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Paragon Law Ltd is committed to ensuring that as a company it adheres to the highest ethical standards at all times. In relation to bribery, the company will take all reasonable steps to ensure that its staff and any third parties used in the course of business are aware of our policy on anti-bribery and the consequences of them breaching this policy. Paragon Law will adopt a zero-tolerance stance on bribery. This policy is fully endorsed and supported by the senior management team.
The Bribery Act 2010 modernised the law on bribery. The Act came into force on 1 July 2011 and includes a new offence – Section 7 Failure of commercial organisation to prevent bribery.
There are now 4 key offences under the Act
Section 1 – Offering, promising or giving of a bribe (active bribery)
Section 2 – Requesting, agreeing to receive or accepting of a bribe (passive bribery)
Section 6 – Bribery of a foreign official
Section 7 – Failure of commercial organisation to prevent bribery
Jurisdiction over section 1, 2 and 6 offences is limited to those committed in the UK with the exception over offences committed outside the UK where the person committing them has a close connection with the UK by virtue of being a British national or ordinarily resident in the UK, a body incorporated in the UK or a Scottish partnership.
With regards to section 7, the Act makes it clear that “close connection” is not a requirement. As such, the act or omission can be anywhere in the world and can be an offence committed by someone who is not a UK national or resident in the UK, nor a body incorporated or formed in the UK.
The Six Principles of the Bribery Act 2010
The Ministry of Justice has set out in guidance six principles which, if adhered to, will allow organisations to have effective anti-bribery processes in place.
- Proportionate Procedures – the policies and procedures in place must be proportionate to the risk presented by the nature of business undertaken.
- Top-level Commitment – the top-level of the commercial organisation must be committed to fostering a culture of integrity where bribery is unacceptable.
- Risk Assessment – the commercial organisation must assess the nature and extent of its exposure to potential external and internal risks of bribery on its behalf by persons associated with it.
- Due Diligence – the commercial organisation applies due diligence procedures, taking a proportionate and risk-based approach, in respect of persons who perform or will perform services for or on behalf of the organisation, in order to mitigate identified bribery risks.
- Communication – the commercial organisation seeks to ensure that its bribery prevention policies and procedures are embedded and understood throughout the organisation through internal and external communication, including training that is proportionate to the risks it faces.
- Monitoring and Review – the commercial organisation monitors and reviews procedures designed to prevent bribery by persons associated with it and makes improvements where necessary.
Overview of Risk
Generally, the work undertaken by Paragon Law Ltd has been assessed as being low-risk for its core areas of work but with medium-risk elements at time where agents may conduct business on its behalf in overseas jurisdictions where there is a higher risk of bribery being more commonplace. The reason we consider our core-business to be low-risk is for the following reasons:
- The vast majority of our business in conducted in the UK which has a low propensity for bribery in comparison with other countries.
- Our fees structure is not based upon successful outcomes and as such there is no financial benefit for our staff to be involved in bribery.
- The applications we make on behalf of clients are almost exclusively paper-based and supported by clear audit-trails which limits greatly the opportunity for bribery to take place.
This risk categorisation will be reviewed on an annual basis by the Practice Manager. The current risk was assessed on 30 January 2019 with the next review due by 30 January 2020.
Our procedures will be tailored to our risk profile with those activities which are low-risk being less onerous than those which are classified as a higher risk.
All employees and associated persons are required to:
- comply with any anti-bribery and anti-corruption legislation that applies in any jurisdiction in any part of the world in which they might be expected to conduct business;
- act honestly, responsibly and with integrity;
- safeguard and uphold the Company’s core values by operating in an ethical, professional and lawful manner at all times.
Bribery of any kind is strictly prohibited. Under no circumstances should any provision be made, money set aside or accounts created for the purposes of facilitating the payment or receipt of a bribe.
The Company recognises that industry practices may vary from country to country or from culture to culture. What is considered unacceptable in one place may be normal or usual practice in another. Nevertheless, a strict adherence to the guidelines set out in this Policy is expected of all employees and associated persons at all times. If in doubt as to what might amount to bribery or what might constitute a breach of this Policy, refer the matter to your line manager or to the Practice Manager.
Definition of Bribery
Inherent within the definition of bribery is the concept of bringing about “improper performance” by virtue of giving or receiving of money, gifts etc.
“Improper performance” is defined at sections 3, 4 and 5 of the Act. In summary, this means performance which amounts to a breach of an expectation that a person will act in good faith, impartially, or in accordance with a position of trust. The test used is what a reasonable person in the UK would expect of a person performing the relevant function or activity. Local practice or custom is to be disregarded, unless permitted or required by local written law. The offence applies to bribery relating to any function of a public nature, connected with a business, performed in the course of a person’s employment or performed on behalf of a company or another body of persons. Therefore, bribery in both the public and private sectors is covered. The function or activity may be carried out either in the UK or abroad and need have no connection with the UK.
The following are specific policy terms designed to ensure risks are mitigated as far as possible.
