Successful collaboration is based on personal trust and appreciation. For this reason, despite very strict compliance regulations, it is still customary to offer small gifts of thanks to business partners. However, caution is required. Non-compliance may lead to labour and criminal law consequences and even dismissal.
Bribery in the course of business
It is a criminal act if, in the course of business, an employee or representative of a company demands or accepts a benefit in exchange for offering an unfair preference (1) in the procurement of goods and services in domestic or foreign competition or (2) in violation of his duties towards the company. This primarily protects free competition but also the company’s assets.
Checks or cash should never be given as it could create an impression of corruptibility. However, bribery is not limited to exchanges involving money; bribery could also occur if, for example, a representative of Company A agrees to continue doing business with Company B only if the representative’s child is offered an internship at Company B despite his lack of qualifications.
Another rule to remember: gifts must always be declined if they are offered close to the conclusion of a transaction. For example, there is a strong suspicion that a bank employee who has received a gift will not dutifully examine the creditworthiness of a customer when issuing a loan. Both the borrower and the bank employee face the risk of criminal liability. The bank employee must also expect to be dismissed without notice.
Judges and the legislature are aware, however, that not all benefits constitute a criminal act. Benefits in accordance with common practice are permitted and small gifts of up to EUR 35 can usually be given with a clear conscience. However, there are no clear boundaries: a small gift worth EUR 50 to an employee with a monthly income of EUR 2000 may be seen as influencing the employee, while a gift worth EUR 500 to an executive director of a DAX company may be safe. One crucial factor is whether the recipient can afford the gift himself.
An example of a permitted common practice may be a gift that is connected to the recipient's work. For example, an expensive textbook providing professional know-how may be given as a gift. Gifts which benefit the entire staff are also permitted.
It is recommended that both donor and recipient always consult with their management or compliance/legal department on benefits and report all benefits received. Some companies have internal rules allowing the recipient to accept a gift and, for example, enter it in the company's Christmas raffle. Remember though, labour law consequences may ensue irrespective of criminal liability if there is a breach of corporate compliance rules.
Benefits granted to public officials
The law is even stricter regarding public officials and particular caution is required. As a rule, public officials and public sector employees may not even accept small gifts worth less than EUR 35 in order to avoid any impression that public officials may be bribed. Such benefits or larger gifts must be declined or passed on to the employer.