What You Need to Know:
- The SFO's new guidance encourages companies to self-report suspected corporate wrongdoing and cooperate fully with investigations, promising Deferred Prosecution Agreement (DPA) negotiations in most cases.
- While the guidance suggests a strong incentive for self-reporting, it falls short of a guarantee, as the SFO retains significant prosecutorial discretion and emphasizes that each case will be judged on its own facts.
- In practice the new guidance adds little to the balancing exercise companies must undertake when assessing whether and when to self-report.
On 24 April 2025, the UK Serious Fraud Office (SFO) issued new guidance to encourage companies to self-report suspected corporate wrongdoing. The guidance states that self-reporting, combined with full cooperation with the SFO's investigation will, absent exceptional circumstances, lead to the SFO inviting the company to commence Deferred Prosecution Agreement (DPA) negotiations.1 While the guidance is a welcome recognition that companies crave certainty of outcome in their dealings with the SFO and a sign of the agency's increased pragmatism, in practice it is unlikely to move the needle for companies on notice of suspected wrongdoing facing the critical strategic decision of whether and when to self-report.
New guidance (old wine in new bottles)
The previous SFO guidance stated that self-reporting was a "relevant consideration" in determining whether a prosecution is in the public interest".2 The two key paragraphs of the new guidance state:
"Each case will turn on its own facts, but a factor which always weighs heavily in favour of a DPA over prosecution is a prompt self-report. If a corporate self-reports promptly to the SFO and co-operates fully we will invite it to negotiate a DPA rather than prosecute unless exceptional circumstances apply.
We will consider inviting to DPA negotiations a corporate that has not self-reported if it has provided exemplary co-operation with our investigation."
Speaking on the day the new guidance was released, SFO Director Nick Ephgrave said this was "as good as a cast iron guarantee [...] "no ifs, buts or maybes". At first glance, the new guidance represents a step-change which should incentivise self-reporting to avoid the risk of prosecution but on closer review it falls short of any kind of guarantee. The express conditionality of the purported guarantee, underlined below, allows the SFO to retain significant prosecutorial discretion and bakes in unhelpful uncertainty for companies and their advisers.
"Each case will turn on its own facts, but a factor which always weighs heavily in favour of a DPA over prosecution is a prompt self-report. If a corporate self-reports promptly to the SFO and co-operates fully we will invite it to negotiate a DPA rather than prosecute unless exceptional circumstances apply.
The new guidance makes clear that self-reporting without full co-operation will not be sufficient to prompt DPA negotiations. Companies should see self-reporting as an aspect of co-operation, rather than a separate category. As the court noted in Airbus,3 "there is no necessary bright line between self-reporting and co-operation". Nor is self-reporting a necessary condition for a "fully co-operative" stance; the new guidance states that the SFO will "consider inviting to DPA negotiations a corporate that has not self-reported if it has provided exemplary co-operation." This is consistent with the SFO's approach under the old guidance, as seen in the Airbus and Rolls-Royce DPAs.4 Self-reporting is a contributing factor in the assessment of co-operation, but it is neither necessary nor sufficient in isolation.
The examples of co-operative conduct listed in the new guidance (e.g., preserving evidence, identifying and disclosing relevant material, presenting the facts to the SFO, identifying implicated individuals, engaging with the SFO in advance of taking material steps during the investigation, waiving privilege over witness interview memoranda) do not differ substantively from the examples set out in existing SFO corporate guidance,5 and the SFO has not provided any indication of what might amount to the kind of "exceptional circumstances" that would prevent a fully co-operative company that self-reported from being invited into DPA negotiations.
The new guidance helpfully identifies five examples of what the SFO considers to be uncooperative conduct:
- Providing unnecessarily large amounts of material to try and overload the SFO's investigation.
- Tactically delaying providing information or material.
- Concealing individual involvement or the full extent of the wrongdoing.
- Seeking to exploit differences between international law enforcement agencies and different legal systems.
- A company forum shopping by unreasonably reporting offending to another jurisdiction for strategic reasons.
The new guidance also imposes new procedural timelines on the self-reporting process. The SFO will seek to:
- Contact a self-reporting company within 48 business hours of a self-report.
- Regularly update the company throughout the process.
- Decide whether to open an investigation within six months of a self-report.
- Conclude their investigation within a reasonably prompt time frame.
- Conclude DPA negotiations within six months of sending an invite.
Ephgrave's New World
The new SFO guidance must be read in light of the relevant domestic and global legislative and enforcement context in which the agency finds itself. Domestically, the Economic Crime and Corporate Transparency Act (ECCTA) 2023 presents the most radical overhaul of corporate criminal liability in the UK in a generation, making it significantly more straightforward for companies to be criminally investigated and prosecuted.
