The Bribery Act, 2016 (the Bribery Act) came into force on 13 January 2017 with the object of providing a framework for the prevention, investigation and punishment of bribery and related offences in Kenya.

Click here to view the Kenya Bribery Act 47 of 2016.

Introduction

The Bribery Act comes in the wake of changes and new appointments to the Ethics and Anti-Corruption Commission (EACC) in a bid to battle corruption in all sectors of the country’s economy.

The Act applies to all individuals and entities in the private and public sectors. Previously, the law did not impose significant responsibilities on the private sector in the fight against corruption.

Importantly, the Act now imposes express duties on private entities and individuals; for example, the duty to prevent and report incidents of bribery, as well as the requirement to have in place procedures for the prevention of bribery. It prescribes penalties for private entities and individuals who fail to adhere to the provisions of the Act.

What is Bribery?

The Bribery Act does not give an express definition of the term ‘bribery’. It however clarifies the meaning of ‘giving and receiving a bribe’ as follows:

Giving a Bribe

Under the Act  a person gives a bribe if ‘the person offers, promises or gives a financial or other advantage to another person, who knows or believes the acceptance of the financial or other advantage would itself constitute the improper performance of relevant function or activity.’

Receiving a Bribe

A person receives a bribe if:

• S/he receives or agrees to receive a bribe with the intention to improperly perform an activity or function;
• Where the action of receiving a bribe, or  agreeing to receive it, is deemed to constitute an agreement for the improper performance of an activity or function; or
• Where as a consequence of receiving a bribe, or agreeing to receive  a bribe, a function or activity is performed improperly by that person, or by another person, at the recipient’s request.

Extra-territorial Application

The Bribery Act has extra-territorial application in relation to bribery-related offences carried out outside Kenya. Persons covered include Kenya citizens, public or private entities, as well as persons associated with these entities whether as employees, agents or otherwise.  Accordingly, all acts of bribery committed by a Kenyan citizen, a public or private entity or a person associated with such a private entity outside Kenya is treated as if the act of bribery took place in Kenya.

Any bribery of a foreign public official in order to influence his or her capacity is also an offence under the Bribery Act.

Duty to Report Bribery

All persons holding a position of authority in a public or private entity must report to the EACC any knowledge or suspicion of instances of bribery.  Failure to report the bribery within a period of 24 hours constitutes an offence.

Prevention of Bribery

Procedures

Public and private entities are now required to put in place procedures for the prevention of bribery and corruption appropriate to their size and scale and nature of their operations.  Failure of private entities to put in place such procedures is an offence on the part of the director or senior officer.

The Bribery Act empowers the Cabinet Secretary, in consultation with the EACC, to publish guidelines that will assist persons in private and public sectors to come up with procedures in their organisations to prevent bribery. For the moment such guidelines have not been issued.

Protection of Whistleblowers and Witnesses

Under the Act, it is an offence to harass, intimidate or disclose any information regarding informants, whistleblowers or witnesses.

The Bribery Act mandates law enforcement agencies to establish mechanisms to protect the identity of informants and witnesses.  Additionally, the EACC is charged with the responsibility to assist any entity and interested persons to develop and put in place procedures to protect whistleblowers.  This would be in addition to the protection under the Witness Protection Act.

Penalties

The Bribery Act imposes heavy penalties for bribery related offences including:

• Imprisonment (maximum of ten years);
• Imposition of a fine (not exceeding KES 5,000,000/-);
• Where the person received a quantifiable benefit or any other person suffered a quantifiable loss, imposition of additional mandatory fine (five times the amount of the benefit and/or loss);
• Requirement to pay the benefit received to the Government;
• Confiscation of property;
• Disqualification from an elective person;
• Disqualification from serving as a director or partner in Kenya; or
• Being barred from holding public office.

Outlook

The new law has wide-ranging implications for clients in Kenya, or operating into Kenya from abroad.  Its effectiveness is yet to be tested, but with the hefty penalties the implications should be factored into all business activities, and businesses need to look to their compliance programmes.  The Bribery Act has far-reaching implications for those doing business in Kenya or with Kenyan entities, alongside other extra-territorial statues on bribery such as the US Foreign Corrupt Practices Act and the UK Bribery Act.

For further assistance please contact Richard Harney, Managing Partner or Angela Waki, Partner, Corporate Commercial or Anthony Njogu, Partner, Dispute Resolution.