30 July 2009
A new Draft Bill to go before Parliament could significantly enforce wide powers to investigate and prosecute British companies committing bribery overseas.
CAFOD welcomes the publication of the Joint Parliamentary Committee report on the Draft Bribery Bill, but calls on the government to strengthen the Bill and enact it into law without delay.
Sonya Maldar Policy Analyst with CAFOD said, `For too long our outdated laws have made it virtually impossible to prosecute companies who use bribery to secure business overseas.
`We know that it is the poorest and most vulnerable people in developing countries who ultimately suffer most from bribery, which can lead to loss of investment and undermine public services. The Draft Bill is an important step in the right direction.'
The World Bank estimates that £1,000 billion ($1 trillion) worth of bribes are paid globally each year.
The draft Bribery Bill creates a new offence which would make companies liable for foreign bribery.
This will make it easier to prosecute British companies who have used bribery to secure business overseas and help in tackling the threat that bribery poses to development.
The current UK law on bribery dates back to before the First World War and is considered archaic and out of date.
Despite ratifying the UN Convention against Corruption and the OECD Anti Bribery Convention, the UK has been slow to bring its anti-bribery laws into line with its international obligations.
This has made it difficult to bring prosecutions against British companies who have committed acts of bribery overseas. To date there has been just one prosecution of a British company for the offence of bribery.
Ms Maldar said, `The Joint Committee proposes recommendations to toughen the Bill which would make it harder for companies to escape liability for foreign bribery.
`We believe these should be adopted by the government as they close potential loopholes in the Draft Bill.'
CAFOD is working alongside other faith based development charities in calling for the Draft Bill to be passed into law quickly.
Head of Policy at Tearfund, Laura Webster said, `Any backtracking on corruption eradication simply leaves millions of lives in the developing world at risk.
`The Draft Bribery Bill shows that the UK government is serious about tackling bribery by British companies overseas, the government must now ensure that it becomes law in the next parliamentary session.'
A notable omission from the Draft Bill is the liability of foreign subsidiaries. Many cases of bribery have involved subsidiary companies, but current legal structures mean it is very difficult to bring successful prosecutions.
Ms Maldar said, `CAFOD believes for the proposed legislation to be effective in stopping bribery overseas, it is essential the draft bill covers acts of bribery by foreign subsidiary companies.'