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Hospitality costs and provision of alcohol

01/04/2015
Standard operating procedures and company policies.
A company must have a standard operating procedure (SOP), or similar, that sets out its policies on meetings and hospitality and provides a guide as to acceptable costs with regard to meals/refreshments.  Clause 22.1 of the Code requires that the costs of subsistence must not exceed that level which the recipients would normally adopt when paying for themselves.  Those responsible for relevant SOPs would be well advised to ensure that if only one figure is quoted, then readers are quite clear that this is the maximum acceptable cost and not the expected cost.

 
Clause 22.2​​ states that the cost of a meal (including drinks) provided by way of subsistence must not exceed £75/person excluding VAT and gratuities.  The supplementary information explains that this cost is only appropriate in exceptional circumstances and should normally be a lot less.  The maximum cost of £75 plus VAT and gratuities (or local equivalent) does not apply when the meeting is held in a European country where the national association is a member of EFPIA; in such circumstances the limits in the host country Code would apply​. 
 
With regard to the provision of alcohol with a meal, the relevant SOP should be explicit as to the company’s position on quantity and type.  It is most unlikely that providing alcohol at lunch would be acceptable under the Code.  With regard to the type of beverage provided, the Authority would suggest that, at least in the UK, it is rarely appropriate to provide sparkling wines, spirits or liqueurs.