Joint Committee on The Draft Corruption Bill Minutes of Evidence


Examination of Witnesses (Questions 500-519)

LORD FALCONER OF THOROTON QC, MR PAUL STEPHENSON AND MS MICHELLE DYSON

4 JUNE 2003

  Q500  Lord Waddington: He clearly is not, you see, because if he is only operating the toll under a contract with the Government he is acting for the Government.

  Lord Falconer of Thoroton: No. He is just doing a business for the Government. Suppose a private contractor rented property from the Government and paid rent and then charged entrance to the people who came into that property. Would that remotely be described as running it for the Government? No, it would not.

  Q501  Lord Waddington: He has been asked by the Government to operate the toll for the Government.

  Lord Falconer of Thoroton: But a contract has been entered into in which the contractor operates in a private capacity. That is what it amounts to.

  Lord Waddington: I can only say that others seek to differ.

  Q502  Lord Carlisle of Bucklow: Can I come back to this definition? I fully accept that it is extremely difficult to find a definition for corruption, partly because it covers such an enormously wide area, but we have had Professor Pieth who suggested that they are getting round this with the European Convention by talking about "undue" acts and "undue" awards. He said that that was one in which a person knew they were not entitled and that that was an adequate word to cover it. The other point which occurs to me is this. Looking at the wide field of what could be said to be corrupt or dishonest intent in business behaviour, for example, in corporate hospitality, etc, can you imagine any corruption offences being brought under this Act which did not in fact involve a dishonest intent in the giving and taking of the award and, if so, is it worth putting them in?

  Lord Falconer of Thoroton: On the first question, namely, undue payment, that is, I think, the concept that has been suggested, the OECD's approach to our law has been as follows. Last year the Working Group looked at our law and concluded that it broadly complied with their approach. They said it was satisfactory. [1]That was before the changes. Our view is that we are not really effecting significant changes in the law; we are codifying and clarifying, so the Working Group as opposed to Professor Pieth have said that our law is okay. As far as the concept of undue payment is concerned, as I have said, our approach is to focus on breaching a trust, which is quite similar to what Lord Waddington suggested as a possibility, breach of duty of some sort, and we are trying to identify what that duty is. If you go for the undue payment concept you end up with considerable difficulties of the sort that Paul's example and other examples give. It just pushes the question to another place.

  Q503  Chairman: But if you use the word "unduly" as an adverb it makes it even more uncertain, does it not?

  Lord Falconer of Thoroton: It does.

  Q504  Chairman: For instance, a sum of money received unduly?

  Lord Falconer of Thoroton: Yes. Just taking up Lord Carlisle's point and your point, does that mean where somebody significantly overcharges me, the owner of my house, for surveying my property that could be corrupt? That is not the essence, I think. Freedom of contract we have to respect to some extent.

  Q505  Lord Carlisle of Bucklow: What do you say about the second point? Can you imagine offences of corruption being prosecuted which do not in fact involve an element of dishonest intent by both parties involved, because that is one possible way to look at it?

  Lord Falconer of Thoroton: We think that dishonesty is a different concept from corruption.

  Q506  Chairman: I agree with that but the question for us, I think, is this: is dishonesty an element of corruption? Can you be corrupt without being dishonest?

  Lord Falconer of Thoroton: What happens where two companies offer the same tender price and one throws in a benefit on top for an employee of the company? Is that dishonest?

  Q507  Lord Carlisle of Bucklow: Probably, depending on the size of the benefit and everything else.

  Lord Falconer of Thoroton: It might be the same.

  Q508  Lord Waddington: It is certainly improper.

  Lord Falconer of Thoroton: Yes, I agree.

  Q509  Lord Waddington: And it is certainly a breach of duty and, although people may criticise the word "undue" and say it is very vague, there is nothing about acting in breach of duty or acting dishonestly or acting with a lack of integrity with which any jury would find difficulty at all, is there? Is there any difficulty at all in any of those concepts?

  Lord Falconer of Thoroton: No, but the way that we have sought to deal with it is to say, was it because of the offer of free drinks for life that the licensing official granted the briber his licence? That is the question that our Bill poses for the jury. Your proposal would be, was the offer of drinks undue? Was the offer of drinks lacking in integrity? Both of those formulations, with the greatest respect, open up the thing completely in a way that provides no certainty.

