We have previously written a post on how the UK Bribery Act has affected companies that rely on taking clients out for corporate hospitality days in order to thank them or to cement business relationships for the future.
The FCA Implemented the new rules which make up the Act in January 2014 and have since carried out an interim review as part of a wider project, the results of which are due to be implemented in 2018.
This review brought to light that some companies had not fully understood the rules or, in some cases, disregarded them completely.
The FCA therefore took the opportunity in May 2015 to re-distribute the rules and remind companies of their obligations to adhere to them. They did this as they felt it was important to issue a reminder as the new report will not be available for some considerable time.
There are no new rules in this review and the following key statement from the report itself explains this:
‘However, due to the delay in implementation of MiFID II to January 2018 the FCA has decided to publish its five key findings to remind firms of expectations around the current rules.’
With this in mind, our five top tips to ensure you remain compliant are still as follows.
1. It is not an offence to allocate a sensible budget for promotional entertainment. However, the Serious Fraud Office may take action if expenditure falls outside what they consider to be reasonable.
2. To address this, create a clear policy which lays out what the organisation has agreed to spend on gifts and hospitality. Your organisation is fully protected from prosecution if you can show that you have processes and procedures in place to prevent bribery.
3. It is wise to appoint a senior member of your business to act as bribery officer. Taking this step means that someone is keeping an eye on expenditure to ensure it remains within the guidelines and is proportionate. This person should also manage the programme of staff training so all members of the organisation are aware of the guidelines and can follow them effectively.
4. Ensuring expenditure is proportionate will mean your business is compliant with the act. The Government does not intend to force companies to cease to provide corporate hospitality or promotional gifts entirely.
5. Keep evidence to show you have recorded the expenditure you make on your clients. In addition, also record those instances where you have declined offers of hospitality made to you. This will show your company is ethical and is willing to decline more lavish offers of hospitality.
If these simple rules are followed, your organisation can happily continue to offer and accept corporate hospitality and use this important business tool to build and maintain relationships.
Of course, Oliver Myles are very aware of the rules and regulations of the Bribery Act, so if you are not sure whether the event you have in mind is compliant or not, why not give us a call and ask us what we think.
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