Bribery and Corruption: FCPA and UK Bribery Act

Two statutes, the US Foreign Corrupt Practices Act 1977 and the UK Bribery Act 2010, have reshaped global anti-corruption enforcement with extraterritorial reach and strict corporate liability. This topic covers their mechanics alongside the OECD Convention and India's Prevention of Corruption Act.

Last updated: 10 Jun 2026

In 1977, the US Congress passed a law that American companies resented for decades. The Foreign Corrupt Practices Act made it illegal for US businesses and individuals to pay bribes to foreign government officials to win contracts, at a time when many competitor nations still allowed such payments as tax-deductible business expenses. For twenty years, the FCPA was often described as a competitive handicap. Then a series of blockbuster enforcement actions in the 2000s and 2010s changed the calculus entirely.

The UK Bribery Act 2010 went further still, creating a corporate offence of failing to prevent bribery that does not require proof of knowledge or intent by senior management. Between these two statutes, plus the OECD Anti-Bribery Convention and national equivalents from Brazil to India, the legal risk of paying a bribe in an international business transaction has never been higher. In 2016, DOJ and SEC collected USD 2.48 billion in FCPA-related fines in a single year.

This topic covers the FCPA's anti-bribery and accounting provisions, the UK Bribery Act's four core offences and the adequate-procedures defence, the OECD Convention's role in globalizing foreign bribery criminalization, and India's Prevention of Corruption Act and its 2018 amendments. It explains the red flags investigators look for, the investigation triggers that typically initiate enforcement proceedings, and the patterns of global enforcement that now reach companies through their jurisdictional connections rather than where the bribe was paid.

Key terms

Foreign Corrupt Practices Act (FCPA): A 1977 US statute with two main pillars: anti-bribery provisions prohibiting corrupt payments to foreign government officials to obtain or retain business, and accounting provisions requiring SEC-registered issuers to keep accurate books and maintain adequate internal controls.
UK Bribery Act 2010: A UK statute creating four offences: paying a bribe, receiving a bribe, bribing a foreign public official, and the corporate offence of failure to prevent bribery. It has no facilitation payment exception and applies with broad extraterritorial reach.
Adequate procedures: The defence to the Section 7 corporate offence under the UK Bribery Act. A commercial organisation must show it had in place bona fide, proportionate anti-bribery procedures to prevent associated persons from bribing.
OECD Anti-Bribery Convention: The 1997 OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, requiring its 44 signatories to criminalise active bribery of foreign public officials and monitored through peer review by the OECD Working Group on Bribery.
Facilitation payment: A small payment to a government official to expedite a routine official action. The FCPA exempts such payments; the UK Bribery Act does not. Most compliance programs prohibit them regardless of local law.
Deferred Prosecution Agreement (DPA): An agreement between a prosecutor and a company in which criminal charges are filed but prosecution is deferred in exchange for cooperation, payment of penalties, and implementation of remediation measures. The primary resolution mechanism for corporate anti-corruption cases in the US and UK.

The FCPA: anti-bribery and accounting provisions

Two separate crimes, not one: paying a bribe and keeping false records.

The FCPA has two pillars that operate independently. This is important because the accounting provisions can be violated even when no corrupt payment was made, and because companies can face SEC enforcement for books-and-records violations without any DOJ criminal prosecution.

Pillar	Who it covers	What it prohibits	Enforcer
Anti-bribery	US persons, US issuers and their officers/directors/agents, foreign companies and nationals while in US territory	Paying, offering, or authorising anything of value to a foreign official to obtain or retain business or gain an improper advantage	DOJ (criminal); SEC (civil for issuers)
Books and records	Issuers registered with the SEC (including foreign companies listed on US exchanges)	Failing to maintain books and records that accurately reflect transactions; failing to maintain adequate internal accounting controls	SEC (civil); DOJ (criminal)

foreign official is interpreted broadly by US prosecutors to include employees of state-owned enterprises (SOEs), which is significant because in many markets, the company the salesperson is dealing with is government-owned. The Alcoa case (2014) involved payments to agents connected to Bahrain Aluminium, a government-owned company. The court and DOJ settlement accepted that an employee of a government-owned enterprise qualifies as a foreign official, even without a formal government title.

