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Part 1: The UK Bribery Act- the FCPA on Steroids!

Part 1: The UK Bribery Act- the FCPA on Steroids!

May 21, 2012

In this first entry, I will outline some key implications of the UK Bribery Act 2010 that may affect all businesses in the USA and beyond.

With the advent of the UK Bribery Act there is an increasing need for US multi·national businesses and indeed US SME’s to understand where the Brits are coming from. The real danger is that established US firms believe that as they have lived and grown up with the rigours of the FCPA. and have become compliant with this law over time, that they must be therefore compliant with the UK Bribery Act …but this is not so.

There are fundamental differences between the FCPA and the UK Bribery Act that I will highlight in this blog over the coming weeks . Some of these differences may be cause for concern for any executive tasked with the oversight of operations in a country or region where his organization has a “jurisdiction hook” to the UK. Some would say that the said “jurisdiction hook” is too far reaching and draconian, but hey, we are British don’t you know and we are used to that stuff!

The Offences Created by the UKBA.

Section 1 of the Act states it is an offence to bribe any person and Section 2 of the Act states that is an offence to be bribed. Thus the offences cover both the GIVER and the TAKER.

As to be expected, Section 6 of the Act deals with the bribing of Government Officials and is similar to former statutes and the FCPA.

Section 7. however, is a whole new ball game and creates a corporate offence .
A corporate offence is committed by a relevant commercial organisation (RCA) if a person associated with the RCA bribes another intending to obtain or retain business for the RCA, or to obtain or retain an advantage in the conduct of business for the RCA.

However, the RCA can defend itself by proving that it had in place “adequate procedures” designed to prevent persons associated with the RCA from undertaking such conduct. Thus there is a new corporate offence for the failure of a commercial organization to prevent bribery.

So what does all this mean for us businesses?

As with all things British, the UK Bribery Act is written so as to allow the reader to register his or her own disbelief, become fearful and believe this whole thing is downright nonsensical all in the same wondrous moment! Much of the Act provides new phrases such as in section 7 above- “adequate procedures”- but then fails to define them. Visit this blog again soon because in the next post, I will attempt to help define these new concepts.

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