UK Bribery Act could be a template for greater transparency in the Caribbean


Friday, February 07, 2014    

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ONE of the UK's leading anti-corruption lawyers John McKendrick believes that the Caribbean can take away a great deal from the UK's Bribery Act if the region is truly committed to greater public and private sector transparency and is determined to stamp out corruption.

McKendrick is from the renowned law firm of Outer Temple Chambers and practises international regulatory, commercial and public law. He has advised governments, public bodies and multinational corporations on anti-corruption measures in the UK and across Latin America and the Caribbean. He was The Times Lawyer of the Week in September 2013.

Speaking with Caribbean Business Report from the British High Commission in Kingston Jamaica, McKendrick said that any Caribbean company that carries out a part of its business in the UK is subject to the full force of the Act if it fails to prevent bribery.

"That means if a company is incorporated in Kingston and is owned by Jamaicans but carries out a part of its business in the UK, then the UK courts have jurisdiction in relation to the criminal offence of bribery committed there. This new criminal offence is a strict liability one and if a person is associated with the relevant commercial organisation that carries out a part of its business in the UK, is involved in bribery, then it doesn't matter that the Board of Directors didn't know, or were reckless or negligent in not making efforts to find out —intention is irrelevant. There is only one defence and that is to have in place adequate procedures against bribery and corruption."

Gold Standard

In this way it is not too dissimilar to anti-money laundering procedures or due diligence procedures. What has to be focused upon here is bribery and corruption.

The UK Bribery Act passed in 2010 is based on six key principles, namely: Proportionality; risk assessment; top-level commitment; due diligence; communication and training; and regular review and monitoring.

"What the Caribbean can take away from the UK Bribery Act is that the UK has passed this piece of legislation, which is a gold standard around the world. Other jurisdictions have similar legislation like the United States' Corrupt Foreign Practices Act and other countries will soon follow suit here because that is what the United Nations and OECD is driving at. So it makes good sense for companies to associate themselves with the type of adequate procedures that the relevant commercial organisations must have in place.

"What we have seen since the passing of the Act is a change in corporate culture. Businesses realise that they have to be seen to be carrying out business in an ethical, non-corrupt transparent way.

"That is one of the things the British High Commission in Jamaica is keen to emphasise, which is those jurisdictions that have high levels of rule of law compliance and low levels of corruption perception have much higher GDPs per capita," explained McKendrick.

It is clear then that if one has a jurisdiction in which international investors and domestic investors perceive that country to have high levels of corruption, than that is an economic hazard and does not encourage firms to invest there.

The former Contractor General of Jamaica Greg Christie was relentless in ensuring that greater levels of transparency in public procurement prevailed but for his valiant efforts both leading politicians and corporate leaders vilified him. Some deemed him too draconian and "too much of a stickler for the rules".

Corruption in the Caribbean

In December 2013, the National Integrity Action (NIA) blamed the Jamaican Government's lack of action and failure to pass the promised anti-corruption legislation for the country's failure to improve on Transparency International (TI) Corruption Perception Index (CPI).

TI placed Jamaica again at number 83 of the 175 ranked in the 2013 survey, with number one being the least corrupt and 175 the most corrupt.

Jamaica shared the 83rd spot with fellow Caricom state, Trinidad and Tobago as well as African countries Zambia and Liberia.

Barbados received the best ranking within Caricom coming in at number 15, while The Bahamas and St Lucia placed at number 22. St Vincent and the Grenadines was ranked number 33 and Dominica 41.

Fully embracing transparency

"I think the key message for the private sector is to fully embrace the transparency agenda because it encourages competition. Now one of the things that people tell me about Jamaica is that there are too many laws that are not enforced. There is something of a culture of impunity growing. One of the things I feel strongly about is if you have laws on the statute book, you need to enforce them because if they are not enforced, then they are not laws.

"So a contractor-general or any official, who is tasked by Parliament, needs to go about enforcing the relevant statutory rules. At the end of the day, the market will operate much more effectively if there are these transparency laws and procedures in place.

"One thing I am not too sure exists in Jamaica but should do so is, I understand in relation to a government procurement exercise there is a concern raised, the contractor-general can investigate and produce a report which is sent to Parliament but is non-binding. What I think would be useful is, if a contract is awarded the private company that was not successful in obtaining the contract should be able to take steps to judicially review or repeal the award of the contract if it has legitimate concerns. The judge then can look to see whether the contract was awarded in a transparent and fair way in accordance with the law. Now that's what happens in the UK," said John McKendrick.





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