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  5. Anti-Bribery Compliance

Anti-Bribery Compliance

Corporate program and legal framework preventing improper payments to government officials and commercial counterparties.

Audit & ComplianceGlobal Payroll

FAQs

What is the difference between the FCPA and the UK Bribery Act?

The FCPA focuses exclusively on bribery of foreign government officials to obtain or retain business; it does not cover purely commercial bribery between private parties. The UK Bribery Act covers both: bribing and being bribed by anyone (government officials or commercial counterparties, domestic or foreign). The UK Act also includes a 'failure to prevent bribery' offense making companies strictly liable for bribery by associated persons unless they had adequate prevention procedures—a significantly broader corporate liability than the FCPA. UK companies face the Act; non-UK companies face it if they have business in the UK. Companies operating internationally must comply with both regimes, typically designing their compliance program to meet the stricter UK standard.

What are facilitation payments and how are they treated under anti-bribery laws?

Facilitation payments (also called grease payments) are small payments to low-level government officials to expedite routine, non-discretionary government actions—clearing customs, obtaining a permit, connecting utilities. The FCPA has a limited exception allowing facilitation payments for non-discretionary ministerial actions, though DOJ and SEC view even exempt payments with increasing disfavor and the exception is narrowly applied. The UK Bribery Act has no facilitation payment exception—they are illegal under UK law regardless of amount or purpose. Most large multinational companies maintain zero-tolerance policies for facilitation payments regardless of FCPA exceptions, both to comply with UK law and to avoid the corruption risks and documentation burden of allowing them.

How do companies conduct anti-bribery due diligence on third parties?

Third-party anti-bribery due diligence is risk-tiered based on the party's relationship to government officials and proximity to regulated decisions. Enhanced due diligence for higher-risk parties includes: UBO (ultimate beneficial ownership) identification; database screening against sanctions lists, PEP (politically exposed person) lists, adverse media, and historical enforcement actions; review of the business rationale for the engagement; verification of services actually rendered; and contractual requirements including anti-bribery representations, audit rights, and termination for compliance breach. Commercial due diligence platforms (LexisNexis Diligence, WorldCheck) automate screening; third-party management platforms track ongoing monitoring requirements as relationships evolve.

Related Terms

Whistleblower Protection

Legal safeguards and financial awards for employees who report corporate fraud or securities violations.

Conflict of Interest

Situation where personal interests or competing loyalties may improperly influence professional judgment or decision-making.

Fiduciary Duty

Legal obligation to act in another party's best interest, arising in relationships of trust and confidence.

SOX Compliance

Adherence to the Sarbanes-Oxley Act requirements for financial reporting controls and auditor independence for public companies.

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Anti-bribery compliance refers to the corporate programs, policies, controls, and culture designed to prevent, detect, and respond to bribery and corruption—the offer, payment, receipt, or solicitation of anything of value to improperly influence a decision or gain an unfair advantage. Several major legal frameworks impose anti-bribery obligations on companies globally.

The U.S. Foreign Corrupt Practices Act (FCPA, 1977) prohibits U.S. companies and individuals, as well as foreign issuers of U.S. securities, from paying bribes to foreign government officials to obtain or retain business. It also contains accounting provisions requiring accurate books and records and adequate internal controls. FCPA enforcement by DOJ and SEC has resulted in over $10 billion in fines against companies including Goldman Sachs, Airbus, and Siemens.

The UK Bribery Act 2010 is considered the world's strictest anti-bribery law: it covers domestic and foreign bribery, prohibits commercial bribery (between private parties), and—most notably—imposes strict liability on companies for failing to prevent bribery by associated persons (employees, agents, subsidiaries), unless the company can demonstrate it had adequate prevention procedures.

OECD Anti-Bribery Convention (ratified by 45 countries) requires signatories to criminalize foreign bribery. ISO 37001 provides an anti-bribery management system standard.

Effective anti-bribery programs include: tone from the top (CEO commitment), risk assessment (identifying high-risk markets, functions, and counterparties), policies and procedures (gifts, hospitality, and entertainment limits; third-party due diligence), training and communication, monitoring and testing (expense report auditing, third-party screening), confidential reporting mechanisms, and swift investigation and remediation of violations.