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Offering, promising or giving a bribe in exchange for improper
performance of a function or activity ('active
bribery');
Requesting, agreeing to receive or accepting a bribe in
exchange for improper performance of a function or activity
('passive bribery');
Bribing a foreign public official (the 'foreign
public official offence'); and
Failure by a commercial organisation (which includes a company
or partnership) to prevent a person associated with it from
committing bribery in order to gain, or retain, a business
advantage (the 'corporate offence').
Critically, the burden is placed on the commercial organisation to
prove it had "adequate procedures" (such as a rigorous
internal compliance programme) in place to prevent bribery (the
'adequate procedures defence').
The key offences are designed to catch all forms of bribery and
are therefore extremely broad. In particular:
There is no precise definition of a bribe, with the Act merely
referring to a "financial or other advantage."
Accordingly, any payment, gift, or other form of benefit may be
caught.
The Act covers private bribery, in addition to bribing a public
official, thereby expanding the scope of the Act well beyond that
of the US Foreign Corrupt Practices Act (the
"FCPA"). The terms "function"
and "activity" are widely defined to include not only any
public function, but also: (i) any business activity; (ii) any
activity performed in the course of employment, and (iii) any
activity performed on behalf of a body of persons (corporate or
otherwise) thereby extending the reach of the provisions to agents
and external third parties. The relevant "function or
activity" need not have a connection to the UK.
"Improper performance" means a breach of the standard
that a reasonable person in the UK would expect in relation to a
duty of good faith, impartiality or a position of
trust.1 By imposing this standard, the provisions
explicitly disregard the local customs or practices existing
outside the UK which might otherwise be applied to soften the
test.2
The Act covers bribery in relation to both acts and omissions.
As well as covering two-party situations, where party A pays a
bribe to party B, in exchange for improper performance by party B;
the provisions also catch situations involving a third party, such
as where the bribe is paid by, paid to, or the improper performance
of an activity or function is by party C.
The corporate offence of failure to prevent bribery covers all
"associated persons". Any person who "performs
services" for or on behalf of a commercial organisation is an
"associated person". Thus, a corporation could be made
liable for failing to prevent bribery in respect of not only its
employees (who are deemed to be associated persons under the Act
unless contrary intention is shown), agents and subsidiaries, but
also joint venture or consortia partners, and potentially external
third parties such as suppliers. From a financial services
perspective, the legislation could extend to trustees, custodians
and even insurers under the Act.
Further, actual knowledge of the bribe by the commercial
organisation need not be proven. The only defence available to the
allegation is to show that the commercial organisation had
"adequate procedures" in place to prevent its employees,
agents and associated third parties from engaging in bribery.
1 Further, merely accepting a financial or other
advantage may itself constitute improper performance of a relevant
function or activity.
2 Unless such a custom or practice is permitted or
required by the written law applicable in the relevant
country.
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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The right of a person to discuss certain matters with their lawyer, no matter how nefarious, without fear of their confidence being broken is one that has been recognised since the 16th Century.
The ramifications for those found to be in civil contempt (as presided over by the High Court), and, in particular, the court’s power to enforce such a finding against a contemnor who resides overseas, are more far reaching than many (civil) lawyers realise.
The Bribery Act has made the news again following the conviction of a would be taxi driver. Earlier this week, at Minshull Street Crown Court in Manchester, Mr Mawia Mushtaq became the second person convicted of an offence under the Bribery Act by attempting to bribe a Licensing Officer.
In the previous edition of Corporate Focus we reported that the Bribery Act 2010 (the Bribery Act) came into force on 1 July 2011 and we considered procedures that commercial organisations could put into place in order to prevent bribery.
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