Mondaq (10/01/08); Rawitz, Jeffrey M.; Reilley, Erica L.
The Foreign Corrupt Practices Act (FCPA) was created in the 1970s when it was discovered that more than 400 U.S. firms had given upwards of $300 million in bribes to foreign governments and officials. In the case of present-day China, local anti-bribery laws are not always sufficiently enforced, creating possible competitive disadvantages for U.S firms doing business in China. This indicates that it is crucial for U.S. firms operating in China to have a strong FCPA compliance program. Such a program should feature clear standards and procedures, training provided by local staff, strict adherence to corporate due diligence, the negotiation of contracts to curb FCPA risks and the creation of an investigative unit that rapidly probes any FCPA issues. China has a long practice of gift giving, but the FCPA forbids the payment, offer, gift, or authorizing of the giving of money, or of "anything of value," such as travel and entertainment expenses. The U.S. Department of Justice (DOJ) interprets the FCPA as allowing entertainment expenses to the extent permitted under Chinese law--RMB 200 (US$24). The DOJ has also concluded that the FCPA permits the payment of travel and lodging costs related to a foreign official for "the promotion, demonstration, or explanation of products or services," but that side trips and spousal costs would be the responsibility of officials themselves.(www.mondaq.com)© Copyright 2008 Information, Inc. © Copyright 2008 Information, Inc.
