On January 13, I moderated a webcast featuring Vivian Robinson QC, General Counsel of the UK's Serious Fraud Office. In the webcast, Mr. Robinson and a panel that also featured Barry Vitou, partner in Winston & Strawn's London office; Richard Kovalevsky QC, 2 Bedford Row; and David Childers, CEO of EthicsPoint looked at "The Impact of the UK Bribery Act on U.S. Companies."  

Following an excellent presentation by the panel (materials available here), Mr. Robinson provided very direct answers to many interesting and challenging questions from the audience. These questions and my summary of his answers follow below. You can view the entire webcast, including the Q&A session, here, as well:

Q: Will "adequate procedures" provide a complete defense or mere mitigation of penalties?

A: It will provide a complete defense under Section 7 if the tribunal of fact (likely to be a jury) concludes "adequate procedures" have been established.

Q:  How does the Act apply to the US parent company of a UK subsidiary? And does it apply, through the US parent, to other subsidiaries of the US parent located in other countries?

A: If the subsidiary is carrying out a function on behalf of the parent company, and if there is a link between the act of corruption and an English company, then the SFO will consider bringing a proceeding.

Q: Are there monetary rewards for whistleblowers under the UK Bribery Act such as those contained in the Dodd-Frank Act?

A: Absolutely not!

Q: Last year there were 74 actions brought under the FCPA and ancillary legislation in the USA  which probably exceeds the rest of the world put together. Perhaps half of these cases involved non-US companies. Isn't the reality that the UK will not prosecute US companies should corruption come to light unless the US authorities fail or decline to prosecute first, and the power to do so will remain hypothetical?

A: That is not the case at all. The SFO will not be dissuaded from prosecuting in such a case, and has seen a recent increase in cases in which it cooperates with US authorities.

Q: In light of UK spending cuts, how likely is strong enforcement of the Act?

A: The cuts will not have any affect on the SFO's appetite to enforce the Act as strongly as it can.

Q: Suppose company X, a US company, has two subsidiaries, Y and Z, where Z is located in the UK and Y in Mexico.  Could bribery by Y in Mexico create liability to X under the Bribery Act?

A: Yes it could, if the bribery in Mexico could be linked in any sense to a UK operation (i.e., the bribery did, or had the potential to, undermine a UK company).

Q: If a company goes to the SFO to get guidance on how to comply with the Act, does the company run the risk that it will subsequently be the subject of an investigation/prosecution based on the company's potential questions regarding its risk areas?

A: We can't exclude that as a possibility, but the more likely approach would be to ask the company to conduct an internal inquiry and then provide a report to the SFO concerning the specific matter at issue. The SFO would then decide how to proceed based on that report.

Q: Recognizing that the Bribery Act does not just apply to payments made to "foreign public officials," under the Bribery Act will employees of General Motors or American International Group be deemed "foreign public officials" because the U.S. government owns, either a majority stake or significant stake, in the companies? What standards will the SFO use as to the general issue of alleged so-called state-owned or state-controlled companies?

A: We don't think the Act is directed to people of that sort. We are not regarding employees of a state-owned company as falling in the ambit of Section 6. People can rest assured that is not what we are looking at at all.... Also, such people would not likely have a sufficient connection with the UK.

Q: Will companies be held responsible for actions prior to the April 2011 implementation of the law.  If so, how far back?

A: This is a difficult question. The immediate answer is that the Act is not retrospective, although we might look very carefully at whether there has been a continuation of infringing activity that began before the Act. But we are really looking at new activity rather than activity prior to the Act coming into force.

Q: What would be the recommendation for those who already have a more FCPA focus bribery policies across their international entities. Would they need to make some updates?

A: Absolutely yes. I don't think anybody should assume that because they are FCPA-compliant that they are necessarily going to be Bribery Act-compliant. I think any responsible company should look at the Bribery Act and the guidance surrounding the Bribery Act in addition to any guidance which they have under the U.S. jurisdiction to make absolutely sure that they are Bribery Act-compliant, as well.

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