The new UK Bribery Act will be brought into force in April 2011.
You may think: so what, I am in Hong Kong? It is not, however, just UK companies that are at risk. Any overseas company carrying on a business, or part of a business, in the UK can commit the offence of failing to prevent bribery, irrespective of where the bribe is paid or received. All of the new offences will have extra-territorial application.
There are four basic offences under the Bribery Act relating to:
(a) Requesting or receiving a bribe;
(b) Offering or giving a bribe;
(c) Bribing a foreign public official; and
(d) Failure by a company to prevent a bribe being paid on its behalf (the new corporate offence).
Hong Kong companies doing business or part of their business in the UK can be prosecuted in relation to bribery offences. Companies, however, will have a defence if a bribe is paid on their behalf, but they are able to demonstrate that they had adequate anti-bribery and corruption procedures in place.
If your business is run out of Hong Kong, but part of it is to be found in the UK, then to make use of the defence, the existence of adequate anti-bribery and corruption procedures may need to be demonstrably in place both in the Hong Kong and the UK jurisdictions in which your business is conducted.
The Long Arm of the Law
Most worrying for overseas entities is the fact that all of the offences will have extra-territorial application. A foreign company which conducts part of its business in the UK can be liable for bribes paid or received outside the UK. Similarly, individuals who are not resident in the UK, but who perform an act or omission in the UK, could be caught. Further, British citizens, holders of BMO passports and others can be held liable and prosecuted in the UK for an act or omission which takes place outside the UK.
The UK Bribery Act should not therefore be ignored by any Hong Kong business which conducts its business in the UK or any part of its business in the UK or whose employees have reason to visit the UK on business.
Who can be liable?
Individuals can be prosecuted for personally giving or receiving a bribe. Different from the Hong Kong legislation where "entertainment" is specifically excluded, hospitality or similar entertainment could be viewed as an advantage for the purposes of the Act. Visiting the UK to entertain clients in the UK may trigger issues for Hong Kong residents or their employers.
Companies will be guilty of the new corporate offence of failing to prevent a bribe being paid on their behalf, unless they have adequate procedures in place. Payments which can be caught could include payments made by subsidiaries, and also delegatees, agents or business joint venture partners even if outside the UK. A company convicted of the new corporate offence can face unlimited fines.
In addition, a company can also be prosecuted for giving or receiving a bribe, if the bribe is paid or received by a senior manager who is the "directing mind and will" of the company.
Company directors, managers and company secretaries can be liable if their company is found to have given or received a bribe and they have "consented or connived" to that act.
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