A Compliance Carol

Introspection and evaluation are as ingrained in our end of year rituals as parties and presents. In Charles Dickens’ iconic tale A Christmas Carol, the protagonist, Ebenezer Scrooge is visited by three Christmas ghosts. They show him his past, present, and potential future in order to convince him to change his ways before it’s too late.

compliance procurementWithout using the same pyrotechnics, we would like to take this opportunity to make you examine your tendering process with compliance-tinted glasses on. Which compliance errors will haunt you this year, or in years to come? What actions can you take now to avoid harder penalties in the future? It might be time for a Christmas miracle…

Which UK acts and regulations should you be looking out for in 2020?

The Bribery Act 2010 (UKBA).

The  UKBA  was  introduced  to  enhance  UK  law  on  bribery  (domestic  and  foreign). Offences are prosecuted by the Serious Fraud Office (“SFO”). The primarily relevant offence to be aware of with tendering is Section 7(1)of the UKBA (Failure of commercial organisations to prevent Bribery).

What the ghost of compliance future shows you:

You are a multinational with operations / employees in the UK. You enter procurement  process  with a  broker or procurement intermediary as an agent, acting on your behalf during tendering.  The broker, without your knowledge, uses bribery (which  could cover  hospitality  and  ‘facilitation  payments’)  to  secure  a  successful  bid. Whistle-blower uncovers bribery and reports. You are liable under section 7(1) of the UKBA despite no knowledge of the bribe.

Other than reputational damage, the consequences could involve:

  • Non-mandatory debarment  from  bidding  for  public  procurement  work; and/or
  • Deferred prosecution  agreements  with  the  SFO  (for  g. in  2017  Tesco settled for £129 million, Rolls-Royce for £500 million)
compliance procurement
How to avoid this fate

One important defense is to demonstrate that your company has “adequate procedures” in place to prevent bribery. Going forward, make sure your processes are transparent and easily auditable.

The Modern Slavery Act 2015 (MSA)

The MSA aims to eliminate slavery and human trafficking in the UK.

Section 54(1) of  the MSA focuses  on  transparency  in  supply  chains.  The  MSA requires organisations  to produce  and  publish  anannual  statement  evidencing exactly what they have done to ensure that there is no modern slavery anywhere in their supply chain

What the ghost of compliance future shows you:

You instruct a  broker or procurement intermediary  as an agent  to  procure  bids.  The broker  awards the  contract  to  the  most  cost-efficient  bidder,  but  without  your knowledge, the  successful  bidder  maintains  low  prices by  using illegal  low costs/child labour.

This could lead to:

  • Civil action in the High Court; or
  • Secretary of state may obtain an injunction requiring adherence

And of course, reputational damage.

How to avoid this fate

Companies have to invest in the transparency, legality and propriety of their supply chain. Using  an  auditable  and  traceable  platform at  the tendering and  contracting  stages is an  integral part  of  this  investment, as they can monitor and audit for red flags and include this step in their annual statement.

compliance procurementThe ghost subtly points you in the direction of DeepStream.

Leaving old habits in the past

While these scenarios shown by the ghosts of compliant futures are the most obvious ones, there are many other habits that could leave you open to many risks. For example, using unsecure methods of sharing sensitive documentation, such as email, could make you run foul of GDPR. Indeed, email and other unsecure methods of exchange, put you at a higher risk of a data breach.

compliance procurementLooking to a compliant future

It’s time to switch to a process that gives you greater peace of mind. DeepStream is a powerful, auditable and secure digital tendering platform. Get greater control over your tendering process whilst significantly reducing your admin headaches.

Sounds good? Check out our video demo here to find out more.

compliance procurement


Claire Trevien