Bribery Act faces fresh delay

The government has delayed the implementation of the Bribery Act, providing the SME community a more realistic timescale to deal with its tough new rules.

Justice secretary Kenneth Clarke confirmed the government would review the legislation as it stands and publish new guidance on implementation.

There will then be at least three months before businesses will be required to comply – pushing the new implementation target date into mid-Summer on from the original April date.

A Ministry of Justice spokesperson told AccountingWEB.co.uk: "We are working on the guidance to make it practical and comprehensive for business. We will come forward with further details in due course".

The Institute of Chartered Accountants of Scotland (ICAS) welcomed the news after last month issuing a policy statement urging the government to give businesses a more realistic timescale.

The extra time will remove areas of uncertainty for businesses operating under the new principles and will allow SMEs to get their policies and procedures in place to bed in the new legislation.

Jonathan Middup, fraud investigations and disputes services partner at Ernst & Young, said: "The delay in the implementation of the Bribery Act gives business some more time to raise the quality of control environments allowing for a more structured and planned change.

“However, this should not be an excuse for businesses to delay taking action. Cases already prosecuted in the UK reinforce that there is a raised expectation that business should be eradicating bribery and corruption now."

James Barbour, director of Technical Policy at ICAS, added: “A delay to at least the summer will greatly assist organisations and help the business community and government work together more harmoniously.

“Many larger businesses, particularly those who operate overseas, are better placed to review their policies and procedures and will already be doing so. It is the smaller and owner-managed businesses that are not as familiar with the new offence of the failure of commercial organisations to prevent bribery and need more time to understand how the new law fits into their business.” 

The Bribery Act will consolidate existing laws on bribery and reform criminal law to create a set of specific offences designed to combat bribery in the public and private sectors.
 

Further reading

The Bribery Act: What is a gift too far?

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OECD fraud expert takes a dim view

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UK companies could face an international blacklist as a result of the delay, according to our sister site HRZone.co.uk.

Mark Pieth, chairman of the Organisation for Economic Co-operation and Development’s (OECD) anti-bribery group told the Guardian he was “disappointed and concerned” about the delay and that patience among other industrialised nations was “running out fast”. The last Labour government passed the Act only after protracted holdups.
 
“This move will hurt the competitiveness of British industry at a moment when it is most vulnerable. Allowing companies to continue to generate business by bribery actually weakens their competitive clout as they become dependent on illegal means,” Pieth said.
 
He added that the OECD had already threatened to blacklist British companies if they remained under-regulated. This happed after a highly critical UK inspection in 2008 that was triggered when a corruption investigation against arms company BAE was terminated by the Labour government.
 
“Competitors are getting ready to take robust action against the UK in the light of continued lack of compliance with international law,” Pieth said, adding that “the new [UK] law is by no means stricter than the laws of other OECD member states”.