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New Bribery Law Will Hit Smes Badly, Lawyers Warn

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What is it aboutthe EPC business that makes it especially vulnerable???

http://www.ft.com/cms/s/0/c34b44ba-c7f8-11df-ae3a-00144feab49a.html

New bribery law will hit SMEs badly, lawyers warn

By Hugo Greenhalgh

Published: September 24 2010 17:30 | Last updated: September 24 2010 17:30

Entrepreneurs face increased costs and the possibility of losing existing contracts once the UK’s strident Bribery Act becomes law in April 2011, senior lawyers have warned.

Under the provisions of the law, the new offence of “failure to prevent bribery” will make small and medium-sized enterprises (SMEs) responsible for ensuring the compliance of any agent or contractor connected with their businesses – irrespective of where they are in the world.

..................

Entrepreneurs themselves gave mixed reactions. Shed Simove, founder of the Talent Shed, a television production company, said the new law would prevent companies from cutting corners or “acting immorally to create more profits”.

However, Marc Blomfield, managing director of the National EPC Company, a supplier of energy performance certificates, said the act would have “a huge effect on my business”.

:blink:

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What is it aboutthe EPC business that makes it especially vulnerable???

http://www.ft.com/cms/s/0/c34b44ba-c7f8-11df-ae3a-00144feab49a.html

New bribery law will hit SMEs badly, lawyers warn

By Hugo Greenhalgh

Published: September 24 2010 17:30 | Last updated: September 24 2010 17:30

Entrepreneurs face increased costs and the possibility of losing existing contracts once the UK’s strident Bribery Act becomes law in April 2011, senior lawyers have warned.

Under the provisions of the law, the new offence of “failure to prevent bribery” will make small and medium-sized enterprises (SMEs) responsible for ensuring the compliance of any agent or contractor connected with their businesses – irrespective of where they are in the world.

..................

Entrepreneurs themselves gave mixed reactions. Shed Simove, founder of the Talent Shed, a television production company, said the new law would prevent companies from cutting corners or “acting immorally to create more profits”.

However, Marc Blomfield, managing director of the National EPC Company, a supplier of energy performance certificates, said the act would have “a huge effect on my business”.

:blink:

...ahh...this means 'tipping' even while on holiday overseas is an offence..... :rolleyes:

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Under the provisions of the law, the new offence of “failure to prevent bribery”

wtf does that mean? I promise not to bribe but other than stopping myself doing it what else am I supposed to do?

Great, another f*cking "policy" that I'll have to write and sign and show that my people have been trained in and are "compliant" with.

I'll put it alongside my "No Murder" Policy, which states that it is our policy not to murder clients, employees or casual bystanders in the course of our business.

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Under the provisions of the law, the new offence of “failure to prevent bribery” will make small and medium-sized enterprises (SMEs) responsible for ensuring the compliance of any agent or contractor connected with their businesses – irrespective of where they are in the world.

That's 'king mad. How can anyone be held responsible for another's behaviour, in an another country ? Surely that can't be what the law intends?

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What's the background on this? Is it some knee-jerk bit of legislation on the back of that BAE furore a while back?

...well if you tip the pool attendant up-front on the first day ...this may well mean some poor German may not be provided with such good service which your 'gratuity' has encouraged...this causes an unfair advantage for the distribution of the best deck chairs in the sought-after locations ....simple.... :rolleyes:

Edited by South Lorne

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What is it aboutthe EPC business that makes it especially vulnerable???

http://www.ft.com/cms/s/0/c34b44ba-c7f8-11df-ae3a-00144feab49a.html

New bribery law will hit SMEs badly, lawyers warn

By Hugo Greenhalgh

Published: September 24 2010 17:30 | Last updated: September 24 2010 17:30

Entrepreneurs face increased costs and the possibility of losing existing contracts once the UK’s strident Bribery Act becomes law in April 2011, senior lawyers have warned.

Under the provisions of the law, the new offence of “failure to prevent bribery” will make small and medium-sized enterprises (SMEs) responsible for ensuring the compliance of any agent or contractor connected with their businesses – irrespective of where they are in the world.

..................

Entrepreneurs themselves gave mixed reactions. Shed Simove, founder of the Talent Shed, a television production company, said the new law would prevent companies from cutting corners or “acting immorally to create more profits”.

