Government confirms Bribery Act will not outlaw corporate hospitality

Hospitality will not be prohibited by the Bribery Act, the Ministry of Justice has confirmed, also announcing that it will come into effect on 1 July.

Government confirms Bribery Act will not outlaw corporate hospitality
Government confirms Bribery Act will not outlaw corporate hospitality

The Act caused a good deal of concern within the event industry, with its seemingly draconian structure implying that huge chunks of corporate hospitality activity could be outlawed.

In official Ministry of Justice guidance on the Act it outlined that hospitality is a legitimate business practice and will not be prevented:

"The government does not intend that genuine hospitality of similar business expenditure that is reasonable and proportionate be caught by the Act, so you can continue to provide a bona fide hospitality, promotional or other business expenditure," said the guidelines.

The government had come under some pressure from the CBI and lobbyists to protect business certain business activities:

"I have listened carefully to business representatives to ensure the Bribery Act is implemented fully and in a workable, commonsense way – this is particularly important for small firms that have limited resources," said justice secretary Kenneth Clare.

"I hope this guidance shows that combating the risks of bribery is largely about common sense, not burdensome procedures."

The Ministry of Justice has outlined six areas which companies can use to show they have not committed an act of bribery, they are:

  1. Proportionality – large organisations may have to make more effort to prevent bribery than small ones.
  2. Top Level Commitment – having procedures in place to prevent bribery.
  3. Risk Assessment – conducting research into your markets.
  4. Due diligence – know exactly who you are working with
  5. Communication – inform staff and contractors of their responsibilities
  6. Monitoring and review – change responsibilities as company evolves

The CBI has now put its weight behind the Act and the new guidelines:

"We strongly support the principles behind the Bribery Act and welcome this much-improved final guidance," said CBI chief policy director Katja Hall.

"The Government has listened to concerns that honest companies could have been unwittingly caught out by poorly-drafted legislation and has clarified a number of important areas. These include the extent of liability through the supply chain, joint ventures, due diligence and corporate hospitality."

"Businesses now need to use the next three months to revise their anti-bribery policies ready for the Act’s implementation. Meanwhile, the Serious Fraud Office must take a common-sense approach to enforcement, ensuring it is reasonable and risk-based. This will help avoid creating a culture of fear that could undermine UK competitiveness."


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