How-to guide: Understanding penalties for breach of the Bribery Act 2010 (UK)

Introduction

This guide helps in-house lawyers and compliance professionals in organisations of all sizes and sectors in the UK to understand the potential consequences of a breach of the UK Bribery Act 2010 (BA 2010).

The BA 2010 came into force on 1 July 2011 and targets bribery and corruption in the private and public sectors. An understanding of the consequences of committing an offence under the BA 2010 should inform your organisation’s commitment to compliance, underpin the creation and implementation of a compliance programme, and aid in taking appropriate steps should suspected misconduct be identified.

This guide includes the following sections:

Penalties
Factors involved in sentencing

This guide can be read in conjunction with How-to guides: Understanding the Bribery Act 2010 offences, How to identify and assess bribery and corruption risk and How to prevent bribery and corruption and Checklists: Anti-bribery and corruption risk assessment and Anti-bribery and corruption procedures.

Section 1 – Penalties

As set out in the How-to guide: Understanding the Bribery Act 2010 offences, there are four offences under the BA 2010:

bribing another – active bribery (section 1);
being bribed – passive bribery (section 2);
bribing a foreign public official (section 6); and
the corporate offence of failing to prevent bribery (section 7).

A corporate body is capable of committing all of the offences. An individual can only commit the section 1 offence of bribing another, the section 2 offence of being bribed or the section 6 offence of bribing a foreign public official.

1.1 Individual penalties

Section 11 of the BA 2010 sets out the penalties that an individual may receive for offences under section 1, 2 or 6. The maximum penalty is a term of imprisonment not exceeding 10 years and/or an unlimited fine.

Dependent on the circumstances of the offence, there are a wide range of ancillary orders that the court can make against the individual such as a confiscation order, compensation order, deprivation order, serious crime prevention order with financial reporting requirements, and also disqualification from acting as a company director. Each is dealt with briefly below.

1.1.1 Confiscation order

This is an order made against a convicted person ordering them to pay the amount of their benefit from the crime. It is essentially a deprivation of the financial benefit that one has gained from the criminality.

1.1.2 Compensation order

This is an order made against the convicted person. For the court to make a compensation order, loss, damage or injury has to result from the offence charged.

Sentencing guidelines make clear that ‘if the court makes both a confiscation order and an order for compensation and the court believes the offender will not have sufficient means to satisfy both orders in full, the court must direct that the compensation be paid out of sums recovered under the confiscation order (section 13 of the Proceeds of Crime Act 2002)’.

1.1.3 Deprivation order

This is an order where the courts have the power to deprive the defendant of property that has been used or was intended to be used to commit or facilitate the commission of any offence.

1.1.4 Serious crime prevention order

Financial reporting requirements can be imposed under the terms of a serious crime prevention order. These requirements might be to submit a report on a regular basis that sets out details of an individual’s income, assets or expenditure. It may also require the submission of bank statements or other documentation detailing financial transactions, including any tax returns that have been filed.

1.1.5 Director disqualification order

Under section 2 of the Company Directors Disqualification Act 1986, the courts have the power, in certain circumstances, to disqualify an offender from being a director or taking part in the promotion, formation or management of a company. A breach of the BA 2010 could lead to disqualification for up to 15 years.

1.2 Corporate penalties

Joint SFO-CPS Corporate Prosecution Guidance sets out the common approach of the Crown Prosecution Service and the Serious Fraud Office to the prosecution of corporate offending, including in respect of BA 2010 offences.

An organisation that is found guilty of an offence under the BA 2010 is liable to a maximum penalty of an unlimited fine.

The court can also make ancillary orders such as confiscation or compensation orders against a commercial organisation (see above).

Commercial organisations may be excluded from public procurement contracts in the UK under the Public Contracts Regulations 20 23. Specifically, Schedule 6 of the Act mandates exclusion where a contracting authority in charge of the procurement procedure has established, or is otherwise aware, that the supplier or a connected person has been convicted of an offence under sections 1, 2 or 6 of the BA 2010. The Procurement Act 2023 provide for the possibility of self-cleaning (ie, the possibility of showing that the circumstances giving rise to the application of an exclusion ground are not continuing or likely to occur again such that it should not be excluded from the procurement process).

Section 2 – Factors involved in sentencing

The Sentencing Council has published detailed guidance on the range of sentences that the court can impose, the process for arriving at a sentence and the factors that are considered as aggravating or mitigating. A summary of the process for arriving at an appropriate sentence and the factors that are taken into account is set out below.

