Authors: Gregory O Manyala & Peter Bogonko Mogire
Introduction
Bribery and corruption have been at the centre stage of many public and private sector scandals. Within the public sphere, the 2021 Corruption Perception Index by Transparency International gave Kenya a score of 30 which is below the Sub-Saharan average score of 33. In 2016,
Kenya enacted the Bribery Act, No. 47 of 2016 (the “Act”) to provide a framework for the prevention, investigation and punishment of giving and receiving of bribes.
The Act was lauded as a step in the right direction as it applies to both public and private entities.
Section 22 of the Bribery Act, 2016 requires the Cabinet Secretary in charge of matters relating to Justice to make regulations for the operationalization of the provisions of the Act. On 26th November 2021 the Attorney General, on the recommendation of the Ethics and Anti-Corruption Commission promulgated the Bribery Act Regulations, 2021 (the “Regulations”).
Application of the Regulations
The Regulations are the latest instalment in the anti-bribery laws in Kenya. As with the Act, the Regulations apply to both public and private entities.
Anti-Bribery Policies and Procedures
Part II of the Regulations operationalizes Section 9 of the Act which requires all entities to have procedures, appropriate to their size, scale and nature of their operation, for the prevention of bribery and corruption.
In addition to the size, scale and nature of its operations, entities should take into account other factors including:
Number of employees, gross annual turnover, the geographical spread of the entity’s operations;
Nature of business including whether the entity operates as a monopoly, branch or a franchise; of another entity;
Risk of bribery and corruption in its operations;
The mode of transacting business, governance and management structures; and
Interdependence between the entity and its branches.
The Regulations require that anti-bribery procedures shall be in writing and shall be made within six months of the making of the regulations. This means that all entities operating in Kenya should have their anti-bribery policies and procedures in place before the end of May 2022.
The specific matters which the anti-bribery policies and principles need to address include the following:
Bribery and corruption risk assessment;
Anti-bribery communication and training;
Structural mechanisms of reporting bribery and corruption within the entity;
Whistle-blowing mechanisms and protection of witnesses and whistleblowers; and
Modes of compliance monitoring and review.
Adoption of Policies and Procedures
The Regulations allow subsidiaries and franchisees, to adopt the anti-bribery procedures of their parent entities or franchisors as long as they comply with the provisions of Section 9 of the Act. This, however, does not relieve the subsidiaries from their obligation to implement the procedures. For joint ventures, the Regulations provide that each venture partner is required to establish its own separate anti-bribery policies and procedures. Further, where a new entity is incorporated, the entity will be required to have its own anti-bribery procedures.
With regard to local entities establishing branches for purposes of their operations, each local entity shall be responsible for ensuring that each branch complies with Section 9 of the Act and implements the anti-bribery procedures.
Reporting Bribery and Corruption
Section 14 of the Act places an obligation on every person holding a position of authority in a public or private entity to report suspicion or knowledge of bribery or corruption to the Ethics and Anti-Corruption Commission (EACC). The report should be either in person, in any electronic manner or through an agent.
The Regulations further specify the contents of the report. These include the date and time, particulars of the allegation, the place of the action, its value and nature. Where the informant requests anonymity, their name and contact details may be omitted. EACC has an obligation to acknowledge receipt of the reported allegation and keep all the records of the reports. These records are intended to help EACC to provide the details of all the records it has and the necessary action taken.
Conclusion
Both public and private entities need to re-evaluate their anti-bribery and anti-corruption policies and procedures, together with their whistleblowing mechanisms to ensure that they comply with the provisions of the Bribery Act, 2016 and the Bribery Act Regulations, 2021. It is worth noting that under Regulation 13, the deadline for compliance with the Bribery Act Regulations 2021 is six months from 26th November 2021.