Out-Law News 2 min. read

Bribery Act letters most likely awareness-raising exercise by UK government, says expert


Reports that the UK government has written to "industry leaders" asking them to comment on aspects of the 2010 Bribery Act are likely to signal the start of an awareness-raising exercise, rather than a review of the legislation, an expert has said.

The letters from the Department for Business, Innovation and Skills (BIS) seek comment on guidance from the Ministry of Justice (MoJ) that accompanies the Bribery Act, rather than the Bribery Act itself, according to a report in the Independent newspaper. Recipients have been asked to comment on whether the UK's flagship anti-corruption legislation has had an impact on their attempts to export, and whether the guidance has been useful, according to the report.

The Independent quoted international corruption bodies, including Transparency International, on their concerns about the review and any attempts to "water down" the Bribery Act. However, white collar crime expert Jennifer Burton of Pinsent Masons, the law firm behind Out-Law.com, said that the review had most likely been prompted by recent government research in which nearly half of small exporters surveyed had been unaware of the legislation and accompanying guidance.

"The problem is not that the MoJ guidance is unclear or that the Bribery Act has a negative impact on companies' abilities to export goods; but that businesses, particularly small and medium sized businesses, have a limited awareness of the Bribery Act and its implications," she said.

"One interpretation could be that, because of the woefully small numbers of SMEs that were aware of the Bribery Act and MoJ guidance, BIS has sent out these letters to try and gain more information, as the small sample size renders the current comments on the MoJ guidance almost meaningless. BIS may also be trying to complete the picture by seeing how the Bribery Act affects larger businesses which, hopefully, should be more aware of the Bribery Act and its guidance," she said.

The Bribery Act came into force on 1 July 2011. It criminalised acts of bribery by businesses, and by those acting on behalf of businesses, with a presence in the UK - regardless of where in the world the alleged activity took place. Under the Bribery Act, businesses can be liable for acts of bribery committed on their behalf unless they can show that they had adequate procedures in place to prevent these acts occurring.

Research issued by the MoJ and BIS at the start of this month found just 56% of 500 small and medium sized enterprises (SMEs) surveyed were aware of the Bribery Act, and that only 26% of those that were aware of it were also aware of the MoJ's guidance on its implications for businesses. Of that 26%, only 75% of them had actually read the guidance, according to the report.

"This means that only around 50 out of the 500 companies surveyed by BIS and the MoJ had read the Bribery Act guidance," said Burton. "Of those companies, three said that the guidance was not useful as it was 'common sense'."

"Of the 280 SMEs aware of the Bribery Act, only 3% - or nine companies - thought that the Bribery Act had a negative impact on their ability to continue exporting. 89% felt there was no impact," she said.

The Independent suggested that one area of particular contention under the Bribery Act was the issue of facilitation payments, such as where officials overseas are given money or goods to perform, or speed up the performance of, something that they should already be doing. These are not illegal under US anti-corruption laws. In the UK, the Serious Fraud Office (SFO) has said that these payments are clearly "a type of bribe" which is illegal under the Bribery Act, regardless of the size or frequency of the payments.

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