An introduction to the UK Bribery Act
The United Kingdom’s Bribery Act (2010) is a landmark piece of legislation enacted by the Westminster Parliament that seeks to repeal and replace a series of fragmented statutes that previously criminalized bribery in relation to public bodies. Since the Bribery Act came into force on 1 July 2011, organizations having any nexus to the United Kingdom—whether in the form of contractual ties, the operation of subsidiaries/branch offices, or otherwise—have been required to monitor their activities in tandem with the far-more frequently utilized U.S. Foreign Corrupt Practices Act (“FCPA”) for any evidence of quid pro quo misconduct, whether occurring in the public sector or in the private sphere.
Main offenses under the Bribery Act: Bribery, accepting a bribe, and failure to prevent commercial bribery
Section 1 of the Bribery Act operates to criminalize an instance where a person offers, promises, or gives a “financial or other advantage” to another person under two (2) principal circumstances—the first being where the person intends the advantage to bring about an improper performance of a relevant function or an activity by another person to reward such improper performance (Section 1(2)); and the second being where the person knows or reasonably believes that the acceptance of the advantage offered, promised, or given ipso facto constitutes the improper performance of a relevant function or activity (Section 1(3)).
While “financial or other advantage” is undefined, a plain language construction of the statute in question serves to put both individuals and entities on notice that the Bribery Act’s prohibitions likely extend to non-pecuniary advantages as well, offered in connection with the proscribed activity. Notably, pursuant to Section 1(4) of the Bribery Act in relation to the first scenario, it is irrelevant whether the person to whom the advantage is offered, promised or given is the same person who performs, or has performed the function or activity concerned. Moreover, under both of the instances mentioned above, Section 1(5) of the Bribery Act makes it clear that the involvement of a third party in the offering of an improper advantage does not operate to relieve the person initiating the scheme of criminal liability. In other words, the use of third-party intermediaries and agents to facilitate conduct proscribed under Sections 1(2) and (3) is still criminally sanctionable under the aegis of the Bribery Act.
As a corollary to Section 1, Section 2 of the Bribery Act criminalizes certain conduct associated with accepting a financial or other advantage. Specifically, Section 2(2) renders a person subject to criminal liability where the person requests, agrees to receive, or accepts a financial or other advantage and intends that a relevant function or activity should be performed improperly. Section 2(3) criminalizes an instance where a person requests, agrees to receive, or accepts a financial or other advantage and that request, agreement, or acceptance itself constitutes the improper performance of the person of a relevant function or activity. Pursuant to Section 2(4), criminal liability is also possible where the person requests, agrees to receive or accepts a financial or other benefit as a reward for the improper performance of a relevant function or activity by either the person in question or a third party. Finally, Section 2(5) criminalizes instances where a person, in anticipation of or in consequence of that person requesting, agreeing to receive or accepting a financial or other advantage, improperly performs a relevant function or activity and where a third party, at the requestor’s behest, or with the requestor’s assent or acquiescence participates in the same activity. Akin to Section 1, the mere fact that the person agrees to receive the improper advantage directly or through a third party or by another person at the person’s specific request, assent or acquiescence does not absolve the original requestor from criminal liability. Similarly, it is irrelevant whether the advantage is, or is intended to be, for the benefit of the requestor or another person. Under Section 2(3) through (5), the subjective belief of the requestor concerning the legality of the performance of a function or activity that is rendered illegal by virtue of the Bribery Act is also irrelevant for the purposes of establishing culpability. Section 2(8) applies the same lack of knowledge stipulation to cases where a third party is performing the function or activity in question.
Section 6 of the Bribery Act specifically criminalizes the act of foreign bribery by persons subject to the United Kingdom’s jurisdiction. Pursuant to Section 6(1) a person “bribes” a foreign official if the person’s intention is to influence the foreign official in his or her official capacity. To be guilty of a crime under Section 6(1), the person charged must have intended to obtain or retain business or an advantage in the conduct of business. A person is criminally liable under Section 6 if, and only if, (a) the person directly or through a third party, offers, promises, or gives any financial or advantage to the foreign official, or to another person at the foreign official’s request, or with that official’s assent or acquiescence; and (b) the foreign official is “neither permitted nor required by the written law applicable to the foreign official to be influenced in his or her capacity as a foreign public official by the offer, promise or gift.” (Section 6(3)).
