Anti bribery compliance: a practical cross jurisdictional guide

January 8, 2025

1. Introduction

Bribery and corruption remain significant challenges for companies operating in a globalised economy. The consequences of bribery-related misconduct are far-reaching, jeopardising a company's financial stability, operational continuity and reputation. Organisations found in violation face substantial penalties, including hefty fines, criminal prosecution, imprisonment of executives, loss of public contracts and revocation of operating licences. Regulatory scrutiny has intensified globally, with enforcement agencies actively pursuing accountability for corrupt practices.

This article provides a practical guide for companies aiming to navigate the cross-jurisdictional landscape of anti-bribery compliance. It outlines key regulatory requirements, industry best practices and proactive measures companies can adopt to mitigate risk and strengthen their compliance frameworks.

The principles discussed are intended to serve as a valuable resource for legal counsel, compliance officers and senior management tasked with designing, implementing and maintaining effective anti-bribery programmes.

2. What is bribery?

Bribery occurs when a person offers, gives, requests or accepts something of value - such as money, gifts or benefits - with the intent to influence the recipient's actions or decisions in their professional or official capacity. It applies to people in both the public and private sectors, such as government officials, company executives or employees of international organisations.

Bribery can take many forms, but it generally aims to:

• influence someone to act improperly or neglect their official duties; or
• cause a public official to misuse their power for the benefit of the briber or a third party.

This broad definition captures the scope of international conventions and local laws, including the UK Bribery Act 2010, the US Foreign Corrupt Practices Act (FCPA) and other anti-bribery regulations from jurisdictions such as the EU, UAE and KSA. Importantly, it applies to both direct and indirect actions, meaning companies can be held responsible if their employees, agents or third-party representatives engage in bribery on their behalf.

3. Why anti-bribery compliance matters

Bribery laws are stringent and non-compliance exposes companies to:

• financial penalties: fines can reach into the millions or billions of dollars;
• criminal prosecution: executives, directors and employees may face imprisonment;
• operational disruption: loss of business licences and disqualification from public contracts; and
• reputational harm: a bribery scandal can permanently damage a company's brand and market value.

Global regulators have broad powers to investigate companies and impose penalties, even for conduct that occurs outside their jurisdiction. For example, the FCPA has extraterritorial reach, holding companies liable for misconduct abroad.

4. Key principles of an effective anti-bribery programme

To protect against bribery risks, companies must implement a risk-based, multi-layered compliance programme. The following principles are foundational to effective compliance:

4.1 Tone from the top

Senior management plays a pivotal role in creating a culture of compliance. Top executives must:

• set a zero-tolerance tone for bribery and corruption;
• communicate clear messages of ethical conduct to employees and stakeholders;
• allocate sufficient resources to the company's compliance function; and
• ensure oversight of the compliance framework.

Senior management's visible commitment to anti-bribery compliance is often a key factor that regulators and courts consider when assessing corporate liability.

4.2 Documented anti-bribery policy

Every company should have a well-documented and comprehensive anti-bribery policy that is tailored to the unique risks of its industry, operations and jurisdictional footprint. These policies should clearly define:

• examples of prohibited conduct, such as offering cash payments, excessive gifts or inappropriate entertainment;
• rules on accepting gifts and hospitality, ensuring they are proportionate, transparent and documented;
• guidelines on dealing with public officials, including restrictions on offering gifts, benefits and facilitation payments depending on jurisdiction; and
• escalation and reporting procedures for employees to raise concerns or report incidents confidentially.

These policies must be reviewed and updated periodically to reflect changes in regulatory standards and business operations.

4.3 Third-party due diligence

One of the most significant bribery risks faced by companies comes from third-party intermediaries, such as agents, distributors, consultants and joint venture partners. These third parties often act on behalf of the company and their misconduct can expose the company to significant regulatory and legal consequences.