The new corporate offence of failure to prevent fraud will come into force on 1 September 2025 . The new offence holds large organisations criminally liable for fraud committed by associated persons who provide services for or on behalf of the organisation with the intention of benefiting it. It is a defence for the organisation to establish that it had reasonable procedures in place to prevent the fraud.
ECCTA amends the existing 'identification doctrine'—the main way in which criminal liability has been attributed to corporate entities in England and Wales—to allow for the actions of 'senior managers', acting within the actual or apparent scope of their authority, to fix the entity with liability with respect to a comprehensive list of economic crimes, including fraud, bribery, money laundering, sanctions, cheating the public revenue and conspiracy to defraud offences.6
ECCTA also expands the SFO's compulsory information request and interview powers beyond international bribery and corruption, giving the SFO the power to compel individuals and companies to provide information at the pre-investigation stage in all SFO cases. This will allow the SFO to progress investigations more quickly and take earlier prosecution decisions.7
The SFO Director is also pushing for the introduction of US-style financial rewards for whistleblowers. Whistleblowers in the UK currently face an uncertain landscape where the fear of repercussions often outweighs any incentive beyond doing the "right thing". Mr. Ephgrave believes that offering a financial incentive, alongside more formal protections against reprisals, will persuade more people to come forward with evidence that will help the SFO discover unknown misconduct and provide a "smoking gun" that will lead to a successful prosecution more readily than existing intelligence gathering powers.
Globally, the new guidance arrives at a time of significant enforcement uncertainty. In February 2025, President Trump issued an Executive Order directing Attorney General Bondi to conduct a six-month review of the guidelines and policies governing FCPA investigations and enforcement actions, effectively pausing FCPA enforcement. The order came a few days after a memo from Attorney General Pamela Bondi instructing the United States Department of Justice (DOJ) to redirect its enforcement efforts away from corporate crimes like FCPA violations and toward the Administration's priorities: combating illegal immigration, drug cartels, and allegedly unlawful DEI practices. The recent establishment of an anti-corruption prosecutorial taskforce between the SFO, France's Parquet National Financier and the Office of the Attorney General of Switzerland, goes some way towards the European agencies signalling that they are prepared to try and fill the FCPA enforcement gap.
Conclusion
Recognising the need for companies to have a better incentive to self-report and increased certainty when dealing with the SFO is a welcome and pragmatic development by the agency. However, companies on notice of suspected wrongdoing must continue to grapple with a number of challenging and competing strategic questions, including: Are mandatory / regulatory reporting obligations in play? How far should an investigation progress before considering a self-report? What are the prospects of the SFO finding out about the issue other than from the company? What control or influence would the company retain over the scope and focus of the SFO's investigation? Which other foreign law enforcement agencies are aware of and investigating the issue? How would DPA negotiations be likely to conclude? What are the relative benefits and drawbacks of a DPA compared to an alternative outcome for the company? What are the prospects of the SFO successfully prosecuting the company? What is the anticipated size of any financial penalty? Is follow-on shareholder litigation in progress or reasonably in prospect? In truth, the new guidance adds little new to the self-reporting balancing exercise.
Footnotes
1 https://www.gov.uk/government/publications/sfo-corporate-guidance/sfo-corporate-guidance.
2 See: Corporate Self-Reporting Guidance: https://webarchive.nationalarchives.gov.uk/ukgwa/20241119162228/https://www.sfo.gov.uk/publications/guidance-policy-and-protocols/guidance-for-corporates/corporate-self-reporting/
3 Director of the Serious Fraud Office v Airbus SE (31 January 2020), paragraph 68. Available at: https://assets.publishing.service.gov.uk/media/67c05a5bb0bb6528ee866bab/R_v_Airbus_Approved_Judgment.pdf.
4 Director of the Serious Fraud Office v Rolls-Royce PLC & Rolls-Royce Energy Systems Inc (17 January 2017). Available at: https://assets.publishing.service.gov.uk/media/67c061c4750837d7604dbc67/sfo-v-rolls-royce.pdf.
5 See: Corporate Co-operation Guidance: https://webarchive.nationalarchives.gov.uk/ukgwa/20241119161826/https://www.sfo.gov.uk/publications/guidance-policy-and-protocols/guidance-for-corporates/corporate-co-operation-guidance/ and Deferred Prosecution Agreements Code of Practice: https://www.cps.gov.uk/sites/default/files/documents/publications/DPA-COP.pdf.
6 Section 196, ECCTA 2023.
7 Section 211, ECCTA 2023, amending section 2A Criminal Justice Act 1987.
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