Bill- I guess I have enough Arkie ties to not be in a position to tell anyone what bribery is or is not, but I'll bet if us Arkies got together with you Texans we could come up with something that the country would buy...Credit to Terrence and Robert for going to the horse's mouth. Gray areas are what line lawyers pockets and make for good listserv discussions....I learn alot from reading "us" and I appreciate the opportunity to participate.
________________________________
From: Bill Shaw [mailto:[log in to unmask]]
Sent: Fri 10/12/2007 4:44 PM
To: [log in to unmask]
Cc: Delaurell, Roxane M; [log in to unmask]; [log in to unmask]; [log in to unmask]; [log in to unmask]; [log in to unmask]
Subject: Foreign Corrupt Practices Act
Good Afternoon Roxane. This is so interesting; wish I knew some answers. By the way, I'm on the side of the good guys about bribery. And of course I'm Texan; we just don't do that. * But what I've read/heard from sociologists/social anthropologists is that behaviors that would be condemned in the West are not looked upon as corrupt in some parts of the world. Certain behaviors would be in keeping with custom/tradition. Now this is probably not rampant because when people see conduct as exploitative/disrespectful/hurtful, taboos are brought into place. That's an evolutionary/survivalist thing. * Gray areas. There are probably fewer of those than are supposed. What passes under that heading are occasions when a business person wants to get by with something that is highly suspect, and falls back this feeble excuse.
ps Terrance -- I'd imagine DOJ would exercise the same extraterritorial jurisdiction over a Mafioso or terrorist if it could connect a U.S. "hit" with the suspect.
Nancy Jean -- The Tectronic case. How'd that come out in the district court?
"Delaurell, Roxane M" <[log in to unmask]> wrote:
I 'm not surprised that bribery is not legal anywhere and wouldn't expect it to be. The problem arises when it may be legal in a host country to hire the foreign official(decision maker) as an expert/consultant or even members of their family. Its these gray areas that lead to problems. If the US company does not 'take advantage' of the law it is at a competitive disadvantage.
BTW, Robert, who teaches a class on a Friday night????You need some representation!
________________________________
From: Academy of Legal Studies in Business (ALSB) Talk on behalf of Terence Lau
Sent: Fri 10/12/2007 1:11 PM
To: [log in to unmask]
Subject: Re: foreign corrupt practices act question
According to the DOJ, which enforces the antibribery provisions of the FCPA, the "legal under local law" exception is an affirmative defense. It's cold comfort, however. When I was in-house counsel at Ford, we (attorneys with responsibility over FCPA) tried to come up with a list of countries that permits bribery under local law, and came with a grand total of zero. We could not think of a single country in the world that has codified bribery as legal. See http://www.usdoj.gov/criminal/fraud/docs/dojdocb.html.
The exception that most business persons hang their hat on is therefore the "grease payments" or "facilitating payments" exception, which is more concerned with local custom than local law. Again, however, it's cold comfort. Under the accounting provisions of the FCPA, these payments must be accounted for separately on a company's books. And again, as a group, we could not think of a single publicly traded company (not one) that has a separate "grease payments" line item on their books.
Thus, Ford's policy (and I believe this is one echoed by many large companies) was no bribes, no grease payments, no exceptions, to the US parent and US subs, as well as all controlled subs and affiliates, no exceptions granted, don't bother calling Legal.
By the way, that DOJ website is worth a read for those of you interested in the extraterritorial application of US law. Note that the DOJ takes the position that it has jurisdiction over non-US companies and non-US citizens who have never been to the US, and even have no nexus whatsoever to the US, as long as that foreign company or person causes an act in furtherance of the corrupt payment to take place within the United States. Thus, for example (and this is just a hypo), any foreign company that has zero contacts with the US, zero employees, suppliers or customers in the US, and uses an email system that routes traffic via the US (such as google mail), and uses the email to further a corrupt payment, is subject to the FCPA.
