Foreign Corrupt Practices Act (FCPA)

Enacted in 1977, the Foreign Corrupt Practices Act (FCPA) makes it illegal for U.S. citizens, U.S. companies and certain foreign companies to bribe a foreign government official in order to obtain or retain business. However, despite the law’s good intentions, the government’s recent FCPA enforcement practices have created major uncertainty for American businesses and highlighted the need for reforms. read more...

Since the FCPA was enacted, trade’s importance to the U.S. economy (as a percentage of GDP) has grown more than fifty percent, and exports of U.S. goods exceeded $2 trillion in 2012. At the same time, foreign governments have increasingly enmeshed themselves in private businesses. 

Unfortunately, the FCPA has not evolved to reflect these changes in the global economy – creating unprecedented uncertainty for American businesses selling goods and services overseas. They are now exposed to civil and criminal penalties for conduct that is, in many cases, beyond their control and knowledge.

For example, when an employee of an American company takes an employee of a company partially owned by the Chinese government to lunch or pays for his cab ride, does that constitute an FCPA violation? And what happens when a rogue employee knowingly violates a company’s internal FCPA compliance system? Should the company be held liable too?

To help address these and other questions, the Department of Justice and the Securities and Exchange Commission released unprecedented joint guidance on their enforcement of the FCPA in November 2012. While this guidance was an important first step towards providing businesses with much-needed clarity and certainty, more reforms are needed. These include ensuring that U.S. companies implementing robust anti-bribery programs are not punished for the actions of rogue employees. The government should also provide a clearer definition of who constitutes a “foreign official” under the statute.  

More information about ILR’s proposals for FCPA reform can be found in the white paper Restoring Balance: Proposed Amendments to the Foreign Corrupt Practices Act.

Research

The ILR Research Review - Winter 2014

December 18, 2014 | This edition of the ILR Research Review offers valuable insights from the latest of ILR's research on perpetual prosecution, the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA), social media, and transnational litigation.

Federal Cases from Foreign Places: How the Supreme Court Has Limited Foreign Disputes From Flooding U.S. Courts

October 21, 2014 | This collection of essays examines the shifting legal landscape of federal claims by foreign plaintiffs in the federal courts and focuses on the most common statutes invoked by foreign plaintiffs, as well as the threshold issues of personal jurisdiction and pleading standards that govern such suits.

Additional Resources

All Results for Foreign Corrupt Practices Act (FCPA)

In the News Today - November 17, 2017

November 17, 2017 | News and Blog

U.S. Foreign Bribery Cases Fast-Tracked Due to Statute of Limitations Rule - SEC Enforcement Chief; Trump Considers Naming Mulvaney Interim CFPB Director Read More »

In the News Today - June 12, 2017

June 12, 2017 | News and Blog

Prospects for significant changes to the Foreign Corrupt Practices Act (FCPA) are low, but some changes may be possible with a pro-business Congress and president. The most likely change would be the introduction of an affirmative defense for effective anticorruption compliance measures. Read More »

In the News Today - May 30, 2017

May 30, 2017 | News and Blog

A trial set for this week "sets the stage for a judge to consider unique questions about the scope of the Foreign Corrupt Practices Act (FCPA) and other U.S. bribery laws." Read More »

Foreign Corrupt Practices Act Has "No Shortage of Challenges"

May 17, 2017 | News and Blog

The Foreign Corrupt Practices Act (FCPA) turns 40 this year and the "ambitious" attempt to deter corruption in international business dealings is "reviled by more than a few" writes Forbes. Read More »

In the News Today - April 25, 2017

April 25, 2017 | News and Blog

Yesterday marks the start of the first bellwether trial over blood thinner Xarelto in New Orleans. Xarelto has "become the poster child for critics of unbridled plaintiffs' attorney advertising" because these ads invite meritless cases and the dire warnings put patients at risk by convincing them to stop taking their medications. Read More »

In the News Today - April 21, 2017

April 21, 2017 | News and Blog

Trevor McFadden, Acting Principal Deputy Assistant Attorney General for the Department of Justice Criminal Division, said that prosecutors are "committed to wrapping up old Foreign Corrupt Practices Act cases and investigating new ones more quickly." Read More »

Largest FCPA Case in History Ends with $2.6 Billion Fine

April 18, 2017 | News and Blog

U.S. District Judge Raymond Dearie ordered Odebrecht, a Brazilian engineering company, to pay $2.6 billion to the governments of Brazil, the U.S., and Switzerland for violations of the Foreign Corrupt Practices Act (FCPA). Read More »

Number of DOJ Declinations Sees "Notable Uptick" Following FCPA Pilot Program

April 11, 2017 | News and Blog

James Tillen and Marc Bohn from law firm Miller & Chevalier found that the Department of Justice's (DOJ) one-year enforcement "pilot program" aimed at promoting greater accountability for those who violate the U.S. Foreign Corrupt Practices Act has been accompanied by "a notable uptick in declinations by the department." Read More »

In the News Today - October 27, 2016

October 27, 2016 | News and Blog

Lanny Breuer, former head of the U.S. Department of Justice's Criminal Division, said the DOJ's FCPA pilot programs makes "‘an extraordinary request' by mandating that companies seeking to have the government decline to bring a corruption case must ‘deconflict' and halt their own internal investigations of potential violations." Read More »

In the News Today - October 18, 2016

October 18, 2016 | News and Blog

In what Bob Conlin of NAVEX Global writes is "a remarkable affirmation of the value of robust compliance and due-diligence programs," the Securities and Exchange Commission (SEC) last month announced that it would not prosecute Harris Corporation for potential Foreign Corrupt Practices Act (FCPA) violations, even though the agency charged an officer of the company over FCPA allegations related to Chinese officials. Read More »

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