Whilst we await the coming into force of The Bribery Act 2010 (“Act”) with baited breath, in the meantime, it is interesting to see the attempts to change the scope of the Act.
There has also been no shortage of various interest groups calling for a delay in the Act’s implementation to allow them to put into place appropriate compliance procedures. Many commentators expect the government guidance to be released in relation to the Act soon and there is a hope that the Act’s applicability is tempered by such guidance.
The Act’s principal prohibitions relate to:
- paying bribes;
- receiving bribes;
- the bribery of foreign public officials; and
- the failure of commercial organisations to prevent bribery.
The Act has a wide territorial scope. In relation to the first 3 prohibitions, in addition to the offences committed in the UK, the courts will have jurisdiction over offences committed abroad where the person performing them has a ‘close connection’ with the UK.
In relation to the fourth prohibition, where an organisation carries on a business activity in the UK (wherever in the world it may be incorporated or formed), the courts will have jurisdiction regardless of where the offence is committed. Therefore, a global organisation with a small office in the UK could fall foul of the Act if it fails to prevent bribery.
A recent report indicates that the long awaited guidance on the Act being drafted by the Ministry of Justice seeks to limit its extra-territorial scope. There is suggestion that there would not be an expectation for companies formed overseas with merely a listing on the capital markets in the UK to be deemed to be carrying on a business in the UK for the purposes of the Act.
Unsurprisingly, there is no guidance on what would constitute carrying on business in the UK for the purposes of the Act. However, an analogy can be drawn with the concept of carrying on regulated activities in the UK for the purposes of the Financial Services and Markets Act 2000. Guidance from the Financial Services Authority (“FSA”) in its Perimeter Guidance Manual states that:
“A person based outside the United Kingdom may also be carrying on activities in the United Kingdom even if he does not have a place of business maintained by him in the United Kingdom (for example, by means of the internet or other telecommunications system or by occasional visits).”
Although the FSA contemplates that there are situations where a person could be deemed to be carrying on business in the UK without a physical presence, it is unclear whether this would apply in the context of the Act. No doubt arguments can be made as to whether an organisation is carrying on a business activity in the UK where it has a limited physical presence, but it appears that this will one of those cases that will judged on its particular circumstances.