Opinion: Bribery Act delay is not a stay on prosecuting corruption

The recent news that Downing Street has ordered a review of the Bribery Act 2010, and the announcement by the Ministry of Justice (MoJ) that the act will now not come into force in April, came as a surprise to many.

Jonathan Whitehead
Jonathan Whitehead

Commissioned on the basis of fears that the new offences could damage economic growth by imposing an unfair burden on businesses, there is now ­widespread speculation about when the act will come into force and whether it will include any material amendments.

While it is undeniable that further ­guidance on the meaning and application of the act would be welcome (some will be published by the MoJ in due course), it remains highly improbable that Downing Street would make significant changes or ditch it altogether at this late stage.

The review has apparently been ordered as a result of certain UK businesses raising concerns about the possibility of now being punished for offering hospitality to ­potential clients and making payments to facilitate routine governmental conduct (facilitation payments). These concerns are apparently heightened by the fact that many other jurisdictions provide express exclusions or defences for such payments. The argument goes that “Britain plc”, and foreign businesses operating in the UK, may be forced to act at a competitive disadvantage when pitching for overseas work.

What I find astounding is that this has come as a shock to UK businesses. The ancient legislation criminalising bribery provides no defence for a small payment to a foreign official to expedite a ­procedure. Similarly, disproportionate gifts, travel or hospitality to a potential business partner can be caught under the criminal law as it now stands.

The act is therefore not – in these senses at least – seeking to restrict UK business any more than UK law has done over the past century. The fact that the current, archaic offences are less well-known should not mean that UK businesses can now complain that they have been caught off-guard by new restrictions. Companies should be careful what they may ­unwittingly admit when they say that the act may now criminalise their conduct; bribery offences are already punishable by imprisonment and unlimited fines. The old offences remain on the statute book.

The attorney general discussed some of these points in a speech given at the World Bribery & Corruption Compliance Forum 2010. He said, in no uncertain terms, that the ban on facilitation payments is not a change and that “the law’s never exempted such payments”. He also clarified that ­hospitality and the promotional expenditure of commercial organisations are not illegal per se, but that lavish hospitality “can be used as a bribe intended to induce a public official to award business”.

While it is impossible to say now what the outcome of Downing Street’s review and this new delay might be – and the attorney general’s stated views may mean few changes, if any, are made – businesses should not delay reviewing or putting in place their anti-bribery measures.

The SFO is so determined to foster an anti-bribery culture whereby, regardless of any changes that might be made, it will not be swayed in its crusade to banish ­corrupt practices and encourage ethical, honest business. While in many ways the act was a much-needed and welcome tool in the SFO’s arsenal, any changes are unlikely to make a practical difference to the SFO’s focus on self-reporting and the punishment of those who are found not to have ’adequate procedures’ in place.

The issues of hospitality and facilitation payments are largely sideshows to the main event, namely the investigation, identification, prosecution and ­punishment of those who practise ’grand corruption’ to win business overseas.

Senior associate Rhys Novak assisted on this article