HOWZAT

He said there would also be a hearing expected later this year in which the court may order the company to pay financial penalties as well as the costs of an independent monitor and legal costs.

“We have also agreed to pay appropriate compensation as a further expression of our regret,” he said.

Richard Alderman, Director of the SFO, said: “These are serious offences and it is significant that Mabey & Johnson has cooperated with us to get to this landmark point.

“This has enabled this case to be dealt with in just over a year and is a model for other companies who want to self-report corruption and have it dealt with quickly and fairly by the SFO.”

Mabey & Johnson, which is based in Reading, Berkshire, designs and manufactures steel bridges used in more than 115 countries world wide.

It makes bridges based on Sir Donald Bailey’s portable Bailey bridges, used by Allied armies in the Second World War.

The court hearing today comes after the company’s voluntary disclosure to the SFO in early 2008 of evidence that it may have engaged in corrupt practices.

Under the UN “oil for food” programme, Iraq was allowed to sell enough oil to pay for food and other necessities for the population, suffering under the strict UN sanctions imposed after the first Gulf War.

But a UN report in October 2005 accused nearly half the 45000 participating companies of paying kickbacks and illegal surcharges to win lucractive contracts.

The information came to light in the course of an internal investigation by the company’s solicitors, Herbert Smith.

Five of Mabey & Johnson’s eight directors have stepped down since Spring 2008 and new management was installed last year by Mabey & Johnson’s holding company.

Since then, the company has worked closely with the SFO to enable charges to be brought, for guilty pleas to be entered and for the case to be processed as quickly and efficiently as possible.

Meanwhile the company has introduced extensive anti-corruption training and overhauled its internal compliance programme.

An SFO-approved independent monitor will be appointed to oversee and report on the effectiveness of these measures to the prosecution authority.

Peter Lloyd, the company’s new managing director, said: “We deeply regret the past conduct of our company and we have committed to making a fresh start, wiping the slate clean of thes offences.

“The investigation has already involved significant costs for the company. In addition, at a hearing expected later this year, the court may order the company to pay a financial penalty, a well as the costs of the independent monitor and legal costs. We have also agreed to pay appropriate compensation as a further expression of our regret.”

Despite the outlay the company was not taking steps to protect jobs and move the business forward, he added.

“Our goal is to maintain a strong and successful UK-based manufacturing and export business, built on sound trading relationships.”

Alistair Graham, partner at the international law firm, White & Case, said: "This prosecution underlines Richard Alderman's threat to company directors - that there is only a short window of forgiveness, once they become aware of wrongdoing, to “self report to the SFO. Corruption is finally on the agenda!"

"As the first prosecution brought in the UK against a company for overseas corruption, it demonstrates Richard Alderman's determination to deliver on his promise of more effective corruption enforcement."

But Jeremy Cole, partner and head of the bribery and corruption task force at Lovells, said that the admission by Mabey & Johnson “does not resolve the underying dilemma for corporates as to whether to self-report".

“Businesses still need a better sense of what they are letting themselves in for if they do self-report.

“It is not clear what the SFO will offer by way of assurance, in exchange for proactive internal investigation and self-reporting."

Explore Law

• Columnists

• Law Panel

• Law Reports

• Student Law

Times Recommends

• BGC 'set aside £40m to lure Tullett brokers'
• Legal aid review to ensure value
• Fears as 21 magistrates' courts face closure