white paper - morrison & foerster llp

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"#$%&'()*!

The Foreign Corrupt Practices Act and Global Anti-Corruption Law

Sponsored by:

FCPA & Anti-Corruption Task Force

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For more ACC InfoPAKs, please visit www.acc.com/infopaks!

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Contents !

I. FCPA Basics......................................................................................................................................7

A. The Statute..............................................................................................................................................................................7

B. Enforcement..........................................................................................................................................................................10

C. Key Cases ..............................................................................................................................................................................10

II. Major Issues ....................................................................................................................................13

A. Third Parties .........................................................................................................................................................................13

B. Gifts, Entertainment, Travel, and Hospitality ................................................................................................................15

C. Facilitating Payments Exception........................................................................................................................................18

D. High-risk Jurisdictions.........................................................................................................................................................19

E. Government Officials and State-owned Enterprises ...................................................................................................22

F. Control Person Liability .....................................................................................................................................................26

G. Accounting and Internal Control Provisions.................................................................................................................28

III. Department of Justice....................................................................................................................31

A. Role and Organization........................................................................................................................................................31

B. Prosecution Policies and Practices ..................................................................................................................................32

C. Interacting with the DOJ....................................................................................................................................................33

IV. Securities and Exchange Commission .........................................................................................35

A. Role and Organization........................................................................................................................................................35

B. Policies and Practices ..........................................................................................................................................................35

C. Interacting with the SEC ....................................................................................................................................................36

V. Enforcement Trends......................................................................................................................37

A. More Aggressive Prosecutions .........................................................................................................................................37

B. Larger Financial Penalties ...................................................................................................................................................38

C. Prosecution of Individuals..................................................................................................................................................39

D. FCPA Whistleblowers ........................................................................................................................................................40

E. Sector or Industry-wide Investigations...........................................................................................................................42

F. Multinational Cooperation ................................................................................................................................................44

VI. Considering Whether to Self-Report...........................................................................................47


Copyright © 2010 Morrison & Foerster LLP & Association of Corporate Counsel!

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A. Primary Advantage of Self-reporting: Mitigation of Criminal and Civil Penalties ................................................ 47

B. Factors to Consider in Deciding Whether to Self-report .........................................................................................48

VII. Red Flags: Facts That Raise FCPA Compliance Issues ..............................................................50

A. Reported Cases....................................................................................................................................................................50

B. Risk Mitigation ......................................................................................................................................................................52

VIII. Compliance Programs ...................................................................................................................53

A. Tone at the Top...................................................................................................................................................................54

B. The Audience........................................................................................................................................................................54

C. What to Cover.....................................................................................................................................................................54

D. Format....................................................................................................................................................................................56

E. Frequency ..............................................................................................................................................................................56

F. Documentation ....................................................................................................................................................................57

G. Case Example: U.S. v. Panalpina.........................................................................................................................................57

IX. M&A Due Diligence........................................................................................................................57

A. Importance of Pre-acquisition Due Diligence ...............................................................................................................57

B. Due Diligence Plan ..............................................................................................................................................................59

X. Suspension and Debarment of Government Contractors.........................................................61

A. Bases for Suspension and Debarment ............................................................................................................................61

B. Scope of Suspension and Debarment .............................................................................................................................63

C. Procedures and Timing for Suspension and Debarment............................................................................................64

D. Strategies and Procedures for Avoiding Suspension and Debarment .....................................................................66

XI. Related Crimes and Commercial Bribery ...................................................................................68

A. Recent Cases ........................................................................................................................................................................68

B. Commercial Bribery and the Travel Act........................................................................................................................69

C. Intersection with Other Crimes ......................................................................................................................................70

D. Reaching the Corrupt Payment Recipient .....................................................................................................................70

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XII. Tag-along Civil Litigation ..............................................................................................................71

A. Securities Class Actions .....................................................................................................................................................71

B. Derivative Suits ....................................................................................................................................................................75

C. ERISA litigation .....................................................................................................................................................................78

D. Suits by Foreign Governments .........................................................................................................................................78

E. Suits by Business Partners .................................................................................................................................................80

F. Suits by Business Competitors .........................................................................................................................................80

G. Employment Suits by Whistleblowers ............................................................................................................................81

XIII. Role of Outside Counsel in Internal Investigations ....................................................................81

A. Conducting an Internal Investigation...............................................................................................................................82

B. Pros and Cons of Retaining Outside Counsel ..............................................................................................................82

C. Other Issues to Consider When Retaining Outside Counsel ..................................................................................83

XIV. Pending Legislation ........................................................................................................................84

A. H.R. 5366—Overseas Contractor Reform Act ...........................................................................................................84

B. H.R. 2152—Foreign Business Bribery Prohibition Act of 2009................................................................................84

C. H.R. 5837—Certification Prior to Award of Federal Contracts..............................................................................84

D. H.R. 4326 and S. 445—Attorney-Client Privilege Protection Act of 2009............................................................85

E. Amendments to the U.S. Sentencing Guidelines..........................................................................................................85

XV. The OECD Convention .................................................................................................................87

A. Prohibited Conduct.............................................................................................................................................................88

B. Sanctions ................................................................................................................................................................................90

C. Enforcement..........................................................................................................................................................................90

XVI. Overview of Anti-Corruption Laws in Other Countries ............................................................91

A. The United Kingdom and the UK Bribery Act 2010...................................................................................................91

B. Australia .................................................................................................................................................................................99

C. Japan..................................................................................................................................................................................... 100

D. China.................................................................................................................................................................................... 104

E. Hong Kong ......................................................................................................................................................................... 106



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XVII. Unique Challenges of Doing Business in China.........................................................................107

A. Foreign officials.................................................................................................................................................................. 108

B. Agents, Distributors, and Third-party Intermediaries ............................................................................................. 108

C. “Fapiao”—Official Receipts ............................................................................................................................................ 109

D. Gifts and Entertainment .................................................................................................................................................. 109

XVIII. Sample Forms...............................................................................................................................111

A. Sample FCPA Due Diligence Checklist for Potential Acquisition ......................................................................... 112

B. Sample Contract Provisions for Agents/Distributors .............................................................................................. 119

C. Sample Contract Provisions for Joint Ventures ........................................................................................................ 121

D. Sample FCPA Compliance Certification for Agents................................................................................................. 123

E. Sample FCPA Compliance Certification for Employees.......................................................................................... 125

XIX. Endnotes........................................................................................................................................126

XX. About the Authors........................................................................................................................138

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A. The Statute

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1. Anti-bribery Provision

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a. The FCPA’s Broad Reach

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b. Exceptions and Defenses

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2. Accounting Requirements

E2"'J8+3'&"N:.&"4'.44:"&4'1,'$5I"'56/'I""9'%,,I4'56/'&"#,&/4'R.6'&"54,65%;"'/"15.;S'1251'R5##:&51";0'56/'75.&;0'&"7;"#1'12"'1&5645#1.,64'56/'/.49,4.1.,64S',7'5'#,$9560\4'544"14M*(''E2"'J8+3\4'.61"&65;'#,61&,;4'9&,-.4.,6'&"N:.&"4'.44:"&4'1,'/"-.4"'56/'$5.615.6'&"54,65%;"'.61"&65;'5##,:61.6A'#,61&,;4='5.$"/'51'9&"-"61.6A'56/'/"1"#1.6A'J8+3'-.,;51.,64M*B'F6',&/"&'7,&'31%$%&-.';.5%.;.10'1,'5##&:"':6/"&'12"'5##,:61.6A'9&,-.4.,64='5'9"&4,6'$:41'RI6,L.6A;0S]'T*U'75;4.70'5'%,,I='&"#,&/=',&'5##,:61=',&'T(U'75.;'1,'.$9;"$"61'5'4041"$',7'.61"&65;'5##,:61.6A'#,61&,;4M''E2"'4151:1"'/,"4'6,1'/"7.6"'RI6,L.6A;0=S'%:1'8,6A&"44'.6/.#51"/'1251'.1'R$"561'1,'"64:&"'1251'#&.$.65;'9"65;1."4'L,:;/'%"'.$9,4"/'L2"&"'5#14',7'#,$$.44.,6',&',$.44.,6'.6'I""9.6A'%,,I4',&'&"#,&/4',&'5/$.6.41"&.6A'5##,:61.6A'#,61&,;4'25-"'12"'9:&9,4"',7'75;4.70.6A'%,,I4='&"#,&/4=',&'5##,:614'M'M'MS',&',7'#.&#:$-"61.6A'.61"&65;'#,61&,;4M*`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



10

!

