Foreign Corrupt Practices Act Essay
Foreign Corrupt Practices Act Essay
The Foreign Corrupt Practice Act makes it illegal for foreign officials to be bribed in return for obtaining or retaining business for individuals or firms (David, 2021). While some have viewed the law as being too punitive to US businesses operating in foreign countries where corruption is especially rampant, I opine that the law is aimed at leveling the playing field.
The US government attempts to make the playing field for doing business level by enforcing the FCPA law against foreign as well as US businesses. The law represents one of the aggressive applications of extraterritorial jurisdiction by the government. If foreign businesses have their shares listed publicly in the US, or if their officials take actions in the US to further their bribery schemes, or if foreign individuals work for US companies or serve as directors or officers of the entities, the foreign businesses or individuals can be subjected to the FCPA.
Records indicate that since 2010, the number of FCPA prosecutions against foreign entities has been on the rise. Several foreign individuals have been sent to US prisons for violations. An example of a high-profile FCPA prosecution is one that involved Siemens and its subsidiaries in Argentina, Venezuela, and Bangladesh. Siemens was fined $800 by US authorities for massive bribery deals involving its officials and foreign government officials in return for business lasting several decades (Brewster, 2017).
This case presents a classic example of how the FCPA attempts to promote a level playing field in international business. Had the firm not been penalized, it would have competed unjustly against other companies. Other than protecting US entities from unfair business practices abroad, the FCPA also prevents US firms from being subject to extortion by corrupt foreign government officials (David, 2021).
Reference
David, P. A. (2021). International logistics: The management of international trade operations (6th ed.). Cicero Books.
Brewster, R. (2017). Enforcing the FCPA: international resonance and domestic strategy. Va. L. Rev., 103, 1611.
Foreign Corrupt Practices Act Essay
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