09 April 2010
Corporate Hospitality - where's the crime in that?

Corporate hospitality has long been an integral feature of doing business in the UK. Whether it is the annual golf day or just a few drinks around the corner, many organisations recognise its value and make significant provision for it.

That may soon change. New legislation has been rushed through Parliament and is now in force that affects every business in the UK. The Bribery Act has abolished the existing anti-corruption legislation and replaced it with a new and simplified obligation.

Highlights include the creation of two general offences of bribery (which in broad terms are bribing another person or being bribed) and a discrete offence of bribing a foreign public official. Individuals found guilty of any of the new bribery offences could face up to ten years in prison and an unlimited fine.

The bribery offences also capture excessive corporate hospitality. This is due to the ongoing concerns that "lavish or extraordinary hospitality" can be used as a bribe to secure advantages and that should not be allowed. Unfortunately the Act provides no guidance as to what is acceptable and so we will all be in the uncomfortable position of having to guess what constitutes "legitimate" hospitality.

Another development is the new corporate offence of failing to prevent bribery. A "commercial organisation" (including partnerships) can be guilty of an offence if anyone acting on its behalf bribes another anywhere in the world. The only defence available is for the organisation to show that there were adequate procedures in place to prevent bribery. This will add new significant responsibility onto senior managers and directors of organisations who will need to monitor deals done by employees and their agents.

Organisations found guilty of an offence can expect unlimited fines, confiscation orders and can be barred from competing for any public sector contract.

It is therefore essential that your existing corporate hospitality policies are now reviewed and robust anti-corruption procedures are promptly implemented. You cannot afford to wait!

To safeguard your organisation why not contact a member of Greenwoods' Business Defence team who would be pleased to visit your office to share their expertise in this field. A visit by a team member would be without charge. Telephone 01733 887700.

More information | previous page