Out-Law Legal Update
High Court guidance will reassure banks acting to freeze accounts suspected of holding proceeds of crime
Out-Law News | 26 Mar 2019 | 11:01 am | 1 min. read
In October 2018, the Home Office wrote to the chief executives of 17,000 UK companies telling them to "open up about modern slavery in their supply chains". It warned that the Home Office would publish a list of non-compliant companies following an audit of statements on 31 March 2019. The recent tender notice makes reference to that list of non-compliant companies, however whether this list will emerge and when is not clear, according to corporate compliance expert Neil Carslaw of Pinsent Masons, the law firm behind Out-Law.com.
"The outreach in October 2018 has caused many companies to be concerned that they would be included on a Home Office list of 'non-compliant' companies and that this list would be published on 31 March 2019. Since then, the Home Office has stated in correspondence that this date is not a single reporting deadline, and rather a date on which it will commence an audit," he said.
"The further information from this tender notice suggests that it will take maybe one to two months for the Home Office to consider the data from an audit and decide on next steps. There may also be a further round of correspondence prior to any list of non-compliant organisations. Practically, corporates which have received a letter should identify all group entities that are required to report; produce statements as required, and consider updating the Home Office and the Modern Slavery Registry with a copy of their latest statement," he said.
'Modern slavery' is an umbrella term which includes the offences of human trafficking, slavery, servitude and forced or compulsory labour, including sexual or criminal exploitation. The Act introduced annual corporate transparency reporting requirements for UK businesses with a turnover of £36 million or more.
Under section 54 of the Act, relevant organisations must report annually on the steps that they have taken during the financial year to ensure that slavery and human trafficking are not taking place in their own business or in their supply chains.
The Home Office tender notice refers to relevant organisations being audited based on whether they meet the 'minimum legal requirements' stipulated in section 54 of the Act; and also whether their statements meet the standards set out in its guidance. Separately, a government-commissioned review of the Modern Slavery Act, chaired by MPs Frank Field and Maria Miller, recommended stronger enforcement of the section 54 transparency requirements, as well as more consistency over the information which relevant organisations should include in their reports.
The tender process ran until 22 March. The contract is expected to run from 2 April to 24 May.
Out-Law Legal Update