However, Marc Blomfield, managing director of the National EPC Company, a supplier of energy performance certificates, said the act would have “a huge effect on my business”.

:blink:

Now they have cleaned up the banking industry so effectively it makes total sense to go for the higher fruit now. :ph34r:

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This is actually a very serious piece of legislation.

Many small firms spend their monies on enetrtaining existing and prospective customers/clients.

Football tickets/ tennis/rugby/cricket - general hospitality

Lunches and dinners

Ski trips/golf trips abroad

Shooting, motor racing

A small list of the obvious with no cash transactions and all of the above fall under the Act in April 2011. Remember each of the above "costs" are tax deductible by the employer yet the "cost" is identified on the employees P11D returned to HMRC annually.

There will of course be exceptions but the general guidance will be do not entertain unless you are absolutely certain the employee cannot be accused of bribery.

Of course it is bribery, why else would it be done? It will destroy hospitality businesses overnight.

If you see your competition behaving in such a way with mutual customers the answer is simple....report them

I do think this legislation a hammer to crack a nut but frankly "hospitality" is out of control.

Think of your local council. Don't tell me the elected representatives (councillors) and officers within procurement and planning have never been "entertained" by businesses and wealthy individuals. The problem of the "brown envelope" has never gone away.

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This is actually a very serious piece of legislation.

Many small firms spend their monies on enetrtaining existing and prospective customers/clients.

Football tickets/ tennis/rugby/cricket - general hospitality

Lunches and dinners

Ski trips/golf trips abroad

Shooting, motor racing

A small list of the obvious with no cash transactions and all of the above fall under the Act in April 2011. Remember each of the above "costs" are tax deductible by the employer yet the "cost" is identified on the employees P11D returned to HMRC annually.

There will of course be exceptions but the general guidance will be do not entertain unless you are absolutely certain the employee cannot be accused of bribery.

Of course it is bribery, why else would it be done? It will destroy hospitality businesses overnight.

If you see your competition behaving in such a way with mutual customers the answer is simple....report them

I do think this legislation a hammer to crack a nut but frankly "hospitality" is out of control.

Think of your local council. Don't tell me the elected representatives (councillors) and officers within procurement and planning have never been "entertained" by businesses and wealthy individuals. The problem of the "brown envelope" has never gone away.

In the private sector there is nothing morally or analytically wrong with so-called bribery. It's logically the same as a 'discount price' for a good.

I.e. I buy your goods for £100, you give my company a £10 'bribe', net result I've paid £90 for some goods.

In the public sector however, since you're dealing with someone else's money that has been stolen form them (tax) , it has to be immoral.

Edited by MrB

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This is actually a very serious piece of legislation.

Many small firms spend their monies on enetrtaining existing and prospective customers/clients.

Football tickets/ tennis/rugby/cricket - general hospitality

Lunches and dinners

Ski trips/golf trips abroad

Shooting, motor racing

A small list of the obvious with no cash transactions and all of the above fall under the Act in April 2011. Remember each of the above "costs" are tax deductible by the employer yet the "cost" is identified on the employees P11D returned to HMRC annually.

There will of course be exceptions but the general guidance will be do not entertain unless you are absolutely certain the employee cannot be accused of bribery.

Of course it is bribery, why else would it be done? It will destroy hospitality businesses overnight.

If you see your competition behaving in such a way with mutual customers the answer is simple....report them

I do think this legislation a hammer to crack a nut but frankly "hospitality" is out of control.

Think of your local council. Don't tell me the elected representatives (councillors) and officers within procurement and planning have never been "entertained" by businesses and wealthy individuals. The problem of the "brown envelope" has never gone away.

Whilst we have all seen cases where entertainment has become bribery, it is not true to paint it all. IMO business runs well when people have good relationships, and sometimes that can be augmented if they spend a bit of time together outside of the tasks; take a guy to a football match that you're both interested in and you talk about stuff outside work, you buyild understanding of values and maybe trust. This is good business and doesn't mean the person becomes obliged to you.

I can honestly say I've never bribed anyone in the sense we all understand; that is, changing their priorities. What i have done is socialised and built relationships, and that is simply a sound way to make business more efficient.

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In the private sector there is nothing morally or analytically wrong with so-called bribery. It's logically the same as a 'discount price' for a good.

I.e. I buy your goods for £100, you give my company a £10 'bribe', net result I've paid £90 for some goods.

