What Is A Facilitation Payment?

Compliance Knowledge Base | Customs Controls

Posted by: Rosie Anderson Published: Fri, 19 Jul 2019 Last Reviewed: Fri, 19 Jul 2019
What Is A Facilitation Payment?

The Bribery Act 2010 outlines the legislation and regulations relevant to bribery within every sector of business. 'Bribery' includes many types of behaviour, for example, the offering or demanding of any undue advantage. This 'undue advantage' can come from a public or government official or any private-sector employees, directors or officers. Facilitation payments are covered in the Bribery Act 2010 and they involve small bribes designed to 'facilitate' specific routines or procedures. What's interesting about facilitation payments is that the payer is usually entitled to the outcome of the process anyway, so the payment is purely offered to speed up the procedure.

An example of a facilitation payment might be a business paying a customs official to release held goods. These held goods will generally be released anyway after the completion of all relevant procedures, but if the company wants them quickly, they may resort to offering a facilitation payment. Another example includes paying for faster approval for an export licence. This would be unfair, as it slows down the process for other companies that have already been waiting a long time.

How to look out for facilitation payments

It's important to be vigilant about facilitation payments. If your company are found guilty of failing to comply with the Bribery Act 2010, anyone involved might be fined or even face time in prison. If you're worried about facilitation payments, you can monitor your business' payment activities. For example, if a payment is requested to speed up a service to which there is a legal entitlement, it's likely a bribe. Facilitation payments can be difficult to spot, so you should keep an eye on whether payments are higher than or over and above the standard fee for a service.

What Is A Facilitation Payment?

How to prevent facilitation payments

The first step in avoiding any kind of unlawful behaviour in the workplace is to do your research. Finding out about anti-fraud and bribery regulations is important, as it can help you make informed decisions about your company's procedures. This research should tell you whether you need any official payment documentation, authorisations or permits. This is especially important if you're concerned about facilitation payments when trading internationally or travelling overseas.

You should also make sure that you keep complete and accurate records of all payments. These records should include details about the steps that were taken to resist payment. If an individual has requested a payment you're unsure about, you should report the problem immediately.

Why are facilitation payments important?

It's widely recognised that bribery is a form of corruption. Not only do forms of bribery including facilitation payments hinder economic development and thwart national and international trade, but there's also an inherent abuse of entrusted power for private gain. If a business is found guilty of committing this crime, they risk losing the confidence of investors, suppliers and customers. The reputations of many sectors have been tarnished by their affiliation with poor business ethics and scandals, which hugely compromises their financial stability.

In some cases, bribery can also undermine environmental and health and safety standards. For example, if a business illegally obtains an export licence for dangerous goods, the transportation of their products might pose serious risks to human health. Many procedures, including those associated with customs control, may seem lengthy and unnecessary. However, they are implemented to keep the environment and economy safe, and therefore it's important to follow them exactly. Think about how annoying it is when someone jumps in front of you in the bus queue and you have to stand for the whole journey!

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