The UK Bribery Act: four offences and the adequate-procedures defence

No facilitation exception. No 'small amounts don't count'. One defence: prove you tried.

The Bribery Act 2010 came into force in July 2011 and immediately changed the compliance calculus for any company with a UK nexus, defined as being incorporated in the UK or carrying on business there, even partly. Its four offences cover far more territory than the FCPA.

Section 1 (paying a bribe): offering, promising, or giving a financial or other advantage to another person, intending the advantage to induce or reward improper performance of a relevant function. Applies to public and private sector recipients.
Section 2 (receiving a bribe): requesting, agreeing to receive, or accepting such an advantage, again in the public and private sphere.
Section 6 (bribing a foreign public official): a standalone offence for which the improper performance element is not required; the intent to influence the official in the exercise of their functions is sufficient.
Section 7 (failure to prevent bribery): the corporate offence. A commercial organisation is automatically guilty if an associated person, an employee, agent, subsidiary, or joint venture partner, bribes to obtain or retain business for it, unless the organisation proves it had adequate procedures to prevent bribery.

The Ministry of Justice published guidance on what constitutes adequate procedures built around six principles: proportionate procedures, top-level commitment, risk assessment, due diligence on third parties, communication and training, and monitoring and review. The guidance explicitly states that it is not a safe harbour checklist; adequacy is assessed on facts and circumstances. The first Bribery Act DPA in the UK was with Standard Bank in 2015, involving USD 6 million paid by a Nigerian associate to secure a government bond issue.

The OECD Anti-Bribery Convention and global criminalization

Before 1997, Germany and France allowed companies to deduct foreign bribes as a business expense.

The OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions was adopted in 1997 and entered into force in February 1999. It has 44 signatories, including all OECD members and several major emerging economies. Its core obligation is straightforward: signatories must criminalise the active bribery of foreign public officials in international business transactions. Before the Convention, many countries not only tolerated such payments but allowed them as tax deductions.

OECD Convention monitoring: Working Group peer review cycle for signatories.

The Convention is monitored by the OECD Working Group on Bribery, which conducts phased peer reviews, currently in Phase 4. Working Group reports are public and include recommendations when enforcement is inadequate. The Working Group has repeatedly criticized Germany, France, and South Korea for periodic enforcement gaps despite having technically compliant legislation. The peer pressure from published criticism has driven several signatories to reform prosecution practices even without treaty-level enforcement mechanisms.

India's Prevention of Corruption Act and 2018 amendments

The 2018 amendment criminalized the giving of a bribe for the first time.

India's Prevention of Corruption Act 1988 (PCA) governs corruption by public servants in India. For the first thirty years of its existence, the Act focused on the demand side: public servants accepting bribes. A person paying a bribe was only an offender if they gave it voluntarily; paying under coercion was a complete defence, even when the victim called the police. The Prevention of Corruption (Amendment) Act 2018 changed this substantially.

Bribe giver liability: the 2018 amendment created a specific offence for persons who give or offer bribes to a public servant. The defence of coercion is narrowed: a person must report the demand to law enforcement within seven days to claim they were extorted.
Commercial organisation liability: a new provision makes commercial organisations liable when a person associated with them gives a bribe to obtain a business advantage, with a defence for organisations that had in place adequate procedures to prevent the bribe. The conceptual similarity to Section 7 of the UK Bribery Act is deliberate.
Prior sanction for arrest: the amendment requires prior government approval before police can investigate a serving public servant, a provision aimed at preventing politically motivated prosecutions but criticized for impeding genuine investigations.

