Posted on 2.7.12
The Bribery Act 2010 came into force on 1 July 2011, amidst a blaze of publicity and confusion. So, one year on, what exactly is a ’bribe’ and how can you protect yourself and your business?
Under the Act a bribe can be anything that gives “benefit” to another. The press were quick to jump on this wide definition and question corporate hospitality. However, the Ministry of Justice has acknowledged that normal corporate hospitality is legitimate, provided it is reasonable and proportionate for the organisations’ business.
Importantly, the bribe does not actually have to be paid. Simply offering or requesting an inducement in order to gain any commercial, contractual or regulatory advantage is an offence, and it is not just the individuals involved that may be held liable.
The Act makes it an offence for organisations to fail to prevent bribery, placing a new burden on businesses to ensure that the activities of their employees and other associated people (such as agents and subsidiaries) are compliant. So, if an employee offers or makes a bribe your business may be held liable as well, unless you can prove that you had adequate procedures in place to prevent them from committing an offence.
With that in mind the government has identified six principles that all organisations should incorporate into their culture to prevent bribery:
i) Risk Assessment – consider what bribery risks exist in your particular sector and market and continue this assessment regularly. Keep records of these assessments.
ii) Top Level Commitment – implement a clear “anti bribery policy”. Educate your employees that bribery is unacceptable and will result in disciplinary action.
iii) Due Diligence – who are you doing business with? Do they have similar anti-bribery policies in place? Can they provide you with copies of these policies? Have they been sent a copy of your anti-bribery policy? Contracts with third parties should also be amended to incorporate anti-bribery clauses and warranties from associates.
iv) Clear Practical and Accessible Policies and Procedures – provide guidance to employees about the new laws and how they relate to specific situations such as political and charitable donations, gifts, hospitality or promotional expenses.
v) Effective Implementation – ensure your policies are applied.
vi) Monitoring and Review – review your policies and update them when necessary. Consider obtaining appropriate legal advice.
More guidance can be found at: http://www.justice.gov.uk/guidance/docs/bribery-act-2010-guidance.pdf.
So, provided good practice is followed by the organisation and its employees, the Act should not cause undue difficulties but if you have any concerns about present business relationships, or want to ensure your organisation is properly protected, the best thing to do is seek early advice from a solicitor.