The British Bankers’ Association (BBA) has published its own guidance for the banking sector as to how to comply with the Bribery Act 2010. This guidance (entitled “Guidance on compliance: Practical implementation issues for the banking sector”) is intended to cover both the requirements of the Act and Financial Services Authority (FSA) regulatory obligations. It supplements, rather than replaces, the Ministry of Justice’s (MOJ) existing Guidance and that from financial services regulators and prosecutors.
The BBA guidance is intended to form part of a collaborative process between the banking sector and its regulators in combating corruption as Angela Knight, its Chief Executive, makes clear in the foreword:
“In order to ensure the UK’s anti-bribery system is proportionate and effective, an ongoing and frank dialogue between the government, regulators and the private sector will be essential. The BBA was pleased to contribute to the Ministry of Justice consultation on the Act and the accompanying guidance and we will continue to proactively engage with the authorities on behalf of our members so that the views of the banking sector can inform future policy making.”
The BBA guidance recognises that the UK Bribery Act arguably represents “the toughest legal regime against bribery anywhere in the world” and is divided into chapters addressing:
- Overview of the Bribery Act
- Comparison of obligations under the Act and the US Foreign Corrupt Practices Act (FCPA)
- The MOJ’s six Principles
- Specific BBA guidance in relation to Principles 2 – 6
- Additional guidance: Gifts, corporate hospitality and promotional expenditure
- Additional guidance: Incident management and reporting
The focus is on Chapter 4, where advice specific to the banking sector is given in relation to the MOJ’s Principles 2-6. Whilst it is probably fair to say that little of the material will be new to those who are already familiar with the MOJ Guidance, the BBA does highlight a number of crossovers between regulatory regimes, for example noting that under FSA rules a bank’s failure to adequately address the risk of associated persons offering/receiving advantage corruptly could constitute a separate systems and controls failing. The BBA guidance recognises that banks will likely treat financial crime risks together and therefore leverage the same procedures and controls in relation to, for example, bribery and money laundering risks.
When it comes to dealing with corporate hospitality (Chapter 5), the BBA guidance takes a fairly relaxed view, emphasising at 5.2.2-5.2.3:
“The intention of the legislation is to catch hospitality and promotional expenditure which is really a cover for bribing someone. As the government has made clear, it is not the intention that genuine hospitality or reasonable and proportionate business expenditure should infringe the legislation… A bank is therefore unlikely to face prosecution for providing reasonable and proportionate levels of hospitality as part of competing fairly in the international arena.”
As with previous guidance, no attempt is made to suggest limits on hospitality or means by which it can be determined whether hospitality is in fact reasonable and proportionate; an approach involving “common sense and flexibility” is recommended.