18 July 2011

The new legislation was passed in 2010 but has been delayed while clarification was made on the use of corporate hospitality.

The Bribery Act overhauls existing laws dating back to 1889 and creates offences that carry prison terms of up to 10 years and unlimited fines.

It makes it illegal to offer or receive bribes and to fail to prevent bribery.

In its guide to the Bribery Act, the Ministry of Justice says: "Very generally, [bribery] is defined as giving someone a financial or other advantage to encourage that person to perform their functions or activities improperly or to reward that person for having already done so."

In March Justice Secretary Kenneth Clarke assured companies the act would be implemented in a "workable, common sense" way.

He has since assured companies that they can take clients to events such as Wimbledon and the Grand Prix, so long as the hospitality is reasonable and proportionate.

The government said it did not expect "genuine hospitality" or similar expenditure to fall under the act. The Federation welcomes this clarification as corporate hospitality in hotels is an important part of our business.

Members should be aware that companies prosecuted under the act must show they have "adequate procedures" in place to stop bribes. "Adequate procedures" may include providing anti-bribery training to staff, carrying out risk assessments for the markets being operated in, or carrying out due diligence on the people being dealt with.

The Federation can provide further advice to Members on this and other legislation if required. A short PDF summary of the Act is available via the following link:

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