Guralp Systems v SFO: High Court clarifies enforcement of deferred prosecution agreements

The Divisional Court has provided important clarification on the enforceability of deferred prosecution agreements (DPAs) in Guralp Systems Limited v The Director of the Serious Fraud Office [2026] EWHC 37 (Admin), ruling that such agreements remain in force beyond their stated expiry date when the defendant company fails to meet financial obligations.

The case concerned a DPA entered into between Guralp Systems Limited (GSL) and the Serious Fraud Office on 22 October 2019, approved by William Davis J. The agreement required GSL to disgorge profits of £2,069,861 by 22 October 2024—five years from the declaration date. Paragraph 4 of the DPA specified that the agreement would end "on or before 22 October 2024, when the financial terms set out in Paragraphs 13-14 below have been fully satisfied".

GSL failed to make any payment by the deadline. The SFO subsequently applied to the Crown Court on 21 November 2024 for a determination that GSL had breached the DPA. GSL challenged the court's jurisdiction, arguing the DPA had expired on 22 October 2024 and could no longer be enforced.

The Divisional Court dismissed this argument, applying established principles of contractual construction from Arnold v Britton [2015] AC 1619. Lord Justice Edis and Mr Justice Calver emphasised that DPAs must be construed in their proper context—not as ordinary commercial contracts, but as agreements serving the public interest within the criminal justice system.

The court noted that when William Davis J approved the original DPA in 2019, he expressly contemplated two possible consequences if GSL failed to meet the financial terms: an application to vary the agreement under paragraph 10 of Schedule 17 to the Crime and Courts Act 2013, or prosecution following termination of the DPA. Both remedies necessarily required the DPA to remain in force beyond the expiry date.

Examining the DPA's provisions holistically, the court found that clause 4 must be read alongside clauses 7, 13-17, and 25-26, which clearly envisaged enforcement action in the event of breach. Clause 7 expressly stated that if GSL "fully complies" with its obligations, the agreement would expire and proceedings would be discontinued. The necessary corollary was that if financial terms were not satisfied, the DPA would remain in force to permit enforcement.

The court rejected GSL's attempt to rely on post-contractual correspondence suggesting both parties initially believed the DPA would expire on 22 October 2024, noting such evidence was inadmissible under the rule in James Miller and Partners Ltd v Whitworth Street Estates (Manchester) Ltd [1970] AC 583.

Significantly, the judgement confirmed that proceedings concerning DPAs are not excluded from the High Court's supervisory jurisdiction under section 28 of the Senior Courts Act 1981. Such decisions do not "relate to trial on indictment" because a DPA prevents any trial from occurring whilst in force.

The ruling provides essential guidance on DPA interpretation, confirming that these agreements remain enforceable instruments designed to serve the interests of justice. Reading expiry provisions in isolation, divorced from enforcement machinery and statutory context, would undermine the entire DPA framework. The decision ensures prosecutors retain meaningful remedies when companies default on agreed financial terms, whilst maintaining judicial oversight through the Crown Court's breach determination powers.

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