The Government is to press ahead with controversial reforms to usher in plea bargaining for corporates in what legal advisers regard as a major step towards US-style white collar crime enforcement in the UK.

The Ministry of Justice (MoJ) today (23 October) said that it would legislate to bring in so-called deferred prosecution agreements (DPAs) in the UK in what the ministry dubbed an "important new tool to combat economic crime".

DPAs are a form of plea-bargaining which enables a prosecutor to defer criminal prosecution against an organisation, in return for compliance with a range of conditions, such as financial heavy penalties, making reparations to victims, undertaking reform and monitoring.

The MoJ said agreements will be made in open court and published, so that the wrongdoing and sanctions imposed are transparent. It stated that DPAs would not be a substitute for prosecution, and that if an organisation failed to meet conditions set in the agreement, it could face prosecution.

DPAs are viewed by many legal advisers as the primary means by which the US achieves its robust levels of enforcement in white collar investigations.

The UK Serious Fraud Office has lobbied strongly for DPAs to be introduced domestically, with the UK Attorney General's Office launching a consultation on such a move last autumn. The MoJ today said that 86% of respondents backed the introduction of DPAs during the consultation.

Kingsley Napley partner Michael Caplan QC welcomed the policy, provided there are "appropriate safeguards and they are properly policed".

"This will require the cooperation of the judiciary, who will be keen to uphold the public interest in prosecuting corporate fraud, ensuring justice is not surrendered in favour of political or financial expediency."

Caplan added that the future "may look bleak" for executives finding themselves exposed to criminal prosecution once a DPA has been made.

However, the move will be criticised by those arguing that companies increasingly face strong-arm tactics thanks to the global regulatory clampdown, effectively forcing many companies convinced of their innocence to accept a plea deal.

Speaking at the Legal Week Corporate Governance and Risk Forum on 18 October, David Bermingham (pictured) – one of the 'NatWest Three' bankers controversially extradited to the US and charged in relation to Enron's collapse – strongly criticised the role of DPAs.

"Plea bargaining is game theory – there's no other way to describe it," he told delegates. "Put two men in a room each with a prosecutor, and say, 'Which ever one of you does the deal first gets the best deal.'

"You have two choices: you can stand by your principles and end up in jail. Or you can do what 98% of people do, which is play the get-out-of jail-early card."

However, Stephenson Harwood partner Tony Woodcock commented: "I believe the move is sensible and mature. It has been tried and tested, usually to good effect, in other jurisdictions. The ultimate objective is to eradicate corruption, and a tool which effects that objective, perhaps more easily and in a more structured way, is to be welcomed."

Announcing the measures, justice minister Damian Green said: "Deferred prosecution agreements will give prosecutors an effective new tool to tackle what has become an increasingly complex issue. It will ensure that more unacceptable corporate behaviour is dealt with including through substantial penalties, proper reparation to victims, and measures to prevent future wrongdoing."

Click here for the consultation document on DPAs.