Joint Committee on The Draft Corruption Bill Report


Annex 1: Schedule of detailed points made about the draft Bill by witnesses, together with comments by the Home Office

Schedule of Detailed Points on the Draft Bill
Clause Original text Change/comment SourceComments by Home Office
1A person commits an offence if Clarify the word "person". In Part 1, the word "person" is used, but in clause 13 the provision applies to any "national of the United Kingdom or a body incorporated in any part of the United Kingdom".

It might be argued that the avoidance of the word "person" in clause 13, and the use of the word "person" in Part 1 mean that "person" should not be interpreted to include a legal person (as it would be presumed to mean in accordance with Section 5 of the Interpretation Act 1978).

Khawar Qureshi DCB 7, para 13 The reason the general word "person" is not used in clause 13 is because it is necessary to identify which persons incur extra-territorial liability. The answer is persons who are either UK nationals or bodies incorporated in the UK.
Clarify how widely this clause is intended and the problems of proof in non-pecuniary advantage (also applicable to clause 2). The current definition is very broad. CPS, DCB 15, para 1 We think that the Bill is very clear on the width of meaning of "advantage". Although a non-pecuniary advantage may be more difficult to prove than an exhibitable bribe, removing the possibility of non-pecuniary bribes would significantly weaken the existing law.
Insert the operative words in clause 5 into clause 1. The definition of corruption will therefore be captured in one clause and make the bill easier to understand. Sir Stephen Silber, oral evidence, 9 June 2003 It would not just be clause 5 that would need to be incorporated, but also clauses 4, 6 and 7. Clause 2 would then need to have incorporated clauses 4, 5, 6, 7, 8 and 9. Clause 3 would need to have incorporated clauses 4, 5, 6, 7 and 10. This would make clauses 1, 2 and 3 very long and repetitive.
1 (b)"he corruptly offers or agrees to confer an advantage" The arguments in favour of 'dishonesty' as the basis for the criminalisation of this sort of conduct are well described in the joint BC and CBA response of 1997. The potential advantages of a scheme based on 'dishonesty' have plainly been rejected completely by the draftsman, but will need to be reconsidered by the Joint Committee. CBA Working Party, DCB 20, para 5(a) We agree that where there is corruption, there is often also dishonesty, for example, fraud. But we do not think that corruption necessarily involves dishonesty, and this is in line with existing law.

The Court of Appeal has held (R vs Harvey 1999) that dishonesty is not a necessary element in the existing offences. Instead, the word "corruptly" was to be construed as meaning deliberately offering money or other favours, with the intention that it should operate on the mind of the person to whom it was made so as to encourage him to enter into a corrupt bargain. Introducing a requirement of 'dishonesty' would therefore constitute a weakening of the law.

Including an element of dishonesty might suggest that the offence must involve damaging the interests of the principal or the public. Whilst this will no doubt usually occur where there is corruption, it does not seem to us to be a necessary element of the offence. For example, where two companies put in identical tenders, but one offers an advantage on top, we would want that to count as corruption (unless there was principal's consent to the advantage). But if an element of dishonesty were required, arguably there would be no corruption because there would be no damage to the interests of the principal since the tenders are identical.

Please also see Lord Falconer's answer to Q506 and Lord Goldsmith's answer to Q576.

3Performing functions corruptly Define the meaning of "function". CPS, DCB 15, para 1 'Functions' is a term which gives the necessary breadth in our view - it covers both what a person is required to do and what he is permitted to do as part of his job - and it is used without definition across the statute book (eg section 6(3) of the Human Rights Act 1998).
Is this offence necessary or appropriate? Is it clear what the criminal act actually is or is intended to be? CBI, DCB 17, para 4 (& response to HO para 17) We do not envisage that the third offence, ("acting corruptly"), will be prosecuted very frequently. However, in some cases it will be necessary, in order to ensure that corrupt behaviour can be punished (e.g. if an agent acts in a certain way because he believes that he would get an advantage - other agents may have got advantages in the past - and finally is not given an advantage).
4A person confers an advantage if The definition of "conferring an advantage" would catch a wide range of business activities which are normal business practice and universally viewed as wholly unexceptionable. There are currently a number of concerns over potential grey areas (free meals/ holidays provided to journalists for review purposes). The Newspaper Society DCB 8, para 3 Whilst it is true that clause 4 is wide, it has to be read with clause 5. Concerning the coverage of clause 5, please see comments below.
Clauses 4 and 5 only refer to "an advantage", rather than the Council of Europe's Criminal Law Convention on Corruption (CoE), which repeatedly refers to an "undue advantage". The draft Bill therefore widens the scope of the offence, which would cover more ground than required by the CoE and other international standards. Drago Kos, GRECO, DCB 12, para 6 The word "undue" is unclear. The Oxford English Dictionary has three meanings, including "not owing or payable" (rare), "improper" and "excessive or disproportionate". We do not think the inclusion of a term which would not be uniformly understood would lend clarity to the Bill.

The international conventions do not require parties to use specific terms in their law. We do not think that the current Bill substantially widens the scope of the law.

