The UK Bribery Act which comes into effect on July 1st will be undoubtedly more strict than the US equivalent, the Foreign Corrupt Practices Act, as it prohibits any form of facilitation payments. The act illustrates a considerable tightening in anti-corruption legislation in the UK.
The UK legislation differs from the FCPA in three fundamental aspects; bribery of private individuals and companies, corporate failure to prevent bribery and facilitation payments. Facilitation payments are bribes made with the intention of quickening the performance of a function or activity (to which the payer is legally entitled) of a public official in everyday governmental activity, such as the issuing of permits or licenses, and not to acquire or maintain business. While in some countries it may be common to provide small unofficial payments in certain situations, in most countries the practice is illegal.
These payments are a troublesome area for the Organisation for Economic Co-operation and Development (OECD) convention as it does not validate facilitation payments as an offence. The aim of the convention is to establish binding standards and measures to criminalise the bribery of public officials in international business transactions. In 2009, the OECD council published a recommendation to all member countries urging them to revise the method of how they tackle this issue and to encourage them to prevent their domestic companies to use facilitation payments.
In the UK facilitation payments abroad are criminalised whereas in the US such payments abroad are not prohibited and there is no upper limit for them. With the introduction of the Bribery Act, UK companies will have to be extremely vigilant in their business relations with countries where facilitation payments are more commonplace. The following link provides further information on the legal status of facilitation payments from country to country http://www.business-anti-corruption.com/country-profiles/.
An example of a facilitation payment which could result in a section six offence (bribery of a foreign official) would be slipping an immigration official money in order to speed up the process of obtaining a visa. The person who makes this payment does not consider this to be overly corrupt or dishonest. This type of payment can also result in a section one offence (bribing another person) which could render the entire business accountable under section seven, which is failure of commercial organisations to prevent bribery.
As with the old law, the Bribery Act does not provide any impunity for such payments. However, the Government does acknowledge the challenges that corporations come up against in certain parts of the world and within market sectors. The total removal of facilitation payments is recognised at both national and international level as a long-term goal, which will require social and economic progress as well as continued adherence to the law, especially in regions of the world where the problem is more widespread.
Co-operation between governments, international bodies and the anti-bribery lobby is essential in the fight against corruption. In addition, individual organisations will have an integral role to play in terms of how they tackle bribery prevention. Within the six principles of the Bribery Act, the second principle of top level commitment states that in large multi-national corporations the board should be responsible for setting bribery policies. They should assign management to draft, operate and control bribery prevention measures and keeping them under constant review. Good corporate governance policies, which if enforced appropriately, can help businesses combat the risk of facilitation payments.
