On 18 August 2025, the UK's Crown Prosecution Service (CPS) and the Serious Fraud Office (SFO) announced the updated version of the joint guidance in relation to the prosecution of corporate entities (the "Guidance"). The Guidance, which has stood unchanged since late 2021, has been updated to reflect a number of recent legislative developments in this area, most notably as a result of the Economic Crime and Corporate Transparency Act ("ECCTA"), which expanded the corporate identification doctrine from 26 December 2023 and introduced the new corporate criminal offence of 'failure to prevent fraud' ("FTPF Offence"), which comes into force from 1 September 2025. (For more detail on the FTPF Offence posts here and here, or listen to our podcast episode here).
Key points to note:
Apart from reflecting the above key legislative changes, the Guidance effectively collects and codifies enforcement and prosecutorial practice and expectations of recent years, with some shifts in emphasis, as outlined below.
1) Clarifying the Routes to Establishing Corporate Criminal Liability
The Guidance highlights how, from 26 December 2023, ECCTA altered the law of corporate criminal attribution with the result that (for specified economic crime offences) prosecutors no longer need to prove involvement by persons representing the 'directing mind and will' of the corporate in order to attribute liability (applying the common law 'identification doctrine'), but can now point to involvement by a much broader population of 'senior managers'. The Guidance expressly draws out and clarifies the various avenues open to prosecutors in establishing corporate liability under either the common law route (i.e. applying the traditional doctrines of identification or vicarious liability) or the various statutory routes (i.e. statutory attribution for specified economic crimes under ECCTA, or the three statutory 'failure to prevent' offences, the latter of which avoid the limitations of the identification doctrine and do not require fault by senior management to be proved).
While statutory attribution under ECCTA is currently limited to the economic crimes specified in Schedule 12 to ECCTA (e.g. fraudulent trading, bribery, money laundering, terrorist financing, and sanctions breaches), the Crime and Policing Bill 2025 (currently due for its second reading in the House of Lords) proposes to extend statutory attribution to all criminal offences, which would render the identification doctrine obsolete.
2) Considering Statutory Defences Earlier
The Guidance instructs prosecutors to "give careful consideration to the statutory defences" available to corporates in relation to each of the 'failure to prevent offences' (i.e. whether the corporate had 'adequate' (for bribery) or 'reasonable' procedures (for tax evasion or fraud) in place to prevent the relevant offending. For the first time, prosecutors are also guided to take into account the six principles that organisations are expected to follow (as articulated in the government guidance accompanying each 'failure to prevent offence') and to use those principles to structure the investigation, lines of inquiry, interviews, and presentation of evidence at any trial. Further, the Guidance suggests that it may be useful for prosecutors to have an appropriate witness to adduce the relevant government guidance as an exhibit "to assist the jury's understanding of the statutory defence." In practical terms, this may mean that investigations may be closed more quickly if corporates are able to demonstrate clearly that they had adequate or reasonable prevention procedures from early on in the investigative and prosecutorial process.
4) Managing the Bribery/Fraud Overlap
There is often a close factual nexus between bribery and fraud offences, and – with the arrival of the FTPF Offence – the Guidance highlights that the availability of such alternative offences may materially affect the formulation of the indictment and the overall case strategy, and warns prosecutors to "be mindful of this from the outset of any investigation where this may be an issue" and ensure that they give careful consideration to whether the facts of a case support a charge under either or both of the 'failure to prevent' offences.
4) Clarifying who is an "Associated Person"
The Guidance also emphasises that – although broadly aligned – the precise meaning and scope of the concept of an "associated person" differs between the three 'failure to prevent' offences, so prosecutors will need to take care to ensure that a given individual or entity falls within the relevant statutory definition. Further, the Guidance notes that the "test is purposive rather than formal, turning on the nature of the relationship in practice and whether, in all the relevant circumstances, the individual was acting in the capacity of performing services for or on behalf of the organisation, irrespective of their contractual status or title."
5) Early, Collaborative Case Building and Use of Investigatory Tools
The Guidance emphasises early collaboration between investigators and prosecutors, and encourages the former to seek early pre-charge advice on the statutory investigatory powers available to them (e.g. disclosure notices under section 62 of Serious Organised Crime and Policy Act 2005), which may be critical to shaping the evidential foundation of the prosecution by identifying lines of inquiry and relevant entities or individuals from the outset.
Additionally, investigators and prosecutors are reminded that corporate offending may engage overlapping criminal and regulatory responsibilities across multiple agencies, and are urged to consider the wider enforcement context and ensure that there is early "communication, collaboration and where necessary de-confliction" between agencies. In this regard, the Guidance notes that prosecutors should consider whether a referral to a regulatory authority is suitable, either as an alternative to criminal prosecution or in parallel, since regulatory sanctions may complement criminal proceedings by addressing systemic failings, governance issues, or fitness to operate.
6) Additional Public Interest Factor In Favour Of Prosecution
It is worth noting that the revision to the Guidance added a new 'additional public interest factor' in favour of prosecution for prosecutors to consider in addition to the factors set out in the Code for Crown Prosecutors: for the first time, prosecutors are directed to consider that a significant level of harm caused directly or indirectly to the victims of the wrongdoing, or a substantial adverse impact to the integrity or confidence of markets, or to local or national governments, will be a factor tending in favour of prosecution.
7) Considering Solvency Earlier
The Guidance requires prosecutors to consider a corporate's solvency at an earlier stage than was typical – whereas the corporate's ability to pay a fine has always been considered at sentencing, the Guidance urges prosecutors to seek disclosure, establish solvency/financial means, and/or use appropriate asset restraint powers at the pre-charge stage, including to prevent dissipation or liquidation by corporates seeking to avoid enforcement. The Guidance emphasises in this context that corporates are expected to be able to provide three financial years' accounts for this purpose, and that the court may draw adverse inferences where such records cannot be produced (i.e. infer that there are no constraints on the appropriate fine).
Next Steps – what does this mean?
It is clear from the Guidance and developments since ECCTA that the UK's corporate criminal prosecution framework is growing stronger, and that the authorities are intent on using all of the (new and not-so-new) statutory tools at their disposal in a more coherent, collaborative, and proactive way than has previously been the case. Corporates should therefore focus on:
- ensuring that they have evidence to support their use of the relevant statutory defences – this should include assessing and documenting the status and evolution of their compliance frameworks for preventing bribery, tax evasion, and fraud (with demonstrable links to the six principles in the government guidance, and ensuring clear version control management) so as to be ready to engage with the authorities as quickly and robustly as possible in the early stages of an investigation;
- ensuring that – when evidence of an actual or suspected offence comes to light – a key part of the internal investigation process focuses on ascertaining the nature and extent of the prevention procedures in place at the time, and whether the offending may have been a 'one-off' that does not otherwise impugn their adequacy or reasonableness;
- clarifying and mapping decision-making matrices/authorities across the organisation and within business units to ascertain (and mitigate) the risk of statutory attribution under ECCTA; and
- preparing clear protocols for responding to incidents of offending, in order to optimise: the timing and content of the information provided to the authorities; the potential for securing a deferred prosecution agreement (or other negotiated settlement); reduce any financial penalties; minimise or manage reputational fallout; and/or achieve an earlier and more predictable resolution than might otherwise be possible.
→ The Guidance is available here.
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.
