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Anna Montes

Marketing or bribery?

Supplier incentive schemes and corporate hospitality could become largely things of the past under new bribery legislation 

B2B incentives

 

The Act potentially affects B2B schemes where a retailer’s or re-seller’s staff are offered incentives by a supplier. Suppliers often offer prizes or rewards to staff at retail outlets who achieve the highest sales of a particular product. Under the old legislation, if the employer had consented to this it was not an offence.

 

Under the new Act, however, it is arguable that, even with the employer’s consent, this practice could amount to illegal bribery if it leads to a breach of customers’ “relevant expectation” – if customers would have a reasonable expectation that the employees would act impartially or in good faith in advising on competitor products.

 

Without further official guidance yet available, businesses may wish to review supplier incentive schemes, or ensure adequate disclosures are given to customers about any incentive arrangements.  

 

Anna Williams is a senior associate at Osborne Clarke. E-mail her at editorial@themarketer.co.uk

 

More Legal Eagle >>>

 

Comments

On 17/01/2012 at 15.46 Martin Gittins wrote:


Your advice seems to be, incentive schemes might fall foul of the Bribery Act, so best stop using them.


This is a badly written and poorly researched article which does nothing to offer any guidance for companies operating incentive programmes or corporate hospitality, nor organisations providing such services. Where The Marketer could have provided some leadership, it has instead opted to add to the confusion and doubt around this Act.


The guidance emerging from the Serious Fraud Office is that incentive payments are commercially justifiable and generally would not fall foul of the act, providing that there was transparency in the incentives being offered, especially to the employer of the recipient.


There's much better guidance online at thebriberyact.com than given in the article above.

 

 

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