To mitigate this risk, companies must conduct risk-based due diligence before engaging with third parties. This process should be thorough and proportionate to the level of risk posed by the third party's role, location and business activities. Key areas to assess during the due diligence process include:

• ownership structure: identify the third party's beneficial owners and ultimate decision-makers to ensure no hidden parties with a history of corruption are involved;
• reputation and history: review the third party's track record for any prior involvement in bribery, fraud or other forms of misconduct. This can be done through public record checks, litigation searches and media reviews; and
• jurisdictional risk: assess the corruption risk in the jurisdiction where the third party operates. Companies operating in high-risk regions should be subject to heightened scrutiny. Risk assessment tools and data-driven insights can be used to flag jurisdictions or industries with a higher likelihood of bribery and corruption risks.

For high-risk third parties, companies should apply enhanced due diligence measures, which may include:

• ongoing monitoring: continuously review the third party's activities, payments and compliance with contractual obligations;
• contractual safeguards: include specific anti-bribery clauses in contracts, such as the right to terminate the relationship if bribery-related misconduct is detected; and
• audit rights: retain the right to conduct periodic audits of the third party's financial records, transactions and compliance practices.

By conducting thorough due diligence, companies can reduce the risk of being held liable for the corrupt actions of third parties. This process not only protects the business from regulatory enforcement but also helps build a culture of integrity and accountability across the organisation's broader network.

4.4 Payment controls and record-keeping

To prevent bribery, companies must ensure that all payments are legitimate, authorised and documented. Key measures include:

• prohibiting cash payments unless absolutely necessary;
• requiring payments to be made to accounts held in the name of the beneficiary;
• accurately reflecting all expenditures and payments in financial records to ensure full transparency and auditability; and
• prohibiting undisclosed or off-the-books accounts, which are red flags for bribery.

4.5 Training and awareness

Training employees on anti-bribery and anti-corruption laws is one of the most effective preventive measures. Regular training sessions should be conducted for employees, managers, senior leadership and third-party agents. Training programmes should include:

• role-specific case studies to demonstrate real-world scenarios;
• practical guidance on identifying red flags (e.g. requests for cash payments or commissions); and
• education on the consequences of bribery, such as fines, imprisonment and loss of business licences.

4.6 Whistleblowing mechanism

A confidential, anonymous and secure channel for reporting bribery concerns is essential. Companies should establish a whistleblowing hotline to enable employees and third parties to report wrongdoing without fear of retaliation.

4.7 Monitoring and auditing

Periodic audits are essential for an effective anti-bribery compliance framework. They provide a proactive mechanism to identify potential weaknesses, ensure ongoing adherence to internal policies and detect early signs of misconduct.

To ensure a comprehensive review of compliance practices, companies should adopt a multi-layered audit approach that includes the following measures:

• internal audits: conduct regular internal audits to assess employee adherence to anti-bribery policies and procedures. These audits should review payment approvals, gift registers and third-party onboarding processes to ensure compliance with internal controls;
• external audits: engage independent, external auditors to assess third-party compliance when needed. These audits provide an unbiased perspective on the conduct of agents, suppliers and intermediaries, especially those operating in high-risk jurisdictions; and
• unannounced spot checks: perform surprise spot checks, particularly for cash-based transactions, which present a higher risk of bribery and corruption. Random inspections of payment records, petty cash funds and expense reports can help identify unrecorded transactions or undisclosed payments.

5. Bribery red flags

Certain behaviors or circumstances should trigger enhanced scrutiny, such as:

• requests for cash payments instead of bank transfers;
• payments to offshore accounts or unverified beneficiaries;
• excessive fees or commissions paid to third parties;
• unexplained "urgent" payments without clear justification;
• requests to bypass standard procurement or payment procedures; and
• transactions with politically exposed persons (PEPs).

Identifying and addressing red flags early is essential for mitigating bribery risks.

6. Facilitation payments

Facilitation payments are typically small payments made to public officials to expedite routine administrative actions (e.g. customs clearance). While these payments may have been tolerated in the past, most modern anti-bribery laws now classify them as illegal bribes. Companies should maintain a strict zero-tolerance approach to facilitation payments. Employees should be trained to recognise these situations and seek guidance if such demands are made.