B. Enforcement

E2"'!"95&1$"61',7'a:41.#"'TR!faSU'56/'12"'@"#:&.1."4'56/'XY#256A"'8,$$.44.,6'TR@X8SU'5&"'12"'A,-"&6$"615;'5A"6#."4'&"49,64.%;"'7,&'J8+3'"67,&#"$"61M''E2"'f77.#"',7'b"6"&5;'8,:64";',7'12"'!"95&1$"61',7'8,$$"&#"'5;4,'564L"&4'A"6"&5;'N:"41.,64'7&,$'DM@M'"Y9,&1"&4'5%,:1'%54.#'J8+3'&"N:.&"$"614M''34'/"4#&.%"/'.6';51"&'#2591"&4='12"'!fa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d''

! !"#$%&'"()*$?'F6'12"';5&A"41'J8+3'4"11;"$"61'1,'/51"='@."$"64'4"11;"/'56'J8+3'#54"'7,&'Zd))'$.;;.,6'.6'())dM*V''F6'())V='e5;;.%:&1,6'56/'5'7,&$"&'4:%4./.5&0'95./'Z<WV'$.;;.,6'1,'4"11;"'5'#54"'&"A5&/.6A'5'>.A"&.56'%&.%"&0'4#2"$"'#5&&."/',:1'%0'5'7,:&K#,$9560'Q,.61'-"61:&"M()''F6'a:6"'56/'a:;0'()*)='E"#26.9'56/'@65$9&,A"11.'>"12"&;56/4'"5#2'5A&""/'1,'950',-"&'ZB))'$.;;.,6'1,'4"11;"'&";51"/'#54"4M(*''

F6/.-./:5;4'#,6-.#1"/',7'#&.$.65;'-.,;51.,64',7'12"'561.K%&.%"&0'9&,-.4.,64'$50'%"'.$9&.4,6"/'7,&':9'1,'<'0"5&4'56/'7.6"/':9'1,'Z*))=)))M''g.,;51.,64',7'12"'5##,:61.6A'9&,-.4.,64'#56'&"4:;1'.6'7.6"4':9'1,'Z<'$.;;.,6'56/'.$9&.4,6$"61'7,&':9'1,'()'0"5&4M((''E2"'@X8'56/'!fa'5&"'.6#&"54.6A;0'9:&4:.6A'5AA&"44.-"'7.656#.5;'9"65;1."4'56/'Q5.;'1.$"M(B''''

! !"#$%&'"()*$?%%F6'39&.;'()*)='5'7,&$"&'"Y"#:1.-"'L54'4"61"6#"/'1,'12"';,6A"41'9&.4,6'1"&$'"-"&'.$9,4"/'.6'56'J8+3'#54"[dW'$,6124M(`''

34'/.4#:44"/'.6'$,&"'/"15.;'.6';51"&'#2591"&4='A,-"&6$"61'.6-"41.A51.,6'L.;;'5;4,';.I";0'%"'7,;;,L"/'%0'5'7;:&&0',7'#.-.;'4:.14'%0'425&"2,;/"&4='#,$9"1.1,&4='56/'"-"6'7,&".A6'A,-"&6$"614M''E2"&"'.4'6,'9&.-51"'&.A21',7'5#1.,6':6/"&'12"'J8+3[,6;0'12"'A,-"&6$"61'$50'%&.6A'56'J8+3'5#1.,6M(<''e,L"-"&='#,6/:#1'1251'-.,;51"4'12"'J8+3'$50'A.-"'&.4"'1,'9&.-51"'&.A214',7'5#1.,6':6/"&'7"/"&5;'56/'4151"';5L4='.6#;:/.6A'12"'@"#:&.1."4'3#1',7'*VBB'56/'@"#:&.1."4'56/'XY#256A"'3#1',7'*VB`='56/'12"'h5#I"1""&'F67;:"6#"/'56/'8,&&:91'f&A56.c51.,64'3#1'TRhF8fSU='L2.#2'9&,-./"4'7,&'1&"%;"'/5$5A"4M'

C. Key Cases

E2"'-541'$5Q,&.10',7'J8+3'5#1.,64'5&"'4"11;"/M''e,L"-"&='5'7"L'#.&#:.1'#,:&1'/"#.4.,64'42"/'4,$"';.A21',6'12"'4151:1"\4'5$%.A:.1."4'56/':6/"7.6"/'1"&$4M'

!


11

!

1. United States v. Liebo (8th Cir. 1991)

F6'(&%2"!#*2-2"'#+)#7%"84='V(B'JM(/'*B)d'Td12'8.&M'*VV*U='12"'X.A212'8.&#:.1'#,64./"&"/'12"'/"7.6.1.,6',7'R."##/0+12MS''3'Q:&0'#,6-.#1"/'12"'/"7"6/561',7'-.,;51.6A'12"'J8+3='7,&'950.6A'Z(=)(d'7,&'5.&;.6"'1.#I"14'7,&'12"'2,6"0$,,6',7'5'>.A"&.56',77.#.5;M''E2"'/"7"6/561'#25;;"6A"/'12"'Q:&0'.641&:#1.,64'/"7.6.6A'12"'1"&$'R#,&&:91;0MS''E2"'.641&:#1.,64'4151"/]''

T*U''R#,&&:91;0S'$"564'1251'R12"',77"&='9&,$.4"'1,'950='950$"61',&'5:12,&.c51.,6',7'950$"61='$:41'%"'.61"6/"/'1,'.6/:#"'12"'&"#.9."61'1,'$.4:4"'2.4',77.#.5;'9,4.1.,6',&'1,'.67;:"6#"'4,$",6"'";4"'1,'/,'4,=S'56/''T(U''R56'5#1'.4'_#,&&:91;0'/,6"\'.7'/,6"'-,;:615&.;0'56/'.61"61.,65;;0='56/'L.12'5'%5/'9:&9,4"',7'5##,$9;.42.6A'".12"&'56':6;5L7:;'"6/',&'&"4:;1=',&'5';5L7:;'"6/',&'&"4:;1'%0'4,$"':6;5L7:;'$"12,/',&'$"564MS''''

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

2. Stichting v. Schreiber (2d Cir. 2003)

E2"'@"#,6/'8.&#:.1'L".A2"/'.6',6'12"'$"56.6A',7'R."##/0+12S'.6'*2%362%&9#+)#*361"%8"1='B(W'JMB/'*WB'T(/'8.&M'())BUM''@1.#21.6A'L54'5'!:1#2'#,&9,&51.,6'7,&$"/',6'%"25;7',7'@50%,;1'>,&12'3$"&.#5'425&"2,;/"&4'1,'9:&4:"'5';"A5;'$5;9&5#1.#"'5#1.,6'5A5.641'@#2&".%"&='@50%,;1\4'7,&$"&'/.&"#1,&'56/'511,&6"0M''@#2&".%"&'5;;"A"/;0'9&,-./"/'@50%,;1'"&&,6",:4';"A5;'5/-.#"'1251'5;;"A"/;0'#5:4"/'@50%,;1'1,'-.,;51"'12"'J8+3M''@#2&".%"&'25/'5/-.4"/'@50%,;1'1251'.1'#,:;/';"A5;;0'%&.%"'5'+565$56.56',77.#.5;'.7'@50%,;1\4'!:1#2'577.;.51"'$5/"'12"'950$"61M''@50%,;1':;1.$51";0'9;"5/"/'A:.;10'1,'-.,;51.6A'12"'J8+3M''E2"'/.41&.#1'#,:&1'A&561"/'4:$$5&0'Q:/A$"61'7,&'@#2&".%"&'%"#5:4"'.1'7,:6/'1251'@50%,;1\4'A:.;10'9;"5'#,641.1:1"/'56'5/$.44.,6'1251'.1'5#1"/'L.12'I6,L;"/A"'1251'.14'#,6/:#1'L54'#,&&:91^'12:4='@1.#21.6A'L54'#,;;51"&5;;0'"41,99"/'7&,$'5&A:.6A'1251'12"';"A5;'5/-.#"'#5:4"/'@50%,;1'1,'%";."-"'.14'5#14'L,:;/'6,1'-.,;51"'12"'J8+3M'E2"'@"#,6/'8.&#:.1'/.45A&""/M''F1'2";/'1251'56'5/$.44.,6'1251'56'5#1'L54'/,6"'R#,&&:91;0S'.4'R6,1'"N:.-5;"61'1,'56'5/$.44.,6'1251'12"'9"&4,6'#,$$.11.6A'.1'I6"L'1251'.1'-.,;51"/'12"'95&1.#:;5&';5L'51'12"'1.$"'12"'5#1'L54'9"&7,&$"/MS''E2"'#,:&1'"$9254.c"/'1251',6;0'R5'%5/',&'L&,6A7:;'9:&9,4"'56/'56'.61"61'1,'.67;:"6#"'5'7,&".A6',77.#.5;'1,'$.4:4"'2.4',77.#.5;'9,4.1.,6S'5&"'&"N:.&"/'7,&'56'5#1'1,'%"'/,6"'R#,&&:91;0MS''E2"'/"7"6/561'6""/'6,1'25-"'56'.61"61'1,'-.,;51"'5'95&1.#:;5&';5L=',&'"-"6'5'A"6"&5;;0'R:6;5L7:;'.61"61MS'



12

!

