Critics Say Bribery Act Cripples Businesses from Competing Abroad; Government to Soften Tight Provisions

Jack Humphrey, Regulatory journalist
January 15, 2011 /

Even little offers given by companies to build up good relationships with other firms could be construed as bribes under the current provisions of the Bribery Act, critics warned.

The UK government confirmed that it will review some provisions of the Bribery Act before implementing it on April 2011 to see which areas it could adjust to soften tight regulatory measures on companies competing abroad.

The Bribery Act, which was passed by the Labor government shortly before the end of its term on April 2010, provides that any “offer, promise or give a financial advantage or other advantage, to another person to bring about improper performance of a relevant function or an activity, or to reward a person for the improper performance of a relevant function or an activity” could be construed as bribe, thus an offense.

Legal experts claimed these provisions could put companies that have weak compliance practices to hot seat even if no evidence could show an act of bribery.

PricewaterhouseCoopers reported December 2010 that even Christmas gifts of a gold fountain pen or a case of champagne could mean bribery under the new regulations. Critics added that it does not tolerate even little “facilitation payments”.

The Growth Review of the Coalition government headed by the treasury and business departments will respond to calls of critics to go over the Bribery Act and adjust its impact before its implementation, confirmed the Ministry of Justice.

A Ministry of Justice spokesperson said that however the government wants to eliminate unnecessary obstacles that hamper the growth of investment and economy of UK, it is “clear that corruption should not be considered an acceptable way to win business and the UK stands alongside the Organisation for Economic Co-operation and Development countries, all of whom have criminalised foreign bribery.”

A guidance for organizations on preventing bribery will be published before January ends.

Head of fraud and partner in the commercial disputes practice at international law firm Taylor Wessing, David de Ferrars, said organizations should still brace themselves for the new regulations even while the government reviews the Bribery Act because it does not seem to make wide changes in its provisions.

 

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