The UK now has the world's toughest anti-bribery laws and who will be the first to feel their wrath? Despite the fact that the Justice Ministry has said that they don't "intend" to catch corporate events and City entertaining in the enforcement of the Act, it would seem very likely that the City is going to be one of the first to feel its cold embrace.
Several compliance and lawyery types I know have commented to me that, "someone is going to be made an example of"... pour encourager les autres I suspect. So whilst the intent of the Act is to stop British companies (and firms with a UK presence) from bribing foreign officials, the earliest effects, I believe, will be felt much closer to home.
The main reason for this is the fascination that the City has with gold plating any form of regulation that comes its way...something that we seem to be a world leader in. This self-destructive zeal with regards to new regulation is not helped by the fact that the law is principles based and very light on hard and fast rules. This allows the compliance department free rein to define "inappropriate" as they see fit.
Moreover the fact that "failure to prevent" an act of bribery is a corporate misdemeanour is a cause of particular consternation; any firm in the "client entertainment" business (either as an entertainer or as a recipient) is having kittens right now to ensure that they don't leave themselves open to action as a result of the over generous nature of some of their employees. Thus the absurdly low (by the standards of City entertaining anyway) limits which many firms are prescribing.
The slightly more insidious side of this situation I allude to in the title of this piece. We now have a very simple (yet powerful) stick with which financial institutions can beat their employees at a future date of their choosing. Want to get rid of someone? Point to some form of "entertainment excess" with a client (or as a client) after 1st July this year and there is very little that the employee can do except to kowtow.
Some might say that the law is unenforceable at this level but, realistically, unless you take your customers to McDonalds or the pub you are going to fall foul of a 150 a head limit at some point. Especially if you are entertaining one of your foreign customers who won't understand the new regime in the UK. Career time-bomb anyone?
The point is this: the institutions now have a very neat new weapon in their armoury to make you "go quietly", without having too much fear of comeback because as long as they have put in place an addendum to the staff handbook, they are off the hook. You aren't.
On that cheery note I will leave you with a prediction: the ultra expensive restaurants that do survive the coming downturn will become very adept at splitting bills into much more manageable bites and I will end up paying for a lot more of my entertaining in cash.
Happy summer holidays everyone....
The writer has 20+ years working in the City.