SGS - Combating corruption abroad

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Following on from the Anti-Bribery Bill published in March 2009, the UK Government issued a new Foreign Bribery Strategy in January 2010, setting out objectives and priorities to combat corruption abroad by UK companies and individuals.

“International corruption remains a worldwide problem that comes at both a human and business cost and the fight against bribery cannot be an optional extra or a luxury to be dispensed with in testing economic times.”

HM Government UK Foreign Bribery Strategy, January 2010

The new strategy identifies four strategic objectives which will lead government policy and actions over the next three years, up to the next scheduled OECD review of the UK in 2012.

Objective 1: Strengthening the Law

The government remains committed to the introduction of a new Bribery Act within this parliament. 

As it stands, the Bill will:

* Create two new general offences of bribery and being bribed (applicable to all personnel, not just public officials)
* Introduce a new specific offence of bribing foreign public officials
* Create a new specific offence for companies and partnerships that fail to prevent bribery by persons performing services on their behalf
* Ban the payment of facilitation payments by UK citizens
* Define specific penalties, including up to ten years’ imprisonment and unlimited fines

There is, however, a specific commitment in the new Strategy to the provision of approved Government guidance to assist companies with respect to both fulfilling their new legal commitments and understanding the “adequate procedures” defence which is explicitly provided for within the proposed legislation.

Objective 2: Supporting Ethical Business

The Government’s aim in this area is to understand better the bribery risks in specific markets and sectors and support “remedial action, self-referral and negotiated settlements”. The objective is to ensure that companies that behave ethically will not find themselves disadvantaged.

To this end, the Government will be providing information and resources to help companies avoid bribery risks (both within the UK and through in-country consular services) and creating a framework which will encourage selfreferral by companies that may have infringed the law.

Objective 3: Enforcing the Law

Enforcement action is driven mainly through the Serious Fraud Office (SFO) and the City of London Police Overseas Anti-Corruption Unit (OACU). The SFO is leading on and
encouraging self-referral and has, for the first time, set out guidelines with respect to both “plea discussions” and the management of corporate self-reporting.

Having increased their case load significantly through 2009, the OACU is now appearing to co-operate ever more closely with overseas agencies to co-ordinate investigations. For instance, in January 2010, the arrest of 21 arms industry executives by the US Department of Justice in Las Vegas was concurrent with the execution of seven warrants on the same companies by the OACU in the UK.

Objective 4: International Co-operation and Capacity Building

The objective here is to “level the playing field” for ethical companies through supporting the fight against bribery in overseas countries. In particular, there will be a focus on supporting African anti-corruption initiatives as well as efforts to strengthen international legal frameworks.

Overall, the impact of the new strategy is going to be simple: more investigations, more prosecutions and more convictions. Whilst there will be support for companies seeking to address bribery issues, those that continue to ignore the issue risk damage to both their corporate finances and reputations and expose their executive managers to significant personal liability.

SGS now provides a range of services for companies seeking to manage or mitigate their bribery risk; from training and consultancy, through supply-chain risk assessment up to full-scale anti-bribery certification.