Bribery Act Delayed But Not Shelved

There were sighs of relief and also of disbelief when it was announced last month that the Bribery Act would be delayed for the second time.

With the Bribery Act being one of the last Acts of the previous Labour government, it is no wonder that the new Coalition government wants more time to fine tune the guidance. The reason given for the delay was to allow time to ensure the guidance was made ‘practical and comprehensive for businesses. There will not be any changes made to the Act itself.

The Act was originally a response to the wider world’s criticism of the UK’s weak anti-corruption laws. Pro-transparency campaigners argue therefore that this delay damages Britain’s overseas interests and reputation, both ethically and commercially. Yet anti-regulation campaigners see this as a victory. In reality, it is likely to be neither.

Long awaited guidance

Three sets of guidance are anticipated in the foreseeable future:

• Section 7 guidance concerning adequate preventative measures
• A Ministry of Justice circular which will outline provisions of the Act
• Guidance for Prosecutors

Although no date has been set for publication of this guidance, there will be a minimum three-month window following its release before the Act comes into force. It is therefore unlikely to come into force prior to June 2011.

Of course companies will focus on the section 7 guidance, but what may be of even more use is the guidance for prosecutors. This will identify the key elements of each criminal offence and how the Act is likely to be enforced.

Firms should, in theory, have been working towards full compliance with the provisions of the Act for some time now, awaiting the guidance to “fine tune” their policies and procedures.

Many firms, especially those which operate internationally, will already be compliant with legislation which operates in other jurisdictions, such as the Foreign and Corrupt Practices Act in the USA. However, the Bribery Act goes further than this, and firms will therefore have to tweak their policies and procedures accordingly.

It is likely that SMEs will be most affected by the Act’s provisions. They will need to be ‘awake’ to the threats of bribery and corruption, as defined by the new Act, throughout their business networks and also in their roles as suppliers to large firms, and have adequate and demonstrable preventative measures in place.

Paul Schofield
Farleys