In the public sector however, since you're dealing with someone else's money that has been stolen form them (tax) , it has to be immoral.

That is not bribery.

Bribery is where you give the 10 pound "discount" to the individual within the company responsible for placing the order, but the company still pays 100 pounds.

tim

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These laws will make people think twice about setting up business in the UK for operations overseas. Businesses involved in export sales will form elsewhere. Combine that with the Companies Act of 2006 and new electronic filing systems and .... well, you get the message....

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In the private sector there is nothing morally or analytically wrong with so-called bribery. It's logically the same as a 'discount price' for a good.

I.e. I buy your goods for £100, you give my company a £10 'bribe', net result I've paid £90 for some goods.

In the public sector however, since you're dealing with someone else's money that has been stolen form them (tax) , it has to be immoral.

No, surely it is I buy X for £100 with my company's money, you give ME a £10 bribe.

That is how bribery work. The paid buyer of the company is now putting his own interests before that of his company, and is not acting in its owners' interests. So it is immoral, if not always illegal.

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Whilst we have all seen cases where entertainment has become bribery, it is not true to paint it all. IMO business runs well when people have good relationships, and sometimes that can be augmented if they spend a bit of time together outside of the tasks; take a guy to a football match that you're both interested in and you talk about stuff outside work, you buyild understanding of values and maybe trust. This is good business and doesn't mean the person becomes obliged to you.

I can honestly say I've never bribed anyone in the sense we all understand; that is, changing their priorities. What i have done is socialised and built relationships, and that is simply a sound way to make business more efficient.

Jeb, the defragulabator's packed up. Give Jenkins a call, get him to fix it.

He can't boss, says he's booked for the next three weeks.

Three weeks, oh gawd. You know we depend on that, without it we might as well shut up shop. Call him again, offer him anything. Is your wife free?

Is this bribery, or not?

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Jeb, the defragulabator's packed up. Give Jenkins a call, get him to fix it.

He can't boss, says he's booked for the next three weeks.

Three weeks, oh gawd. You know we depend on that, without it we might as well shut up shop. Call him again, offer him anything. Is your wife free?

Is this bribery, or not?

Sounds like payment to me.

Whether it's bribery depends on whether Jenkins is breaching his duties by turning up in exchange for your wife. If he's self-employed or the boss then by definition he is unbribeable - he sets the business priorities.

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What is it aboutthe EPC business that makes it especially vulnerable???

http://www.ft.com/cm...144feab49a.html

New bribery law will hit SMEs badly, lawyers warn

By Hugo Greenhalgh

Published: September 24 2010 17:30 | Last updated: September 24 2010 17:30

Entrepreneurs face increased costs and the possibility of losing existing contracts once the UK's strident Bribery Act becomes law in April 2011, senior lawyers have warned.

Under the provisions of the law, the new offence of "failure to prevent bribery" will make small and medium-sized enterprises (SMEs) responsible for ensuring the compliance of any agent or contractor connected with their businesses – irrespective of where they are in the world.

..................

Entrepreneurs themselves gave mixed reactions. Shed Simove, founder of the Talent Shed, a television production company, said the new law would prevent companies from cutting corners or "acting immorally to create more profits".

However, Marc Blomfield, managing director of the National EPC Company, a supplier of energy performance certificates, said the act would have "a huge effect on my business".

:blink:

Funny thing is, bribery is corruption by definition and selling to public sector and offering a bribe, indeed accepting one is already a crime..and the law doesnt prevent it now, so having another law is going make what difference??

Rape, murder, theft and fraud are all crimes with long sentances available, but people still do it. Laws prevent nothing for the determined.

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I have had to sit through two presentations on this (although admit paid minimal attention).

The first was for the US legislation, the second was for the new UK legislation.

Interestingly the Americans very specifically make allowances for small gifts (like a bottle of wine, company merchandise etc).

As far as I could see there was no such exemption under the UK proposal.

So it would appear that if I give a customer a promotional company keyring in future I am technically at risk of falling foul of the new regs.

Nice.

Edited by libspero

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If I buy raw materials from a supplier I'm interested in three things; price, quality and availability. What I'm not interested in is "free" tickets to the cup final, a day at a golf course or half a ton of promotional mouse mats, mugs and pens.

If any supplier does start offering free golf days or cup final tickets I just ask how much they would normally "cost" and then deduct this amount from the invoice.

