The days of prawn sandwiches in corporate boxes could be under threat following strict new anti-corruption laws coming into force here.
The Criminal Justice (Corruption Offences) Act 2017 introduces a string of new offences that can make senior employees and companies automatically culpable in cases of white collar corruption.
Similar laws in the UK sparked fears that corporate patronage of marquee events might dwindle if the entertaining of clients be construed as inappropriate.
The Chelsea Flower Show, Royal Ascot and Wimbledon were all seen as examples of the types of events that might suffer as regulators sharpened their focus on the conduct of big business.
"It's not the death knell for corporate hospitality but it's an era of more deliberate and conscious approaches to hospitality," said Kenan Furlong, partner at A&L Goodbody's litigation and dispute resolution division, who has been advising clients ahead of the new laws being introduced here. "What we are telling people is don't panic but do prepare."
The act brings into force six recommendations proffered by the Mahon planning tribunal, which carry potential prison sentences as well as unlimited corporate fines.
Marking a new era of corporate regulation, such laws first emerged in the US and later spread to the UK, the latter bringing in its own Bribery Act in 2010.
While low-key corporate hospitality events here are unlikely to change dramatically, the new regime will mean a stricter eye on gifts given by companies and officials.
For example, it outlaws a person giving a gift where the person knows or ought to know it will be used to facilitate corruption. It also includes an offence of “trading in influence” to criminalise bribing someone who may exert an improper influence over the decision making of a public or foreign official.
Overhaul
In January, 2017 Rolls-Royce agreed to pay £671 million in penalties following investigations into claims it paid bribes for export contracts. The settlement meant the company avoided prosecution although individual executives could still be charged.
Mr Furlong explained the new Irish laws would open up the number of people who could be prosecuted for bribery and corruption offences – “anyone from a janitor way up to the chief executive”.
“The only defence available to the company is that it took all reasonable steps, all due diligence, to stop that from happening,” he said.
Introducing the laws on Monday, Minister for Justice Charlie Flanagan said they represented "a complete overhaul" of anti-corruption legislation.
“This highlights our ongoing commitment to tackle the issue of corruption at a national and international level,” he said.
The legislation allows companies to defend themselves by saying they took “all reasonable steps” to safeguard against corruption – incentivising them to introduce checks and balances.
Mr Furlong said companies should evaluate their bribery and corruption risk based on the nature and location of activities, review contracts, and encourage a “zero tolerance” approach and awareness.
