Difference between FCPA and UKBA

1. Comparison between US FCPA and UKBA
Issue US Foreign Corrupt Practices Act 1977 UK Bribery Act 2010
Who is subject to?
Territorial reach
 Any company that issues securities within US or files
reports with SEC; [local/foreign company can be
prosecuted in US]
 Any US citizen, national or resident or business entity that
has principal place of business in US or is covered by US
law;
 Any foreign non-issuer including non-US national, if acting
within territory of US. [any foreign individual or company
can be prosecuted]
 Liability of Parent for the act of subsidiary: A parent
company can be liable for its subsidiary’s improper
payments if the parent authorized or knew of the payments;
 Liability of both the parent and subsidiary: if the subsidiary
acted as the parent’s agent in making the improper
payments. [any foreign subsidiary cab be prosecuted as
well]
 Any individual/company (giving or receiving side) can be
liable for sections 1, 2 or 6 offences if committed within
UK ;
 Any individual/company (giving or receiving side) can be
liable for the same offences if committed outside the UK
when that individual/company has a ‘close connection’
with the UK. [foreign company/individual can be
prosecuted in UK]
 The ‘failure to prevent bribery’ offence applies to: (i) UK
entities that conduct business in the UK or elsewhere; and
(ii) any corporation, wherever formed, which carries on
business or part of a business in the UK (section 7(5)).
[foreign company/individual can be prosecuted in UK]
What constitutes
offence?
 Only offence of active Bribery to Foreign Public Official –
‘FPO’: If the subjected individual/company offers or gives
bribery to FPO; (15 U.S.C. §§78dd-1(a) and (f)(1))
 This offence could be occurred by the offender directly or
through any intermediary (agent, subsidiary) indirectly – of
anything of value;
 Offence of active bribery: If the giving-side
individual/company offers or gives bribery to another
person; (Section 1)
 Offence of passive bribery: If the receiving-side
individual/company requests/receives/accepts bribery from
the giving-side individual/company; (Section 2)
 These two offences could be occurred by the subjected
individuals/company directly or through any associated
person (agent, subsidiary) indirectly
 Offence of bribing FPO: (Section:6)
 Offence of failure of commercial organizations to prevent
bribery (Section: 7)
Scope  FCPA prohibits only giving of bribery to FPO
alternatively; it prohibits only active bribery and bribery in
 It includes both public and private sector bribery, and
 any form of bribery- active and passive in nature.

2. Comparison between US FCPA and UKBA
the public sector.
 Accepting bribery and bribery of private sector are not
included within the scope of this law.
Requirement of
intention
 To establish the allegation, the government must show that
the offender had the requisite state of mind with respect to
his actions i.e., negligence, recklessness, intent (15 U.S.C.
§ 78dd-1(f)(2).).
 Under Section 1&2 offence, intention to offer or receive
bribery is required for influencing any position or
securing improper performance.
 In case of bribing FPO offence, no ‘corrupt ‘or
‘improper’ intention is required.
Legality of
facilitation payments
 Facilitation payments to FPO are permitted if the same is
used to expedite or secure the performance of routine
governmental action.
 The routine government action does not include any action
taken by a If FPO is involved in the decision-making
process to influence a decision relating to new business
approval or continuation of business with specific party.
(15 U.S.C. §78dd-1(b) and §78dd-1(f) (3)).
 Prohibits any facilitation payments. The SFO guidelines
on facilitation payments describe it as “unofficial
payments made to public officials in order to secure or
expedite the performance of a routine or necessary
action”.
 However, SFO is not interested in a single payment of
£20 and bottle of whisky made to a pilot to take a ship to
a specific destination. A course of conduct over a number
of years will be prosecuted.
Provision of
hospitality i.e., gifts,
travel expenses,
meals, entertainment
 Defense is available for ‘reasonable and bona fide’
expenses.
 No detail guidance as to what gifts or hospitality will be
considered a bribe – this is a question of fact and degree,
and the full circumstances of the case must be considered.
 Should be reasonable, proportionate and made in good
faith (SFO guidance).
 However, such hospitality might qualify as bribery if it
falls under the offences set out in Sections 1, 6 or 7. SFO
indicated that its focus was on bribes disguised as
legitimate business expenditure rather than “bona
fide hospitality”.
Provision of
corporate strict
 No liability imposed on a company to ensure adequate
procedure to prevent bribery.
 In contrary to FCPA, a commercial organization is guilty
of strict corporate liability offence, if a person associated

3. Comparison between US FCPA and UKBA
liability  However, SEC and DoJ decide on whether compliance
policies of a company should be considered as defense or
not?
with the organization, bribes another person with the
intention of obtaining or retaining business or an
advantage in the code of business for the organization.
 Associated person includes anyone who serves on behalf
of the corporation i.e., employees, agents, representatives,
and subsidiaries.
 The only affirmative defense to this liability is available
if the corporate has adequate procedures in place i.e., a
robust and comprehensive compliance programme.
Regulatory body  DoJ (Department of Justice) and SEC (Securities and
Exchange Commission) have joint enforcement
responsibility;
 DoJ has criminal enforcement responsibilities for
violations of the anti bribery and SEC has civil enforcement
responsibility for violations of the anti-bribery provisions
committed by issuers (or agents of issuers, including
individuals)
 UK's Serious Fraud Office (SFO
Penalties  Individual- fined up to US$250,000 per violation and also
be given up to five years imprisonment.
 Company- for a fine of up to US$2,000,000 per violation.
 Individual- up to 10 years of imprisonment and unlimited
fine; Senior officer (section 14) can be held personally
liable for any offences if committed by the company with
his consent and the officer has close connection with the
UK.
 Companies: unlimited fines