The Bribery Act

The Bribery Act will not outlaw corporate hospitality which may have led to a large number of prosecutions, the Government has said in its long awaited guidance on last year’s Bribery Act.

The Act should not be used to stop companies from entertaining customers and contacts, the new rules have said.

Standard 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 criminalize such behaviour – says the guidance.

The guidance makes 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.  Reasonable hospitality to meet, network and improve relationships with customers is a normal part of doing business.

The Act has clarified what was seen as an old and confusing set of bribery laws but businesses were worried that it would make corporate hospitality illegal and placed too big a burden on companies for the behaviour of rogue staff.

The original guidance produced by the former Labour Government was criticised by the Law Society for being too vague and the current Government delayed the implementation of the Act in order to write this new guidance.  The Act came into force on 1st July 2011.

The guidance clarifies what is mean’t be adequate procedures and said that this would be considered in the light of the size and kind of company involved.

Eventscape is pleased to report that as long as businesses have a clearly designed policy, then reasonable and proportionate expenditure is appropriate.

Hospitality is legitimate and normal business practise.  Companies should ideally keep a register of their spending when it comes to any form of corporate hospitality.