Since the UK Bribery Act was enacted in 2010, London-based lawyers have rubbed their hands at the prospect of fresh business. There are dangers ahead for US companies that trade with the UK and indeed much of Europe.

Under the British Bribery Act, the authorities can charge any British bank with committing bribery or allowing "associated persons" to do so on its behalf. Relationship managers are at the forefront of banks' efforts to comply. This is especially true as there is no “mental element” to the crime; the only defence is the maintenance of an effective programme by bank staff.

When the Act was enacted in 2010, with government guidance to follow, lawyers in the City of London were rubbing their hands at the prospect of fresh business and proclaiming that a ‘new gold standard’ had been created. This might turn out to be something of an exaggeration, but there are still dangers ahead for US companies that trade with the UK and indeed much of Europe.

Under the news act, there are no cases. This has come to light from a recent Freedom of Information Act request.

It is also true that the Act has not set up a regulatory regime as such. The SFO and the Crown Prosecution Service are the only agencies that can prosecute anyone for bribery according to Section 10 and they do publish guidance, but this falls short of regulation.

The legislation, in the words of The Economist on 11 July 2011, was “conceived by the previous Labour government in response to the scandal of BAE bribes in Saudi Arabia” but no case involving a public official has yet come to light.

The likelihood of a US target

The new Act, however, should not be discounted as a mere paper tiger; all new legislation has to be “bedded in”. The US authorities, for their part, prosecuted nobody at all under the Foreign Corrupt Practices Act 1977 during its first two years of life. Speculation is rife about the ground on which the SFO will choose to fight its first test case.

Richard Lissack QC, drawing from his knowledge of that body, said that he expected a case against a foreign corporation which, through a bribe, had secured an advantage in a situation where a rival British company did not pay the bribe. He thought that this would “tick a lot of boxes”, especially since it would be good for the image of British businesses. This strategy could be popular in government circles at the moment in view of the recent swingeing fines that US regulators have levied – some say in a nationally targeted way – on UK banks such as HSBC, Barclays and RBS over money-laundering controls and LIBOR. Lissack also thought that the SFO wanted to prosecute small multinationals – possibly US, once again – that lacked the resources for good controls.