Leaked Government Documents Reveal Weakening of U.K. Bribery Act

Leaked government documents suggest that the U.K. Ministry of Justice has taken measures to radically weaken the jurisdictional reach of the country's new bribery act, which could in turn reduce the work generated by the proposed law for U.S. white-collar lawyers when it takes effect.

A draft copy of the new guidance, first obtained by The Guardian, reveals that international companies with London Stock Exchange listings but no other presence in the United Kingdom will be exempt from prosecution under the act.

"The government would not expect, for example, the fact that the company's securities have been admitted ... to trading on the London stock exchange, in itself to qualify that the company is carrying on a business in the U.K. ... for the purposes of [the act]," the guidance says.

Previously, such companies would have been subject to what has been described as the world's most draconian anti-corruption law, carrying unlimited fines and an increased maximum jail term of 10 years.

"If the reports of what is contained in the final guidance are indeed correct, then it is surprising that the MoJ has been willing to stray from the narrow confines of what it is obliged to provide under Section 9 of the Bribery Act into offering apparent blanket exemptions," says former Serious Fraud Office (SFO) anti-corruption head Robert Amaee, who joined Covington & Burling's London white-collar team in January. "It is by no means certain that there is a sound legal basis or that it is indeed desirable from a policy perspective to say that any non-U.K. registered company trading on the London Stock Exchange but not otherwise operating in the U.K. is, as a matter of course, exempt from the ambit of the term 'carries on a business, or part of a business, in … the U.K.'; a term which after all was left undefined by Parliament."

A spokesperson for the MoJ said: "We cannot comment on draft guidance which is yet to be made public. A common sense approach would mean that organisations which do not have a demonstrable business presence in the U.K. would not satisfy this test. The mere fact that a company is listed for London Stock Exchange purposes may not, in itself, be enough to amount to carrying on a business or part of a business in the U.K. However, it will always be for the courts to decide in individual cases whether a foreign company carries on a business or part of a business in the U.K."

To Continue Reading: Click Here
-------------------------------------------
Source: law.com
By: Chris Johnson