  Q510  Lord Carlisle of Bucklow: Is it done with dishonest intent?

  Lord Falconer of Thoroton: Is it?

  Q511  Lord Carlisle of Bucklow: I do not know. I am asking you if that is a simpler way to deal with it.

  Chairman: Let us take another practical example and test it with that.

  Q512  Vera Baird: This is a very homely example for you, nothing to do with football either. At the moment "corrupt" is defined in the Bill by reference really to the primary intention of the act as a whole in regard to the discharge of duty of the principal. Supposing A, the buyer, is bought lunch which cost £25 by B representing the company before a contract, his primary intention being to influence A to give him the contract. On the other hand, as before but A is not hungry, so B gives him £25 instead. One would guess that a jury now would say that probably B is corrupt in giving the £25 but A is not. Are you intending to change that? That would be perhaps that because of the nature of the advantage that it would look more corrupt. This would be more likely to make both of them corrupt, would it not? Is that good or not?

  Lord Falconer of Thoroton: The example is quite difficult because lunch costing £25 as it were between two great arms manufacturers presumably is not remotely going to affect what happens. Lunch for £25 where the job is deciding what stationery is purchased might have more effect, as would the payment of £25. It is impossible to answer the question without knowing more about the facts, it seems to me.

  Q513  Chairman: Does it depend on the intention or on the effect?

  Lord Falconer of Thoroton: The intention was to get somebody to do something and the belief has got to be that as a result of either buying lunch, in Vera's example, or giving the £25, the person sought to be bribed then might do something he or she might not otherwise do. I have given a rather muddled answer to that. Does it make a difference that it is £25 rather than lunch? In certain circumstances the fact that it was cash would make it look a lot more obvious, but that is the law now. That goes to intention and belief, does it not?

  Q514  Vera Baird: Do you see that the position as to which of those is corrupt is going to alter under the new Bill?

  Lord Falconer of Thoroton: No.

  Q515  Vera Baird: It is going to stay the same?

  Lord Falconer of Thoroton: I think it would stay the same because in seeking to ascertain what the defendant's intention was obviously it would depend upon the facts but in reality you would be much more readily able in most circumstances to explain why you bought somebody lunch as opposed to why you gave somebody £25 in cash.

  Q516  Vera Baird: It is more easily hidden perhaps. You might press that point and say, I suppose, that by defining it with reference to the intention you are taking away some of the potential contentiousness of the definition of corruption because if you say to the jury, "Look at the intention; do not look at whether it is lunch, which you might think is more natural, or money which is not", you will get perhaps different views on whether lunch was corrupt or not, whereas if you look at the intention would you say it is a surer test?

  Lord Falconer of Thoroton: You have got to look at the intention now. There could not be any way you could frame the law without referring to intention in some shape or form. People give various sorts of hospitality in the course of business. What is their intention in doing it? Obviously, it is to get a good relationship with their potential clients but not necessarily to make them make their decisions primarily based upon lunch at Wimbledon rather than the merits of a particular deal.

  Q517  Lord Carlisle of Bucklow: And not necessarily to make an act dishonestly.

  Lord Falconer of Thoroton: Exactly. However, taking up Vera's example, I do not know how much lunch and two tickets at Wimbledon might cost, but suppose that cost £350, to hand over £350 in an envelope, however you framed the law, is going to be a lot more suspicious than inviting somebody to lunch at some great sporting occasion.

  Q518  Chairman: Although the intention might be the same as the other example which you gave; the effect might be the same.

  Lord Falconer of Thoroton: This is not a legal problem. The factual point is, could you think of an explanation for giving somebody £350 in a brown envelope?

  Q519  Chairman: But all of this shows how important it is that people, and perhaps particularly businessmen, should understand what is not going to be covered by the new Bill.

  Lord Falconer of Thoroton: I do not think the position is that businessmen currently believe that giving people cash in brown envelopes is not possibly over the line.


1   Note by witness: The OECD Bribery Working Group in its review of implementation released 3 March 2003 concluded as follows "the Working Group is of the opinion that the UK law now addresses the requirements set forth in the Convention." Back


 
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