Bribery Act and the NHS

16 September 2010

The Bribery Act is due to come into force in April 2011. The Act will make it a criminal offence for commercial organisations to fail to prevent bribes being paid on their behalf.

Organisations which fail to take appropriate steps to avoid (or at least minimise) the risk of bribery taking place will face large fines and even the imprisonment of the individuals involved and those who have turned a blind eye to the problem.

What offences relevant to employers are created under the Act?

The Act will:

• make it a criminal offence to give or offer a bribe, or to request, offer to receive or accept a bribe, whether in the UK or abroad (the measures cover bribery of a foreign public official);
• make it an offence for a director, manager or officer of a business to allow or turn a blind eye to bribery within the organisation; and
• introduce a corporate offence of failure to prevent bribery by persons working on behalf of a commercial organisation.

However, organisations will have a defence against prosecution if they can show that they have adequate procedures in place to prevent bribery.

What is the “adequate procedures” defence?
The Government has indicated that it expects “commercial organisations” to take a proportionate approach in implementing procedures that will tackle the risks that they are likely to encounter. Adequate procedures should include:

• a detailed consideration of the risk areas;
• the creation of policies and practices which are tailored to the areas of particular risk, in order to reduce the likelihood of bribery;
• consideration of the anti-bribery protocols at board level; and
• proper implementation of these policies and practices, including staff training on the risks of bribery and the organisation’s anti-bribery policy and procedures.

Is my Trust a “commercial organisation”?
This is a debatable point and no guidance has been issued by the Government which provides a definitive view. Our understanding is that, at the very least, Foundation Trusts and GP practices will be considered to be commercial organisations for this purpose. While the position in respect of PCTs, LHBs and other organisations is less clear we would suggest that all NHS bodies should err on the side of caution and implement adequate procedures that will protect them from the damage that bribery can do to their reputation, as well as avoiding criminal and other penalties under the Act. The NHS Counter Fraud Service could be a useful source of guidance for most NHS bodies seeking to implement rigorous anti-bribery and corruption measures.

What are the potential penalties for failing to comply with the Act?
The penalties for breach of the Bribery Act are potentially very severe. There is no upper limit on the level of fines that can be imposed. An individual convicted of an offence will face a prison sentence of up to 10 years. If a bribery offence by a staff member is proved to have been committed with the consent or connivance of a director, manager or other similar person, that person (as well as the business) is also guilty of the offence and liable to be prosecuted and fined or jailed accordingly.

Government guidance on adequate procedures subject to consultation
A consultation process to determine what are to be regarded as adequate procedures commenced on 14th September with the final guidance due to be issued in early 2011. However, the Government is encouraging commercial organisations not to wait until the guidance is published before taking action to protect themselves against the risk of bribery.

If you need any advice, training or support on issues raised in this e-shot please contact:-

Andrew Craggs
Partner
andrew.craggs@hilldickinson.com
+44 (0)151 600 8334

David Hill
Solicitor
david.hill@hilldickinson.com
+44 (0) 151 600 8195