3. United States v. Kay (5th Cir. 2007)

E2"'J.712'8.&#:.1'254'/"7.6"/'12"'R>$116/112S'56/'R."##/0+12S'";"$"614M''F6'(&%2"!#*2-2"'#+)#:-;='<*B'JMB/'`B('T<12'8.&M'())WU='"Y"#:1.-"4'51'5'&.#"'#,$9560'L"&"'#,6-.#1"/',7'-.,;51.6A'12"'J8+3'%0'950.6A'%&.%"4'1,'e5.1.56',77.#.5;4'1,'&"/:#"'#:41,$4'/:1."4'56/'45;"4'15Y"4',6'&.#"'.$9,&14M''E2"'J.712'8.&#:.1':92";/'12"'/.41&.#1'#,:&1\4':4"',7'12"'7,;;,L.6A'Q:&0'.641&:#1.,64='4.$.;5&'1,'12,4"'599&,-"/'.6'7%"84]''

T*U''56'5#1'.4'/,6"'_#,&&:91;0\'.7'.1'R.4'/,6"'-,;:615&.;0'56/'.61"61.,65;;0='56/'L.12'5'%5/'9:&9,4"',&'"-.;'$,1.-"',7'5##,$9;.42.6A'".12"&'56':6;5L7:;'"6/',&'&"4:;1=',&'5';5L7:;'"6/',&'&"4:;1'%0'4,$"':6;5L7:;'$"12,/',&'$"564MS'''T(U''R56'5#1'.4'/,6"'_I6,L.6A;0\'M'M'M'56/'/"7.6"/'M'M'M'54'/,6"'-,;:615&.;0'56/'.61"61.,65;;0='6,1'%"#5:4"',7'5##./"61',&'$.415I"MS''

!"7"6/5614'5&A:"/'12"'.641&:#1.,64'L"&"'.65/"N:51"'%"#5:4"='5$,6A',12"&'&"54,64='12"0'75.;"/'1,'.641&:#1'12"'Q:&0',6'12"'";"$"61',7'L.;;7:;6"44M''E2"'J.712'8.&#:.1'2";/'1251'5'#&.$.65;'-.,;51.,6',7'12"'J8+3'/,"4'&"N:.&"'1251'12"'/"7"6/561'RI6"L'1251'2"'L54'/,.6A'4,$"12.6A'A"6"&5;;0'_:6;5L7:;\'51'12"'1.$"',7'2.4'5#1.,6MS''i:1'.1'2";/'12"'/.41&.#1'#,:&1\4'Q:&0'.641&:#1.,64'#591:&"/'1251';"-";',7'.61"61'%0'&"N:.&.6A'5'7.6/.6A',7'R%5/'9:&9,4"',&'"-.;'$,1.-"MS'F6'5'9&.,&'/"#.4.,6'.6'12"'45$"'#54"='12"'J.712'8.&#:.1'565;0c"/'12"'&"N:.&"$"61'1251'950$"614'%"'$5/"'R+"':%%$%+'$&'"=+:$&$&8'"#'#*+:$&$&8'=/%$&*%%MS(C''E2"'#,:&1'2";/'%&.%"4'95./'1,'&"/:#"'#:41,$4'/:1."4'56/'45;"4'15Y"4'L"&"'L.12.6'12"'4#,9"',7'12"'J8+3'%"#5:4"'12"'%&.%"&0'L54'.61"6/"/'1,'9&,/:#"'56'"77"#1'1251'L,:;/'544.41'.6',%15.6.6A',&'&"15.6.6A'%:4.6"44M'

4. A Shortage of Decisions

E2"'/"5&12',7'#54"';5L'.61"&9&"1.6A'12"'J8+3'254'56':67,&1:651"'4./"'"77"#1'7,&'/"7"6/5614[12"'A,-"&6$"61'254'%&,5/'/.4#&"1.,6'1,'4""I'4"11;"$"614',7'#54"4'%54"/',6'5995&"61;0'L"5I'75#14M''''

! !"#$%&'"()*$?'?"41.6A2,:4"'3.&'i&5I"'E"#26,;,A."4'8,&9,&51.,6'TR?3iEX8SU'95./'6"5&;0'ZC))=)))'1,'4"11;"'5'#54"'L.12'12"'!fa='.6'L2.#2'12"'!fa'5;;"A"/'1251'5'7,:&12K1."&'4:%4./.5&0',7'?3iEX8'25/'.$9&,9"&;0'&"#,&/"/'Z*BW=`))'L,&12',7'950$"614'1,'F6/.56',77.#.5;4M''E2"&"'L"&"'6,'5;;"A51.,64'1251'?3iEX8'25/'I6,L;"/A"',7'12"'-.,;51.,6M''E2"',6;0'%54.4'7,&'.67"&&.6A'I6,L;"/A"'1,'?3iEX8'L54'1251'12"'4:%4./.5&0\4'5##,:614'L"&"='R51'12"'"6/',7'"5#2'7.4#5;'0"5&='#,64,;./51"/'.61,'12"'%,,I4='&"#,&/4='56/'5##,:614',7'?3iEX8MS(W''8,$$"6151,&4'25-"'#&.1.#.c"/'12"'#54"'54':4.6A'12"'J8+3\4'%,,I4'56/'&"#,&/4'9&,-.4.,6'1,'.$9,4"'41&.#1';.5%.;.10',6'#,$956."4'7,&'12".&'5A"614\'J8+3'-.,;51.,64M'''

!%

!


13

II. Major Issues

A. Third Parties

1. Risks When Dealing with Third Parties

E2"'J8+3'.$9,4"4';.5%.;.10',6'5'#,$9560'7,&'$5I.6A'950$"614'1,'5'12.&/'95&10'L2.;"'RI6,L.6AS'1251'12"'12.&/'95&10'L.;;'$5I"'5'#,&&:91'950$"61'.6'-.,;51.,6',7'12"'J8+3M''E2.&/'95&1."4'.6#;:/"='5$,6A',12"&4=';,#5;'4:%4./.5&."4='Q,.61'-"61:&"4='#,64:;15614='5A"614='/.41&.%:1,&4='56/'%&,I"&4M'''R@&">$&8S'$"564'1251'5'9"&4,6'.6'12"'#,$9560'.4'5L5&"'1251'12"'12.&/'95&10'.4'"6A5A.6A'.6'9&,2.%.1"/'#,6/:#1',&'1251'12"'9&,2.%.1"/'#,6/:#1'.4'4:%41561.5;;0'#"&15.6'1,',##:&M''3#1:5;'I6,L;"/A"'.4'6,1'&"N:.&"/M''RG6,L.6AS'5;4,'$"564'#,64#.,:4;0'/.4&"A5&/.6A'5'R2.A2'9&,%5%.;.10S'1251'5'9&,2.%.1"/'950$"61'L.;;',##:&M(d''FA6,&.6A'&"/'7;5A4'1251'.6/.#51"'12.&/'95&1."4\'9,1"61.5;'J8+3'-.,;51.,64'#,:;/';"5/'1,';.5%.;.10M''

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2. Risk Mitigation

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14

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!


15

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B. Gifts, Entertainment, Travel, and Hospitality

1. Under the FCPA Generally

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16

'

2. Affirmative Defenses

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a. “Lawful” Payments and Gifts

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b. “Bona Fide” Expenditures

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!


17

75#.;.1."4',&'511"6/'5'1&5.6.6A',&'4"$.65&'L,:;/'6,&$5;;0'%"'9"&$.11"/M''e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i"7,&"'599&,-.6A'4:#2'950$"614='12"'#,$9560'42,:;/'#,64./"&'L2"12"&'12"'!fa',&'@X8'L,:;/'-."L'12"'"Y9"6/.1:&"4'54'25-.6A'12"'599"5&56#"',7'56'"Y9"#1"/'N:./'9&,'N:,M'!

