Guidelines on the UK’s new Bribery Act are about to be published by the Ministry of Justice. We can therefore expect this piece of legislation to come into force within 3 months. Businesses everywhere – not just in the UK – need to take note, as this anti-corruption law applies to any companies doing business in Britain and targets bribes given or accepted anywhere in the world, whether in the public or private business sectors. During this 3 month period, companies affected by the Act – and this means every company or corporate group that does business in the UK – are expected to “put their house in order” in terms of their internal anti-corruption compliance programmes. Those who don’t, risk prosecution under the extra-territorial and far-reaching anti-bribery laws pushed through Parliament last year in the dying hours of the old Labour government. Despite reservations expressed by the current Conservative-Liberal coalition government, about the breadth and exact meaning of the new law, as well as its potentially severe impact on UK business at a delicate time in the nation’s economic recovery, it looks as though it will enter into force this summer, and companies all over the world –  including in the Czech Republic cannot afford to ignore it. Under the Act, UK prosecutors will be empowered to investigate, prosecute and convict companies and their senior managers for giving or accepting bribes in the public or private business spheres anywhere in the world. | The failure of a corporate organization to prevent bribery within its business structure is also an offence punishable by unlimited fines. The only link a company need have with the UK for the law to apply to it, is for it to do business there. Failure to prevent bribery within your business organization can result in criminal liability of your company carrying unlimited fines. The concept of bribery is no longer restricted to paying off foreign public officials to secure government contracts; wholly private business transactions influenced by bribery are equally targeted by the new legislation. Nor does the UK Bribery Act tolerate facilitation or “grease” payments (elsewhere regarded as a widespread but tolerable corrupt practice) which are used to smooth or speed administrative procedures that have to happen anyway. Moreover, lavish corporate hospitality, which is disproportionate to, or largely unconnected with, the business deal presented as the justification for the expense, may now be a thing of the past. A defence of “adequate procedures”, meaning an appropriately tailored and management-backed internal anti-bribery compliance programme (including clear rules, procedures, training and whistle-blowing channels) will assist companies caught by the new rules. Whilst all companies, large and small, are potentially affected, complex multi-nationals and certain industry sectors may be more particularly exposed, such as those frequently involved in public procurement tendering and companies in the pharmaceutical, construction, energy, aerospace and defence industries. Those incorporated offshore in territories still under British influence (Bermuda, Caymans, Channel Islands, British Virgin Islands, Isle of Man) should also beware, as the government has declared its intention to secure the passing of similar legislation in those jurisdictions. | US Foreign Corrupt Practices Act requirements will not be sufficient. The new UK law goes further in its definition of bribery and territorial reach. Internal compliance programmes demonstrating your organization has “adequate procedures” in place to prevent bribery, are a defence to allegations of corruption made against your company. In summary if you do business in the UK, it would be prudent to take a critical look at your business practices, because corruption is everywhere (under the new definition) and it‘s not clear on which side of the law any of us stand.
Katie Schoultz is a partner at Schoultz & Partners, Law Office, Prague, specializing in anti-bribery compliance advice and internal corporate programmes. 
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