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Indian firms listed in London, but without registered offices or subsidiaries in the country could still face prosecution under the UK Bribery Act 2010, which comes into force later this year.
The director of Britain's Serious Fraud Office, Mr Richard Alderman, has warned foreign companies against “over-technical” interpretations of the law. It follows guidance published last week that indicated that foreign firms without businesses in the UK could be exempt from some of the regulations.
The Bribery Act 2010 creates a comprehensive set of anti-bribery regulations, replacing the existing fragmented system, and was passed by Parliament last year. The law creates a new offense for companies that fail to prevent a bribe being paid on their behalf, and requires firms to put in place adequate procedures to prevent bribery.
The Director has said that if he receives a complaint or allegation from an ethical UK company that has lost out on a contract to a foreign firm which has paid inducements to win the contract he will look into the foreign company's business activity to identify what is its connection with the UK, a spokesperson for the Serious Fraud Office told Business Line in an email.
Even if the firm did not have a registered office or subsidiary in the UK, the SFO would examine whether the firm had activity in the UK to its benefit or service.
He would consider whether the evidence of “some activity” could reasonably persuade a court and whether it was in the public interest for him to bring a prosecution, the spokesman added.
The Government anticipates that applying a common sense approach would mean that organisations that do not have a demonstrable presence in the United Kingdom would not be caught, says the much anticipated guidance on Section 7 of the UK Bribery Act 2010, which deals with responsibilities of companies to prevent bribery.
The guidance has been heavily criticised here in the UK, with investors and corruption watchdogs arguing that any exemptions would drastically weaken the new law, and disadvantage British firms that are subject to all the regulations.
The final decision of how to interpret the law will rest with the courts. However, the Serious Fraud Office says it's eager to hear from foreign firms.
Says the spokesperson, “A key message from (Mr Alderman) is that if they have any uncertainties about their position, or whether they are uncertain if they have adequate procedures to prevent bribery within their organisation he wants to hear from them.”
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