Offset arrangements
Produced in partnership with Richard Furlong of Carmelite Chambers
Offset arrangements

The following Corporate Crime guidance note Produced in partnership with Richard Furlong of Carmelite Chambers provides comprehensive and up to date legal information covering:

  • Offset arrangements
  • Types of offset arrangement—direct or indirect
  • Criticism of offset arrangements
  • Offset arrangements and the Bribery Act 2010

Offset arrangements arise where an additional investment, payment or other industrial, commercial or economic benefit is offered or required as part of an organisation’s tender, normally as part of a public procurement contract. Such arrangements, common in the aerospace and defence industries, may also be called offset agreements, industrial benefit or compensation, industrial co-operation, juste retour or counter-trade.

Types of offset arrangement—direct or indirect

Direct offset

A direct offset arises where the supplier offers to allow, eg a component to be manufactured in the purchasing territory or by the purchasing government.

Indirect offset

An indirect offset arises where the supplier or its government is required to purchase some other good or service from the purchasing government or within its territory