Effective planning and research will help you avoid business risks that come with selling to foreign countries and ensure you adhere to local laws and legislation. By taking this responsibility seriously you will be able to capitalise on great market opportunities and build valuable and commercially beneficial partnerships with overseas partners and consumers.
Be aware of bribery
Offering or accepting bribes is illegal but unfortunately still wide spread in some countries and not always easily determinable if you are not familiar with the local customs or legislation. Things like ‘facilitation payments’ – a flowery term for speed money, or small bribes which help smoothen administrative procedures, can often be hard to tell apart from the mountain of other tariffs and bureaucratic payments, licenses etc which are required when trading. Other bribes include excessive gifts which could influence an important business decision, or hospitality offerings which are disproportionate to a transaction.
Make sure you check the legislation to avoid any serious consequences for your business. It is ok to reject any offerings which seem to be inappropriate to ensure the integrity of your business is not compromised.
Other countries may have different laws in place, so make sure you research them before acting upon any business deals.
Check the UK legislation
The UK Bribery Act applies to your UK business as well as any other business doing business in this country. Persecution could be the result of not complying and if there is evidence of giving or receiving a bribe as well as “failure to prevent bribery”. To prevent bribery and create awareness within your workforce, make sure your employees are adequately trained and you have the right policies in place to insure yourself against prosecution. The Ministry of Justice offers guidance for commercial organisations and the measures they can put in place to prevent any sort of bribery.
In addition, you should familiarise yourself with the Modern Slavery Act which encompasses different types of contemporary slavery such as human-trafficking, slavery, servitude, forced and bonded labour as well as child labour.
You should also check all trade embargos and sanctions the UK has put in place for political and national security reasons with other countries and ensure you have the appropriate export licences required for licensable goods.
Conduct due diligence checks
The number one top tip for exporters is usually: Do your research. Making sure you analyse the risks and check information about your customers as well as partners, is the business’ responsibility and can help you make informed decisions. There are several providers and tools which available which can help you conduct due diligence checks such as:
Look out for the warning signs of impropriety
On great.gov.uk you can find a checklist of what to look out for when doing business in a new country which can help reduce the risk of any impropriety. These include:
- Reluctance to go through a due-diligence procedure or provide the requested documents
- Insisting on the use of specific suppliers without making a business case for this
- Requesting a high commission or unusually large fees for your chosen market
- Close relationships to a government official, also known as a Politically Exposed Person or PEP
- Refusal to have a written agreement or sign a contract
- Requesting payments to be made into an offshore account, in cash or to a charitable cause
Make use of the Business Integrity Consultancy Service
Don’t be put off by potential risks when selling overseas, in particular if there are a lot of opportunities for you to capitalise on in a specific market.
The Department for International Trade (DIT) in conjunction with the Department for International Development and the Foreign Office is offering a Business Integrity Consultancy Service which aims to support businesses with their international strategy, help them export to high risk countries and supply tools to minimise the risk associated when selling to these countries.
Speak to an International Trade Adviser
The Department for International Trade offers impartial and free advice through a network of International Trade Advisers. Their wealth of experience can help your business grow and they will be able to advise you regarding overseas business risks and how to best mitigate them, as well as point you in the right direction of services that are right for your business.
It also helps speaking to other, more experiences UK companies who have already done business in your next target market. The Department for International Trade has a network of export champions in place which could help you with your decisions and give you advice where appropriate.