Enforcement of the PCA sits primarily with the Central Bureau of Investigation (CBI) for central government matters and with state anti-corruption bureaus for state-level matters. The Enforcement Directorate investigates the proceeds of PCA offences under the Prevention of Money Laundering Act, because corruption is a scheduled predicate offence under the PMLA.

Red flags, investigation triggers, and enforcement trends

How anti-corruption cases actually start.

Anti-corruption investigations rarely begin with a smoking-gun bribe receipt. They begin with anomalies in financial records, disclosures to regulators, or information from cooperating individuals. Understanding the typical trigger helps compliance practitioners design controls that catch problems before they become enforcement matters.

Third-party red flags: agents and consultants who are recommended by government officials, have no obvious qualifications, receive commissions significantly above market, operate through shell companies in secrecy jurisdictions, or cannot demonstrate actual services rendered.
Books-and-records anomalies: expenses coded as entertainment, travel, or consulting that have no supporting documentation, are approved outside normal channels, or have a pattern coinciding with contract award or regulatory decision timelines.
M&A due diligence: acquiring a foreign company and discovering pre-acquisition bribery is a common source of self-reported FCPA matters. The DOJ and SEC have issued guidance on successor liability and give credit for voluntary disclosure of predecessor conduct.
Whistleblower reports: the SEC's whistleblower program, established by the Dodd-Frank Act, has paid more than USD 1.9 billion in awards to whistleblowers since 2012, many in FCPA cases. The program creates a direct channel for employees and third parties to report to regulators, bypassing internal compliance.

Worked example

Siemens AG: the largest FCPA settlement until then

Systemic bribery, a two-country resolution, and the compliance transformation that followed.

In December 2008, Siemens AG and three of its subsidiaries pleaded guilty to FCPA violations and agreed to pay combined penalties of USD 800 million to US authorities and EUR 395 million to German prosecutors, totaling approximately USD 1.6 billion in global penalties. At the time it was the largest anti-corruption enforcement action in history. The factual record established by the DOJ provides a detailed anatomy of how systemic corporate bribery operates.

Siemens maintained a system of off-book cash accounts and slush funds, managed through a network of trusted agents, former employees, and external banks. At various points, cash payments were recorded as consulting fees or commissions to entities with no genuine business activity.
DOJ investigators found evidence of bribery to obtain contracts in Argentina (national identity card system), Bangladesh (mobile telephone network), Venezuela (metro system), and many other countries across the company's power, transportation, and telecommunications divisions.
The investigation began in part when German authorities raided Siemens offices in November 2006, uncovering documents related to slush funds. Siemens disclosed the German investigation to the SEC, triggering parallel US proceedings. The company subsequently conducted one of the largest internal investigations in corporate history, retaining outside counsel and forensic accountants and reviewing transactions across more than 65 countries.
Siemens received credit for cooperation, replacement of senior management, and implementation of a comprehensive compliance program. A compliance monitor was appointed for four years. Siemens has since become a reference case for compliance transformation following enforcement: the company's subsequent compliance ratings and third-party risk management program have been cited as industry benchmarks.

Check your understanding

Question 1 of 4· 0 answered

A US company pays a small cash sum to a customs official at a foreign port to ensure its legally entitled shipment is processed without delay. This is legal under which statute?

Key Takeaways

The FCPA has two independent pillars: anti-bribery provisions targeting corrupt payments to foreign officials, and books-and-records provisions requiring accurate accounting and adequate internal controls, enforceable even without a bribe.
The UK Bribery Act covers public and private sector bribery, has no facilitation payment exception, and imposes strict corporate liability for failure to prevent bribery unless the company demonstrates adequate procedures.
The OECD Anti-Bribery Convention (1997) drove most OECD signatories to criminalize foreign bribery; Germany and France, which previously allowed such payments as tax deductions, enacted compliant legislation as a result.
India's 2018 PCA amendment criminalized bribe-giving for the first time and introduced a corporate liability provision mirroring the UK Bribery Act's Section 7 structure.
Major enforcement actions are now typically multi-jurisdictional, with DOJ, SEC, and foreign authorities coordinating; the Siemens (2008) and Odebrecht (2016) cases show that a company cannot contain exposure by settling with one regulator alone.

