As the festive season approaches, many of us embrace the tradition of gift-giving. Whether it be tokens of appreciation for clients, hospitality for partners or seasonal gestures among colleagues. While these exchanges can foster goodwill and strengthen professional relationships, they also carry significant legal risks.
Gifts refer to items or services voluntarily given without expectation of return. In a business context, this might include hampers, event tickets or promotional items.
Bribery, as defined by the Bribery Act 2010 (Act), involves offering, promising, giving, requesting or receiving a financial or other advantage with the intention of inducing or rewarding improper performance of a relevant function or activity.
The distinction lies in intent and perception – as a gift becomes a bribe when used to influence decisions or gain unfair advantage.
The Act makes clear that well-intentioned gifts and hospitality may be scrutinised if they appear to influence business decisions or compromise ethical standards. With Christmas being a peak time for such gestures, it is essential to understand the fine line between generosity and bribery to ensure that all festive interactions remain within the bounds of compliance.
Understanding the Bribery Act 2010
The Act outlines four key offences:
- Bribing another person
The offering, promising or giving of a financial or other advantage to a person to induce or reward a person to perform a relevant function or activity improperly. - Being bribed
The accepting, receiving or requesting of a financial or other advantage as a reward for performing a relevant function or action improperly. - Bribery of foreign officials
Using a bribe to influence a foreign (non-UK) public official to obtain or retain business or a business advantage. - Corporate offence of failing to prevent bribery
A commercial organisation failing to prevent a person associated with it from bribing another person.
The Act applies to both individuals and organisations.
Acceptable vs Unacceptable Gifts
To remain compliant, organisations must assess the intention, value and timing of gifts and hospitality.
Examples include:
Acceptable: modest seasonal gifts, branded stationery, refreshments at meetings, hospitality proportionate to the business relationship.
Unacceptable: lavish gifts, cash or equivalent, extravagant hospitality or anything perceived as influencing a decision or securing a business advantage.
A good rule of thumb: if you would be uncomfortable disclosing the gift publicly or to a regulator, it may be inappropriate.
Sentencing and Penalties
Bribery offences under the Act are triable either way, meaning they can be heard either in the Magistrate’s or Crown Court depending on the seriousness of the case.
- Individuals convicted on indictment face up to 10 years’ imprisonment and/or unlimited fines.
- On summary conviction, penalties include unlimited fines and/or imprisonment up to the statutory maximum.
- Companies may face unlimited fines and exclusion from public procurement.
- Directors involved in bribery may be disqualified for 2–15 years.
When determining the appropriate sentence, courts consider two key factors:
- Culpability – being the level of responsibility and intent.
- Harm – being the impact or potential impact of the offence.
The Sentencing Council has published offence specific guidelines for courts sentencing individuals and corporate offences for bribery offences.
These penalties serve as a clear reminder that the consequences of bribery are severe and that compliance is not optional. The law takes misconduct seriously.
Training, Procedures and Compliance
To reduce exposure to bribery risks, organisations must implement adequate procedures. The Ministry of Justice outlines six principles for compliance.
- Proportionate procedures
Proportionate to the bribery risks the organisation faces and to the nature, scale and complexity of its activities. Although a small business may require simpler controls than a multinational corporation, both must ensure procedures are effective. - Top level commitment
Top-level management (be it board of directors, the owners or any other equivalent body or person) are committed to preventing bribery by persons associated. - Risk assessment
Assess the nature and extent of its exposure to potential external and internal risks of bribery on its behalf by persons associated with it. - Due diligence
Apply due diligence procedures, taking a proportionate and risk-based approach in respect of persons who will perform services for or on behalf of the organisation. - Communication and training
Seeks to ensure bribery prevention policies and procedures are embedded in and understood throughout the organisation. - Monitoring and review
Monitoring the effectiveness of anti-bribery procedures and review periodically to ensure they remain fit for purpose.
Training should be mandatory and refreshed regularly, especially ahead of high-risk periods like the festive season.
A clear internal policy should define thresholds for acceptable gifts, approval process and reporting obligations. Compliance officers play a vital role in overseeing anti-bribery efforts. Transparency and documentation are key to demonstrating compliance.
The Bribery Act imposes strict obligations on organisations and individuals regarding gifts and hospitality. To remain compliant, organisations must carefully assess the intention, value and timing of gifts and hospitality. Implementing clear anti-bribery policies and adhering to government guidance assists organisations to reduce the risk of liability and uphold ethical standards expected.
Christmas is a time for goodwill, not grey areas.
BPE Solicitors LLP’s Corporate and Commercial team advises clients across Cheltenham, Gloucestershire and nationally on anti-bribery compliance. We assist organisations by drafting and reviewing anti-bribery and gifts-and-hospitality policies, carrying out risk assessments and supporting businesses with broader corporate governance and regulatory matters.
If you would like guidance on ensuring your organisation is compliant this festive season and beyond, our team would be happy to help. Please click here.
