The Bribery Act 2010 in force

You might have seen some conflicting news reports about the Bribery Act lately. Notably, the legal firm Ernst & Young recently polled company employees and found that only 6% of companies surveyed believed that the Bribery Act compliance rules had affected their business. That said, the Bribery Act 2010 is also very young – the first person to be sentenced under the terms of the act was sent down on the 18th of November 2011.

He wasn’t some high flying CEO handing over diamonds in exchange for winning an oil contract or for favour in a weapons contract bid but a 22 year old court clerk from Redbridge called Munir Yakub Patel. His six year sentence (which could have been somewhat worse had he not pleaded guilty very quickly) has been taken as proof that the courts intend to take the act seriously. However, since he was a public employee, it is difficult to glean any information about how the courts intend to treat businesses in anti-corruption cases.

The big thing that everyone should take away from the sentence is this: Munir Yakub Patel didn’t offer a bribe, he took one. This is why the Royal Mail have been issuing guidelines warning postmen not to take Christmas tips worth more than £30 and this is why companies need to know the compliance rules so they don’t inadvertently find themselves in unexpected legal trouble by taking a gift they shouldn’t have done.

The Bribery Act 2010 is especially unclear on the subject of gifts between companies. The Ministry of Justice didn’t specify any monetary value above which the act comes into force which can leave companies open to unexpected legal challenges.  A company can cover itself by having a clear and public policy regarding gifts, including a maximum monetary value.

Things to consider

When choosing “reasonable and proportionate gifts” it is important to consider the context. Giving a lavish gift to a retiring client shouldn’t present a problem since there isn’t any intent for the recipient to act improperly in exchange. Similarly, presenting a gift in recognition of a job already accomplished is generally acceptable. Companies should be more circumspect when exchanging gifts in an ongoing business relationship.  The general consensus appears to be that “reasonable and proportionate” gifts include items like calendars and USB sticks. Be careful with expensive alcoholic beverages and avoid things like expensive jewellery, Christmas hampers and foreign trips.

Another reason to have a clear policy is that companies can now be found liable for failing to prevent employees or contractors from taking or receiving bribes. This makes it especially important for expanding businesses involved in multiple tenders or business relationships to have a clear anti-corruption policy that all employees are aware of, simply to protect themselves. It wouldn’t be worth the cost of a legal wrangle if an employee inadvertently takes a £200 bottle of champagne from a contractor and gets called up before the courts! For this reason the company’s policy on bribery should also be provided to suppliers and other relevant business contacts such as those bidding for tenders so that they don’t inadvertently expose the company to legal trouble.

In addition to the arrest of Munir Yakub Patel, fines have also been brought against a number of large corporations. It is likely that 2012 will be the year that the Bribery Act 2010 comes into its own and the year in which business finds out how the courts intend to apply it. To ensure your business doesn’t face undue problems, read the act, draw up a simple compliance policy and ensure that your employees are aware of it. Those simple steps will do a lot to limit the exposure of any company to the new anti-corruption rules. Win that Bid’s bid management and co-ordination service can help get all your documents in order and fill in any gaps.

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