The Bribery Act 2010 commenced on Friday 1st July 2011.
The act is amongst the toughest anti-bribery and corruption legislation in the world. The publicity surrounding the introduction of this Act has led to concerns about how this will impact on corporate hospitality and other promotional activities.
Such concerns are overstated. The Government has made it clear, it is not the intention that genuine hospitality or reasonable and proportionate business expenditure should infringe the legislation. You can continue to provide bone fide hospitality. The intention of the legislation is to catch hospitality which is really a cover for bribing someone.
In a commercial context (that is not involving foreign public officials) for there to be an offence, the prosecution must show that the hospitality:-
(a) provided an advantage to another person; and
(b) was offered or given with the intention of inducing the person to perform a relevant function improperly or in the knowledge of acceptance of the advantage would in itself be improper performance.
It should be understood that improper performance of a function is a performance which amounts to a breach of an expectation that a person will act in good faith, impartially or in accordance with a position of trust.
In order to bring a case relating to the provision of hospitality or promotional expense the prosecution would have to show that the hospitality was intended to bring about improper performance and this is judged by what a reasonable person in the UK would think.
In his foreword to the Guidance, Kenneth Clarke made it clear that the tough new legislation was aimed at making life difficult for those responsible for corruption but not to unduly burden the vast majority of decent law abiding firms. He went on to say that no one wants to stop firms getting to know their clients by taking them to events like Wimbledon or the Grand Prix.
So companies can be sure that continuing to provide hospitality to sporting & cultural events as a reflection of your good relations do not infringe the Act, provided that they are reasonable and proportionate for the business being undertaken. The Guidance specifically allows for the standards and norms of a particular sector to be relevant to proportionality.
I do hope that the above extracts, from the report created by Shoosmiths, prove to be of assistance when considering your marketing activities in the future. If we can be of any further assistance, either with regard to the Act or with any potential events you are considering please do not hesitate to contact us.