3. Risk Mitigation

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! D#:9*1'6"#'."50:&2'+"/#%'"#'+#:$&$&8]'E2"'#,$9560'42,:;/'6,1'950'560'1&5-";',&',12"&'"Y9"64"4'7,&',77.#.5;4\'B-$%.;#$"$8"1'',&',12"&'A:"414M''F/"5;;0='12"'A,-"&6$"61'5A"6#0'&512"&'1256'12"'#,$9560'42,:;/'#2,,4"'12"'511"6/""4M'E2"'#,$9560'42,:;/'6,1'



18

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! I+$0*&3%?'E2"'#,$9560'42,:;/'6,1'9&,-./"'5'/5.;0'5;;,L56#"'T.M"M='5'9"&'/."$U',&'560',12"&'I.6/',7'#542'41.9"6/'1,'-.4.1.6A',77.#.5;4M'

! I"/9*&$#%',7'6,$.65;'-5;:"='4:#2'54'9"64='EK42.&14='56/'4.$.;5&'.1"$4'1251'7"51:&"'12"'#,$9560';,A,='$50'%"'9&,-./"/M'

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C. Facilitating Payments Exception

E2"'J8+3'#,615.64'56'"Y#"91.,6'7,&'R75#.;.151.6A'950$"614S'T5;4,'I6,L6'54'R75#.;.151.,6S',&'RA&"54"S'950$"614UM''E2.4'"Y#"91.,6'9"&$.14'950$"614'1251'5&"'.61"6/"/'R1,'"Y9"/.1"',&'1,'4"#:&"'12"'9"&7,&$56#"',7'5'&,:1.6"'A,-"&6$"615;'5#1.,6MSBC'''E2"'75#.;.151.6A'950$"614'"Y#"91.,6'599;."4'1,'R-"&0'65&&,L'#51"A,&."4',7';5&A";0'6,6K/.4#&"1.,65&0='$.6.41"&.5;'5#1.-.1."4'9"&7,&$"/'%0'$./K',&';,LK;"-";'7,&".A6'7:6#1.,65&."4MSBW''Rh,:1.6"'A,-"&6$"61'5#1.,6S'.6#;:/"4'5#1.,64'4:#2'54'R,%15.6.6A'9"&$.14'M'M'M'1,'/,'%:4.6"44'.6'5'7,&".A6'#,:61&0S'56/'R4#2"/:;.6A'.649"#1.,64'M'M'M'&";51"/'1,'1&564.1',7'A,,/4'5#&,44'#,:61&0MSBd''!"#.4.,64'1,'5L5&/'%:4.6"44'1,',&'1,'#,61.6:"'"6A5A.6A'.6'%:4.6"44'L.12'5'#,$9560'5&"'6,1'&,:1.6"'A,-"&6$"615;'5#1.,64='56/'950$"614'1,',%15.6',&'&"15.6'%:4.6"44'5&"'6"-"&'#,64./"&"/'75#.;.151.6A'950$"614M'J5#.;.151.6A'950$"614'$50'6,1'%"':4"/'1,'.6/:#"'5'7,&".A6',77.#.5;'1,'-.,;51"'5'/:10M''F7'12"'&"#.9."614',7'12"'950$"614'R"Y9"/.1"S'12".&'/:1."4'%0'75.;.6A'1,'9"&7,&$'12"$',&'%0'9"&7,&$.6A'12"$'.65/"N:51";0='12"'#,$9560'$50'%"';.5%;"'7,&'-.,;51.6A'12"'J8+3M''''

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!


19

950$"614MS''J:&12"&$,&"='#,$956."4'5&"';.5%;"'7,&'75.;.6A'1,'5##:&51";0'&"#,&/'9"&$.11"/'75#.;.151.6A'950$"614M''''

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1. Risk Mitigation

E2"'#:&&"61;0'&"#,A6.c"/'%"41'9&5#1.#"'.4'1,'9&,2.%.1'75#.;.151.6A'950$"614'5;1,A"12"&M''F6'5//.1.,6'1,'12".&'%".6A'A"6"&5;;0'9&,2.%.1"/':6/"&'/,$"41.#'%&.%"&0';5L4='12"'f&A56.451.,6',7'X#,6,$.#'8,,9"&51.,6'56/'!"-";,9$"61'&"#"61;0'#5;;"/'7,&'12".&'9&,2.%.1.,6M`B''E2"'@X8'56/'!fa'5&"'5;4,'.6#&"54.6A;0'15I.6A'"67,&#"$"61'5#1.,6'%54"/',6'950$"614'1251'4""$.6A;0'75;;'L.12.6'12.4'"Y#"91.,6M``''i"#5:4"'%,12'75#.;.151.6A'950$"614'56/'950$"614'9&,2.%.1"/'%0'12"'J8+3'.6-,;-"'950$"614'1,'"6#,:&5A"'56',77.#.5;'1,'15I"'56'5#1.,6'51'12"'#,$9560\4'&"N:"41='.1'#56'%"'/.77.#:;1'7,&'"$9;,0""4'1,'#,64.41"61;0'/.41.6A:.42'%"1L""6'9"&$.11"/'56/'9&,2.%.1"/'950$"614M'''F7'12"'#,$9560'$:41'9"&$.1'75#.;.151.6A'950$"614='.1'42,:;/'.641.1:1"'5'#;"5&'L&.11"6'9,;.#0'1251'.6#;:/"4'"Y9;.#.1'4156/5&/4'56/'1251'.4'599;.#5%;"'#,$9560KL./"M''X5#2'950$"61'42,:;/'%"'5:12,&.c"/'%0'12"';"A5;'/"95&1$"61',&'#,$9;.56#"',77.#"&='56/'"5#2'950$"61'$:41'%"'5##:&51";0'&"#,&/"/'.6'12"'#,$9560\4'%,,I4'56/'&"#,&/4M'

D. High-risk Jurisdictions

8"&15.6'Q:&.4/.#1.,64'9,4"'"49"#.5;;0'2.A2'&.4I'7,&'9:&9,4"4',7'J8+3'#,$9;.56#"M''E2.4'.4',71"6'%"#5:4"'12"';,#5;'%:4.6"44'#:;1:&"'.6-,;-"4'&"#.9&,#5;'A.71KA.-.6A='#,&&:91.,6'.4'"6/"$.#=',&'12"'A,-"&6$"61'.4'2"5-.;0'.6-,;-"/'.6'12"'"#,6,$0M''e.A2K&.4I'Q:&.4/.#1.,64'5&"'A"6"&5;;0'/"-";,9.6A'"#,6,$."4M'

1. China

82.65'254'A"6"&51"/'12"'4"#,6/K2.A2"41'6:$%"&',7'J8+3'#54"4',7'560'#,:61&0'.6'12"';541'1"6'0"5&4='L.12'1"6'.6-"41.A51.,64'41"$$.6A'7&,$'950$"614'1,'82.6"4"',77.#.5;4M`<''h"#.9&,#5;'A.71KA.-.6A'.4'#:;1:&5;;0'.$9,&1561'.6'82.65='56/'4151"K,L6"/'"61"&9&.4"4'/,$.651"'12"'"#,6,$0M''i,12',7'12"4"'75#1,&4'"Y5#"&%51"'12"'&.4I',7'-.,;51.6A'12"'J8+3'L2"6'/,.6A'%:4.6"44'.6'82.65M''TJ,&'56'.6K/"912'/.4#:44.,6',7'82.65K49"#.7.#'J8+3'.44:"4='4""#@"#1.,6'ngFF',7'12.4'F67,+3G='RD6.N:"'825;;"6A"4',7'!,.6A'i:4.6"44'.6'82.65MSUM'

2. Russia, Eastern Europe, and Central Asia

8,&&:91.,6'.4'9"&-54.-"'.6'h:44.5'56/'12"'#,:61&."4',7'X541"&6'X:&,9"'56/'8"61&5;'34.5M''h:44.5'56/'DI&5.6"'5&"'%,12'&56I"/'*`C',:1',7'*d)',6'E&56495&"6#0'F61"&651.,65;\4'())V'8,&&:91.,6'+"&#"91.,64'F6/"YM`C''3c"&%5.Q56'&56I"/'*`B'56/'L54'12"'4,:&#"',7'5'$5Q,&'J8+3'9&,4"#:1.,6'.6'())VM''8,$956."4',9"&51.6A'.6'12"4"';,#51.,64'5&"'75#"/'L.12'12"'/.;"$$5'1251'#,&&:91'950$"614',71"6'4""$'6"#"445&0'.6',&/"&'1,'"6A5A"'.6'#"&15.6'I.6/4',7'%:4.6"44M'''