_____
Terence Lau
Assistant Professor, Business Law
Management and Marketing Department
University of Dayton
[log in to unmask]
Robert Bird
Sent by: "Academy of Legal Studies in Business (ALSB) Talk"
10/12/2007 12:22 PM
Please respond to
"Academy of Legal Studies in Business (ALSB) Talk"
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Re: foreign corrupt practices act question
This question gets all the more interesting as the text I use states (if I recall correctly) that bribes are not permitted even if they are allowed under local law. The Foley & Lardner site seems to directly say 'yes' to this question. Perhaps the word 'maybe' is order for my class tonight.
Robert
Robert C. Bird
Assistant Professor
University of Connecticut
email: [log in to unmask]
View my research on my SSRN Author page:
http://ssrn.com/author=56987
________________________________
From: Academy of Legal Studies in Business (ALSB) Talk on behalf of Delaurell, Roxane M
Sent: Fri 10/12/2007 12:05 PM
To: [log in to unmask]
Subject: Re: foreign corrupt practices act question
Looks like even Foley Lardner is soft on the issue claiming that local legal payments are rarely permitted....I wonder how they know that....My understanding is that the biggest problem with FCPA is its extraterratorial application as Sally referred to. If terretorial jurisdiction is the strongest form then US companies must adhere to standards on the ground. isn't that why FCPA was passed in the first place? to allow US companies to say hey, I can't pay this because I will be breaking the law of my home country? The 70s was a period of US expansion of its antitrust laws as well, by their application extraterritorially. I think Robert has posed the classic conflicts question- what does a US company do if its damned if it does by host country and damned if it doesn't by home country?
________________________________
From: Academy of Legal Studies in Business (ALSB) Talk on behalf of Hotchkiss, Carolyn
Sent: Fri 10/12/2007 11:21 AM
To: [log in to unmask]
Subject: Re: foreign corrupt practices act question
According to my favorite source on the FCPA,
http://www.fcpaenforcement.com/explained/explained.asp, "Under certain
other exceptional circumstances, a payment may be made to foreign
officials when the payment is "lawful under the written laws of the
foreign country." Such payments, however, are rarely, if ever,
permitted under local law." It's a (largely hypothetical) affirmative
defense to a FCPA charge. I assume it would also have to be disclosed
in the firm's financial records in order to meet the accounting
provisions of the FCPA.
The Foley & Lardner site referenced above is a terrific resource on all
things FCPA.
Carolyn
Carolyn Hotchkiss
Professor of Law
Babson College
-----Original Message-----
From: Academy of Legal Studies in Business (ALSB) Talk
[mailto:[log in to unmask]] On Behalf Of Hartman, Laura
Sent: Friday, October 12, 2007 10:39 AM
To: [log in to unmask]
Subject: Re: foreign corrupt practices act question
Wasn't one of the objectives of the FCPA to prohibit payments that might
be considered acceptable locally but not under US standards? Just a
thought . . .
Prof. Laura P. Hartman
Assoc. Vice President, Academic Affairs
Professor of Business Ethics, Dept. of Management
DePaul University
1 E. Jackson Blvd., ste. 7000
Chicago, IL 60604
Ph: 312/362-6569, Fax: 312/362-6973
Mobile: 312/493-9929
www.nothingbutnets.net
-----Original Message-----
From: Academy of Legal Studies in Business (ALSB) Talk
[mailto:[log in to unmask]] On Behalf Of Robert Bird
Sent: Friday, October 12, 2007 9:28 AM
To: [log in to unmask]
Subject: foreign corrupt practices act question
Hi everyone,
I have a question about the FCPA. The FCPA prohibits payments to
foreign government officials in order to influence a governmental
decision. I know about the "rountine governmental action" exception.
But what if the payment is legal under local law? Is the FCPA violated
then?
I am getting conflicting answers to this question from a textbook and
other sources, and would appreciate your help! (I teach the topic
tonight)
Thanks,
Robert
Robert C. Bird
Assistant Professor
University of Connecticut
email: [log in to unmask]
View my research on my SSRN Author page:
________________________________
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