Scottish companies encouraged to 'self-report' bribery



Frank Mulholland offered leniency for self-reporting of bribery



The UK Bribery Act came into force on 1st July 2011, but many businesses in Scotland are still racing to figure out how the law will affect them.

While the Bribery Act legislation is relevant throughout the UK, including Scotland, the fact that Scotland has a different legal system has thrown up a number of difficulties.

Unlike in the rest of the UK, the Bribery Act will not be policed, investigated and prosecuted by the Serious Fraud Office (SFO) in Scotland, rather it will be the job of the police to investigate and the job of the Crown Office & Procurator Fiscal Service (COPFS) to prosecute.

In February 2010, the Scottish Parliament agreed a Legislative Consent Motion for the UK Bribery Act, which permitted the UK Houses of Parliament to legislate in a devolved area.

Scotland's Lord Advocate Frank Mulholland QC approved an initiative for businesses to "self-report" bribery offences in Scotland, as of 1st July.

According to COPFS, "The Crown will accept reports from businesses who wish to report the discovery by them of conduct within their organisation which may amount to an offence under the Bribery Act, or under the law before 1 July. The Crown will give consideration to refraining from prosecuting the business and instead referring the case to the Civil Recovery Unit (CRU) for civil settlement."

Mulholland said "The Bribery Act introduces a stricter, modern anti-bribery regime to the UK. Cases of bribery [in Scotland] will be referred to a team of special prosecutors within and Serious and Organised Crime Division and cases will be prioritised and tackled effectively."

Regarding the self-reporting initiative, Mulholland said it "is a one of a number of ways we will fight against this serious and insidious crime. I hope that businesses will be encouraged to self-report any cases involving bribery within their organisations without delay."

While it has already been established that self-reporting could result in leniency in England, this was the first mention of it in Scotland.

The BBC quoted Barbara Bolton, from the law firm Tods Murray, as saying, "Up until now there has been complete silence from the Scottish authorities in terms of whether or not there would be any equivalent in Scotland to the English system of leniency in return for self-reporting."

Other lawyers have highlighted the lack of dialogue and instruction in Scotland.

Tom Stocker, an Edinburgh-based partner of McGrigors said, "When the Act was being discussed, the Scottish Justice Minister clearly looked at the number of prosecutions against Scottish companies for Bribery offences, and took the view that corruption was not an issue in the country. There was never really a proper debate and now a raft of legislation has been introduced that could catch Scottish companies out."

Stocker expresses concern that the UK Bribery Act has not received enough attention in Scotland, and says it is still unclear whether the SFO or Scottish Crown Office will take the lead on enforcement for companies with a presence in both England and Scotland.

Sources: BBC News, Briberyact.com, COPFS, McGrigors, Scottish Government

For more information, please see the Menas ACCS website, here.