20

'?.12'&"49"#1'1,'h:44.5='56"#H-..#*21""2#I4J1&-.'&"#"61;0'6,1"/'1251'Rk,l6"',7'12"'$5Q,&',%415#;"4'1,'#,6/:#1.6A'%:4.6"44'.6'h:44.5'.4'12"'5;;K9"&-54.-"'#,&&:91.,6MS`W''E251'45$"'5&1.#;"'L"61',6'1,'6,1"='Rk%l"#5:4"'12"'A,-"&6$"61'9;504'4:#2'56'.$$"64"'&,;"'.6'12"'#,:61&0\4'"#,6,$0='#,61&,;;.6A'4,$"',7'.14'$,41'.$9,&1561'4"#1,&4=';.11;"'#56'%"'/,6"'L.12,:1'%&.%.6A',77.#.5;4MS`d''@.$.;5&;0'"Y1"64.-"'A,-"&6$"61'.6-,;-"$"61'.6'12"'"#,6,$0'.4'#,$$,6'5$,6A',12"&'7,&$"&'#,$$:6.41'#,:61&."4'54'L";;M''E2.4='#,$%.6"/'L.12'#.-.;'4"&-5614\';,L'45;5&."4='254'$5/"'#,&&:91.,6'&5$9561M`V''P,L'45;5&."4'"Y"&1'9&"44:&"',6'#.-.;'4"&-5614'1,'5%:4"'12".&'9,4.1.,64='56/'.1'.4'&";51.-";0'.6"Y9"64.-"'7,&'#,$956."4'1,'#,$9;0'L.12'/"$56/4'7,&'#,&&:91'950$"614M'3'#,67:4.6A'56/'#25,1.#'%:4.6"44'56/'9,;.1.#5;'"6-.&,6$"61'"Y5#"&%51"4'#,&&:91.,6'.6'12"4"'#,:61&."4M''fL6"&42.9'56/'5#N:.4.1.,6'41&:#1:&"4'.6'h:44.5'25-"'%""6'/"4#&.%"/'54'Ri0c561.6"MS<)''E&5#I.6A'12"':;1.$51"'&"#.9."61',7'560'950$"61'.4'12"&"7,&"',71"6'/.77.#:;1M''E2"'&:;"',7';5L='.6'1"&$4',7'59,;.1.#5;='#,64.41"61'"67,&#"$"61'56/'56'.6/"9"6/"61'Q:/.#.5&0='.4',71"6'41.;;':6/"&/"-";,9"/M''f6A,.6A'9&.-51.c51.,64'9&,-./"':6/"&95./'#.-.;'4"&-5614='56/'2.A2K;"-";',77.#.5;4='L.12'5$9;"',99,&1:6.10'1,'"Y1&5#1'950$"614M'?2"6'12"';"A5;'56/'%:4.6"44'"6-.&,6$"61'.4'#,6/:#.-"'1,'#,&&:91.,6='54'.6'h:44.5'56/',12"&'#,:61&."4'.6'X541"&6'X:&,9"'56/'8"61&5;'34.5='#,$9&"2"64.-"'/:"'/.;.A"6#"',7'5#N:.4.1.,6'15&A"14='.6-"41$"614='56/'%:4.6"44'95&16"&4'.4'"44"61.5;M'

! !"#$%&'"()*$?'E2"'9&,9,4"/'9&.-51.c51.,6',7'12"'4151"',.;'#,$9560'.6'3c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`''''

3. The Middle East

E2"';5&A"'6:$%"&',7'5:12,&.15&.56'&"A.$"4'56/'4151"K,L6"/'"61"&9&.4"4'.6'12"'H.//;"'X541'#,61&.%:1"4'1,'5'2.A2';"-";',7'#,&&:91.,6M''H.//;"'X541"&6'#,:61&."4'1251'&56I'2.A2',6'E&56495&"6#0'F61"&651.,65;\4'8,&&:91.,6'+"&#"91.,64'F6/"Y'.6#;:/"]'P"%56,6'T*B)U='@0&.5'T*(CU='56/'XA091'T***UM''f12"&'#,:61&."4'75&"'%"11"&='4:#2'54]'G:L5.1'TCCU='@5:/.'3&5%.5'TCBU='i52&5.6'T`CU='56/'12"'D6.1"/'3&5%'X$.&51"4'TB)UM''>"-"&12";"44='12"'2.A2';"-";',7'#,&&:91.,6'12&,:A2,:1'12"'&"A.,6'L5&&5614'#5&"7:;'511"61.,6'1,'J8+3'#,$9;.56#"M'''H560'"67,&#"$"61'5#1.,64'.6-,;-.6A'1&5645#1.,64'.6'12"'H.//;"'X541'5&"'&";51"/'1,'12"'D>'f.;'7,&'J,,/'9&,A&5$M''3;12,:A2'1251'9&,A&5$'.6-,;-"/'12"'&"A.$"',7'@5//5$'e:44".6='F&5N'&"$5.64'&56I"/'*WC',:1',7'*d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

!


21

4. Latin America

J,&".A6'.6-"41$"61'.4',6'12"'&.4"'.6'P51.6'3$"&.#5='56/'J8+3'"67,&#"$"61'5#1.,64'5&"'54'L";;M''3'4:%41561.5;'6:$%"&',7'#54"4'7&,$'())V'.6-,;-"'#,&&:91'950$"614'1,'P51.6'3$"&.#56',77.#.5;4='#,61.6:.6A'5'1&"6/'1251'254'%""6',6A,.6A'4.6#"'51';"541'())WM<C''8,$956."4'5;&"5/0',9"&51.6A'.6',&';,,I.6A'1,'$,-"'.61,'P51.6'3$"&.#5'42,:;/'%"'-.A.;561'7,&'9,1"61.5;'-.,;51.,64='%"#5:4"'12"'@X8'56/'!fa'5&"'7,#:4.6A',6'12.4'&"A.,6M''

! !"#$%&'"()*$?%E2"'@X8'5;;"A"/'1251'5'#,$9560\4'7,&$"&'-.#"'9&"4./"61'5:12,&.c"/'#"&15.6'950$"614'56/'I6"L'5%,:1',12"&'950$"614'1,'H"Y.#56'#:41,$4',77.#.5;4'.6'&"1:&6'7,&',-"&;,,I.6A'#:41,$4'/"7.#."6#."4M<W'

! !"#$%&'"()*$?%E2"'!fa'.6/.#1"/'5'7,&$"&'A"6"&5;'$565A"&',7'5'E"Y54'%:4.6"44':6.1',7'5'DM@M'4:%4./.5&0',7'5'@L.44'#,&9,&51.,6'7,&'5;;"A"/;0'$5I.6A'950$"614'1,'5'H"Y.#56'4151"K,L6"/':1.;.10'#,$9560'.6'"Y#256A"'7,&';:#&51.-"'#,61&5#14'L.12'1251':1.;.10M''H560',7'12"'5;;"A"/;0'#,&&:91'950$"614'L"&"'$5/"'12&,:A2'12.&/K95&10'H"Y.#56'#,$956."4M''E2"4"'#,$956."4'5#1"/'54'R45;"4'5A"614S'1,'4"#:&"'%:4.6"44'7&,$'12"':1.;.1."4'56/'5;4,'9&,-./"/'75;4"'.6-,.#"4'1,'75#.;.151"'.61"&651.,65;'L.&"'1&5647"&4M<d'

! !"#$%&'"()*$?'E2"'@X8'5;;"A"/'1251'5'i&5c.;.56'4:%4./.5&0',7'>51:&"\4'@:642.6"='5'$56:75#1:&"&',7'6:1&.1.,65;'9&,/:#14='95./'#:41,$4',77.#.5;4'1,'5;;,L'.1'1,'.$9,&1'.14'9&,/:#14='/"49.1"'5'#256A"'.6'12"';5L'1251'#;544.7."/'$560',7'.14'9&,/:#14'54'$"/.#.6"4'56/'&"41&.#1"/'12".&'.$9,&151.,6M<V''

