Bribery Act

The Bribery Act: Corporate Hospitality gets the Green Light!

Inconnection can confirm that long awaited clarification on The Bribery Act has finally been released - The Government has stated it will NOT outlaw corporate hospitality.

Justice Secretary Ken Clarke announced that "bona fide hospitality, promotion or other business expenditure which seeks to improve the image of a commercial organisation, better present products and services, or establish cordial relations, is recognised as an established and important part of doing business and it is not the intention of the Act to criminalise such behaviour."

"The guidance makes it clear that no one is going to try to stop businesses getting to know their clients by taking them to events like Wimbledon, Twickenham or the Grand Prix", said Clarke.

How does the Act effect Corporate Hospitality Event Managers?

The good news is that it doesn't!

The Serious Fraud Office (SFO) has released that they will be looking at five factors when considering corporate hospitality in the context of the Bribery Act.

1. The company has a clear issued policy regarding gifts and hospitality.
2. The scale of the expenditure in question falls within the confines of such policy and if not, whether special permission for it had been sought at a high level within the organisation.
3. The expenditure is reasonable and proportionate with regard to the recipient.
4. There is evidence that such expenditure had been recorded by the Company.
5. The recipient was entitled to receive the hospitality under the law of the recipient's country.

The inference that the expenditure was intended as a bribe would be strengthened if it should transpire (a) that there had been any unjustifiable 'add-ons', for example with regard to travel or accommodation, or (b) that the expenditure in question could be related in time to some actual or anticipated business with the recipient, particularly in a competitive context.

The guidance clarifies what is meant by adequate procedures, and said that this would be considered in the light of the size and kind of company involved.

"Small organisations are unlikely to need procedures that are as extensive as those of a large multi-national organisation," said the guidance. "A very small business may be able to rely heavily on periodic oral briefings to communicate its policies while a large one may need to rely on extensive written communication."

The Act has brought much needed clarification to what was widely regarded as an old and confusing set of bribery laws, with businesses worrying that it would make corporate hospitality illegal and placing too big a burden on companies for the behaviour of event teams/staff.

It is all a question of looking at the particular circumstances and assessing whether what is proposed is reasonable and proportionate.

"We are delighted to be able to put forward clarification to our clients. The new guidance suggests that common sense has prevailed which is a welcome relief from the Government to all businesses that employ in the corporate hospitality sector and whom entertain in an appropriate and proportionate manner." says Nick Hamilton, Inconnection Managing Director.