Publication
Regulation Around the World: Open Finance
In this issue of Regulation Around the World we look at how regulators are developing their proposals for Open Finance.
Australia | Publication | March 2024
The Crimes Legislation Amendment (Combatting Foreign Bribery) Bill 2023 (Cth) (the Bill) passed Federal Parliament on 29 February 2024. The measures in the Bill are long overdue. Previous governments have introduced similar bills to Parliament, but those bills lapsed before the end of their corresponding Parliamentary terms.
As explained in our previous article, the Bill creates a new offence of failing to prevent bribery of a foreign official by an associate, and represents a fundamental shift in how corporations can be prosecuted for bribery in Australia.
Under the current law, a corporation is not criminally responsible for bribery by its employees, agents or officers, if it can prove it has exercised due diligence to prevent the crime.
The Bill introduces a new absolute liability offence of failing to prevent bribery of a foreign public official. A corporation will commit the offence if an associate commits the bribery offence for the profit or gain of the corporation.
An ‘associate’ is broadly defined, and includes an employee, contractor, agent, subsidiary or controlled entity of the corporation, or a person that otherwise performs services on behalf of the corporation. The latter phrase is a new concept. The Explanatory Memorandum states that such a person need not necessarily be an officer, employee, agent, contractor, subsidiary or controlled entity of the corporation. Conceivably this applies to individuals and entities that are not directly engaged or paid by a corporation. For example, indirect suppliers such as customs agents who are engaged by a supplier in another market may fall within this definition.
The new offence will result in maximum penalties of the greater of:
The new offence of failure to prevent bribery can be committed even if the bribe was not authorised by the corporation, and the corporation did not intend for its associate to engage in bribery. A corporation’s only defence to the new absolute liability offence is proving it adopted ‘adequate procedures’ to prevent bribery.
The Bill does not detail what constitutes adequate procedures to prevent bribery. Instead, the Bill provides that the Attorney-General must publish guidance on adequate procedures.
The Attorney-General has indicated that the guidance will be based on the UK Government’s guidance that accompanies the ‘failure to prevent’ offence under s 7 of the Bribery Act 2010 (UK). The UK guidance provides that adequate procedures should be informed by six broad principles:
Under the current bribery offence, if an employee, agent or officer of a body corporate acting within the actual or apparent scope of their employment, or within their actual or apparent authority, provides a benefit to a foreign official that was ‘not legitimately due’, a corporation can be liable for providing or causing that benefit. Bribes can often be disguised as agent fees, which makes it difficult to determine whether the payment was legitimately due.
The Bill replaces the concept of ‘not legitimately due’ with one of ‘improper influence’. The rationale of this change is to stamp out bribes that are concealed as legitimate payments.
In our experience, effective anti-corruption and bribery (ABC) programs are:
Many Australian corporations have ABC policies in place, but they may not have:
Corporations in this position will not be able to make out an adequate procedures defence.
The expanded definition of “associate” means corporations need to carefully consider their direct and indirect supplier ABC risk. Australian third party due diligence programs seldom focus on ABC risk beyond their agents. This is a significant broadening of potential criminal risk.
These changes will commence six months after the Bill receives royal assent. This gives corporations time to assess their ABC risks and design effective programs that could underpin an adequate procedures defence.
Norton Rose Fulbright has vast experience in assisting corporations in improving the effectiveness of their ABC procedures. We are able to provide guidance on what constitutes adequate procedures and regulatory practices.
This also extends to providing customised ABC training via our award-winning online legal compliance training program, Compliance Manager.
Want to know more, we are hosting a webinar: New Australian failure to prevent bribery offence - will Australia’s foreign bribery laws finally bite?
Publication
In this issue of Regulation Around the World we look at how regulators are developing their proposals for Open Finance.
Publication
On 3 July 2025 the UK Takeover Panel (Panel) published PCP 2025/1: Dual class share structures, IPOs and share buybacks (Consultation) setting out a proposed framework for the application of the UK Takeover Code (Code) to companies with dual class share structures (DCSS companies).
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