The FCPA is dead: long live the Bribery Act?

We have often felt frustrated during recent UK and European bribery and corruption conferences, when the focus has been biased towards US lawyers talking about how European corporates should comply with the FCPA. Hopefully this can now change to a far more Euro-centric focus, because after a tortuous drafting and review process, the Bribery Bill was rushed through the final Parliamentary review processes with barely a comment, so focused were the MPs on the forthcoming general election. Accordingly, the Bribery Act 2010 received Royal Accent on 9 April, shortly before the formal dissolution of Parliament (more here)

The text of the Act is here.

As we have written here previously, the Bribery Act represents a wholesale update of the antiquated and discredited UK bribery laws. Our lawyer friends have all written excellent summaries of the new rules (see for example Fulbright’s summary here and Norton Rose’s here which we will not try to replicate for breadth or depth. But we will try to produce the briefest summary to be found on the web to date…..

• The Bribery Act applies to all companies with a UK nexus. It applies to worldwide acts. It crimanalises offering, paying, requesting or receiving bribes. It prohibits bribery in both the public and private sectors.
• Bribery is defined in terms of intending to procure the “improper performance” of a person’s duties. This means that the recipient of the bribe would be expected to act otherwise than in good faith, an impartial manner or in accordance with a position of trust. Expectations are judged by UK, not local, standards.
• A new strict liability offence for businesses of failing to prevent bribery is introduced. The only defense is if “adequate procedures” were in place to eliminate bribery.
• There is personal criminal liability for senior executives with whose “consent or connivance” the bribery was committed.
• A business is liable for bribery carried by “associated persons”, defined as persons or entities which perform services on behalf of the principal.

Importantly for corporates, the Bribery Act is far wider in scope than the FCPA, and so foreign multinationals must take heed. “FCPA reviews” for global corporates should really now be replaced by far more stringent “Bribery Act reviews”, as companies cannot simply rely on their FCPA compliance programs to be covered under the Act.

• The Bribery Act applies to business to business activities, not just to the bribery of foreign public officials (FPO)
• It applies to receiving as well as paying bribes
• Bribery of an FPO need not be done “corruptly”
• There is no exemption for facilitation payments
• It has a wider extra-territoriality

So having a place of business in the UK, a foreign company can commit the failure to implement “adequate procedures” offense in relation to conduct in a foreign country. The overseas bribery need not be connected with the specific UK business.