The Foreign Corrupt Practices Act (“FCPA”) was enacted in 1977 to make unlawful the bribing of foreign government officials in order to obtain or retain business.
FCPA prohibits paying, offering or promising to pay money or anything of value to a foreign official, foreign political party or party official or any candidate for foreign political office.
The scope of FCPA is sufficiently broad to cover the acts of agents of a U.S. company, which can include foreign sales agents and foreign distributors. The point is that if your company engages in commercial transactions abroad, you need to be aware of FCPA and that the illegal actions of your agents abroad can create civil and criminal liability for you.
This exposure should cause you to see if your agreements with foreign sales agents and distributors address their compliance with FCPA and whether you have an effective compliance program in place to make sure your foreign agents and distributors are aware of the law and are complying completely with its provisions.
Obviously there is more to FCPA than what is set out above. But awareness of this problem is the first step in avoiding the issue.
Michael W. Margrave