Dispute Resolution Festive Forecast: today, we provide a guide
to corporate gifts and hospitality this Christmas in light of the
Bribery Act 2010.
One prediction for 2017 is that the Serious Fraud Office (SFO)
will build on the enforcement of the Bribery Act 2010 that we
witnessed during 2016.
As it is the season of giving, we are regularly asked by clients
'where is the line?' in relation to what is and is not
allowed in the arena of Christmas gifts and hospitality.
By way of answer, we have prepared the following guidelines to
prevent your festive season's activities becoming the subject
of the SFO's to do list in 2017:
The first point is that corporate
hospitality and gifts are not by themselves criminalised by the
Act. Those that are reasonable and proportionate are perfectly
permissible. The Ministry of Justice has said as much. However, it
is plain that gifts and hospitality are vulnerable to being used as
Three critical factors to consider
when proposing to offer, or when being offered, gifts or
hospitality this Christmas are: the intention behind the offer, its
value, and its timing.
Intention: Is the
underlying intention to reflect good working relations with, or to
thank, a customer for its custom, for example by hosting Christmas
drinks or distributing branded merchandise (generally OK)? Or, is
there really no business development aspect at all, for example by
providing a customer employee with tickets to a Christmas show for
him and his family, without any attendance by the business
(generally not OK)? Worse still, is it in reality designed to
induce improper decision making on the part of the recipient of the
gift or hospitality (definitely not OK)?
Value: Is the gift
or hospitality of relatively modest value in the context of the
industry (e.g. a Christmas lunch or a bottle of wine (generally OK)
or is it a case of rare vintage champagne (certainly requires more
Timing: What is the
timing of what is being offered? Is it being offered simply to mark
the Christmas period (generally OK)? Or is it being offered to
persons with decision making power during a tender or procurement
process (generally not OK), or while there is an ongoing dispute
over services provided or invoices (requires more scrutiny)?
You should operate an anti-bribery
policy, together with gifts and hospitality register. Thresholds
must be set in the context of the industry. However, example
thresholds for written registration and approval might be
£500 per head for hospitality (given or received) and
£100 per head for gifts (also given or received).
We anticipate intensified SFO anti-bribery enforcement activity
in 2017. Accordingly, we recommend that all of our clients take the
opportunity to review and if necessary revise their anti-bribery
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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