4 (1)(a)"A person confers an advantage if -

(a) he does something (for example makes a payment) or he omits to do something that he has a right or duty to do"

Clause 4(1)(a) gives an example of doing something which confers an advantage but does not give an example of omitting to do something. An example here would help to clarify this clause. Bob McKittrick, Institution of Structural Engineers DCB 4, para 3.3 We avoid examples in primary legislation unless necessary to avoid the provision being misunderstood. Where examples are useful by way of explanation, they can be placed in explanatory notes. It was felt necessary to give an example of "doing something" so that it was clear that clause 4 was dealing with the bribe rather than what was done in return. This point is now clear so there is no need for a further example, and we do not think that "omitting to do something" is in itself a difficult concept to understand.
The language of this clause is ambiguous. It needs to be made clear, by punctuation or otherwise, that the subordinate clause "which he has a right or duty to do" applies only to an omission and not to an act. Secretariat to the OECD's Bribery Working Group, DCB 26, para 2b We see no ambiguity in view of the repetition of the pronoun 'he'.
Clause 4(1) as presently drafted gives rise to one potential ambiguity as to the definition of "advantage". Secretariat to the OECD's Bribery Working Group, DCB 26, para 2b This seems to be the same point addressed above.
Replace ";" ["semi-colon"] with ", and" ["comma and"] at end of 4(1)(a), 5(1)(a), (b) and (c), 5(2)(a), (b), (c) and (d), 6(2)(a), 6(3)(a), 6(4)(a), 7(1)(a), 8(1)(a), 10(1)(a), 10(2)(a), 13(1)(a), 13(2)(b) and 16(3)(b). This would reflect consistency with the correctly punctuated clauses in the rest of the draft Bill. CBA Working Party, DCB 20, para 16a We think it is clear from the context that in each case these are cumulative conditions and therefore "and" adds nothing of substance. However, we will be checking the consistency of the Bill's punctuation before it is introduced into Parliament.
4 (2)"An act or omission may be done or made in consequence of a person's request even if the nature of the act or omission, and the time it is intended to be done or made, are not known at the time of request." Clause 4(2) is too vague and unclear. It needs the example (or similar) that is given in the explanatory notes. Bob McKittrick, Institution of Structural Engineers DCB 4, para 3.3 As explained above, the practice is to avoid examples in primary legislation unless necessary to avoid misunderstanding. We do not consider that misunderstanding will arise here.
5Conferring an advantage: meaning of corruptly A majority of the Working Party favours adding "dishonestly" as an additional element in all new offences. CBA Working Party, DCB 20, paras 9-13 Please see response on 1b.
The offences in the draft Bill are framed according to whether advantages have been conferred or obtained and do not require a specific element of dishonesty or even a breach of the agent's duties to his principal. Exceptions would be very difficult to establish. Financial Services and Markets Legislation City Liaison Group, DCB 14, para 3 Please see response on 1b. The Law Commission rejected the idea of breach of duty (paras 5.5-5.10 of their report). However we will reconsider in view of the concerns expressed.
Replace "an advantage" with "an improper advantage". Emphasis should not just rely on "primarily" and primary purpose, but should also apply a concept of conferring or receiving an improper advantage (in line with OECD Convention Outlawing Bribery of Foreign Public Officials). Using the word 'improper' would considerably strengthen the bill and make it easier to understand.

Detailed guidance should be provided once the scope of the new offences is decided, so that companies can review and update their codes of conduct and practice for employees.

Exclude small facilitation payments, 'offset' contracts, insurance and other commissions paid in the financial services industry. Exemptions or specific defences should be made for corporate entertainment, bona fide promotional expenditure, payments made or conferred under duress and small facilitation payments as recognised in commentaries to 1997 OECD Convention.

CBI, DCB 17, para 4 and CBI oral evidence, 11 June 2003



Para 17

In Article 1 of the OECD Convention, the terms 'undue' and 'improper' are both used: the first qualifies the advantage given by the briber and the second the advantage given in return by the official. But we do not believe that either term (or both if we follow the OECD precedent) would add clarity to the Bill. Jurors, in particular, would not necessarily have the same understanding of what is or is not improper ("not in accordance with accepted standards of behaviour" (OED)).

We are considering guidance (see Lord Falconer's answer to Q537).

a)  
b)  Facilitation Payments

We do not think it desirable for UK law to apply differently overseas to the way it applies in the UK. That admits a double standard. The realities of life in less developed countries may well be very different, but we see no formal way of distinguishing those countries from the others, and there is an international effort to raise standards so that the number of countries where such payments are normal should be reducing over time.

Blanket exemptions are always liable to misuse, and we do not think it appropriate to make an exemption for 'facilitation payments'. However, in considering whether or not to prosecute individual cases, prosecutors must decide whether it would be in the public interest to do so. They may then take into account how the payment is viewed locally. Lord Falconer dealt with this in answer to Q 526. As concerns corruption cases, there is the additional safeguard of Attorney General's consent: the Attorney General must give his agreement to any prosecution.

c)  Offset payments

We do not believe that the draft Bill would ordinarily capture offset contracts. Offset is, in essence, a commitment from a contractor to provide an extra service (e.g. buy local components, build a local hospital) in addition to the main terms of the contract for which he is bidding. As such, it can be seen as one of the specifications of bidding, whether mandatory or not. We do not see it being treated any differently under the Corruption Bill than any other contractual term. See Lord Falconer's answer to Q468.

i)  Promotional expenditure/corporate hospitality

An act of corporate hospitality would not be corrupt unless the "advantage" (for example a corporate lunch, a gift, or a sum of money) was given or received on the understanding that it is primarily the advantage, or promise of an advantage, that would make an agent act in a certain way - for example award a contract. Thus corporate hospitality is not corrupt unless it is on such a scale as to be the prime motivation for an act by an agent. It would also not be corrupt if the agent receiving it has his principal's consent and the agent is not performing functions for the public.

Definition of corruption could also encompass non 'transactional' corruption, including:

- misuse of position by officials (as defined by Asia Development Bank)

- improper use of information and property (Article X1, Inter-American Convention Against Corruption).

Khawar Qureshi, DCB 7, para 7 This Bill is designed to repeal and replace the common law of bribery and the statutory offences of corruption in the Prevention of Corruption Acts 1889-1916. While other forms of behaviour may be characterised loosely as 'corruption' they are distinct issues, and are not for this Bill.
New legislation should incorporate a comprehensive set of specific corruption offences, including 'trading in influence', (as specified in the Council of Europe Criminal Law Convention).

The offences should be defined so as not to require proof of dishonest intent, but on the basis of payment or other gratification without reasonable explanation (an inference of corrupt behaviour compatible with the ECHR).

