LONDON, Jan.19: The OECD after a two-day deliberation in Paris by its working group on bribery has admonished Britain for dropping a Serious Fraud Office (SFO) inquiry into an alleged fraud relating to a multi-million dollar arms deal with Saudi Arabia.The OECD said it was concerned that scrapping the SFO inquiry last month might have breached Britain’s responsibilities under an international anti-bribery convention, which it signed up to in 2002.

The statement is likely to add to pressure on the government, which has faced fierce criticism for axing the probe on the grounds of national security.

Prime Minister Tony Blair has already taken responsibility for the controversial decision to terminate the Serious Fraud Office’s inquiry into allegations that BAE paid bribes to Saudi royals.

The OECD has given Britain two months to provide further explanations before the group decides what to do.

Officials from America and France were prominent in pressing for firm action against Britain. It is understood that Britain was able to rally only limited support from other countries during the closed door meeting in Paris.

Some said the BAE decision made a mockery of the treaty. They fear that if Britain is, in effect, allowed to escape punishment in this case, it will encourage other countries to follow suit and allow their companies to continue making corrupt payments to secure contracts.

In London Attorney-General Lord Goldsmith admitted that Sir John Scarlett, the head of MI6, had never possessed intelligence that Saudi Arabia planned to cut security links with Britain. This admission appears to undermine government claims that Britain’s national security was at stake unless the SFO inquiry was called off. Lord Goldsmith conceded to the Liberal Democrats that Sir John “did not say that the Saudis would be bound to withdraw cooperation”.