The Bribery Act 2010

Following a delay caused by the need for additional consultation and clarification, the Bribery Act 2010 has received Royal Assent and will come into force on 1 July 2011. This Act aims to modernise the law in relation to bribery both within the UK and abroad.

The Ministry of Justice has issued a Quick Start Guide to the Act. The Guide starts by defining bribery as “giving someone a financial or other advantage to encourage that person to perform their functions or activities improperly or to reward that person for having already done so.”

One of the reasons for the delay to the Act was the generally expressed concern that hospitality could have been deemed to fall under the definition of bribery within the new Act. This has been clarified with “reasonable and proportionate” hospitality not falling within the remit of the Act.

Penalties for failing to comply with the Bribery Act 2010 have been increased to a jail sentence of up to 10 years, and/or an unlimited fine for individuals or companies.

The Bribery Act 2010 applies to UK companies operating both within the UK and abroad as well as to overseas companies operating within the UK. It also applies equally to officials of the company as well as associated persons acting on behalf of the company. Organisations are required to apply the following 6 guiding principles when complying with the Act:
Top Level commitment
Risk Assessment
Due Diligence
Monitoring and Review

With the Act also applying to a company which fails to prevent a bribe being paid for or on its behalf it is essential that the guiding principles are incorporated within organisational procedures to provide some measure of defence. With less than two months to go, companies should ensure that they carry out appropriate assessments and training as soon as possible.

19th May 2011

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