5. Emerging Trends

a. Increasing Local Anticorruption Enforcement

!"-";,9.6A'#,:61&."4'5&"'.6#&"54.6A;0':4.6A'/,$"41.#'561.K%&.%"&0'4151:1"4'5A5.641'7,&".A6'#,$956."4M''J,&'"Y5$9;"='.6'a56:5&0'())W='@256A25.'9,;.#"'599&"2"6/"/'(('9",9;"'.6'5'%&.%"&0'.6-"41.A51.,6'.6-,;-.6A'?"41"&6'#,$956."4MC)''+"94.'/.4A,&A"/'9&,7.14'56/'95./'5'7.6"'7,&'5;;"A"/'#,$$"&#.5;'%&.%"&0'.6'82.65'.6'())VMC*''F6'H5&#2'()*)='82.65'5;4,'4"61"6#"/'56'3:41&5;.56'"Y"#:1.-"',7'12"'$.6.6A'#,$9560'h.,'E.61,'1,'1"6'0"5&4'.6'9&.4,6'.6'5'%&.%"&0'#54"'.6-,;-.6A'82.65\4';5&A"41'41"";'$56:75#1:&"&4M'P,#5;'561.K%&.%"&0';5L4'$50'/.77"&'4.A6.7.#561;0'7&,$'12"'J8+3='2,L"-"&M''J,&'.64156#"='/,$"41.#'561.K%&.%"&0'4151:1"4',71"6'9&,2.%.1'75#.;.151.6A'950$"614M''8,$956."4'/,.6A'%:4.6"44'.61"&651.,65;;0'42,:;/'5;L504'%"'5L5&"',7'599;.#5%;"';,#5;';5L'L2"&"-"&'12"0',9"&51"M'

b. Increasing Cooperation Between Anticorruption Enforcement Agencies ?2"6'12"'J8+3'L54'9544"/'.6'*VWW='7"L',12"&'#,:61&."4'25/'4151:1"4'9&,2.%.1.6A'7,&".A6'%&.%"&0M''@.6#"'12"6='12"'D6.1"/'@151"4'254'4:##"447:;;0';,%%."/'1&5/.6A'95&16"&4'56/'$:;1.;51"&5;'.641.1:1.,64'1,'5/,91';5L4'4.$.;5&'1,'12"'J8+3M''34'/.4#:44"/'.6'$,&"'/"15.;'.6'@"#1.,6'ng='12"'f&A56.451.,6',7'X#,6,$.#'8,,9"&51.,6'56/'!"-";,9$"61'5/,91"/'12"'8,6-"61.,6',6'8,$%51.6A'i&.%"&0',7'J,&".A6'+:%;.#'f77.#.5;4'.6'F61"&651.,65;'i:4.6"44'E&5645#1.,64'.6'*VVVMC(''3&1.#;"'*M*',7'12"'fX8!'8,6-"61.,6'&"N:.&"4'4.A651,&."4'1,'9&,2.%.1'R560'9"&4,6'.61"61.,65;;0'1,',77"&='9&,$.4"',&'A.-"'560':6/:"'9"#:6.5&0',&',12"&'5/-5615A"='L2"12"&'/.&"#1;0',&'12&,:A2'56'.61"&$"/.5&0='1,'5'7,&".A6'9:%;.#',77.#.5;',&'7,&'5'12.&/'95&10='.6',&/"&'1251'12"',77.#.5;'5#1',&'&"7&5.6'7&,$'5#1.6A'.6''



22

'&";51.,6'1,'12"'9"&7,&$56#"',7',77.#.5;'/:1."4='.6',&/"&'1,',%15.6',&'&"15.6'%:4.6"44',&',12"&'.$9&,9"&'5/-5615A"'.6'12"'#,6/:#1',7'.61"&651.,65;'%:4.6"44MS''E2.&10K".A21'#,:61&."4'25-"'&51.7."/'12"'8,6-"61.,6M'TJ,&'5'/"15.;"/'/.4#:44.,6',7'12"'fX8!'8,6-"61.,6='.6#;:/.6A'5';.41',7'12"'4.A651,&0'#,:61&."4='4""'@"#1.,6'ng',7'12.4'F67,+3G='RE2"'fX8!'8,6-"61.,6SUM'E2"'9&,;.7"&51.,6',7';5L4'9&,2.%.1.6A'7,&".A6'%&.%"&0'254'75#.;.151"/'1&564651.,65;'"67,&#"$"61'#,,9"&51.,6M''E2"'#2."7',7'12"'@X8\4'J8+3'D6.1='82"&0;'@#5&%,&,='4151"/'.6'a56:5&0'()*)'1251'2"&':6.1'.61"6/4'1,'/""9"6'.14'&";51.,642.94'L.12'7,&".A6'&"A:;51,&4'56/'.6-"41.A51,&4MCB''J,&'"Y5$9;"=',6'J"%&:5&0'<='()*)='12"'!fa'56/'12"'DG\4'@"&.,:4'J&5:/'f77.#"'Q,.61;0'"61"&"/'.61,'5'4"11;"$"61'L.12'i3X'@041"$4='5'DG'#,$9560MC`''i3X'@041"$4'5A&""/'1,'950'12"'!fa'Z`))'$.;;.,6':6/"&'12"'4"11;"$"61M''@.$.;5&;0='12"'J&"6#2'#,$9560'3;41,$'.4'%".6A'.6-"41.A51"/'.6'3:41&5;.5='i&5c.;='+,;56/='@L.1c"&;56/='12"'DG='56/'12"'DM@M':6/"&'%,12'/,$"41.#'56/'7,&".A6'%&.%"&0'4151:1"4MC<''E2"'7.&41'%&.%"&0K&";51"/'.6-"41.A51.,6',7'3;41,$\4'5#1.-.1."4'L54'#,6/:#1"/'%0'H"Y.#,'.6'())*='56/'5'DM@M'4:%4./.5&0'9;"/'A:.;10'1,'56'5/$.6.41&51.-"',77"64"'.6'F15;0'.6'())dMCC''J.65;;0='12"'.6-"41.A51.,6'&"4:;1.6A'.6'12"';5&A"41'J8+3'4"11;"$"61'1,'/51"='.6'L2.#2'@."$"64'3I1."6A"4";;4#2571'TR@."$"64'3bSU'5A&""/'1,'950'Zd))'$.;;.,6'1,'12"'@X8='5;4,'.6-,;-"/'56'.6-"41.A51.,6'.6'b"&$560':6/"&'.14'7,&".A6'%&.%"&0'4151:1"MCW''E2"'b"&$56'.6-"41.A51.,6'&"4:;1"/'.6'12"'950$"61',7'56'5//.1.,65;'Zd))'$.;;.,6'1,'b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d'''

E. Government Officials and State-owned Enterprises

1. Definition of “Foreign Official”

D6/"&'12"'J8+3='12"'.61"6/"/'&"#.9."61',7'12"'#,&&:91'950$"61'$:41'25-"'%""6'5'R7,&".A6',77.#.5;MS''3'9"&4,6'L.12'56',77.#.5;'9,4.1.,6'.6'5'A,-"&6$"61'56/'5'#,&&"49,6/.6A'1.1;"'T"MAM='@"651,&='8,:6#.;$56='H.6.41"&=',&'8:41,$4'3A"61U'.4'"54.;0'./"61.7."/'54'5'R7,&".A6',77.#.5;MS''e,L"-"&='$560'9",9;"'L2,'/,'6,1'2,;/',77.#.5;'9,4.1.,64'.6'5'A,-"&6$"61'$50'5;4,'%"'#,64./"&"/'R7,&".A6',77.#.5;4S':6/"&'12"'J8+3='.6#;:/.6A'.6/.-./:5;4'L2,'/,'6,1'9"&7,&$'1&5/.1.,65;'A,-"&6$"615;'7:6#1.,64M'''E2"'J8+3'%&,5/;0'/"7.6"4'12"'1"&$'R7,&".A6',77.#.5;S'1,'.6#;:/"]''

k3l60',77.#"&',&'"$9;,0""',7'5'7,&".A6'A,-"&6$"61',&'560'/"95&1$"61='5A"6#0=',&'.641&:$"615;.10'12"&",7=',&',7'5'9:%;.#'.61"&651.,65;',&A56.c51.,6=',&'560'9"&4,6'5#1.6A'.6'56',77.#.5;'#595#.10'7,&',&'%"25;7',7'560'4:#2'A,-"&6$"61',&'/"95&1$"61='5A"6#0',&'.641&:$"615;.10=',&'7,&',&',6'%"25;7',7'560'4:#2'9:%;.#'.61"&651.,65;',&A56.c51.,6MCV'''

E2"'%&"5/12',7'12.4'/"7.6.1.,6'&"414'.6'.14':4"',7'12"'92&54"'R/"95&1$"61='5A"6#0',&'.641&:$"615;.10'12"&",7MS''E2"'!fa'56/'@X8'.61"&9&"1'12.4'92&54"'1,'$"56'1251'"$9;,0""4',7'%+:+*E">&*3'."55*#.$:1'*&+*#0#$%*%'RSI<L%TU'5&"'R7,&".A6',77.#.5;4S'L.12.6'12"'$"56.6A',7'12"'J8+3='"-"6'

!


