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The Foreign Corrupt Practices Act
The Foreign Corrupt Practices Act of 1977 is a federal law that was enacted to make it unlawful for individuals and companies to make payments to foreign government officials to assist in obtaining or retaining business. The anti-bribery provisions of this law prohibit any offer, payment, promise to pay, or authorization of the payment of money or anything of value to a foreign official to influence the foreign official in his or her official capacity, induce the foreign official to do or omit to do an act in violation of his or her lawful duty. In other words, you cannot give or offer to give either directly or indirectly anything of value to a government official to obtin or to retain business or to secure any improper advantage over competitors for that business.
Congress enacted the Foreign Corrupt Practices Act ("FCPA") to criminalize illicit payments to foreign public officials by United States companies or individuals. The FCPA makes it illegal to bribe a foreign official to obtain or retain business for or with any company or any person. Penalties under the Act include fines of up to double the benefit expected to be received from the bribery.
The Foreign Corrupt Practices Act also requires companies with securities listed in the U.S. to meet its accounting requirements. These accounting requirements unction in parallel with the anti-bribery requirements of the Foreign Corrupt Practices Act. An exception exists to the anti-bribery prohibition relating to payments to facilitate expediting the performance of a routine governmental action. Admittedly, it is sometimes difficult to differentiate between legal fees paid to expedite routine processes and payments considered to be illegal under the FCPA.
Edited by Michael C. Dennis, author of several books including: "Credit and Collection Handbook." Mr. Dennis can be reached with comments or questions at mcdennis13@yahoo.com