What does the FCPA prohibit?

The Foreign Corrupt Practices Act has two main components. The anti-bribery provisions prohibit US persons and issuers, and foreign persons acting in US territory, from paying or promising anything of value to a foreign government official to obtain or retain business. The accounting provisions require issuers registered with the SEC to maintain accurate books and records and adequate internal accounting controls, even without any corrupt payment.

How does the UK Bribery Act differ from the FCPA?

The UK Bribery Act is broader in three ways. It covers bribery in the private sector as well as of public officials. It creates a strict-liability corporate offence of failure to prevent bribery, where a company is guilty if an associated person bribes on its behalf unless it had adequate procedures to prevent it. And it does not have the FCPA's facilitation payment exception.

What is the corporate offence under the UK Bribery Act?

Section 7 of the Bribery Act creates an offence committed by a commercial organisation when a person associated with it bribes another person to obtain or retain business or a business advantage for the organisation. The defence is that the organisation had adequate procedures designed to prevent bribery. This places the burden on companies to demonstrate proactive compliance.

What is a facilitation payment and is it legal?

A facilitation payment, sometimes called a grease payment, is a small payment to a low-level government official to speed up a routine service the payer is already entitled to, such as a visa stamp or a customs clearance. The FCPA has an explicit exception for such payments. The UK Bribery Act does not: facilitation payments are bribes under the Act regardless of amount. Most major companies prohibit facilitation payments globally as a result.

What is the OECD Anti-Bribery Convention?

The OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (1997) requires its 44 signatories to criminalise the bribery of foreign public officials in international business. It was the instrument that prompted many countries to enact or strengthen foreign bribery offences, including the UK Bribery Act. It is monitored through a peer review Working Group on Bribery.

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Bribery and Corruption: FCPA and UK Bribery Act

Last updated: 10 Jun 2026

Pillar

Who it covers

What it prohibits

Enforcer

Anti-bribery

US persons, US issuers and their officers/directors/agents, foreign companies and nationals while in US territory

Paying, offering, or authorising anything of value to a foreign official to obtain or retain business or gain an improper advantage

DOJ (criminal); SEC (civil for issuers)

Books and records

Issuers registered with the SEC (including foreign companies listed on US exchanges)

Failing to maintain books and records that accurately reflect transactions; failing to maintain adequate internal accounting controls

SEC (civil); DOJ (criminal)

Key Takeaways

The FCPA has two independent pillars: anti-bribery provisions targeting corrupt payments to foreign officials, and books-and-records provisions requiring accurate accounting and adequate internal controls, enforceable even without a bribe.

The UK Bribery Act covers public and private sector bribery, has no facilitation payment exception, and imposes strict corporate liability for failure to prevent bribery unless the company demonstrates adequate procedures.

The OECD Anti-Bribery Convention (1997) drove most OECD signatories to criminalize foreign bribery; Germany and France, which previously allowed such payments as tax deductions, enacted compliant legislation as a result.

India's 2018 PCA amendment criminalized bribe-giving for the first time and introduced a corporate liability provision mirroring the UK Bribery Act's Section 7 structure.

Major enforcement actions are now typically multi-jurisdictional, with DOJ, SEC, and foreign authorities coordinating; the Siemens (2008) and Odebrecht (2016) cases show that a company cannot contain exposure by settling with one regulator alone.

What does the FCPA prohibit?

How does the UK Bribery Act differ from the FCPA?

What is the corporate offence under the UK Bribery Act?

What is a facilitation payment and is it legal?

What is the OECD Anti-Bribery Convention?

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Key Takeaways

Key Takeaways