Laws which are set to pave the way for deferred prosecution agreements (DPAs) in England and Wales have been given Royal Assent.

Schedule 16 of the Crime and Courts Bill, which was passed into law last week, contains provisions for a prosecutor and defendant to reach plea-bargaining settlements of the type widely used in the US.

Following the approval, a draft code of practice for prosecutors is expected to be published by the director of public prosecutions and director of the Serious Fraud Office (SFO) in the coming weeks, which will contain practical details and principles for when a DPA would be appropriate.

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

In a statement, Pinsent Masons partner Barry Vitou and 2 Bedford Row barrister Richard Kovalevsky QC suggested that in the wake of the formal introduction of DPAs – slated for early 2014 – the SFO would look to use the tool, regardless of comments by SFO director David Green that the body doesn't "do deals".

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

Prior to the passage of the Bill, a consultation carried out by the Ministry of Justice last year found that 86% of respondents backed the introduction of DPAs. The SFO has long lobbied for DPAs to be introduced domestically.

"This legislation is highly innovative and follows on from the groundbreaking Bribery Act," said Steptoe & Johnson London partner Patrick Rappo, the former joint head of bribery and corruption at the SFO.

"Judicially sanctioned DPAs are meant to incentivise companies to self-report, to improve compliance, and to facilitate repayment of monies to victims. They certainly give prosecutors and companies more options, beyond prosecution or civil recovery.

"Whether companies will have sufficient incentive to engage in the process will become clearer when the joint prosecutors code is produced, and when guidance on corporate fines in criminal cases is produced."