Examination of Witnesses (Questions 680
- 692)
THURSDAY 25 JUNE 2009
BARONESS SCOTLAND
OF ASTHAL
QC
Q680 Mr Cox: But in some of these
countries there will not be an established legal system; there
will not be lawyers like that. What do you do there, Attorney
General?
Baroness Scotland of Asthal: That
is one of the testing issues now in terms of why we say the written
law. There has to be law. The question is, if you cannot do business
with those people because there is no basis upon which you can
give money, then you cannot do business.
Q681 Mr Cox: Bad news for the country.
Baroness Scotland of Asthal: It
is a sad day, is it not, if we were to say, "You can't do
business save corruptly?" There is always an opportunity
for you to do legitimate business in a way that is clear, transparent
and open.
Q682 Lord Lyell of Markyate: Change
of culture is very important in some areas, but you do not do
that by producing a law which is perceived to be unjust. That
is the context of the "reasonable belief" defence. It
is a very serious question, is it not?
Baroness Scotland of Asthal: I
think it is a very serious question. I do think though that the
way in which the Bill is currently structured is fair and it does
enable those who have behaved properly to know precisely what
will be done in relation to their act and they can be confident
that if they have behaved properly they will not fall foul of
this Bill. If we had thought that this Bill could not be fair
without the Law Commission's "reasonable belief" defence
we would certainly have put it in, but we do think that the OECD's
anxiety about this kind of defence was well-founded.
Q683 Lord Goodhart: Lady Scotland,
let me ask you this. Under clause 5 one of the conditions that
has to be satisfied for the prosecution is to show that a responsible
person was negligent in failing to prevent the bribe. What is
the duty of care that gives rise to negligence, because you cannot
have negligence without a duty of care?
Baroness Scotland of Asthal: As
you know, the proposal for a negligence requirement coupled with
a due diligence defence which was arrived at by the Law Commission
after really carefully considering all the options. In my view
it represents a balanced solution to the problem of the removal
of one element; that is the negligence requirement, which would
threaten that balance, because you were talking about, I think,
in terms of whether we should have negligence or gross negligence.
Q684 Lord Goodhart: "Gross negligence"
I think would be dreadful. I think it would defeat the whole purpose
of the Bill. Anyway, go on.
Baroness Scotland of Asthal: I
think the importance is that negligence is a well-established
concept. Everyone is familiar with it in terms of the business
sense. It is an opportunity, therefore, to apply it with the greatest
degree of ease and I do not think it would be necessary to define
it because the ordinary principle with which we are familiar would
be capable of operating in a way that makes good sense.
Q685 Lord Goodhart: But negligence
must include a failure to put into force adequate procedures to
prevent bribery?
Baroness Scotland of Asthal: Yes.
Q686 Lord Goodhart: Does that not
mean that what is happening here is that you end up by saying
that a failure to set up adequate procedures is both a matter
which has to be proved by the prosecution under clause 5(1)(c)
and is a defence under clause 5(4), which has to be proved on
the balance of probabilities by the defendant?
Baroness Scotland of Asthal: The
prosecution are going to have to prove that they failed in their
duty and produce evidence as to what was reasonable in those circumstances.
I suppose it is going then to be for the defence to say, "No,
you have got that entirely wrong. In fact, what we did was wholly
defensible and entirely proper on the balance of probabilities".
I can see that you are saying, if we have to prove it beyond reasonable
doubt and they only have to prove it on balance of probabilities
do they then succeed? As I am rightly reminded, if we look at
clause 5, it is probably the difference between a responsible
person who is negligent at 5(1)(c) and the company who is negligent,
and that difference is quite important.
Q687 Lord Goodhart: Why is it necessary
to prove that a responsible person has been negligent? Is it not
obvious that if the company has no adequate procedures in position
you do not really need to identify who the individual or individuals
are who are responsible for that?
Baroness Scotland of Asthal: I
think you still would, Lord Goodhart, because if you are looking
at the "relevant commercial organisation" you have to
establish that if the person "performing services for and
on behalf of C bribes another person" the bribe was connected
with the business and the "responsible person, or a number
of other such persons taken together, was negligent in failing
to prevent the bribe". I do think you have to prove both.
Q688 Lord Goodhart: Why do you have
to identify the individuals who are responsible for the negligence?
If there is a failure to set up adequate procedures that is in
itself negligent, surely. You do not need to go and look through
the company's management and say, "X is responsible for this
and Y is not". Why not just abandon the need to show who
is the individual who is responsible, and say, "There is
a failure here. We do not need to know which individuals are concerned.
There appears to us to be a failure and it is up to the company
to say, `We did have adequate procedures'."?
Baroness Scotland of Asthal: I
think when they were looking at it they were probably looking
at it in terms of having to establish that there was someone in
the company with that responsibility. I do see the point you are
making. It would make it even more onerous than that which we
have currently structured for the company.
Q689 Lord Goodhart: It would, but
rightly, surely? If 5(1)(c) has to be satisfied there are going
to be very few prosecutions that succeed, or a reduced number.
Baroness Scotland of Asthal: I
see what you say. I think you are a harder man than we, Lord Goodhart,
in terms of this offence, but I am certainly happy to take that
away and think about it.
Lord Goodhart: Thank you.
Q690 Chairman: Lady Scotland, corporate
liability is going to be the subject of a completely different
Bill and I think we do need to satisfy ourselves that what we
have got in here is workable.
Baroness Scotland of Asthal: I
think what we have here is workable, but what the noble Lord Goodhart
is suggesting is that we should be even more trenchant in the
way we deal with it, which is another matter. The way in which
this Bill works, Lord Goodhart will probably acknowledge, means
that it is workable. All he is suggesting is that it would be
easier to prosecute more people if we were to change it and make
it even more trenchant in the way in which it has been expressed.
Chairman: I knew this was going
to happen. We are going to lose our quorum.
Linda Gilroy: There is a statement
on national security.
Q691 Chairman: I quite understand.
I did want to get on to question 14 because everybody has said
there should be guidance on the main offences, it is very important.
I do not know how it would work at this point.
Baroness Scotland of Asthal: My
Lord Chairman, would it be helpful if I were to provide a written
answer in relation to that matter? Would that help the Committee?
Q692 Chairman: I think it would be
very helpful indeed because, to start with, who would do it? Secondly,
how would it be admissible in a trial? It would have to have some
status. The Americans have an entirely different system. Nevertheless,
everybody thinks it is lovely if you can get guidance on which
you can then rely and I think the practicalities of that would
be very difficult.
Baroness Scotland of Asthal: I
think it would be very difficult and I am very happy to amplify
my evidence by giving written answers, and, if I may, I will also
give a written answer in relation to Lord Goodhart's intriguing
suggestion.
Chairman: Thank you very much indeed
for everything you have been able to tell us. It has been extremely
helpful in every way and has greatly advanced our deliberations.
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