Bribery Act 2010


Author: David Robinson


Update as at 31 March 2011

Guidance has now been issued. Please see our legal update at: www.fladgate.com/BriberyAct2010_Guidance

The Bribery Act 2010 (Act) comes into force on 1 July 2011. In this article, we consider the new legislation and the steps businesses should take to minimise their, and their management and employees’, risk of exposure.

The Act will codify the existing offences of bribery and it also introduces a corporate offence of failure to prevent bribery. This offence will apply to commercial organisations in the UK, whether they are incorporated (private and public companies, limited liability partnerships) or unincorporated (partnerships, unincorporated associations). The offence will also apply to any overseas corporate entity or partnership that carries on any business in the UK. Essentially, if you are a business in the UK, or are doing business in the UK, then the Act is likely to apply to you.

What are the offences under the Act? In summary:

  • offering a financial or other advantage to another person to perform improperly a relevant function or activity
  • accepting a financial or other advantage offered by a person to perform improperly a relevant function or activity
  • bribery of a foreign public official, which means to offer a financial or other advantage to a foreign public official in an attempt to influence them in their capacity as a public official and to obtain or retain business, or an advantage in the conduct of business
  • the corporate offence of failure to prevent bribery.

A relevant function or activity is widely defined, and includes a function of a public nature and an activity connected with a business or in the course of employment.

The corporate offence of failure to prevent bribery is one of strict liability, which means that if bribery has been committed, then the corporate is, subject to an applicable defence, guilty of the offence. As with all offences under the Act, neither ignorance nor negligence are defences. The only defence for the corporate offence is to have adequate procedures in place which are designed to prevent bribery. All corporate entities should have procedures in place, tailored to their specific business, aimed at preventing bribery (and to act as a defence if an employee or agent commits an offence).

At the very least, we suggest this should be a clear statement of policy and be reflected by contractual provisions in employment contracts or the employee handbook.

Offences under the Act are punishable by fines and/or up to ten years imprisonment, in addition to the possibility that senior officers of the corporate are individually penalised where they are particularly culpable. Such officers may also face possible civil action against them personally.

The offence of bribery of a foreign public official is particularly interesting. As some international businesses have discovered, in certain jurisdictions and particularly those with developing economies, “additional” payments are quite customary when dealing with local authorities, to overcome the slow machinations of local bureaucracy. Such payments are the target of the Act.

This is not controversial; even if such payments are customary in that jurisdiction, most reasonable, law abiding people would consider such payment a “bribe”. But the offence under the Act may also catch payments (or provision of benefits) that may not generally be thought of as a bribe. Referral agreements or corporate hospitality could, for example, also contravene the Act in some circumstances. Certainly, if the making of such payment (or other provision of benefit) to a foreign public official is prohibited (or not specifically permitted) by local law then it is very likely that there will be an offence under the Act.

All businesses which have any international dealings with public bodies should carefully consider the nature of their relationships with foreign public officials (the definition for which includes officials or agents of a public international organisation) and take appropriate advice both in the UK and locally.

For further information, please contact Charles Wander, Partner or David Robinson, Partner

View by author:


Would you like to hear more?