Bribery Act 2010

What this presentation will cover Understanding of what bribery is Have an overview of the current regulatory and legislative environment Understand how bribery may effect you Understand the reasons behind Intrinsic Policies and Procedures relating to bribery and expectations of you Understand what you need to do

What is Bribery? A definition of bribery is: “An offer or receipt of any gift loan, fee, reward or other advantage to or from any person as an inducement to do something which is dishonest, illegal or a breach of trust, in the conduct of the enterprise’s business” This is based on the Transparency International definition which defines corruption as: “The abuse of entrusted power for private gain”

What is Bribery? Not only cash/money, it is any item of benefit Bribery relates to the giving AND/OR receiving of bribes It is also the ‘offering or promising’ of a bribe, not only actual payment Amounts are irrelevant, does not matter how small the amount, it is the intention that counts Bribes can influence a person to either perform an action or not perform an action

Consequences of bribery Bribery is the fastest growing form of economic crime Estimates show that the cost of bribery and corruption equals more than 5% of global GDP (GBP £1.6 Trillion), with over GBP£630 Billion pounds paid in bribes each year Deters investment and hinders growth Enforcement and criminal activities Corruption is both a cause of poverty and a barrier to overcoming it

History The UK signed up to the Organisation for Economic Co-operation and Developments (OECD) Convention combating Bribery of Foreign Public Officials in International Business Transaction The 38 countries that have so far signed the OECD Convention are required to put in place legislation that criminalises the act of bribing a foreign public official.

UK Bribery Act 2010 The Bribery Act 2010 is an Act of the Parliament of the United Kingdom The Act defines four new criminal offences Offering or paying a bribe Requesting or receiving a bribe Bribing a foreign public official (A specific offence required to comply with the OECD convention) A corporate offence of failing to prevent bribery being undertaken on its behalf

UK Bribery Act 2010 Associated Persons ‘An associated person’ is defined under the corporate offence in the Act as one who: “performs services on behalf of a commercial organisation (UK companies and partnerships, or other companies and partnerships which carry on their business, or part of their business in the UK).” The Act gives the examples of employees, agents, subsidiaries, joint ventures etc Maximum penalty of 10 years imprisonment and/or unlimited fines for individuals under offences 1, 2 and 6 The corporate offence carries an unlimited fine

UK Bribery Act 2010 The legislation applies to all companies, partnerships and individuals based in England, Scotland, Wales and Northern Ireland, as well as foreign companies and individuals doing business in the UK The Act has a global reach, applying to acts or omissions taking pace anywhere in the world The UK Bribery Act 2010 was due to come into force in April 2011 but was delayed until 1st July 2011 SFO will be primarily responsible for ensuring adherence to the Act

UK Bribery Act 2010 General offences – Companies or Individuals (sections 1 & 2) “Offering, promising or giving a bribe in the UK or abroad, in the public or private sector” “Requesting, agreeing to receive or accepting of a bribe in the UK or abroad, in the public or private sector.

UK Bribery Act 2010 General offences Must be an “intention” to induce a person to act improperly in the performance of their duties. What is “improper” is judged by the standards of “reasonable person in the United Kingdom” – local custom is not a defence.

UK Bribery Act 2010 Specific offences (sections 6 & 7) “Bribery of a foreign public official in order to obtain or retain business or advantage in the conduct of business” “Failure by a commercial organisation to prevent a bribe being paid (directly or indirectly) by those who perform services for or on behalf of the organisation” It will be a defence to this corporate offence if a company has “Adequate Procedures” in place

UK Bribery Act 2010 Bribery – Potential Risk Areas Gifts, Entertainment, Hospitality Conflicts of Interest Lobbying, charitable donations Procurement

Possible consequences of bribery Financial Reputation Ability to hire new staff Losing contracts

What do I need to do now? Be aware of and follow procedures relating to bribery prevention in relation to your role. Exercise vigilance and due care and follow the appropriate reporting processes where concerns about bribery exist Be aware of and apply the relevant procedures and practices to mitigate bribery If you become aware of any attempt to offer or receive a bribe you need to contact the Intrinsic’s Head of Financial Crime

Summary New legislation Bribery Act 2010 Offer, pay or give a bribe Request, agree to receive or accept a bribe Foreign Public Official offence Corporate offence