Bribery Act Essentials for 2012 CICES 28 February 2012 Barry Vitou & Neil McInnes

Outline What is a bribe? What is the new law? –Key provisions –‘Adequate Procedures’ defence How do you identify your corruption risks? Specific issues and hot topics –Gifts and Hospitality –Facilitation Payments What are the regulators up to?

Spotting bungs Serious Fraud Office cases –The “after sales service fee” –The “Professional Education” fund –Gifts to spouses –Offshore structures and agents Closer to home –“10 x £50” notes –An electronics gadget –A family holiday to Italy –Getting the house re-wired SFO Corruption Indicators

Bribery Act on a page In force 1 July 2011 – wide jurisdictional reach Corporate offence of failure to prevent bribery –Associated person liability –Defence of adequate procedures Other offences replace existing UK corruption laws: –Bribing another person –Being bribed –Bribing a foreign public official –Director and Senior Officer liabilities A commonsense definition? Sentencing powers, Proceeds of Crime, debarment and other sanctions

Not perfect, but adequate Having ‘adequate procedures’ in place is a full defence to the new corporate offence of failure to prevent bribery Government Guidance published on 30 March 2011 What is ‘adequate’ will depend on the circumstances: –Proportionate to bribery risks faced by an organisation –Nature, scale and complexity of organisation’s activities also relevant –Procedures should be “clear, practical, accessible, effectively implemented, and enforced”

Six principles for happy compliance Proportionate Procedures Top level commitment Risk AssessmentDue Diligence Communication (Including Training) Monitoring and Review

Capturing your corruption risk Risk Assessment Country risksSector risks Transaction risks Business Partnership risks Internal structures and procedures Agents and Intermediaries

The Grand Prix and Wimbledon. Tick? Corporate Hospitality –Hospitality intended to induce improper performance? or –reasonable public relations, enhance knowledge of your organisation etc? Gifts and Incentives What the SFO have said :

Grease payments What are facilitation payments? How to spot them? How to resist them? What organisations are doing to protect themselves What the SFO have said :

Jail time and following the money Lessons from the US Current UK enforcement approach –Proceeds of Crime Act –Self-reporting and whistleblowing –Criminal prosecutions Priorities for the new SFO Director? –The non-UK corporate? –The complicit senior officer?

Contacts Barry Vitou, Partner Neil McInnes, Senior Associate, Barrister

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