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House of Lords Select Committee on the Bribery Act 2010: Post Legislative Scrutiny

  • United Kingdom
  • Fraud and financial crime
  • Litigation and dispute management

15-03-2019

The House of Lords Select Committee on the Bribery Act 2010 has published its much-anticipated report, concluding that the Act is “an exemplary piece of legislation”.

It has also set out a number of recommendations which will be of great interest to UK businesses. In making these recommendations, the Select Committee drew from more than 100 written submissions and oral evidence from 52 individuals, including Laura Dunseath, Principal Associate and Barrister from Eversheds Sutherland’s Corporate Crime and Investigations team. 

Some significant areas addressed in the Select Committee’s report include:

The corporate offence of failure to prevent bribery: The Select Committee recommends that guidance is expanded to provide clarity as to which procedures could be adopted by SMEs, consequently helping them to create a good defence. Furthermore, the Select Committee seeks clarification that “adequate” procedures should be more adequately interpreted as procedures which are “reasonable in all the circumstances” (acknowledging the inconsistency between the wording of the Bribery Act and the more recent Criminal Finances Act which created offences of failure to prevent the facilitation of tax evasion).

Corporate Hospitality: The Select Committee have acknowledged that establishing a clear boundary between bribery and corporate hospitality can often be challenging. While acknowledging that the current Ministry of Justice Guidance is as clear as possible in the absence of any judicial interpretation of the relevant statutory provisions, the report makes recommendations that further guidance be added to assist in clearly defining what might constitute acceptable corporate hospitality.

The Select Committee also recommends that the Director of the Serious Fraud Office and the Director of Public Prosecutions publish plans to address how they will ensure that investigations are conducted more quickly, and how levels of communication with those placed under investigation will be improved.

Deferred Prosecution Agreements (DPAs): The Select Committee accept DPAs as a positive development, stating that they “have proved to be an excellent way of handling corporate bribery, providing an incentive for self-reporting and for co-operating with the authorities”. The Select Committee do not, however, go as far as recommending the adoption of US-style non-prosecution agreements.

Adopting the “strongly held views” of witnesses including Laura Dunseath, the Select Committee concludes that “far from being an alternative to the prosecution of individuals,” the DPA process “makes it all the more important that culpable individuals should be prosecuted.” Notably, the Select Committee points out that the requirement for co-operation means that a company negotiating a DPA should provide all available evidence which might subject individuals to criminal liability, regardless of how senior the individuals suspected of bribery are.

Bribery of foreign public officials and facilitation payments: The Select Committee makes recommendations as to the need to support SMEs, particularly those who may be facing corruption issues overseas. The report recommends that even smaller overseas UK Embassies have at least one official with the relevant expertise in local language, customs and culture, so that they may contact official representatives of the relevant foreign government department on behalf of any UK company which may be facing such issues.

Training: A lack of police training and awareness in regards to the Bribery Act could be a contributing factor to the low number of prosecutions for bribery.

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