Misuse or abuse of public office as a separate offence committed by a public official or servant could be a useful tool for upholding public integrity in cases where to mount a full corruption prosecution would present insuperable difficulties.

Transparency International (UK), DCB 18, para 3.12, 4.1.2 and 3.13 A/ A list is less likely to be comprehensive - it would be problematic to ensure that all corrupt behaviour is covered. The multiplicity of existing offences has not proved helpful in practice either in the case of corruption or fraud. UK law already contains sufficient offences to meet the requirements of the Council of Europe Convention, with the exception of 'trading in influence.'

Trading in influence is a complicated concept. It is difficult to ensure that the offence only covers dishonest behaviour, and does not cover legitimate actions such as lobbying and advice giving. (It is possible to make a reservation on the Council of Europe provision on trading in influence - many countries including the US and Sweden have done so or intend to do so). Where an agency relationship exists, trading in influence is included in the corruption offences. It can be argued that if a person taking advice does not establish some kind of agency relationship with the one who gives him advice, he has only himself to blame if he gets biased advice.

B/Payment or other gratification without reasonable explanation appears to create a reverse burden of proof that goes to the heart of the offence. It is difficult to imagine how any reverse burden provision of this nature would not have potential problems of compatibility with ECHR.

C/ Misuse of Public Office is a very complex area of the law and its reform, while it may be desirable, is not urgent when compared with some other issues in the criminal justice arena. Cases can be prosecuted under the common law, though there have been a number of recent court cases on misfeasance where issues (such as the exact definition of recklessness in this context) have arisen. It may be that one or more of these cases will yet come before the Appeal Court, and the outcome would be relevant to the content of any future statutory offence of misuse of office.

Language needs to be clarified to counter uncertainties as to whether some small facilitation payments may now be decriminalised. This is suggested by the definition of 'corruptly' in clause 5 and the need to prove 'belief' that an act was done, or omission made, 'primarily' in return for the advantage. Transparency International (UK), DCB 18, para 3.10 Some facilitation payments may not be 'corruptly' given under existing law. It depends on the circumstances. The 'primarily' test in our view does not decriminalise any particular type of payment that might be criminal now.
The Bill should include a general exemption for the financial services industry, as various forms of commissions and fees are standard commercial practice throughout the financial services industry, not least between manufacturers and distributors. Investment Management Association, DCB 3, para 4 For a commission to be corrupt, it would be necessary to establish that the commission was the primary motivator for the agent to act or forbear to act in relation to his functions as an agent of another person, and that the agent's principal had not consented, or would not have consented if he had known all the facts. As concerns the recipient of the commission: in order for him to be considered guilty, it would be necessary to establish that he knew or believed that the person conferring the commission conferred it corruptly. (See Lord Falconer's answer to question 477).
Standard newsgathering practices, including inducements or reward, could effectively be criminalised, thereby potentially inhibiting investigative journalism. Journalists may have a defence under sections 6 and 7 of the Bill, but this could be obviated by excluding such conduct altogether from the definition of 'corrupt' behaviour.

Alternatively, an additional public interest defence could be introduced into the Bill. This could follow the definition in the Code of Practice administered by the Press Complaints Commission.

The Newspaper Society, DCB 8, para 2 See answer under 4 "public interest defence".
The concept of A, B and C is particularly difficult to understand, as it focuses on the relationship between the agent and principal, rather than the briber and bribee (which is how most people conceive of it). Corruption can be fundamentally defined by 'secrecy'. DPP and SFO, oral evidence session, 14th May 2003 The essence of corruption, according to the Law Commission, is the suborning of an agent against his principal. By being bribed, an agent is going against the bond of duty and trust he owes to his principal and is acting in the interests of the briber. Corruption must involve three persons or entities. If there is no principal, then there is no reason to criminalise acting primarily because of an advantage. To do so would run counter to principles of freedom of contract.

See Lord Falconer's answers to questions 460, and 483 - 486.

A serious effort should be made to devise a more easily understandable definition of "corruptly" than the present one. Ideally, this key definition should be worded in affirmative terms and might be based, for example, on existing common law or statutory language and include the word "undue" as used in the Convention. Secretariat to the OECD's Bribery Working Group, DCB 26, para 3 See answer under clause 4
5 (1)"A person (C) who confers an advantage, or offers or agrees to confer an advantage, does so corruptly if …" Give examples to illustrate what is meant by this clause.

A threshold should be given, as a way of delineating what is acceptable. This should not be a percentage, but could be based, for instance, on the tax threshold for entertaining staff per annum.

Bob McKittrick, oral evidence session, 20th May 2003 A/ See answer under clause 4 above.

B/ There are strong practical difficulties in establishing minima. What would hold good for one sector of society (for example the extractive industries) would not hold good for another (for example a parking attendant). In addition, if "corruptly" is defined in terms of an intention to induce an agent to act in a certain way, the fact that a gift was of small value will be evidence that it could not have been intended to act as an inducement.

5 (1) (a)





5 (1) (b)

"he intends a person (A) to do an act or make an omission in performing functions as an agent of another person (B) or as an agent for the public;"

"he believes that if A did the act or made the omission it would be primarily in return for the conferring of the advantage (or the advantage when conferred), whoever obtains it"

The UK authorities should consider substituting "in performing functions" with "in relation to the performance of functions" in order not to restrict the scope of the offence as required by Article 1.1 of the OECD Convention. The language should not exclude, for example, acts done outside the public agent's "authorised competence".

Any conferring of an advantage done with the intent in (a) and the belief in (b) will be corrupt according to this definition, unless it falls within one of the exceptions. As a definition of the core mens rea element of the offence, this is obscure, circular and unsatisfactory. It would be preferable to devise an affirmative definition of "corrupt" or "corruptly" using language drawn from existing common law, cases and statutes, or by using the word "undue" as it is used in the OECD Convention.