7. Role of the Compliance Officer

The Compliance Officer is responsible for managing and enforcing the company's anti-bribery programme, ensuring alignment with regulatory standards. Their key duties include:

• policy oversight: implement, maintain and update anti-bribery policies and procedures;
• investigations: lead internal investigations into bribery allegations and recommend corrective and disciplinary actions;
• risk assessment: conduct regular risk assessments to identify and mitigate bribery risks in operations and third-party relationships;
• training: oversee training programmes to ensure employees and third parties understand anti-bribery expectations and procedures;
• audits: supervise internal audits and address compliance gaps effectively; and
• guidance and reporting: provide guidance to management and employees, and report incidents to senior management or regulatory authorities when required.

8. Reporting and self-disclosure

When bribery is discovered, companies may have a duty to self-report to regulatory authorities, depending on the jurisdiction. Failure to self-report can expose the company to increased liability, including harsher penalties and reputational damage. Many jurisdictions offer self-reporting mechanisms that incentivise disclosure by offering reduced fines or leniency.

Regulators often view voluntary disclosure as a mitigating factor, especially if the company demonstrates full cooperation during the investigation. Timely self-reporting, combined with proactive corrective measures, can significantly reduce the severity of enforcement actions. However, the content of a self-report should be carefully crafted in consultation with legal counsel, ensuring a strategic approach that minimises regulatory exposure while maintaining transparency and compliance with reporting obligations.

9. Corrective actions

Even the most robust compliance systems are not immune to breaches. To effectively address bribery incidents, companies must have a clear and well-defined corrective action process. Swift, decisive action helps mitigate regulatory exposure and reduces the risk of repeat violations.

When a bribery incident occurs, companies should take the following steps:

• conduct a root cause analysis: identify the underlying factors that enabled the misconduct, such as process gaps, inadequate oversight or weak controls;
• disciplinary action: impose appropriate disciplinary measures on employees, agents or third parties responsible for the breach, in accordance with company policies and applicable employment laws;
• policy and procedure revisions: update anti-bribery policies, controls and procedures to address the weaknesses identified during the root cause analysis; and
• targeted training and awareness: provide additional, targeted training to employees, managers and third-party partners to prevent a recurrence of similar incidents.

10. Mitigation and regulatory discretion

The existence of a robust anti-bribery compliance programme can serve as a significant mitigating factor when authorities and courts assess the severity of penalties. Regulatory bodies often exercise discretion on a case-by-case basis, taking into account whether the company had effective procedures in place to prevent bribery before the misconduct occurred.

Companies that can demonstrate the implementation of proactive compliance measures - such as well-documented policies, regular training, third-party due diligence and ongoing monitoring - are more likely to benefit from reduced fines, lighter penalties or deferred prosecution agreements. This highlights the critical importance of embedding anti-bribery controls as a core element of the company's risk management framework.

How Dentons can help

The anti-bribery regulatory landscape is complex, dynamic and jurisdiction-specific, requiring companies to stay agile and proactive in their compliance efforts. Operating in high-risk jurisdictions poses even greater challenges, making a risk-based approach to compliance essential. Companies must not only prevent bribery but also demonstrate to regulators that they have effective measures in place to detect and respond to potential misconduct.

With a global presence and a team of experienced legal professionals, Dentons provides end-to-end support for anti-bribery compliance. Our services include:

• drafting and reviewing policies and procedures tailored to your business operations;
• conducting risk assessments to identify vulnerabilities and high-risk areas;
• providing targeted training to employees, management and third-party partners;
• conducting internal, confidential and privileged investigations into suspected bribery incidents; and
• providing guidance on self-reporting obligations and strategies to mitigate regulatory penalties.

Whether you need to strengthen your compliance framework or address a specific issue, Dentons' Compliance and Investigations team is ready to support you. Contact us for tailored guidance on all aspects of anti-bribery compliance.

Disclaimer: Dentons publications should not be construed as legal advice on any specific facts or circumstances. The contents are intended for general information purposes only and may not be quoted or referred to in any other publication, presentation or proceeding without the prior written consent of Dentons, to be given or withheld at Dentons' discretion.

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This article is a summary overview and is not intended to be exhaustive. As a result, further analysis should be undertaken before applying this overview to any specific circumstance.