2.1 Individual liability

The first step for the court is to determine the category of offence. This involves an assessment of both culpability (ie, the offender’s role and the extent to which the offence was planned) and harm (ie, the impact of the offence and the actual or intended gain of the offender).

Indications of a high level of culpability may include, for example, involving others through pressure or influence, the intended corruption of a senior official performing a public function or a law enforcement office, or the sophisticated nature of the offence or offending that takes place over a sustained period of time. Indications of a low level of culpability may include involvement as a result of coercion, a lack of motivation for personal gain or a peripheral role in the activity.

At the most serious end of the scale, harm could include a serious detrimental effect or substantial actual or intended financial gain to the offender (or loss caused to others). At the least serious end, harm could be a risk of limited impact.

The court considers the assessment of culpability and harm and arrives at a starting point for the sentence that could range from a community order through to seven years in custody. The court then considers whether any contextual factors should result in an upward or downward adjustment to the starting point.

From that starting point, factors that increase seriousness include the following:

previous convictions;
an offence committed whilst on bail;
attempts to conceal or dispose of evidence; and
blame wrongly put on others.

From that starting point, factors that reduce seriousness or reflect personal mitigation include the following:

no previous (or no recent or relevant) convictions;
remorse; and
co-operation with the investigation, making early admissions or the voluntary reporting of offending.

The court will then consider other reasons to reduce the sentence including assistance given to the prosecution, a reduction for guilty pleas and, in circumstances where sentencing is for more than one offence or where the offender is already serving a sentence, any reduction to ensure that the totality of the sentence is just and proportionate to the overall behaviour. Where time has been spent on bail, the court must also consider whether to give credit for this.

2.1.1 Orders

The court must deal with whether or not to impose a confiscation order before, and when assessing, any other fine or financial order (except compensation).

Where the offence has resulted in loss or damage, the court must consider whether to make a compensation order and must give reasons if it decides not to order compensation.

The court may also consider whether to make ancillary orders, which may include a deprivation order, a financial reporting order, a serious crime prevention order and disqualification from acting as a company director.

2.2 Corporate liability

The process for arriving at a sentence for a corporation is largely the same as for that of an individual.

A high level of culpability is demonstrated by characteristics including involving others (eg, employees or suppliers) through pressure or coercion, corruption of government officials or ministers or officials performing a law enforcement role, or abuse of a dominant market position or position of trust or responsibility. For the section 7 offence only, a high level of culpability is demonstrated by a culture of wilful disregard for the commission of offences by employees or agents with no effort to put effective systems in place.

A lesser level of culpability is indicated by the corporation playing a minor peripheral role in unlawful activity organised by others, or involvement through coercion, intimidation or exploitation. For the section 7 offence only, a lesser level of culpability might be demonstrated by some effort made by the organisation to put bribery prevention measures in place even if these are insufficient to amount to a defence.

Harm is represented by the financial gain obtained or intended to be obtained (or loss avoided or intended to be avoided). For offences under the BA 2010, the appropriate figure will normally be the gross profit from the contract obtained, retained or sought as a result of the offence. An alternative measure for offences under section 7 may be the likely cost avoided by failing to put in place appropriate measures to prevent bribery.

Each level of culpability is represented by a percentage figure. The starting point for lesser culpability is 100%, the starting point for medium culpability is 200% and the starting point for high culpability is 300%. These may be adjusted up or down to reflect factors that increase or reduce seriousness.

The adjusted percentage figure is then multiplied by the harm figure to arrive at the level of the fine. Once this is arrived at, the court considers whether there are any further factors that would indicate that the fine should be adjusted in order to achieve the goal of the removal of gain, appropriate additional punishment and deterrence. The Sentencing Council guidelines indicate that factors to consider are as follows:

the fine should fulfil the objectives of punishment, deterrence and removal of gain;
the value, worth or available means of the offender;
whether the level of fine might impair the offender’s ability to make restitution to victims;
the impact of the fine on an offender’s ability to implement effective compliance programmes;
the impact of the fine on the employment of staff, service users, customers and the local economy (but not shareholders); and
the impact of the fine on the performance of public or charitable functions.

The court will then consider other reasons to reduce the sentence including assistance given to the prosecution, a reduction for guilty pleas and any reduction to ensure that the totality of the sentence is just and proportionate to the overall behaviour.

Additional resources

The Sentencing Council
The Crown Prosecution Service
The Serious Fraud Office
Ministry of Justice Bribery Act 2010 Quick start guide
Ministry of Justice Guidance about procedures which relevant commercial organisations can put into place to prevent persons associated with them from bribing

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Laws

Bribery Act 2010 (UK)