Secretariat to the OECD's Bribery Working Group, DCB 26, para 3 and 2b We think that the language does not exclude acts done outside the scope of the public agent's "authorised competence". If a public agent does something outside of his job description because of a bribe (for example an official who does not normally give out passports gives out a passport because of a bribe), then he is still performing functions as an agent for the public, albeit functions he does not normally perform.

Please see Lord Falconer's Memo paras 7-9. On "undue" please see above.

5 (1)(b)

5 (2)(b)

"it would be primarily in return for the conferring of an advantage"

"he knows or believes that A has done the act or made the omission primarily in order to secure that a person confers an advantage"

The use of the word "primarily" is not in line with the requirements of international conventions and could cause difficulties in implementation, by making it more difficult to prove the genuine intention of the perpetrator. Drago Kos, GRECO, DCB 12, para 8 The term 'undue' is not defined in the Conventions, and is left to the interpretation of Parties. The 'primarily' test is our interpretation of the term.
5 (3)"For the purposes of subsection (1) the nature of the intended act or omission, and the time it is intended to be done or made, need not be known when the advantage is conferred or the offer or agreement is made." Clause 5(3) is too vague and unclear Bob McKittrick, Institution of Structural Engineers, DCB 4, para 3.4 For issues of general clarity, please see Lord Falconer's Memo paras 7-9.
6Acting on behalf of principal or public: no corruption This is unclear and is likely to be ignored. Bob McKittrick, Institution of Structural Engineers, DCB 4, para 3.5 Clause 6 is needed so that, for example, where an agent's salary is paid by a third party on behalf of his principal, no corruption offences are committed. It seems very unlikely that a case revolving around clause 6 would come to court, but it is still a very important aspect of the definition of "corruptly". We do not agree that clause 6 is unclear.
Exceptions would be needed in clause 6 and 7, to describe situations where the advantage cannot be described as an 'undue' one. Additional language to explain the reasons for clause 6 might be useful to avoid misinterpretation. Drago Kos, GRECO, DCB 12, para 6 We are not attracted by the term 'undue', as already mentioned. The point however may be met by our reconsideration of 'breach of duty' referred to above (on Clause 5).
6 (3)"The second condition is that -

(a)  The functions concerned are performed only for the public and not for a principal;

(b)  C is acting on behalf of the public"

If a definition by reference to exceptions is to be retained, a clearer explanation is needed of exactly what it is intended to exclude from the scope of the offence, so that this is more easily understandable to the enforcement authorities. It should be stated which party bears the burden of proving an exception. We think that the layout of the Bill is clear but, as explained above, it seems unlikely that the enforcement authorities will frequently be concerned with a case where clause 6 is relevant. The burden of proving that the exception does not apply is on the prosecution.
6 (3)(b)"C is acting on behalf of the public" Insert "on behalf of the public as remuneration or reimbursement in respect of the performance of the function" (as in original draft Bill produced by Law Commission). Even with this inclusion, it is still questionable whether it is appropriate to define corruption offences in such a way as to require no element of lack of integrity, or breach of duty. George Staple, Clifford Chance, DCB 19, para 5 The point may be met by our reconsideration of 'breach of duty' referred to above (on Clause 5).
6 (4)(b)"each element of the advantage is conferred" Insert "improper" before "advantage" to make the meaning and ambit of this exemption more clear. CBI, DCB 17, para 5 and 17 For issues of general clarity, please see Lord Falconer's Memo paras 7-9.
6 (6)"References to the public are not confined to the public of the United Kingdom or any part of it." There should be a specific and explicit inclusion of the crime wherever it takes place in the world (rather than the current provision, which suggests it is an addendum). Transparency International (UK) from oral evidence, 13th May 2003 That this is the effect of the Bill is quite clear from Clause 13 .
7Principal's consent: no corruption This is unclear and is likely to be ignored. Bob McKittrick, Institution of Structural Engineers, DCB 4, para 3.5 No comment.
7 (1)(a)"the functions concerned are performed only for a principal and not for the public" Provide a more detailed definition of functions "performed for the public". Do privatised bodies perform functions "for the public" or for its shareholders or both? In addition, in its dealings with its employees, does a local authority perform functions for the public or for the benefit of its employees or both? Sir Stephen Silber, DCB 22, para 5 The draft Bill draws a distinction between public and private which is based on the nature of the functions concerned. Choosing this approach, rather than, for example, listing which bodies are to be considered public bodies, affords greater flexibility in dealing with a changing political and economic environment. The draft Bill follows the example of the Human Rights Act 1998. In determining whether a body is performing functions of a public nature for the purposes of section 6 of the 1998 Act, the courts have said that the issue must be looked at in the round, taking into account all the circumstances of the particular case. But the following factors have been picked out as having general application:

§  Whether the act is done pursuant to a statutory power or duty

§  The extent of control over the body's functions exercised by another body which is a public authority

§  The more closely the act concerned is enmeshed in the activities of a public body, the more likely it is to be a function of a public nature.

§  The degree of public funding the body receives in relation to the act

The Joint Committee on Human Rights is currently conducting a short inquiry into the issue, and is expected to report on it before the summer recess.

We will consider whether it is possible to achieve greater clarity on this issue without losing anything from the Bill.

