ACCA Applied Knowledge · Business and Technology · Regulation and financial crime
Marlow plc operates in several countries. A senior manager suspects that an overseas agent is paying bribes to win contracts, and that the payments are recorded as 'consultancy fees'. Under typical anti-bribery legislation such as the UK Bribery Act, which statement is most accurate regarding the company's position?
The company may be liable for failing to prevent bribery by associated persons such as agents, even overseas and without board authorisation. Its defence is proving that it had adequate procedures in place to prevent bribery. Using an independent agent does not remove liability.
- AThe company may be liable for failing to prevent bribery by persons associated with it, but can defend itself by showing it had adequate procedures in placeCorrect
- BThe company is liable only if the board of directors personally authorised the payments
- CThe company cannot be liable because the agent is an independent third party
- DThe company is liable only if the bribes were paid within its home country
Explanation
Such legislation creates a corporate offence of failing to prevent bribery by associated persons, including agents, with extraterritorial reach. The defence is having adequate procedures. Board authorisation is not required, agents are covered, and location of payment does not remove liability.
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