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Bribery Act guidance for small businesses

The Bribery Act, introduced on 1 July 2011, created several new criminal offences which the owners and managers of small businesses need to understand fully. Read our summary of what the law means for businesses.

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The key points of the Act that affect small businesses are as follows:

  • An organisation could be liable if a very senior person in the organisation (for example, a managing director) commits a bribery offence, i.e. offering, promising or giving a reward to induce a person to act improperly, or accepting a bribe.
     
  • An organisation could also be liable where it fails to prevent someone who performs services for it – like an employee or agent – paying a bribe specifically to get business, keep business, or gain a business advantage for the organisation. However, it is very unlikely that an organisation will be liable for the actions of someone who simply supplies goods to them.
     
  • The Act covers bribery which takes place in the UK and overseas, by employees and third parties employed by your organisation.
     
  • There is a full defence if you can show you had adequate procedures in place to prevent bribery, but you do not need to put these in place if there is no risk of bribery on your behalf.
     
  • Facilitation payments – payments to induce officials to perform functions they are otherwise obligated to perform – are bribes under the Act.
     
  • Hospitality is not prohibited by the Act.

The defence

An organisation has a full defence for this offence, and can avoid prosecution, if it can show it had adequate procedures in place to prevent bribery.

What counts as adequate will depend on the bribery risks your organisation faces and the nature, size and complexity of your business.

So, a small or medium-sized business with minimal bribery risks will require relatively minimal procedures to mitigate those risks. If your business is at high risk, you need to demonstrate that you've carried out a risk assessment and due diligence, and that your anti-bribery policies are proportional, with buy-in from management and have been communicated to all staff and contractors. You must also regularly monitor and review your policy.

What are the risks?

Many organisations will face little or no risk of bribery, especially if their business is undertaken primarily in the UK. The risk is potentially heightened if you operate overseas.

Factors such as the particular country you want to do business in, the sector which you are dealing in, the value and duration of your project, the kind of business you want to do and the people you engage to do your business will all be relevant in assessing your risk.

To get more information about the country you are doing business in, contact UK Trade and Investment.

The Ministry of Justice has produced a Bribery Act guide for businesses that documents which steps a business should take to assess risk and implement procedures.

For more information, Forum members should call the helpline on 0845 130 1722.

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