Problems could arise where the public/private functions are blurred. For instance, a private principal can consent to something which would otherwise be corrupt, but where functions are of a public nature the principal's consent cannot exonerate. CPS, DCB 15, para 1.1 See above
Should a distinction between public and private acts be drawn, as this goes against the Government's general stated intention? CBI, DCB 17, para 13 The Law Commission identified practical difficulties in consent on behalf of the public. However, if it is possible to eliminate the one public/private distinction made in the Bill we would be glad to do so.
7 (2)"A person is to be treated as if he were aware of all the material circumstances and consented to the conferring of the advantage or the making of the offer or agreement…" The defence should only apply where the belief is 'reasonable' or 'genuine'. Without this qualification, the exception is too wide in where it will apply. Public Concern at Work, DCB 9, para 6 We do not think it is necessary to require the belief to be genuine. If the belief were not genuine, it would not be a belief and clause 7(2) would not apply. We do not want to require the belief to be "reasonable". The defendant should be able to rely on clause 7(2) if he had a genuine belief in consent even if his belief was not necessarily reasonable i.e. one that the reasonable man would have come to.
Insert "improper" before "advantage" to make more clear the meaning and ambit of this exemption. CBI, DCB 17, para 17 See above on "improper".
8 (1)(a)"another does something (for examples, makes a payment) or he omits to do something which he has a right or duty to do" Delete "he" before "omits". CBA Working Party, DCB 20, para 14a On reflection, we agree that "he" is ambiguous and we will clarify its meaning before the Bill is introduced into Parliament.
8(1)(a) Insert "and" after " ; "

General drafting point: there is inconsistency in whether "and" is used in the cases of cumulatively required conditions - e.g. 6(4) 7(1) 8(1) 10(1) 10(2) (no "and") 9(1), 9(3) ("and")

Peter Alldridge, University of Cardiff We think it is clear from the context that in each case these are cumulative conditions and therefore "and" adds nothing of substance. However, we will be checking the consistency of the Bill's punctuation before it is introduced into Parliament.
8 (2)"an act or omission may be done or made in consequence of a person's request…" Replace with: "the act or omission of that other person is done or made in consequence of his request (express or implied) or with the result (direct or indirect) that he benefits". CBA Working Party, DCB 20, para 14b Clause 8(2) applies only where an act or omission is done or made in consequence of a person's request. It is only in this situation (as opposed to the situation where the act or omission benefits the person) that the nature of the act or omission and the time that it is intended to be done may not be known. The suggested wording which includes reference to the act or omission benefiting the person is therefore incorrect.
9Obtaining an advantage: meaning of corruptly The wording is unclear.

The Bill makes certain acts illegal but the authorities (Trade Partners UK) have suggested that some behaviour within this definition (eg. Facilitation payments) will be overlooked in a discretionary manner.

Bob McKittrick, oral evidence session, 20th May 2003
See answer on 'facilitation payments' in Clause 5).
9 (1)(b)"he gives his express or implied consent to obtaining it (in a case where he does not have to request it)" Replace with: "he either requests it or gives his express or implied consent in obtaining it, or both". CBA Working Party, DCB 20, para 14c There is no need for a request to be covered in clause 9(1)(b) since it is already covered by clause 8(1)(b).
9 (2)"A person who agrees to obtain an advantage agrees to obtain it corruptly if he knows or believes that the person agreeing to confer it agrees corruptly". Replace the last "agrees" with "does so" (thus mirroring clause 5 (1)). CBA Working Party, DCB 20, para 14d This is not an issue of substance but we will consider it as regards consistency.
10 (1)(a)


10 (2)(b)

"he does an act or makes an omission primarily in order to secure that a person confers an advantage"

"he regards the act or omission as done or made primarily in return for the conferring of the advantage"

The use of the word "primarily" is not in line with the requirements of international conventions and could cause difficulties in implementation, by making it more difficult to prove the genuine intention of the perpetrator. Drago Kos, GRECO, DCB 12, para 8 See above, under Clause 5 (1) (b).
10 (1)(a)"he does an act or makes an omission primarily in order to secure that a person confers an advantage" Replace with: "he does an act or makes an omission primarily in order that a person should confer an advantage (whoever may obtain it)". CBA Working Party, DCB 20, para 14e There is no change of substance here and we think the existing wording is clear.
10 (2)"A person who performs his functions as an agent performs them corruptly if -

(a) he does an act or makes an omission when he knows or believes that a person has corruptly conferred an advantage (whoever obtained it);

(b) he regards the act or omission as done or made primarily in return for the conferring of the advantage."

Replace with:

"(a) he knows or believes that a person has corruptly conferred an advantage (whoever obtained it)

 (b) he does an act or makes an omission primarily in return for the conferring of that advantage".

