UPDATE 1-UK fraud office loses Supreme Court case against KBR over overseas documents

Adds details from judgment, lawyer quotes

By Kirstin Ridley

LONDON, Feb 5 (Reuters) - The UK Serious Fraud Office (SFO) on Friday lost a Supreme Court battle against U.S. engineering, procurement and construction company KBR Inc KBR.N over whether it has the power to compel foreign businesses to hand over documents held overseas.

In a judgment that will hamper cross-border criminal investigations, senior judges said they unanimously disagreed with a 2018 lower court ruling that decided so-called Section 2 notices could have extra-territorial reach.

"The presumption against extra-territorial effect clearly applies in this case because KBR Inc is not a UK company, and has never had a registered office or carried on business in the UK," the court said.

The SFO opened a bribery and corruption investigation into KBR's British business in 2017.

But after a degree of initial cooperation, KBR Inc challenged a Section 2 notice handed by an SFO case officer to a U.S.-based senior executive during a meeting in Britain in July 2017 to discuss the investigation.

(Reporting by Kirstin Ridley; editing by John Stonestreet and Susan Fenton)

((kirstin.ridley@thomsonreuters.com; +44 (0) 207 513 5666;))