UK: the Bribery Bill - the failure to prevent bribery by a commercial organisation

The Bribery Bill received its second reading in the House of Lords earlier this week (read the debate here). The Bill will, inter alia, introduce a new offence: failure by a "relevant commercial organisation" (e.g., a company) to prevent bribery (see clause 7). A defence is available where the organisation can show that it had in place "adequate procedures" to prevent bribery (clause 7(2)). With regard to this defence, Lord Bach, the Parliamentary Under-Secretary of State at the Ministry of Justice, stated during debate (at col. 1087):

We recognise that there has been considerable debate about what constitutes "adequate procedures" for these purposes. As we indicated in our response to the Joint Committee, the Government agree that guidance should be made available to commercial organisations. We propose that such guidance should be available well in advance of the new offences coming into force. Over the coming months we will develop appropriate guidance, drawing on the expertise of business representatives, Transparency International and others. Among other things, we envisage that the guidance will provide illustrative good practice examples of adequate procedures. While guidance will be in place to assist business, the message from the Bill is clear. The payment of bribes, including facilitation payments, is unlawful. If companies pay them in order to gain a business advantage they run the risk of prosecution. Bribery on any scale cannot and should not be tolerated or condoned".

There is, however no duty on the Government to provide such guidance, a point made by Lord Goodhart during debate (see col. 1091). Lord Henley, the shadow justice minister, offered support for the Bill but stated (at col. 1120):

We have concerns about how the Bill is framed and we will probe, for example how Clause 7 will work in practice. An offence of omission is being created for companies that do not prevent bribery. The defence is vague. We will probe what is meant by 'adequate procedures'. One of the core aims of this legislation must be that it is clear and unambiguous. We have heard representations from businesses that seek assurances that they are not going to be left in difficulties because of the change in the law. A great deal may hinge on what sort of guidance is put in place, rather than on the wording of the Bill, and we will certainly be looking at putting down amendments to elicit more information from the Government on this".