Justice Secretary Kenneth Clarke said he had been “stirred into action” to reassure the hospitality industry over “scaremongering” connected with legislation surrounding the Bribery Act, now due to come into force on 1 July, three months later than planned. Clarke vowed corporate hospitality would not be made illegal.
The Government published, 30 March, guidance to interpreting the Act, saying it was simplified to clarify the difference between an illegal bribe and everyday business entertaining.
UK directors could be jailed for up to 10 years if staff based overseas pay bribes to influence local officials. But Clarke said most of the proposals should not make any difference to any reputable company. “They won’t have to spend millions of pounds on new control systems, which the compliance industry will tell them they need,” the Minister told the London Evening Standard newspaper.
He said a “common sense” approach would be used and said corporate hospitality such as taking customers to Twickenham was “normal”, although a Caribbean cruise with the family was different.
The Ministry’s short version of the guidance for small businesses, The Bribery Act Quick-start Guide, says: “As a general proposition, hospitality or commercial expenditure which is proportionate and reasonable given the sort of business you do is very unlikely to engage the act.
“You can continue to provide tickets to sporting events, take clients to dinner, offer gifts to clients as a reflection of your good relations or pay for reasonable travel expenses in order to demonstrate your goods or services to clients if that is reasonable and proportionate for your business.”
Nevertheless some lawyers insist guidance does not provide a defence to any of the new offences created with all levels of directors potentially liable for prosecution.
Richard Beavan, Partner in the corporate team at Boodle Hatfield acknowledged the Government had sought to address concerns by publishing the guide, but added: “The Act has not changed at all; the new guidance simply addresses some of the misconceptions that surrounding the legislation.”
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