23

L2"6'12"'@fX4',9"&51"'54'7,&K9&,7.1'#,$956."4='56/'/,'6,1',12"&L.4"'4"&-"'A,-"&6$"61'7:6#1.,64MW)''F6',12"&'L,&/4='12"'7:6#1.,6',7'12"'"61.10='.M"M='L2"12"&'.1'.4'5'#,$$"&#.5;'"61"&9&.4"',&'.1'.4',77"&.6A'1&5/.1.,65;'A,-"&6$"61'4"&-.#"4='.4'6,1'&";"-561'1,'L2"12"&'12"'"61.10\4'"$9;,0""4'5&"'R7,&".A6',77.#.5;4S'7,&'J8+3'9:&9,4"4M''F641"5/='12"'!fa'56/'@X8';,,I'1,'12"'/"A&""'1,'L2.#2'12"'"61.10'.4'#,61&,;;"/'%0'5'7,&".A6'A,-"&6$"61M''F6'/,.6A'4,='12"'!fa'56/'@X8'599"5&'1,'%"'A:./"/'%0'#,6A&"44.,65;'.61"61'1,'#&.$.65;.c"'#,&&:91'950$"614'1,'7,&".A6'"$9;,0""4',7'@fX4MW*''>,'$.6.$:$'12&"42,;/',7',L6"&42.9'%0'5'7,&".A6'A,-"&6$"61'.4'&"N:.&"/'7,&'56'"61.10'1,'%"'#,64./"&"/'L.12.6'12"'4#,9"',7'12"'J8+3MW(''F641"5/='"77"#1.-"'#,61&,;',7'12"'"61.10'.4'12"'/"#.4.-"'75#1,&M''E2:4='56'"61"&9&.4"'$50'%"'/""$"/'1,'%"'56'@fX'"-"6'.7'12"'A,-"&6$"61',6;0'254'5'$.6,&.10',L6"&42.9'415I"='4,';,6A'54'1251'$.6.$5;'415I"'.4'/""$"/'1,'A.-"'12"'7,&".A6'A,-"&6$"61'12"'5%.;.10'1,'R#,61&,;S'12"'"61"&9&.4"MWB'''H,&",-"&='54'12"'!fa'254'$5/"'#;"5&='12"'J8+3'599;."4'1,'R560'9:%;.#',77.#.5;'&"A5&/;"44',7'&56I',&'9,4.1.,6MSW`''E251'.4=',6#"'12"'!fa',&'@X8'/"#./"4'1251'5'7,&".A6'#,$9560'.4'5'R/"95&1$"61='5A"6#0='.641&:$"615;.10=S',&'@fX='"-"&0'4.6A;"'"$9;,0""',7'12"'"61.10[7&,$'56',77K2,:&4'Q56.1,&'1,'12"'8Xf',7'12"'%:4.6"44[L.;;'%"'#,64./"&"/'5'RA,-"&6$"61',77.#.5;S'7,&'9:&9,4"4',7'12"'J8+3M''E2.4'.4'1&:"'.&&"49"#1.-"',7'2,L';,#5;';5L'$50'#25&5#1"&.c"'12"'"$9;,0""MW<'

a. Examples of “Foreign Officials”

8,$956."4'#,6/:#1.6A'%:4.6"44'5%&,5/'42,:;/'%"'5L5&"'1251'12"'1"&$'R7,&".A6',77.#.5;4S'"6#,$9544"4'$560'5#1,&4'1251'9"&7,&$'"61.&";0'#,$$"&#.5;'5#1.-.1."4M''J,&'"Y5$9;"='.6'&"#"61'"67,&#"$"61'5#1.,64='12"'7,;;,L.6A'"$9;,0""4'L"&"'/""$"/'1,'%"'R7,&".A6',77.#.5;4S]'''

! +204.#.564'56/';5%,&51,&0'9"&4,66";''! @1"";'$.;;'$565A"&4''! 3.&9,&1'"$9;,0""4'! X6A.6""&4'56/'9:&#254.6A',77.#"&4',7'9,L"&'A"6"&51.,6'#,$956."4''! E";"#,$$:6.#51.,64'#,$9560'"$9;,0""4''! e,1";'56/'#,6-"61.,6'#"61"&'#,641&:#1.,6'"Y"#:1.-"4'! 3.&;.6"',77.#.5;4M'

'>,6"',7'12"4"'R7,&".A6',77.#.5;4S'9"&7,&$"/'560'1&5/.1.,65;'A,-"&6$"615;'7:6#1.,64M''E2"4"'#54"4'$5I"'#;"5&'1251='L2"6'5'#,$9560'.4'544"44.6A'L2"12"&'56'"$9;,0""',7'5'7,&".A6'"61"&9&.4"'.4'5'R7,&".A6',77.#.5;=S'12"'#,$9560'#566,1'&";0',6'12"'7:6#1.,6'12"'"$9;,0""'.4'9&,-./.6AM''E2"'#,$9560'$:41';,,I'51'R#,61&,;S'&512"&'1256'7:6#1.,6M'

b. Case Example: DOJ Sheds Light on When Consultants are “Foreign Officials”

8,64:;15614'5&"',71"6'I"0'1,'6"A,1.51.6A'L.12'7,&".A6',77.#.5;4M''D4"7:;'#,64:;15614'A"6"&5;;0'25-"'1."4'1,'12"'7,&".A6'A,-"&6$"61'L.12'L2.#2'12"0'5&"'"6A5A"/'1,'/,'%:4.6"44M''E251'&5.4"4'12"'''N:"41.,6='.4'12"'#,64:;1561'5'R7,&".A6',77.#.5;=S'4,'1251'950.6A'2.$'1,'.67;:"6#"'12"'7,&".A6'A,-"&6$"61'-.,;51"4'12"'J8+3o''3'&"#"61'!fa'f9.6.,6'+&,#"/:&"'h";"54"WC'.6/.#51"4'1251'12"'564L"&'.4'6,1'6"#"445&.;0M''E2"'&";"54"'#;5&.7."4'12"'1"&$4',6'L2.#2'5'#,$9560'$50'"6A5A"'4:#2''



24

'#,64:;15614'L.12,:1'-.,;51.6A'12"'J8+3M'!

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c. Case Example: A Challenge to the Expansive Definition

E2"'!fap4'56/'@X8\4'"Y9564.-"'.61"&9&"151.,6',7'R7,&".A6',77.#.5;S'254'6,1'%""6'12,&,:A2;0'1"41"/'.6'12"'#,:&14M''E2"'$511"&',7'>"Y:4'E"#26,;,A."4'TR>"Y:4SU'#5$"'#;,4"'1,'9&,-./.6A'5'Q:/.#.5;'"Y5$.651.,6',7'12.4'.44:"='56/'.;;:41&51"4'L20'$560'.44:"4',7'4151:1,&0'.61"&9&"151.,6'&"A5&/.6A'12"'J8+3'&"$5.6':6&"4,;-"/'%0'12"'#,:&14M'!

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!


25

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2. Foreign Government Investments

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26

!