CBA Working Party, DCB 20, para 14f We will consider this.
11Meaning of agent and principal Requires greater detail about what would happen if the briber (ie. person C from clause 5) was not a UK national (as only the agent and the principal are mentioned here) and the corruption offence takes place in the UK. Drago Kos, GRECO, DCB 12, para 9 We do not think that this issue is unclear. If any person (no matter what his nationality), who is not protected by immunity, 'bribes' someone in the UK, he would be liable for prosecution in the UK under clause 1.
The concept of agency, though well developed in common law, has been stretched unreasonably in this Bill. The concept of actors in the offence being agents for, or performing functions for 'the public' is particularly difficult. Transparency International (UK), DCB 18, para 3.4 In this respect the Bill, like the Law Commission's scheme, builds on the precedent of section 1 (3) of the 1906 Act, which is currently in use.
11 (1)( a)"… to perform the functions for the second;" Replace ";" ["semi-colon"] with ", or" ["comma or"] at end of 11(1)(a) and (b), 11(2)(a), 15(7)(b), 16(4)(a) and 18(a). This would reflect consistency with the correctly punctuated clauses in the rest of the draft Bill. CBA Working Party, DCB 20, para 16b We do not think there is any ambiguity in these provisions. However, we will be checking the consistency of the Bill's punctuation before it is introduced into Parliament.
11 (1)(a)"the first and the second are partners in the same partnerships" This clause creates unreasonable difficulties for partnerships. To ensure that there is no corruption, under clause 7(1)(b) the consent of all partners is required and this creates real practical and inappropriate difficulties. George Staple, Clifford Chance, DCB 19, para 9 We think that it is appropriate, in the event that one partner is receiving advantages as the prime motivator for certain acts or omissions performed as part of his functions for the partnership, that the other partners should consent (or that their consent would be given if they knew all the circumstances).
11 (3)"A person is an agent performing functions for the public if the functions he performs are of a public nature." In the absence of an autonomous definition of "foreign public official" in clause 11, the UK authorities are requested to give an assurance, as was done by the Attorney General in the context of the Anti-Terrorism, Crime and Security Act 2001, that this Bill is intended to cover "all the categories of public official that the OECD Convention requires to be covered". Secretariat to the OECD's Bribery Working Group, DCB 26, para 2b We believe that all categories of public official that the OECD Convention requires to be covered are covered by Clause 11 (3) and (4). We would be happy to give such assurance.
12Proceedings in Parliament Remove clause 12 - if the words or actions in proceedings of a member or a witness could be used to prosecute the member or witness or some other person, proceedings in Parliament would no longer be free from all external interference. Harry Evans, Clerk of the Senate (Australia), DCB 2, para 10 Clause 12 is intended to ensure that speeches in Parliament are free of external interference, because it aims to ensure that what is said is not subject to the influence of a corrupt advantage. (See the Attorney General's reply to question 551). Also, in corruption cases, action can only be taken with the consent of the Attorney-General - a protection on the importance of which the Joint Committee on Parliamentary Privilege insisted.
Consider whether clause 12 needs to be drafted more narrowly and whether the drafting is proportionate to the perceived problem. Additionally, consider whether the clause should proceed at all, in the absence of a commitment from the Government to the introduction of a Parliamentary Privileges Bill.
Roger Sands, Clerk of the House of the Commons, DCB 5, para 14 We do not agree that clause 12 should be drafted more narrowly (see the Attorney General's answer to Q549). In particular it does need to cover others as well as MPs (see the Attorney General's answer to Q 565). It is possible that primarily in return for a corrupt reward a person who is not a Member might say or do something in Parliament. For example, having been paid by the owners of a factory, a representative of an NGO with an interest in ecology might give evidence to a committee scrutinising a Bill on noxious gases to the effect that the fumes from this factory do not harm the environment in any way. In addition, for example, a person charged with conferring an advantage on an MP would not currently be able to use evidence of parliamentary proceedings in his defence. Without clause 12, what was said or done in Parliament could not be made available as evidence in court and notwithstanding the fact that a record may be available within Hansard, or the action in question may have been televised, no inference can be made.

On the question of a Privileges Bill, see the Attorney General's answer to Q 546.

Parliamentary privilege could better be maintained by the implementation of the fifth recommendation of the Joint Committee on Parliamentary Privilege (replacement of section 13 of the Defamation Act 1996). Michael Davies, Clerk of Parliaments, DCB 6, para 3 The 5th recommendation would not solve the problem of the potential usefulness of evidence of proceedings in Parliament in securing convictions for corruption.
Consider the United States model as an alternative to this clause - the Supreme Court has explicitly drawn between the improper compact and the performance; the first within the cognisance of the courts, the second not. Sir William McKay, DCB 11, para 35 Please refer to question 556 and 570 of the Attorney General's evidence.
Having sanctions against MPs who might speak for corrupt purposes would enhance freedom of speech in the Parliament. It might also be useful to extend this clause to include fraud, but this would be a policy issue. Attorney General Lord Goldsmith, oral evidence session, 4th June 2003 There is an argument that corruption is a special case in that it has the potential to be detrimental to the freedom of speech in itself: that is, a corrupt bargain could motivate what was said or done in Parliament. Clearly, parliamentary privilege has the potential to be an impediment to the prosecution of other offences, but this is not an issue for this Bill. Extending clause 12 to fraud would be outside the scope of the Bill.
12 (2)"These offences are corruption offences" Remove this clause and put its content in a separate clause within Part I (along with 13(3), 15(9) and 17(4)). Stating the definition of corruption offences more than once is not necessary. CBA Working Party, DCB 20, para 15 We will consider this. The same applies to clause 12(2).
13Corruption committed outside the UK There is a lack of clarity about the locus of prosecutions for such offences. According to the Brussels Convention and UK common law, it is wrong for the Government to suggest (as it did in its response for consultations) that the locus of prosecution should be in the countries where payments have been made. Corner House, DCB 1, para 9.2 The clause enables UK nationals and incorporated bodies to be tried in the UK. The locus of prosecutions is a matter for consideration on a case by case basis, not for the Bill. For practical reasons (availability of witnesses and evidence) the jurisdiction where the acts took place is usually best placed to try the offence.
Greater detail needed to explain what would happen if a foreign national committed a corruption offence abroad and was arrested in the UK. Could he/she be prosecuted in the UK? Drago Kos, GRECO, DCB 12, para 11 The UK does not have universal jurisdiction, thus a foreign national who committed a corruption offence abroad would not be triable by UK courts. He could be extradited to face trial in his own country, or in the jurisdiction where the acts took place.
Clause 13 should extend to include subsidiary companies of those incorporated in the UK if under actual control. In the case of other subsidiaries, associated companies and joint ventures, there should be an offence by the UK incorporated company if it fails to take adequate measures to satisfy itself that the foreign registered company or joint venture is implementing sustainable anti-corruption policies in the conduct of its business. Transparency International (UK), DCB 18, para 4.3 The UK already has jurisdiction over acts committed by any company, foreign or UK, which commits acts of bribery wholly or partly in its territory and this form of jurisdiction will be confirmed and extended by clause 14. In addition, under the Criminal Law Act 1977, the courts of England and Wales have jurisdiction over persons who conspire to commit any act in another country which is an offence against the law of that country, provided that the act would have constituted an offence if committed here, and provided there is some connection to England and Wales, for example, where an act (or omission) which contributes to the formation or furtherance of the conspiracy takes place here. Therefore a UK parent company that conspired in the UK with its foreign subsidiary to pay a bribe abroad could be prosecuted.

