UK bribery act to affect retailers

A new legislation has been brought in by the Ministry of Justice, which could have significant implications for retailers. The new law makes it a corporate offence to not prevent bribery by those working for your company wherever they be based.

With UK retail sales slow and further expansion plans taking place overseas “UK retailers may become liable under the act for the actions of third parties who provide services to them, wherever they based,” she explained.

“So, for example, if one of your overseas suppliers gives or receives a bribe which is intended to obtain or retain a business advantage for your organisation, you will be guilty of an offence under the act unless you can show that you had “adequate procedures” in place to prevent bribery,’ warns Melanie Wadsworth, retail specialist at a UK law firm.

With retailers so reliant on suppliers and localised operators to run international branches and franchises, a review of procedures is essential. Wadsworth added: “More than ever, it is important for retailers to carry out risk-based due diligence on the third parties who provide services to them and give careful thought to the terms of their agreements with such persons. “Not only should you be establishing clear anti-bribery procedures for your own organisation, but you should be looking to impose these on your contractual counterparties and ensure you have the ability (e.g. a right to audit; termination rights in
the event of corrupt practices being uncovered) to give them teeth.”

A criminal conviction for giving, offering or promising a bribe will now carry a maximum penalty of seven to ten years imprison with an unlimited fine.

Ken Clarke, ministry of Justice, says, ‘I believe the Act will create greater clarity and establish a level playing field, helping to align trading nations around decent standards. It offers a strong hand to any worker or manager from whom illegal payments are solicited – giving them the power to say no. And it protects the reputation of British firms.’