The new UK Bribery Act, which was to be implemented in April, has been delayed again, the Ministry of Justice (MoJ) confirmed yesterday.
The Act, which contains some of the toughest anti-corruption measures anywhere in the world, will not now be implemented until three months after guidance on its requirements has been distributed to business, said Ministry spokesmen. While they gave no date on when the guidance would be published, observers believe that it will appear within the next few weeks.
The government has ordered new scrutiny of the Act under its Growth Review. Experts do not believe the process will produce any material changes to the law, but its perceived lack of clarity has been widely criticised by business leaders, with John Cridland, newly-appointed director general of the Confederation of British Industry (CBI), stating that it is “not fit for purpose.”
The Act introduces four offences – making a bribe, accepting a bribe, bribing a foreign public official and failure by UK companies and their directors to prevent bribes being offered on the company’s behalf, anywhere in the world. It is a defence against the fourth offence for companies to prove that they had “adequate procedures” in place aimed at preventing persons associated with them from offering bribes, but convictions will carry a maximum jail sentence of 10 years.
Observers point out that the new law is tougher than the US Foreign Corrupt Practices Act (FCPA), which only deals with bribery within the public sector. Late last year, it was reported that a number of the world’s biggest drugmakers were being investigated by the US Department of Justice (DoJ) and the Securities and Exchange Commission (SEC) in connection with alleged violations of the FCPA, involving the possibility of bribes having been offered by companies or their agents to government officials in Brazil, China, Germany, Italy, Poland, Russia and Saudi Arabia.
Moreover, the UK Act would ban “facilitation payments,” which are made to public officials or others as a way of ensuring that they perform their duties, either more promptly or at all. Facilitation payments are not illegal under the US law.
Late last year, Richard Alderman, director of the UK Serious Fraud Office (SFO) told an industry conference that UK pharmaceutical companies are on the US Department of Justice’s anti-corruption “high-risk register” and that the SFO is also looking closely at the sector.
The Bribery Act received the Royal Assent in April 2010, just minutes before business in Parliament ended to prepare for the General Election on May 6. The new coalition government then announced that implementation of the Act would be postposed until April 2011 in order to give companies time to establish the necessary procedures, and a two-month consultation began in September.
In January, Jonathan Djanogly, Parliamentary Under-Secretary of State at the MoJ, told the Daily Telegraph that, as an opposition spokesman, he had been concerned that the Labour government had tried to rush the bill through without proper consideration of the impact on business.
Now, the coalition government is “working closely with business to ensure that we are able to bring in the Act without putting UK firms at a disadvantage,” added Mr Djanogly, who is Conservative MP for Huntingdon.
