On 20 May 2022 the UK Government published guidance on reducing the risk of bribery and corruption in trade which can be found here. In this blog we consider the key recommendations and how organisations can implement these.
The Foreign, Commonwealth & Development Office and Department for International Trade have taken the interesting step of issuing guidance for an international audience on what UK companies require to do to comply with the Bribery Act 2010. Readers will remember that the 2010 Act not only prohibits bribery and corruption, but also criminalises the failure to prevent bribery by associated persons.
The Government puts it this way:-
"When dealing with UK trading partners you may need to prove that your business and supply chain is free from bribery and corruption."
Identifying bribery and corruption
The guidance makes clear that corruption can take various forms. A "bribe" needn't be financial. An organisation may be asked to make low-value facilitation payments to obtain customs clearance or a licence. An official may seek extravagant gifts or hospitality during a tender process.
The UK Government will expect an organisation to closely question a potential business partner if it:
- refuses to provide documentation, sign contracts or take part in due diligence; or
- asks for undocumented fees, cash payments or donations to overseas accounts or charities.
Organisations should consider how it can incorporate policies and procedures which allow these issues to be recorded and further investigations made. This may include revising current due diligence procedures.
Reducing risk of bribery and corruption
The guidance recommends four key steps organisations should take to avoid bribery and corruption:
1. Assess risks
Make a list of the risks of bribery and corruption in your country, your sector, and among your suppliers and employees.
This may involve updating or revising due diligence and onboarding procedures to ensure that the risks you have identified are captured and appropriate follow up enquiries made.
2. Research potential trading partners
The guidance contains links to OECD, World Economic Forum, and Transparency International resources which can assist in evaluating potential business partners and deals.
3. Train your people
Training can be a crucial strength, or weakness, when a company seeks to present a defence that it had "adequate procedures" in place designed to prevent bribery from occurring.
The guidance contains links to free training resources provided by the UN, Transparency International and others. These resources can be a very helpful starting point but it's important to ensure that the training is relevant to the risks faced by an organisation and its people.
4. Keep records
The guidance emphasises to an international audience the value of keeping records of anti-bribery and corruption training and procedures, and being able to demonstrate these to UK companies when seeking to develop trading relationships.
While this guidance is primarily aimed at an international audience it's also a useful reminder of the anti-bribery and corruption standards which the UK government will expect of corporates and other commercial organisations operating in the UK. Whether you are a UK business, or an international organisation seeking to work with UK businesses, it's a great way to benchmark your current approach.
Please do get in touch with us if you would like to discuss any of the issues in this article.