Bribery act blog

The Bribery Act 2010 comes into force today (1st July 2011). This legal change will affect how all businesses operate. The BA2010 creates four new offences:

1. Paying bribes.
2. Receiving bribes.
3. Bribing a foreign public official.
4. Failure of commercial organisations to prevent bribery.

The first two offences are similar to existing law albeit they introduce the central concept that a bribe is intended to induce ‘improper performance’ in relation to a ‘relevant function or activity’. The third offence covers offering bribes to foreign officials; the fourth offence can only be committed by commercial organisations – although senior officers/directors of such organisations can be held personally liable for ‘failure to prevent’.

The fourth offence will be committed where:

• A person associated with a commercial organisation (employee, agent or external third party) bribes another person in order to gain or retain a business advantage, and
• the organisation cannot show it had adequate procedures in place to prevent bribes being paid – the ‘due diligence’ defence.

Hospitality, promotional and other business expenditure

The provision of bone fide hospitality, promotional or other business expenditure which seeks to improve the image of the Company in order to better present its products or services, or establish cordial relations with customers or industry stakeholders, is an established way of doing business and is not criminalised by the BA2010.

It is, however, clear that hospitality could be employed as a bribe and the key point is that any such expenditure must be reasonable and proportionate.

To avoid falling foul of the new law it is important that all businesses put in place a bribery policy and do a risk assessment to demonstrate due diligence. CPL Training has developed a Bribery Act Compliance e-learning course which will be made available online. The course will detail all the offences under the new Act, how to construct an anti-bribery policy and do a risk assessment in order to ensure compliance and avoid offences.