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 already having done so.
The Bribery Act 2010
Date of implementation: 1 July 2011
The original impetus for this legislation was the concern raised over the making of “facilitation” payments for the granting of large foreign contracts, especially in the defence and armaments industry. However, as is usually the case, the framework of the legislation makes no specific reference to the original problem. As a result, the new Act applies to all businesses and all business relationships.
It is important therefore that all bookkeepers, whether in practice or employment, have sufficient understanding of the legislation to enable them to take the necessary steps to protect themselves, their businesses, and the people they work for.
According to the Ministry of Justice Bribery Act 2010 Guidance:
The Government does not intend that genuine hospitality or similar business expenditure that is reasonable and proportionate be caught by the Act, so you can continue to provide bona fide hospitality, promotional or other business expenditure………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.
The Act creates several offences that carry penalties applying to both individuals and companies. For individuals there are fines and/or terms of imprisonment ranging up to ten years, while for companies there are uncapped fines. The defence under the Act is to show that there are adequate procedures in place to prevent bribery.
The Risk-Based Approach
For individuals and companies to adequately respond to the Act, it is recommended that they adopt a risk-based approach to preventing bribery. All business relationships and contacts should be reviewed and assessed in relation to the risks involved and steps taken to mitigate those risks.
Practices that employ staff need a bribery policy and should communicate it to those staff.
Below is some suggested wording that could form the basis of a standard bribery policy. You can download this text as a Word document.
This business will take the following measures to ensure that Bribery is not committed on its behalf in accordance with the Bribery Act 2010:
1. Consider doing due diligence on persons who perform services for the business.
2. If the risk of bribery has been assessed as low, then due diligence will consist of satisfaction that people performing services for the business are genuine and can be trusted to do business without bribing. The business may make enquiries with business contacts, local chambers of commerce or business associations or via the internet.
3. If the risk becomes higher, further due diligence measures may be necessary and financial statements or accounts, and other references, may also need to be checked and followed up.
In all cases, personal contact, to enable assessment of the agent/staff, is thought to be very helpful.
Example Bribery Policy.doc
Bribery Act Quick-Start Guide
Guide to preventing bribery
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