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How the UK Bribery Act affects UAE companies

UK Bribery Act 2010 could affect UAE companies

The UK Bribery Act generally affects UK residents and citizens but it may affect companies in the GCC in ways they may not be aware of...

October 15, 2012 4:11 by



The UK Bribery Act has been frequently dubbed as the ‘toughest anti-corruption legislation in the world’. Carrying a near-universal jurisdiction, the act carries the ability to prosecute corporations and individuals with ‘any British connection’ regardless of where the crime was committed.

If a company in violation of the act has business dealings or trade with the UK including suppliers, clients and associates, then it will be held liable. The Bribery Act essentially applies to UK Citizens, residents as well as companies established under UK law. But, non-UK companies can also be held liable for a failure to prevent bribery if they do business in the UK.

In the context of the act, a Bribery is defined as ‘occurring when a person offers, gives or promises to give a “financial or other advantage” to another individual in exchange for “improperly” performing a “relevant function or activity”.

At a conference held by the British Business Group to raise awareness on the act, the panelists pointed out that many companies in the GCC tend to believe that the UK Bribery Act wouldn’t affect them but more often than not, it does.

Speaking with Debby Burton-Shaw, a lawyer and Internal Corporate Governance perspective speaker at Trowers & Hamlins Law Firm; Kipp places the UK Bribery Act into context for SMEs and larger corporations in the United Arab Emirates and the GCC.

What is the UK Bribery Act, in brief?

The UK Bribery Act came into force in 2011. It applies to British citizens and people that are ordinary UK residents. It also applies to British companies or partnerships set up in the United Kingdom and other corporations that may not be set up in the country but have business dealings there. It prohibits the giving the receiving of bribes as well as the bribery of foreign public officials.

What constitutes a bribe?

For the Bribery Act, the definition of bribery is very broad. It’s basically any given benefit or inducement – so paying for a luxurious holiday for somebody would be a bribe. Paying for outlandish corporate hospitality, if you were, to say, fly somebody to the Grand Prix in Monaco that could potentially be a bribe, because it’s beyond what the normal standard of hospitality is.

You’d have to look at the current practices of that industry – so it’s on an industry basis – but also on a reasonable basis. I would think anything along the lines of flying people all around the world would be at risk of being excessive.



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1 Comment

  1. Tarek Aziz on October 18, 2012 1:42 pm

    Excellent initiative by the UK government. One should look into the affairs of Barclays Bank’s business in its UAE operations. Lots of skeletons will come out of the cupboard. This will actually help the economy of the UAE in the long run.

     

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