We do not think it appropriate to go further and to take jurisdiction over a foreign company for actions which take place entirely in a foreign country. The position of overseas subsidiaries (which are clearly foreign if they are registered abroad) is an international problem, which needs to be tackled on an international basis. The OECD is examining the issue and the Government has said (in its response to the all-party Commons International Development Committee report on corruption) that it will consider its policy in relation to the coverage of foreign subsidiaries in the light of the OECD examination, its existing policy on extra-territoriality and its obligations as a member of the World Trade Organisation.

This would inevitably include countries where actions would not be illegal or even morally disapproved. Is it right to 'export' criminal law for a crime with a proposed maximum sentence of only seven years and would it 'unfairly' disadvantage citizens/companies who were British/ incorporated in the UK? Additionally, there are obvious practical problems involved in trying such a crime. CBA Working Party, DCB 20, para 3 and 4 We consider it of the utmost importance that UK citizens do not contribute to corruption either at home or abroad. The vast majority of OECD countries have extra territorial jurisdiction over their nationals, thus we do not see any unfair disadvantage for UK interests. We do not know of any country in which bribery is not considered a crime.

Although we agree that there could be practical problems in trying a corruption crime which took place abroad, we do not consider it impossible - the USA prosecutes a handful of such cases each year. In any case extra-territorial jurisdiction has substantial preventative force.

A clause should be inserted which explicitly states that bribery of foreign public officials is covered. Mark Pieth, Professor of Criminology, oral evidence session, 2 June 2003 We think that the inclusion of such a clause would raise more questions than it would resolve. It is clear that the bribery of foreign public officials is covered in the Bill.

The requirement under the Convention is that Parties should criminalise the bribery of foreign public officials. The means by which parties achieve that aim remain open to them. Indeed the commentaries on the Convention, adopted by the Negotiating Conference in 1997 state: "a statute prohibiting the bribery of agents generally which does not specifically address bribery of a foreign public official, and a statute specifically limited to this case could both comply.

13 (1)(a)"This section applies if -

A national of the United Kingdom or a body incorporated under law in any part of the United Kingdom does or omits to do anything"

Unincorporated associations and partnerships should be included as bodies capable of committing corruption offences. Transparency International (UK), DCB 18, para 4.2 An unincorporated body does not have legal personality so criminal liability for corruption could not attach to the body itself. Any criminal liability would have to attach to the people who were members of the unincorporated body. So it would be possible, for example, to bring within the scope of the corruption offences individual members of a partnership where the partnership was drawn up under English law. But we think this would be taking extra-territorial jurisdiction too far. Many people will make their agreements subject to English law even though they have no connection with this country. It would not be fair for them suddenly to find that they were personally subject to English criminal law jurisdiction because of this.
13 (2)(a)"the act or omission constitutes the offence concerned;" Replace ";" ["semi-colon"] with "," ["comma"] at end of 13(2)(a), 15(7)(a) and 16(3)(a). This would reflect consistency with the correctly punctuated clauses in the rest of the draft Bill. CBA Working Party, DCB 20, para 16c We do not think there is any ambiguity in these provisions. However, we will be checking the consistency of the Bill's punctuation before it is introduced into Parliament.
13 (3)(c)"These offences are corruption offences - aiding, abetting, counselling or procuring the commission of an offence under this Part" Change to: "complicity in, including aiding, abetting, implicitly authorising, counselling or procuring the commission of an offence." Corner House, DCB 1, para 7.5 Clause 13(3)(c) reflects section 8 of the Accessories and Abettors Act 1861 which makes it an offence to aid, abet, counsel or procure the commission of any indictable offence.
15Authorisations for intelligence agencies The Criminal Convention does not contain any express provision which provides clear justification for clause 15. The legal basis for this clause may need further clarification. Khawar Qureshi, DCB 7, para 15 There is no specific provision on security service issues in the Council of Europe Convention. As we have not ratified the Council of Europe Convention, there is no legal impediment to our enacting clauses 15 and 16. They are closely based on section 7 of the Intelligence Services Act 1994. That allows the Secretary of State to grant authorisations to the SIS which have the effect of negating any liability that might otherwise arise under UK law in relation to acts carried out outside the British Islands. This would apply to the making of 'corrupt' payments.

We do not see that there is a problem with the OECD Convention as it relates to international business transactions only.

As concerns the Council of Europe, we do recognise that the remit of the Convention is wider and we will consider the issue in the ratification process. However, we do not consider that the question is unique to the UK.

15 and 16Authorisations: supplementary No international treaty would allow an exemption from the general criminalisation of corruption as stated in clauses 15 and 16. It is not in compliance with the Council of Europe's Criminal Law Convention on Corruption or the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Drago Kos, GRECO, DCB 12, para 12 See above and the Attorney General's point below.
Clauses 15 and 16 are inappropriate in a new corruption law and, if needed at all, should be included in a more general Intelligence Services Act. Transparency International (UK), DCB 18, para 3.11 We recognise the point about the desirability of a wider provision but there is no current vehicle for a wider change.
This clause is "asking for trouble" in relation to the OECD Convention. Mark Pieth, Professor of Criminology, oral evidence session, 2 June 2003 The Convention is limited to bribery in international business transactions and the clauses are modelled on extant provisions (see above).
The Attorney General regards it as highly desirable to have these provisions. It is better to have these activities subscribed to by parliament but subject to checks and balances. Attorney General Lord Goldsmith, oral evidence session, 4th June 2003 We agree with the Attorney General.
17Consent to prosecution The Attorney or Solicitor General's consent for prosecution should be removed from the bill to allow for private prosecutions (this also represents a potential breach of Article 5 of OECD Convention on Combating Bribery in International Business Transactions). Corner House, DCB 1, para 4
1  The requirement for the Law Officers' consent to statutory corruption prosecutions is part of the existing law and it does not lead to problems.

