidiary after
deduction of trade discounts, value-added tax and any other taxes
based on the amounts so derived. Further, guidance from the Home
Office (the lead U.K. government department for immigration and
passports, crime, counter-terrorism and police) provides that the
relevant test for whether a company is "doing business"
in the U.K. is whether or not the business in questions has a
"demonstrable business presence" in the U.K. Whether or
not a company has a demonstrable business presence in the U.K. will
be reviewed on a facts and circumstances basis applying a common
sense approach, but is expected to be interpreted broadly.
The Act requires businesses subject to the Act to publicly state
the activities they engage in to ensure that their business and
supply chain are free from human trafficking and slavery (a
"Section 54 Statement") at least annually.
The Section 54 Statement must, at a minimum:
List the steps the organization has
taken during the financial year to ensure that slavery and human
trafficking are not taking place in any of its supply chains and in
any part of its own business; or
State that the organization has taken
no steps to ensure the business and supply chain are not engaged in
slavery or human trafficking.
Home Office guidance suggests the Section 54
Statement be written in simple language so as to be accessible to
everyone and, while being concise, also cover all the pertinent
information and include links to relevant publications, documents
or policies. Guidance further suggests that a Section 54 Statement
should include information about the following:
The organization's structure,
business and supply chains;
Its policies in relation to slavery
and human trafficking;
Its due diligence processes in
relation to slavery and human trafficking in its business and
The parts of its business and supply
chains where there is a risk of slavery and human trafficking
taking place, and the steps it has taken to assess and manage that
Its effectiveness in ensuring that
slavery and human trafficking is not taking place in its business
or supply chains, measured against such performance indicators as
it considers appropriate; and
The training about slavery and human
trafficking available to its staff.
A Section 54 Statement must be approved by the company's
board of directors, published on the company's website and
appear via a link in a "prominent" place on the
website's homepage. The deadline for publishing a company's
first Section 54 Statement is within six months of the first fiscal
year end that falls after March 31, 2016.
Unlike the California Transparency in Supply Chains Act,
if a covered company under the Act does not publish a Section 54
Statement, the Home Secretary can seek an injunction in the High
Court to require the company to do so. If the company fails to
comply with the injunction, it will be held in contempt of court
and liable for an unlimited fine.
As we stated previously, whether or not your company is subject
to the current laws on trafficking and slavery, consider whether
your company should begin accounting for risks of human trafficking
and slavery in its supply chain. You can do this by requesting
certifications in requests for proposals and representations and
warranties in supply contracts and work orders, especially if the
company's operations create risk for supply chain issues.
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.
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With a view to promote corporate transparency and prevent misuse of corporate vehicles for illicit purposes such as corruption, tax evasion, money laundering, the Financial Action Task Force ("FATF")...
An assignment of rights under a contract is normally restricted to the benefit of the contract. Where a party wishes to transfer both the benefit and burden of the contract this generally needs to be done by way of a novation.
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