Time is running out to implement foreign bribery prevention measures

In March 2024, the Crimes Legislation Amendment (Combatting Foreign Bribery) Act 2024 (Cth) was passed. The Act is designed to remove barriers to foreign bribery investigations and prosecutions previously faced by law enforcement and prosecutors.

The key changes include:

• A company will be criminally liable if an associate (an officer, employee, agent, contractor or subsidiary) bribes a foreign public official. This will be a strict liability offence. 
  • (i) By making the offence strict liability, it means an organisation will be liable even if it did not condone or know of the behaviour.
• Broadening the bribery offence by:
  • Including bribing to a gain a
  • personal advantage (i.e., nonbusiness)
  • Removing the previous requirement that the benefit or business advantage sought must be ‘not legitimately due’. Instead, improperly influencing a foreign public official will be sufficient
  • Removing the requirement to show that the foreign public official was influenced in the exercise of their duties, and 
  • Includes ‘candidates for public office’ within the definition of foreign public official.
• Establishing a new corporate, strict liability, indictable offence of ‘failing to prevent bribery of a foreign public official’ to take effect from 8 September 2024.
• Providing a defence for organisations to the failing to prevent bribery offence if they can show they had implemented ‘adequate procedures’ to prevent bribery.
• Providing for a maximum penalty for failing to prevent bribery of the greater of $31.3 million, three times the value of the benefit obtained or 10% of the company’s annual turnover.

The adequate procedures for defence

The Act provides a defence for a company that can demonstrate that it had in place ‘adequate procedures’ intended to prevent foreign bribery. 

The legislation does not define ‘adequate’ but does place a requirement on the Attorney General’s Department to publish guidance on what adequate procedures should include. These guidelines will be helpful, but companies must design procedures based on their particular circumstances.

Simply rolling out an anti-bribery policy will not be sufficient. The policy should form part of a robust anti-bribery framework. To be able to demonstrate adequacy, the anti-bribery framework should:

• Be supported by a demonstrable culture of integrity with support from senior management and the board. 
• Be based on a bribery and corruption risk assessment.
• Link to other relevant policies and procedures including codes of conduct, fraud and corruption control, whistleblower management and employee, supplier, customer and third-party due diligence.
• Be adequately communicated to employees and third parties with mechanisms to test understanding. Higher risk roles should attest that they have received training and confirm periodically that they have not been involved, or are aware of, foreign bribery.
• Be periodically and independently tested and assessed to ensure the framework remains fit for purpose and is working as intended.

It’s time to act

Now is the time for companies to assess their risk and revisit existing anti-bribery measures, or quickly put measures in place to manage this important risk.

PKF Integrity has leading practitioners with extensive experience helping companies comply with complex bribery and corruption laws. 

We would be delighted to speak with you about how we can assist you to ensure you are compliant with this new regime.