2  The Government made a statement on its position on the consent requirement in corruption cases on 10 April 2001. They noted that the Law Commission had recommended in October 1998 that consent should be required for "offences which create a high risk that the right of private prosecutions will be abused and the institution of proceedings will cause the defendant irreparable harm". The Government said it believed that this category is relevant to the offence of corruption. It also noted that the Joint Committee on Parliamentary Privilege recommended that prosecution under the new legislation, whether of a member or non-member, should require the consent of a law officer. They said that 'all those who are in the public eye are particularly vulnerable to mistaken or malicious allegations. For these people, and no doubt others, the new offence will create a high risk that the unrestricted right of private prosecution will be abused'. CBI has underlined that Attorney General's Consent is a very useful safeguard.

The Attorney General's consent is in the current law. The OECD stated in its 2003 report that "the Working Group is of the opinion that the U.K. law now addresses the requirements set forth in the Convention."

3  

The issue of private prosecutions is not dealt with in the OECD Convention.

In relation to allegations against Members, consent to prosecution should be given by Director of Public Prosecutions after consultation with the Parliamentary Commissioner for Standards. Proposals that discretion over the prosecution of elected MPs should be exercised by a Government Minister run contrary to both history and principle. Roger Sands, Clerk of the House of Commons, DCB 5, para 12 Please see responses 571, 580 and 585 of the Attorney General's evidence.
No explanation is given as to why the consent of the Attorney General or Director of Public Prosecutions for NI is needed to start proceedings. This is a highly unusual clause and might lead to a perception of political interference in prosecutorial functions. At the very least, additional explanatory language is needed. Drago Kos, GRECO, DCB 12, para 14 See above
The CPS does not believe that the Attorney General's consent is necessary. The consent of the DPP could act as a necessary check against private prosecutions which are not in the public interest. In practice, this would mean an individual prosecutor taking the decision under the Director's delegated authority CPS, DCB 15, para 3.1 In the case of Attorney General's consent, the consent can only be delegated to the Solicitor General. However in the case of the Director of Public Prosecutions, such consent can be delegated to individual prosecutors, which may not satisfy all concerned that the protection given would be of a high enough level. The Nicholls Report suggested that "the Director of Public Prosecutions does not appear to be appropriate because he does not have parliamentary experience."
Politicisation of prosecutions would be retrograde and there should be no requirement for the Attorney General's consent to prosecution of offences. Transparency International (UK), DCB 18, para 3.15 See above. There is no question of politicisation of prosecutions - see Attorney General's answer to Q 585.
Considerable care has been taken to distance the Attorney-General from daily decisions of the prosecuting authorities (setting up CPS and SFO) and there seems to be no reason why the principles behind this should not be equally valid in respect of prosecutions for corruption. It would also be inappropriate for the DPP to sanction a prosecution brought by the SFO. George Staple, Clifford Chance, DCB 19, para 14 and 15 See above
This clause could be limited to cases where the defendant is an elected representative.

The DPP considers that consultation/ communication with the Parliamentary Commissioner would be mandatory before taking a case forward. Even if it were not included in the draft Bill, it would be done anyway.

DPP and SFO, oral evidence session, 14th May 2003 MPs are not the only people who could be damaged by a malicious prosecution. The CBI and others consider that the risk of malicious prosecutions in the field of business and the devastating effect these could have on victims merits the retention of Attorney General's consent.

We understand the Attorney General is to write on this matter.

The OECD would have difficulties with this clause and sees no reason for a political officer to give consent to all corruption cases. However, the OECD would not object to the consent of the Attorney General being attached to cases involving MPs. Mark Pieth, Professor of Criminology, oral evidence session, 2 June 2003 The OECD's BWG has already determined that the UK's existing law, and New Zealand's law (which has a similarly broad consent requirement), address the requirements of the Convention.
The Attorney General would be able to bring parliamentary knowledge and experience to the role. However, the Attorney General is "quite relaxed" about who the consent should come from (either himself or the DPP), as long as the reason for not giving it to the Attorney General was because they could not be trusted. He and his predecessors have been committed to making impartial decisions. Attorney General Lord Goldsmith, oral evidence session, 4th June 2003 The Government prefers to retain the Attorney General consent mechanism.
17 (1)"No proceedings for a corruption offence may be started in England and Wales except with the consent of the Attorney General" The Attorney General might have or be perceived as having a conflict of interest if he has to decide if a corruption offence can be brought against a politician. It might be better for clause 17(1) to require the consent of the Attorney General or the Director of Public Prosecutions, provided that he can only delegate this duty to certain specified senior officials. Sir Stephen Silber, DCB 22, para 4 See previous comments.
19"Abolition of existing offences etc" Further clarification is needed regarding the repeal of Section 2 of the Prevention of Corruption Act 1916. In particular, the Bill contains no provision dealing with 'illicit enrichment' which is defined in Article 25 of the UN Draft Convention on Corruption. Khawar Qureshi, DCB 7, paras 19-22 Section 2 of the Prevention of Corruption Act 1916 in effect places the onus on the public servant to prove his innocence and is to be repealed as it could potentially conflict with ECHR.

We think that the offence of "illicit enrichment" as defined in the draft UN Convention is also potentially in conflict with ECHR. We have agreed to an EU Common Position binding us not to support a mandatory provision. The Government has no intention to introduce any such offence.

22"Postponement of limitation periods" There is no provision for compensation claims, as provided for in Article 5 of the Civil Convention. Normal civil proceedings could be considered, but further clarification is required regarding whether proceedings against the Crown could be undertaken in this manner. Khawar Qureshi, DCB 7, para 10 (Answer from Department of Constitutional Affairs). We believe that the usual principles on which the Crown is liable will apply in the same way to corruption as they do elsewhere. Generally the Crown Proceedings Act 1947 provides for the Crown to be liable in tort and contract in the same way as a private person. We do not consider that the subject of corruption raises any new issues in respect of Crown liability.



 
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