UK Bribery Act 2010: A 10-Year Anniversary

September 1, 2020
bribery act 2010, ISO 37001, FCPA, anti-bribery, anti-corruption, Pakistan, United Kingdom, United Arab Emirates, Malaysia

Ten years after passage of the UK Bribery Act 2010, what effect has it had on compliance and business in the UK and beyond? And how have business leaders responded to its guidelines? In this article, we’ll look at how this groundbreaking legislation has helped shape the effort to prevent and prosecute bribery offences, as well as areas in which some critics feel the law has come up short.

 

History of the UKBA: Responding to a need

When the Parliament of the United Kingdom passed the UK Bribery Act in 2010, the intention was to replace previous common law provisions against bribery. Up until that time, anti-bribery law in the UK was mostly a patchwork of provisions including the Public Bodies Corrupt Practices Act 1889, the Prevention of Corruption Act 1906, and the Prevention of Corruption Act 1916. These obviously outdated laws were considered inadequate for dealing with bribery and corruption in modern terms. The Bribery Act UK 2010, by comparison, legislated crimes and provided for punishments in cases of bribery and corruption, notably:  bribery of foreign officials; bribery against private businesspeople; “facilitating payments”; negligence and failure of an entity to prevent bribery on its behalf; and strict punishments for both entities and individuals convicted of such crimes. These include a maximum 10 years imprisonment, unlimited fines, and allowing for the confiscation of property deemed as proceeds of a crime.

The scope and reach of the Bribery Act extend far beyond the borders of the UK. If an individual or organisation anywhere in the world is alleged to have committed a crime of bribery and corruption in business linked to the UK, they can be prosecuted under the UKBA. Needless to say, this stringent law garnered attention when it was passed, and since then various other countries (including Malaysia, for example) have modelled new laws or provisions after some of its elements.

So, 10 years on, where do things stand with the UKBA? Is it considered a success, or still a work-in-progress? Read on to decide.

 

Assessing the impact of UKBA

The UK Bribery Act 2010 doubtless has influenced change in business practices, including requiring increased integrity due diligence. Business owners, directors and executives saw a “sea change” in how they address bribery and corruption risk, with tough decisions being made on suppliers, contractors and third-party partners who, under the provisions of the Bribery Act, suddenly represented more potential risk than positive upside.

Enforcement under the Bribery Act UK 2010 has certainly helped drive its effectiveness. Financier Worldwide noted that last year was a “key year of development for the legislation,” but the article noted that many cases last year still ended in in deferred judgment or deals with the alleged offenders rather than convictions and prosecutions. This is also examined in the Law360 article, “Reflections on the UK Bribery Act 10 Years on”: “Commentators are pointing fingers at regulators and their inability to prosecute cases of bribery successfully, and to put the criminals behind bars. Instead, enforcement agencies are happy to agree to deferred prosecution agreements. Large fines are then paid and monitors are appointed for a period of time (or not), and life goes on — a kind of expensive slap on the wrist, with massive fees going to lawyers and consultants.”

Other critics have weighed in, as well. The Times article “Worth of the Bribery Act Under Scrutiny” states that “Fanfare greeted the Bribery Act when it was enacted ten years ago; anniversary celebrations over the past few days have been much more muted. The legislation is viewed by some people as a landmark that cracked down on corporate corruption and forced individual executives to take responsibility for ethical behaviour and by others as a missed opportunity that has generated few convictions and had little practical effect.”

 

For businesses, being proactive is critical

Many business leaders, however, probably see things a bit differently. While the punishment side of the Bribery Act UK 2010 has perhaps left something to be desired, the cloud of investigations and the cost of litigation can often serve as an effective deterrent to committing (or turning a blind eye toward) bribery and corruption. There is no argument about the Serious Fraud Office’s engagement in following tips and opening investigations, similar to an increased commitment in the U.S. to investigate alleged Foreign Corrupt Practices Act (FCPA) violations. It’s part of the new landscape of compliance and enforcement that the public, and many governments, now expect.

This is one reason, as described in CRI Group’s “Why Financial Services Firms Need ISO 37001 ABMS?” featured on Lexology, that companies are being more proactive to avoid running afoul of the SFO and the UK Bribery Act in the first place. The investment in compliance standards like ISO 37001 Anti-Bribery Management System represent a modest up-front cost to prevent potential massive costs in the future – litigation, fines, loss of business and loss of reputation. “ISO 37001 ABMS is designed to help global organisations implement an anti-bribery management system (ABMS), as the standard specifies a series of measures required by the organisation to prevent, detect and address bribery, and provides guidance relative to that implementation … this is a critical layer of protection that provides both anti-bribery controls and a system for compliance with various anti-corruption legislation, such as the FCPA and UK Bribery Act. The UK Bribery Act’s adequate procedures requirement dictates that all companies need to have ongoing monitoring, training, surveillance and risk assessments – ISO 37001 ABMS is designed to fulfil these criteria and more.”

 

Conclusion

Where will the UK Bribery Act 2010 be in the next 10 years, and how will it be regarded? It’s impossible to say for sure. But it seems inevitable that its provisions will continue to be among the top considerations for companies and individuals doing any kind of business linked to the UK, for risk of running afoul of the law. Organisations need thorough anti-bribery anti-corruption controls as well as integrity due diligence processes. For most, the possibility of unlimited fines and prosecution is enough to drive that reality home.

Engage ABAC Certification’s expert ISO 37001 Anti-bribery Management Systems training and certification, and be proactive in preventing and detecting bribery at all levels of your organisation. ABAC Certification’s experts are skilled in developing and implementing programs tailored to each client’s needs and requirements. Learn more about ABAC Certification today.

 

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