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Bribery - The Elephant in the Room

Elephant in the room

There are a few things you should consider before you get that little bit too lavish.

The UK Bribery Act – Is what I'm doing legal?

The UK Bribery Act (2010) led to many people fearing the demise of corporate hospitality. In fact, as subsequent events have shown, the industry is still very much alive and well. In fact, the Act has encouraged people to focus more on the objectives of their planned activity and by definition, improve the return. The Act itself was intended to prevent people from bribing others to do something they should not do. A typical company looking to take a client to a sporting event will not do so on the understanding that their client will improperly favour them in some way. The intention is to establish a rapport with a client to cement cordial relationships. However, do bear in mind that from the Act's point of view, the host should be at the event otherwise the whole question of "cementing relationships" is called into question.

Generally, entertaining guests at a sporting event is unlikely to cause difficulty and nor is a provision of a "goodie bag" containing inexpensive corporate gifts; but including a Rolex would do!

So, it really is about what is appropriate and reasonable – inviting a potential client to a major event during a tender process could be considered bad business practice (or worse) whereas spending time getting to know clients over dinner makes commercial sense.

In the words of the Former Lord Chancellor, Ken Clarke "Rest assured, no one wants to stop firms from getting to know their clients by taking them to events like Wimbledon or the Grand Prix" and those of the Director of the SFO (Serious Fraud Office), Robert Alderman "sensible proportionate entertaining or promotional expenditure" is "perfectly lawful" but if a company pays for a prospective client's "month long all expenses paid Caribbean holiday you will not be surprised if the SFO takes an interest".

So, now that's cleared up, back to the big day itself!

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At a Glance

It is a proven fact that, when done well, corporate hospitality can benefit your business, whether it be in terms of cementing client relationships, showcasing your event management skills or attracting new customers.

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