Companies that do business overseas must be aware of, and comply with, the FCPA and other applicable anticorruption laws. In recent years, the Securities and Exchange Commission and the Department of Justice have increased their focus on FCPA enforcement, and they now coordinate with officials in other countries to enforce anticorruption laws. Any company doing business abroad falls under the scope of the FCPA: companies will be held responsible for the actions of their subsidiaries, joint ventures, partners and agents. Companies with international operations must have rigorous anticorruption compliance programs, so that potential violations are immediately identified and their effects are mitigated.
A few things every corporation should know about the FCPA:
- The FCPA applies to contact with any person or entity associated with a foreign government; for example, it prohibits corrupt offers or payments made to legislators, unelected officials, political candidates, government employees and employees of government-owned businesses (including schools and hospitals).
- Companies are liable for the acts of their employees, agents and third-party intermediaries.
- A mere offer of an illegal payment by an employee can subject a company to FCPA liability.
- FCPA penalties are severe—companies can be fined up to $2 million per violation and may be barred from government contracting.
- The government will consider a robust compliance program as a mitigating factor if it imposes sanctions resulting from a violation.
- The FCPA’s Books, Records, and Internal Controls provision requires publicly traded companies to accurately detail transactions and maintain appropriate controls to ensure the same. Companies that do not maintain accurate books and records can be liable under the FCPA.
In addition to the FCPA, companies that do business in the United Kingdom must comply with the UK Bribery Act. This law, which became effective in July 2011, contains similar prohibitions as the FCPA, but also extends to bribery in the private sector. The Bribery Act authorizes severe penalties and imposes a strict liability offense against companies that fail to implement adequate procedures to prevent bribery. As such, it is vitally important for companies to institute robust compliance programs with effective anticorruption controls.
Our Team and Experience
Our team consists of former U.S. attorneys, Securities and Exchange Commission attorneys, and attorneys and professionals who have served in all levels of the federal government.
Our attorneys’ and professionals’ general experience in FCPA and anticorruption representation includes:
- defense against governmental investigations and enforcement actions;
- assistance in all aspects of voluntary disclosures, including working with government-assigned monitors;
- design and implementation of anticorruption compliance programs, policies and procedures;
- training employees on anticorruption compliance;
- due diligence reviews for anticorruption compliance on potential target companies during acquisitions;
- review of applications of agents and intermediaries to determine whether they are appropriate business partners; and
- internal investigations and advice.
Some representations we have recently handled include:
- representation of a large pharmaceutical company before the Department of Justice and Securities and Exchange Commission in an Iraq oil-for-food investigation and enforcement proceeding;
- an internal investigation in the Middle East for a global tool manufacturer;
- internal investigations in Italy and India for a Fortune 100 technology company;
- advice to a U.S. logistics company operating in Iraq;
- preparation of an internal anticorruption compliance program for a major medical products company with operations in over 100 countries;
- development of an internal anticorruption compliance program and counseling on individual practices and potential enforcement issues for a multibillion-dollar pharmaceutical company with extensive international operations;
- development of anticorruption compliance program and counseling on individual compliance matters for multinational banks headquartered in Europe and Japan;
- counseling of a U.S. defense contractor in the structuring of its payments to a European agent in order to comply with applicable anticorruption laws;
- representing a multinational technology company in connection with a voluntary disclosure under the FCPA;
- counseling of a U.S. subsidiary of a large European defense contractor on anticorruption issues in connection with payment of agents’ fees under a contract to supply defense products to a Latin American government; and
- advice to a U.S.-based agricultural company on the application of anticorruption laws to payments to a foreign government hostile to the United States to obtain exit visas for certain of its employees under persecution by that government.