The further delay of the implementation of the Bribery Act by the Ministry of Justice in order to review its guidance raises the issue as to whether the time for the coming into force of this Act will ever be right.
Most fair-minded people will be delighted to know that the UK will have the most far-reaching anti-corruption legislation in the world, but many will admit that the economic climate in which businesses will have to implement this legislation is far from ideal.
At a time when the British economy is trying to move slowly out of recession, British businesses now have to cope with the additional costs of implementing strict anti-corruption procedures.
Won’t British business interests be disadvantaged compared to foreign competitors who are not required under their local laws to run up such compliance costs? Couldn’t these compliance requirements even deter foreign business from setting up operations in the UK at a time when foreign investment is needed most?
Despite this criticism, John Cridland, Director-General of the Confederation of British Industry (‘CBI’), considers that this “temporary delay will strengthen the Bribery Act by providing firms with the clarity and confidence they need to do business abroad. Britain needs to be free to compete internationally while meeting legal an ethical standards”.
There is no doubt that the Bribery Act will ultimately be implemented. Although it is not possible to say at this stage when it will precisely come into force, it is indeed difficult to see how this piece of legislation, which received full cross-party support and was based on a Law Commission report, could ever be amended or even watered down.
How the government and prosecuting authorities will enforce the Act is yet to be seen and remains unknown. Richard Alderman (the Director of the Serious Fraud Office) announced on 9 February 2011 that in addition to the Section 9 Guidance of the Ministry of Justice, the Serious Fraud Office (‘SFO’) (the main prosecuting authority for serious fraud and corruption offences in the UK) will publish on the same day another document to be called “Directors’ Guidance” which will “discuss the detail of various offences and what needs to be proved”. It will also set out the public interest factors that prosecutors will need to take into account in deciding whether to prosecute. According to the Director of the SFO, this guidance will “shed a lot of light on some of the issues raised concerning facilitation payments and hospitality”.
However recent cuts announced by the UK Treasury Department to the budget of the SFO (which will be cut from £34 millionin 2011 to £29 million in 2014) cast doubt on the vigour that the SFO will be able to apply towards anti-corruption.
Further, Jonathan Russell reported in the Daily Telegraph that the Justice Minister Lord McNally said in reply to a question in the House of Lords (the UK’s upper House in its Parliament) that the SFO will only “have an additional cost of £2m for enforcement of the new offence of failure by commercial organisation to prevent bribery”.
To add to this problem, Alex Spence reported in the Times that the SFO could be reorganised and absorbed by a new agency called the National Crime Agency (‘NCA’) which would take over the handling of complex fraud cases.
It is likely though that fighting fraud and corruption will not be the top priority of the NCA, which will also have to focus on tackling organised crime and terrorist networks.
Perhaps the way forward for the Act to remain a deterrent and to encourage Defendants to come forward and self-report would be for the government to follow Lord Goldsmith’s (the former Attorney General in the UK) proposal to allow the SFO to enter plea bargaining in bribery cases, but this proposal would require the government to legislate.