Gifts and Corporate Hospitality
It can sometimes be difficult to judge the line between the giving or receiving of gifts or hospitality and actions which can be construed as bribery. It is felt impractical to impose strict financial limits in this area as customs and practice vary greatly between countries and cultures. Instead, the guidance below sets out the criteria and procedures which are to be considered and applied in the event that gifts or corporate hospitality are to be given or received:-
The giving or receiving of business gifts to/from clients, customers, contractors and suppliers is not prohibited provided the following requirements are met:
- the gift is not made with the intention of influencing a third party to obtain or retain business or a business advantage, or to reward the provision or retention of business or a business advantage, in an improper manner or through improper performance
- it complies with local laws
- it is given in the Company’s name, not in the giver’s personal name (in the case of a gift being provided by us)
- it does not include cash or a cash equivalent (such as gift vouchers)
- it is of an appropriate and reasonable type and value and given at an appropriate time.
- it is given openly, not secretly
- it is approved in advance by a director of the Company if it relates to a gift to be provided by us.
In summary, it is not acceptable to give, promise to give, or offer, a payment, gift or hospitality with the expectation or hope that a business advantage will be received, or to reward a business advantage already given, or to accept a payment, gift or hospitality from a third party that you know or suspect is offered or provided with the expectation that it will obtain a business advantage for them.
Any payment or gift to a public official or other person to secure or accelerate the prompt or proper performance of a routine government procedure or process, otherwise known as a “facilitation payment”, is also strictly prohibited. Facilitation payments are not commonly paid in the UK but they are common in some other jurisdictions.
By way of an example of the above criteria being applied, it will not generally be considered appropriate for a gift from a client in excess of £50 value to be accepted by an employee, particularly if the gift is given before substantive work is carried out for the client.
Any gifts received or declined must be recorded on the client’s file for future record.
Any sums spent by us on corporate hospitality will be clearly identified under the Marketing Nominal Ledger within the office accounts so that amounts paid are traceable and transparent.
Compliance With This Policy by Others
As part of the Bribery Act 2010 contains a requirement to ensure that a commercial organisation prevents bribery, it is also necessary for us to have a policy on how we will communicate our policy to others and make sure they act appropriately.
- Employees (including consultants) – All new employees will have anti-bribery policy training as part of their induction. Additionally, current employees who were employed before the terms of the Bribery Act 2010 came into force will have specified training on the policy to include the offences within the Act, anti-bribery procedures and the consequences of failing to adhere to the policy (disciplinary proceedings). Additionally, further training will be provided as and when it is considered appropriate to keep employees abreast of new developments, case law and other updates. All staff will be asked to sign a declaration to confirm that they understand their obligations in relation to statutory duties. Additionally, all new staff will be fully reference checked within 1 month of starting work with us as part of a due-diligence test of suitability of character.
- Third party contracts within the UK – Any contracts for goods or services to be provided to or by Paragon Law will include a clause which states that we operate an anti-bribery policy and anyone who enters into a contracted relationship with us undertakes to uphold the same professional standards. An overview of the salient points of our policy will be available on our website for perusal. An anti-bribery statement will be included in our client-care letters as well as all letters of instructions to counsel, experts, interpreters etc.
- Third party contracts outside the UK – As third party contracts outside of the UK are more difficult to monitor and bribery is more prevalent in many other countries it is important that further steps are taken to prevent bribery for these types of contracts. In addition to the steps taken for third party contracts for goods and services within the UK (point 2 above), further due diligence is required before allowing a third party to act on our behalf. This due diligence will be appropriate to the circumstances of the individual case but will include potentially obtaining references for the third party, consulting with local trade bodies to see if the third party has a history of being involved in bribery, internet searches and any other relevant resources which may give valuable background history on the person or organisation we intend to contract with. If the third party does not pass the due diligence test or refuses to accept the anti-bribery policy details, then we will not contract with them.
By way of example on this policy, if we were preparing to instruct a UK-based country expert to prepare a report on a particular country we would normally apply the “Third party contracts within the UK” rules. However, if we knew, or discovered, that this expert instructed people on the ground in the country of choice to obtain information etc then it would be appropriate to conduct the due diligence test required under the “Third party contracts outside the UK” rules as there is still a link between Paragon Law and the increased risk of bribery actions being carried on its behalf.
Reporting of Suspected Bribery
If any individual suspects any employee or third party agent of Paragon Law of being involved in any element of bribery they should report the matter to the Practice Manager who will fully investigate the matter. Should there be a finding of involvement, the matter will be dealt with via the disciplinary procedures (gross misconduct) for employees and breach of contract provisions for third party agents. Additionally, the appropriate criminal authorities shall be notified to underline our commitment to a zero tolerance policy on bribery.
There are some potential indicators of bribery related activities which it is important to bring to people’s attention so that they are more aware of instances which should be reported. For example, evasive answers to straightforward requests for information, overly elaborate payment arrangements involving further third parties and ad hoc or unusual requests for expense reimbursement not properly covered by accounting procedures. In cases where there is doubt, the advice given to individuals is to inform the Practice Manager in order that he may formally investigate.
Further guidance on the application of the Bribery Act 2010 is available from the Practice Manager.