Finally, Sections 7, 8, and 9 of the Bribery Act provide a means by which a “relevant commercial organization” may be guilty of an offense to the extent a person associated with the commercial organization bribes another person, intending to obtain or retain business or secure a business advantage for the commercial organization. Pursuant to Section 7(2), a commercial organization has a viable defense if it can demonstrate—on the balance of probabilities—that it had in place “adequate procedures designed to prevent persons associated with [the commercial organization] from undertaking such conduct.” Section 7(5) broadly defines “relevant commercial organization” as including: (1) a body incorporated under the law of any part of the United Kingdom and which carries on a business (whether there or elsewhere); (2) any other body corporate (wherever incorporated) which carries on a business, or part of a business, in any part of the United Kingdom; (3) a partnership formed under the law of any part of the United Kingdom and which carries on a business (whether there or elsewhere); or (4) any other partnership (wherever formed) which carries on a business, or part of a business, in any part of the United Kingdom.
Notably, Section 9 of the Bribery Act requires the Secretary of State to publish guidance concerning procedures that relevant commercial organizations may put in place to prevent persons associated with them from participating in bribery under Section 7(1). As of the date of this primer, the most up-to-date version of Bribery Act guidance promulgated by the Ministry of Justice is available here.
“Function or activity” relating to bribery
“Functions or activities” that can be improperly performed for the purposes of both Sections 1 and 2 of the Bribery Act encompass: (a) all functions of a public nature; (b) any activity connected with a business; (c) any activity performed in the course of a person’s employment; and (d) any activity performed by or on behalf of a body of persons, whether incorporated or unincorporated. (Section 3(2)(a)–(d)). Along with these parameters, Section 3(1)(b) explicitly provides that the requisite function or activity must also meet the requirements of at least one of the three conditions—A through C—encompassed in the latter portion of Section 3. These conditions include: (1) that person performing the function or activity is expected to perform it in good faith; (2) that a person performing the function or activity is expected to perform it impartially; and (3) that a person performing the function or activity occupies a position of trust by virtue of performing it.
Notably, a function or activity meets the definition of Section 3 even if it has no discernible connection with the United Kingdom and is performed in a country or territory outside of the United Kingdom. In this respect, Section 12(2) provides that if an act or omission does not take place in the United Kingdom, but the person’s act or omission would constitute an offense if carried out there and the person has a “close connection” to the United Kingdom, an offense may still be committed. For the purposes of Section 12(4), “a close connection with the United Kingdom” is defined as: (a) a British citizen; (b) a British overseas territories citizen; (c) a British National (Overseas); (d) a British Overseas citizen; (e) a person who under the British Nationality Act 1981 was a British subject; (f) a British protected person within the meaning of that Act; (g) an individual ordinarily resident in the United Kingdom; (h) a body incorporated under the law of any part of the United Kingdom; and (i) a Scottish partnership.
An individual found guilty of an offense under Sections 1, 2 or 6 of the Bribery Act on summary conviction faces the potential for imprisonment for a maximum term of six (6) months, an unlimited fine, or both. Conversely, an individual convicted on indictment faces the potential for imprisonment for a maximum term of ten (10) years, an unlimited fine, or both. Additionally, commercial organizations convicted of an offense under the aforementioned sections face the potential for an unlimited fine under either summary conviction or conviction on indictment. Finally, a commercial organization convicted of an offense under Section 7 (pertaining to failure to prevent commercial bribery) likewise faces the potential for an unlimited fine. While cases brought under the auspices of the Bribery Act since its entry into force have been relatively few and far between, it is important to note that a rise in multilateral commitments to combat bribery and corruption are likely to result in an uptick of enforcement actions involving the Bribery Act in the near future. Accordingly, all organizations with any connection to the United Kingdom should heed the Ministry of Justice’s guidance concerning appropriate mitigation measures.