The Bribery Act 2010 came into force on the 1st July 2011, creating four new offences: giving and receiving bribes; bribery of foreign officials; and failure by commercial organisations to prevent bribery.
General Offences
The 'general offences':
- Section 1: giving a bribe, which prohibits giving, promising or offering a financial or other advantage ( the Act is silent on the meaning of "financial or other advantage");
- Section 2: receiving a bribe.
Bribery of Foreign Public Officials
Section 6 introduces the offence of bribing a Foreign Public Official, when a person:
- offers, or promises or gives
- a financial or other advantage
- to a Foreign Public Official
- with the intent to influence the Foreign Public Official who is not permitted or required by applicable local written law to be influenced by the advantage
- in order to obtain or retain business or an advantage in the conduct of business.
There is no need for the Foreign Public Official to perform his or her function “improperly” as a result.
Where the activity or function in question is to be carried out outside UK jurisdiction , local custom or practice is to be disregarded, unless, the written law applicable to the country or territory concerned either requires or allows it. Local custom is not the equivalent of local written law.
Failure of commercial organisations to prevent bribery
The Section 7 "Corporate Offence" is of particular relevance to universities, since it covers all members of staff, agents or consultants. Offences can be committed overseas as well as in the UK.
A defence of "adequate procedures" is available, but only to the institution, not the person who committed the offence.
Different types and sizes of organisations will face different issues, however, the procedures put in place must produce an outcome that is "robust and effective" in order to prevent bribery taking place.
Prosecution and Penalties (Sections 10 and 11)
An individual found guilty section 1; 2 or 6 offences is liable:
- on summary conviction, to imprisonment for a maximum of 12 months (six months in NI), or a fine not exceeding the statutory maximum or to both;
- on conviction on indictment, to imprisonment for a maximum of ten years, or to a fine, or to both.
Any other person found guilty of an offence under sections 1; 2; or 6 is liable:
- on summary conviction to a fine not exceeding the statutory maximum
- on conviction on indictment, to a fine
Senior Officers can only be liable for an offence committed by the company, not for an offence committed by an individual employee.
A person guilty of an offence under S7 (failing to prevent bribery) is liable to conviction on indictment to a fine.
Guidance
The procedural guidance sets out six principles, giving a number of examples showing what could amount to bribery and what may amount to acceptable behaviour:
- Proportionate procedures
- Top level commitment
- Risk Assessment
- Due diligence
- Communication (including training)
- Monitoring and review
The Guidance also deals with hospitality, promotional and other business expenditure: "Bona fide hospitality and promotional, or other business expenditure which seeks to improve the image of a commercial organisation, ………, or establish cordial relations, is recognised as an established and important part of doing business and it is not the intention of the Act to criminalise such behaviour."
Examples given by the SFO include buying breakfast or lunch for a client, or flying a group of prospective clients to see your facilities. However, something excessive or lavish, will be a problem, an example given is adding on to a reasonable business trip a month long all expenses paid holiday.
Minimising the risk for Higher Education
In order to minimise risks universities should:
- make clear that bribery is absolutely prohibited;
- review existing policies and procedures to ensure they are adequate;
- effect ongoing risk assessment of the institutions activities (existing or planned), identify potential problem areas, and ensure they are dealt with;
- maintain a register of gifts and benefits given or received, include hospitality as well as financial incentives. A 'de minimis' limit will ensure the register is workable;
- have a gifts and hospitality policy, (and set a de minimis limit);
- consider a corporate hospitality budget;
- provide adequate staff training;
- ensure staff complaints and disciplinary processes deal with bribery related offences;
- ensure student complaints and disciplinary procedures deal with allegations of bribery or attempted bribery;
- agreements with third parties should allow for termination if that third party commits a bribery related offence;
- appropriate audit trails should be in place in the finance office.
Institutions should pay particular attention to overseas arrangements, in practice, this is where a number of problems may arise and is a focus of the Guidance.
Conclusion
The Act requires organisations have appropriate and effective anti-corruption procedures and processes. In order to ensure buy-in and compliance from staff and others acting on the Institutions behalf, policies and procedures, including appropriate training programmes must be in place.
For more information, please contact Karen Stephenson on 0117 314 5656.
This article appeared in University News, July 11.
This publication is for guidance only. Reliance should not be placed upon it and nor should action be taken, without obtaining advice in respect of the specific circumstances applicable. We will be pleased to provide such advice or assistance.
