Define: Foreign Corrupt Practices Act

The Foreign Corrupt Practices Act is a U.S. federal law that prohibits bribery of foreign officials by individuals and companies operating within the United States.

The FCPA applies to all U.S. citizens, residents, and companies, as well as foreign companies listed on U.S. stock exchanges or conducting business in the United States.

A bribe under the FCPA includes any payment, gift, or promise of something of value to a foreign official with the intent to influence their actions or obtain an unfair advantage in business.

Facilitation payments, also known as grease payments, are small payments made to expedite routine government actions. While some countries may allow facilitation payments, the FCPA prohibits such payments.

Individuals and companies found guilty of violating the FCPA can face significant fines, imprisonment, and other criminal and civil penalties. Companies may also face reputational damage and loss of business opportunities.

Yes, a company can be held liable for the actions of its employees, agents, or third-party intermediaries if they engage in bribery on behalf of the company. It is crucial for companies to have robust compliance programs in place to prevent such misconduct.

There are limited exceptions and affirmative defences under the FCPA, such as facilitating payments for routine government actions. However, these exceptions are narrowly construed, and companies should seek legal advice before relying on them.

Yes, companies can voluntarily disclose potential FCPA violations to the U.S. Department of Justice (DOJ) or the Securities and Exchange Commission (SEC). Self-reporting, cooperation, and remediation efforts may result in reduced penalties or leniency.

Companies can ensure compliance with the FCPA by implementing robust anti-corruption policies, conducting regular training for employees, conducting due diligence on third-party partners, and regularly monitoring and auditing their compliance programs.

Yes, non-U.S. companies can be prosecuted under the FCPA if they have sufficient ties to the United States, such as conducting business in the U.S., using U.S. financial institutions, or listing securities on U.S. stock exchanges.