Free corporate gifts and incentives don't exist.... someone somewhere pays for them and it's always the customer.

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Free corporate gifts and incentives don't exist.... someone somewhere pays for them and it's always the customer.

True.. but you wouldn't expect to be thrown in gaol for handing out branded mouse mats at an exhibition either.

My only criticism is that, as far as I can tell, there are no allowances what-so-ever.. simply "anything that could be considered a bribe".

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Whilst we have all seen cases where entertainment has become bribery, it is not true to paint it all. IMO business runs well when people have good relationships, and sometimes that can be augmented if they spend a bit of time together outside of the tasks; take a guy to a football match that you're both interested in and you talk about stuff outside work, you buyild understanding of values and maybe trust. This is good business and doesn't mean the person becomes obliged to you.

I can honestly say I've never bribed anyone in the sense we all understand; that is, changing their priorities. What i have done is socialised and built relationships, and that is simply a sound way to make business more efficient.

I have absolutely no problem with inter-company personal relationships at all, whether they be based on sex, football matches, golf days whatever.

I do have a problem where a) the cost is offset by the employer and not necessarily the employee who pays using company money where it is recorded on a P11D B) the competition of the paying company cannot compete in offering complimentary "jollies".

As for this type of "inducement" in the public sector it ought not to happen at all under any circumstances. Paid public (servants) employees are there to work for the country and not the "supplier" of goods and services.

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I have absolutely no problem with inter-company personal relationships at all, whether they be based on sex, football matches, golf days whatever.

I do have a problem where a) the cost is offset by the employer and not necessarily the employee who pays using company money where it is recorded on a P11D B) the competition of the paying company cannot compete in offering complimentary "jollies".

As for this type of "inducement" in the public sector it ought not to happen at all under any circumstances. Paid public (servants) employees are there to work for the country and not the "supplier" of goods and services.

I don't know what you mean there. Obviously as with anything which is there to make business more efficient, the cost should be borne by the firm.

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wtf does that mean? I promise not to bribe but other than stopping myself doing it what else am I supposed to do?

Great, another f*cking "policy" that I'll have to write and sign and show that my people have been trained in and are "compliant" with.

I'll put it alongside my "No Murder" Policy, which states that it is our policy not to murder clients, employees or casual bystanders in the course of our business.

The corporate offence of "failing to prevent bribery" has just one defence - that of having adequate procedures to prevent bribery from occurring. Adequate is subjective and (although there is only limited guidance available at present) would likely need to be risk-based.

That's 'king mad. How can anyone be held responsible for another's behaviour, in an another country ? Surely that can't be what the law intends?

Indeed, the act is "extra-territorial" in that it binds all subsidiaries of a company that has a presence in the UK. The act also covers "associated persons" which is anyone who is acting on your behalf .

Law should read -

From the x of the y only government employees are allowed to take bribes.

ALL YOUR BRIBES ARE BELONG TO US.

Quote the opposite - the Act has specific penalties related to bribing public officials. Arguably more strict that those around private bribes.

Sounds like payment to me.

Whether it's bribery depends on whether Jenkins is breaching his duties by turning up in exchange for your wife. If he's self-employed or the boss then by definition he is unbribeable - he sets the business priorities.

The definition is one of "improperly performing duties". The bribe does not have to specifically benefit the person whose behaviour has changed and does not have to be monetary.

Did I understand right? This also applies to UK companies in how they do business abroad.. Good luck getting anything done in China without a back hander. Way to help the UK companies compete.

There is an important principle at stake - this sort of behaviour is declared as incompatible with modern business standards. The UK is taking a stand and will likely look for a few early scalps to clarify the law.

The US already has the Foreign Corrupt Practices Act but that has a number of exemptions - including small facilitation payments which are in the scope of the UK Act. The US will likely tighten its guidelines to bring it in line with the UK.

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There is an important principle at stake - this sort of behaviour is declared as incompatible with modern business standards. The UK is taking a stand and will likely look for a few early scalps to clarify the law.

The US already has the Foreign Corrupt Practices Act but that has a number of exemptions - including small facilitation payments which are in the scope of the UK Act. The US will likely tighten its guidelines to bring it in line with the UK.

....where do the Germans, French and Chinese exporters stand on this ...are the UK and USA in the same playing field or disadvantaged....?..... :rolleyes:

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