Bribery Act: Goodbye to the gravy train

Gary Waylett examines how the UK Bribery Act 2010 is ushering in a new era of tighter control over corporate hospitality and employee entertainment. 

For any business built on wining and dining customers and business partners, the introduction of the UK Bribery Act this July will have a significant impact on its behaviour.

To ensure they comply with the law, and minimise the associated personal and corporate risk, organisations will need to put in place robust employee expense and entertainment recording, analysis and reporting mechanisms. Companies cannot afford to take a wait and see attitude; 

Spotlight on employees

The UK Bribery Act 2010 introduces a new crime of failure to prevent bribery, which means organisations will need to demonstrate they have adequate procedures to prevent corrupt practices both internally and by third parties. Failure to do so could expose the business and its senior managers to unlimited fines, debarment from government business or even a jail sentence.

Industries that rely on entertainment and strong inter-personal relationships should look to ensure every instance of corporate entertainment received from a customer, supplier or partner – from a casual coffee with an IT supplier to an invitation to speak at a conference – is rigorously recorded. Information must include not only the time and date of the event, where it occurred and what was received, but also the names of all individuals attending.

Continued...

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Comments

Sheer unworkable rubbish

Roland195 | | Permalink

but a rosy future for those in the myriad of consultancy firms that will be specialising in compliance.

Democratus's picture

May be unworkable rubbish

Democratus | | Permalink

But it's a serious enough bit of legislation and unless you have adequate procedures in place as a defence your company is open to a costly and possibly reputation damaging challenge.

 

It's another nail in the coffin of free enterprise and begs the question why would anyone set up a business in the private sector, what with being an unpaid tax collector with fines for getting a complicated and confusing mess of legislation wrong, Working time Directive, Equality provisions, compulsory pension contributions (is this another tax) coming up, and the myriad of other red tape issues which are too numerous to mention.

 

 

carnmores's picture

once again the bureaucrats have failed

carnmores | | Permalink

is there a de minimis level here or in the MLR rules - there should be

IR35 was/is just as mad! New madness makes "tipping" illegal ...

dstickl | | Permalink

IR35 was/is just as mad, especially as its wording could be interpreted in a number of ways, as the 2008 2-part "IR35 Lottery" thread shows!

This new UK madness seems to me to be even more restrictive than corresponding "anti-Bribery" legislation in USA. Why? Do the legislators want to weaken UK GDP performance still further? [For example IR35 so weakened one-man contracting bands that apparently some cynical larger consultancies had - in my opinion - an incentive to spin out large IT projects at the inevitable expense of the taxpayer like you when the large IT project over ran!]

The petty fogging HMRC "it's the legislation" excuse for a £100 fine for military taxpayers abroad is equally nonsensical - shouldn't these brave people be protected by law/SI drafted by HMRC/ HMRC extra statutory concession??

QUESTION to "CHEW OVER" ABOUT THIS 2010 BRIBERY ACT: Doesn't this 2010 Act make "tipping" an illegal action by a satisfied diner, who just happens to wish to encourage good service when s/he next visits that restaurant??

 

[Is the answer just cash tips, and no refund by employer? What about taxis?]

davidwinch's picture

The satisfied diner    1 thanks

davidwinch | | Permalink

Let's not get carried away here.  Basically a bribe is a payment, in money or in kind, to someone for acting improperly - see s1 Bribery Act 2010.

It might be a payment in advance to induce the recipient to act improperly, or a payment after the event for acting improperly.

A waiter (or taxi driver or whoever) who does his job well is not 'acting improperly' and so a tip for good service is not a bribe.

David

"improperly" and "When in Rome, do as the Romans do"?

dstickl | | Permalink

Thanks David - so I can carry on tipping as and when, and all such tipping should be noted in the accounting records presumably!

But isn't the word "improperly" just a subjective thing depending one's culture and one's cultural values in our now very multi-cultural United Kingdom, OR is it unambiguously defined in the 2010 Act?

HENCE: I note that the Act also goes on to say regarding activity/actions overseas: "In deciding what such a person would expect in relation to the performance of a function or activity where the performance is not subject to the law of any part of the United Kingdom, any local custom or practice is to be disregarded unless it is permitted or required by the written law applicable to the country or territory concerned", and I ask you how can it be sensible to disregard "any local custom or practice" when the general advice is "When in Rome, do as the Romans do" AND/OR when "the written law applicable to the country or territory concerned" is silent?