The anti-bribery laws of many jurisdictions (notably the Foreign and Corrupt Practices Act in the US and the Bribery Act 2010 in the UK) will require a business to ensure that no part of its operation, in any jurisdiction in which it operates, commits bribery offences. The UK legislation imposes liability for any bribery offences committed anywhere in the world by any business that has a connection to the UK, irrespective of whether or not that business is primarily based in the UK. Business deals done with executives from the UK can also come within the scope of UK legislation regardless of who the other parties are. Proper controls must be put in place to guard against any potential liability.
Key considerations include the following:
* To what bribery legislation is the business already subject in its existing jurisdictions?
* What policies or other controls need to be put in place to ensure compliance with this legislation by the business' new operation?
* What new legislation will be imposed on the business in the new jurisdiction?
* Will this new legislation also require the existing business to alter or tighten its practices in the jurisdictions in which it already operates?
Transparency International (TI) provides data on a country-by-country basis aimed at assessing the prevalence of corruption within a jurisdiction and any recent steps taken to improve the situation. TI's Corruption Perceptions Index is available online and measures the perceived levels of corruption in 177 countries and territories around the world. The Index ranks and heat maps those countries in order of perceived corruption from those regarded as the least corrupt to those perceived to be the worst. (See our earlier post on whether Transparency International's measure of occupation is still valid).
Other sources of useful information include the CIA's Factbooks and the Business Anti-Corruption Portal at business-anti-corruption.com which profiles the business corruption risk in 103 countries around the world.
A business should not wait for corruption issues to be raised by a local lawyer – local lawyers may not be aware of the far-reaching scope of the U.S. and UK legislation and therefore may not prioritise these risks as highly as lawyers from the U.S. and UK. Clearly doing business in countries which pose high corruption risks will require greater due diligence and enhanced compliance measures. It will also require proper training of executives doing business in those countries to ensure their understanding of the need for an extra investment in compliance. That training cannot be a tick the box exercise. A proper risk-based program using online and face-to-face training is essential.
Jonathan Armstrong is a Partner at Cordery. He qualified as a lawyer in the UK in 1991 and has focused on technology, risk and governance matters for almost 20 years. He is a Fellow of The Chartered Institute of Marketing and has spoken at conferences in the U.S., Canada, China, Brazil, Singapore, Vietnam and across Europe. Cordery is a trading name of Cordery Compliance Limited which is authorised and regulated by the Solicitors Regulation Authority; SRA number 608187. Cordery Compliance Limited is a separate legal entity to Reed Elsevier (UK) Limited trading as LexisNexis.