(USE OSCOLA REF). READ THE SUBMISSION BLOW AND: Ask probing question. Share an insight from having read the Submission Offer and support an opinion. Validate an idea with your own experience. Make a suggestion. Expand on the submission

While directors are under civil liability to not accept any benefits from a third party, I agree that both civil and criminal liability is essential in protecting the directors fiduciary position. A bribe is given by third parties in order to corrupt the recipient, in this case the director, which is considered to be a criminal matter under the Bribery Act 2010.[1] Both the Companies Act 2006 and the Bribery Act 2010 are important in protecting the directors position. In addition, the Bribery Act establishes company liability for corrupt acts committed by persons acting on behalf of the company.[2]

The Companies Act 2006, in addition to outlining diretors duties in sections 170-175, has strict guidelines where directors owe duties not to accept benefits from third parties. These duties are covered under section 176 of the act. A director of the company should not accept benefits from a third party. A third party can be a person other than the company, an associated body corporate or a person acting on behalf of the company or an associated body corporate.[3] However, one limitation of the acceptance of bribery is outlined under Section 176 (4) where this duty is not infringed if the acceptance of the benefit cannot reasonably be regarded as likely to give rise to a conflict of interest.[4] In this case, it has to be proven that the bribe itself gives rise to conflict of interest.

Section 176 of the act relates to section 175, where the director of the company has to avoid interest that can or does conflict with the interest of the company. After all, the director of the company has a duty to the company to promote the success of the company, outlined by section 172.

In the case of Philip Towers v Premier Waste Management Ltd (2011), a director of the company accepted a free loan of equipment from a customer which breached his fiduciary duty. The director filed an appeal against this decision that he was in breach of fiduciary duty. This appeal was dismissed as it was held that the applicable duties were of a directors loyalty to the company and the duty to observe the no conflict principle, which embraced a duty not to make a secret profit.[5]

While the Companies Act 2006 outlines directors duties, the Bribery Act 2010 outlines bribery offenses. In particular, section 2 of the Bribery Act covers offenses relating to being bribed. Where a director agrees or receives financial or other advantage intended that, in consequence, a relevant function or activity should be performed improperly, it related to director being bribed.[6]

The Bribery Act 2010 is essential in protecting directors fiduciary position as it gives guidelines to what a director should avoid doing. If a director opposes the outlined rules, he is subject to section 11 of the Act which covers penalties. If an individual is found guilty of an offense under section 1, 2, or 6, they are liable to imprisonment for a term not exceeding 12 months, or to a fine not exceeding the statutory maximum, or both [7]or on conviction on indictment, to imprisonment for a term not exceeding 10 years , to a fine, or to both. [8]

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