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3. Risk Mitigation

E,':6/"&4156/'56/'$.1.A51"'.14'J8+3'&.4I4='5'#,$9560'$:41'I6,L'.14'1,:#2'9,.614'L.12'7,&".A6'A,-"&6$"614'56/'5;;'7,&".A6K#,61&,;;"/'@fX4M''360'"$9;,0""4',7'12"'@fX4[&"A5&/;"44',7'12"'"$9;,0""\4'9,4.1.,6',&'7:6#1.,6[$:41'%"'#,64./"&"/'5'R7,&".A6',77.#.5;S'7,&'J8+3'#,$9;.56#"'9:&9,4"4M'?2"12"&'5'95&1.#:;5&'@fX'N:5;.7."4'54'5'A,-"&6$"61'.641&:$"615;.10'L.;;'/"9"6/',6'5'#5&"7:;'&"-."L',7'5;;'5-5.;5%;"'75#14'&"A5&/.6A',L6"&42.9'56/'A,-"&656#"',7'12"'@fXM''34'/.4#:44"/'.6'@"#1.,6'XM*'5%,-"'TR!"7.6.1.,6',7'_J,&".A6'f77.#.5;\SU='$5Q,&.10',L6"&42.9'.4'6,1'/"1"&$.651.-"M''E2"'!fa'56/'@X8'L.;;'#,64./"&'56'"61"&9&.4"'56'R.641&:$"615;.10S'"-"6'.7'12"'7,&".A6'A,-"&6$"61'.4'5'$.6,&.10',L6"&='4,';,6A'54'12"'A,-"&6$"61'#56'"Y"&#.4"'#,61&,;',-"&'12"'"61"&9&.4"M'?2.;"',L6"&42.9'.61"&"41'.4',71"6'54#"&15.65%;"='.1'$50'%"'$,&"'/.77.#:;1'1,'/.4#"&6'12"'/"A&""',7'A,-"&6$"61'#,61&,;M''F6'/"1"&$.6.6A'L2"12"&'56'@fX'42,:;/'%"'#,64./"&"/'56'R.641&:$"615;.10=S'12"'!fa'56/'@X8'5&"';.I";0'1,'#,64./"&'12"'/"A&""'1,'L2.#2'12"'A,-"&6$"61'.4'.6-,;-"/'.6'599,.61.6A',77.#"&4'56/'/.&"#1,&4',7'12"'@fX='56/'L2"12"&'12"&"'5&"',12"&'75#1,&4'T.6#;:/.6A'L2"12"&'12"'@fX'.4';.41"/',6'5'7,&".A6'41,#I'"Y#256A"U'1251'$50'L".A2'.6'75-,&',7'5'7.6/.6A'1251'12"'@fX'.4='.6'75#1='.6/"9"6/"61',7'12"'A,-"&6$"61M''F7'12"&"'.4'560'/,:%1',-"&'12"'"Y.41"6#"',7'5'7,&".A6'A,-"&6$"61\4'#,61&,;='#,$956."4'42,:;/',9"&51"',6'12"'544:$91.,6'1251'56'@fX'.4'5'A,-"&6$"61'.641&:$"615;.10'7,&'9:&9,4"4',7'12"'J8+3MdW'

F. Control Person Liability

F$5A.6"'5'8Jf'51'5'9:%;.#'#,$9560'L.12'4:%4./.5&."4'/,.6A'%:4.6"44'5#&,44'12"'L,&;/M''3L5&"',7'12"'J8+3\4'/"$56/4'56/'&.4I4='42"'254'.641.1:1"/'5'4041"$',7'.61"&65;'#,61&,;4'1251'42"'%";."-"4'L.;;'5;"&1'2"&'1,'560'J8+3'-.,;51.,6'L.12.6'12"'#,$9560M''E2"'.61"&65;'56/'"Y1"&65;'5:/.1,&4'25-"'6"-"&'./"61.7."/'56'J8+3'-.,;51.,6M''E2"0',6#"'/"1"#1"/'5'7"L'"&&,&4'.6'2,L'5'4:%4./.5&0'&"#,&/"/'950$"614='%:1'12"'.44:"'L54'&"4,;-"/M''j"5&4';51"&='12"'#,$9560';"5&64'1251'"$9;,0""4'51'5'i&5c.;.56'4:%4./.5&0'25-"'%""6'$5I.6A'#542'950$"614'1,'#:41,$4',77.#.5;4'.6',&/"&'1,'4I.&1'.$9,&1'&"N:.&"$"614='56/'%,,I.6A'12"'950$"614'54';"A.1.$51"'.$9,&151.,6'"Y9"64"4M''!"49.1"'2"&'5995&"61'A,,/'75.12='12"'8Jf'.4'-:;6"&5%;"'1,'9&,4"#:1.,6'7,&'12"'4:%4./.5&0\4'"$9;,0""4\'J8+3'-.,;51.,6M'E2"'J8+3'561.K%&.%"&0'9&,-.4.,64'25-"'12&""'4"95&51"'I6,L;"/A"'4156/5&/4M''J.&41='560'-.,;51.,6'$:41'%"'/,6"'R#,&&:91;0MS''@"#,6/='56'.6/.-./:5;'$:41'25-"'5#1"/'RL.;;7:;;0S'.6',&/"&'1,'&"#".-"'#&.$.65;'9"65;1."4M''J.65;;0='7,&'12.&/K95&10';.5%.;.10='560'950$"61'1,'5'12.&/'95&10'$:41'25-"'%""6'$5/"'RL2.;"'I6,L.6AS'1251'12"'950$"61'L54'/.&"#1"/'.6'L2,;"',&'95&1'1,'5'7,&".A6',77.#.5;M''i:1'56,12"&'9&,-.4.,6',7'12"'4"#:&.1."4';5L4='@"#1.,6'()T5U',7'12"'@"#:&.1."4'56/'XY#256A"'3#1',7'*VB`='"Y956/4'.6/.-./:5;';.5%.;.10'7,&'"$9;,0""4\'56/'12.&/'95&1."4\'J8+3'-.,;51.,64M''@"#1.,6'()T5U'9&,-./"4'7,&'Q,.61'56/'4"-"&5;';.5%.;.10'7,&'560'9"&4,6'L2,'R/.&"#1;0',&'.6/.&"#1;0='#,61&,;4'560'

!


27

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dd''?2"12"&'5'/"7"6/561'.4'5'R#,61&,;;.6A'9"&4,6S'.4'5'2.A2;0'75#1K.61"64.-"'.6N:.&0MdV''8,:&14'A"6"&5;;0'5A&""'1251'5'/"7"6/561\4'9,4.1.,6'L.12.6'12"'#,$9560',&'4.A651:&"4',6'@X8'7.;.6A4'5&"'6,1='4156/.6A'5;,6"='"6,:A2'1,'"415%;.42'#,61&,;'9"&4,6'4151:4MV)'@"#1.,6'()T5U'9&,-./"4'/"7"6/5614'5'RA,,/'75.12S'577.&$51.-"'/"7"64"'.7'12"0'R5#1"/'.6'A,,/'75.12'56/'/./'6,1'/.&"#1;0',&'.6/.&"#1;0'.6/:#"'12"'5#1',&'5#14'#,641.1:1.6A'12"'-.,;51.,6',&'#5:4"',7'5#1.,6MS''e,L"-"&='/"7"6/5614'%"5&'12"'%:&/"6',7'9&,-.6A'12"'/"7"64"='L2.#2'.4'6"5&;0'.$9,44.%;"',6'5'$,1.,6'1,'/.4$.44M''36'5;;"A"/'75.;:&"'1,'5//&"44'9,1"61.5;'&"/'7;5A4',&'1,'$5.615.6'5/"N:51"'.61"&65;'#,61&,;4'$50':6/"&$.6"'12"'/"7"64"M'F6'12"',9"6.6A'209,12"1.#5;='12"'8Jf'L,:;/'5&A:"'1251'42"'5#1:5;;0'%";."-"/'6,'J8+3'-.,;51.,6'L54'15I.6A'9;5#"='56/'7:&12"&$,&"='12"&"'L54'6,'.6/.#51.,6'1251'.1'L54'"-"6';.I";0M''e,L"-"&='42"'#,:;/'41.;;'%"'2";/';.5%;"'54'5'R#,61&,;;.6A'9"&4,6=S':6;"44'42"'#56'9&,-"'2"&'A,,/'75.12M'''!

1. Case Example: SEC v. Nature’s Sunshine

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f'56/'7,&$"&'8JfM''>51:&"\4'@:642.6"'5;;"A"/;0'-.,;51"/'12"'J8+3\4'%,,I4'56/'&"#,&/4'9&,-.4.,64='L2.#2'&"N:.&"'5'4"#:&.1."4'.44:"&'1,'I""9'&"#,&/4'1251'5##:&51";0'&"7;"#1'.14'1&5645#1.,64'56/'544"14M''3##,&/.6A'1,'12"'@X8\4'#,$9;5.61='5'i&5c.;.56'4:%4./.5&0',7'>@+'-.,;51"/'i&5c.;.56';5L'%0'75.;.6A'1,'&"A.41"&'.14'2"5;12'4:99;"$"614M''>@+\4'4:%4./.5&0'$5/"'#542'950$"614'1,'12.&/K95&10'#:41,$4'%&,I"&4='L2,'9544"/',6'9,&1.,64',7'12"'950$"614'1,'i&5c.;.56'#:41,$4',77.#.5;4M''>@+'5;;"A"/;0'95./'7""4'54'2.A2'54'(<'9"&#"61',7'12"'42.9$"614\'-5;:"M''F6'"Y#256A"='12"',77.#.5;4'5;;,L"/'>@+'1,'.$9,&1'56/'"Y9,&1'.14':6&"A.41"&"/'9&,/:#14M''>@+\4'i&5c.;.56'4:%4./.5&0'.$9&,9"&;0'%,,I"/'.14'.;;"A5;'950$"614'54';"A.1.$51"'.$9,&151.,6'"Y9"64"4M'E2"'@X8'5;;"A"/'1251'>@+',77.#.5;4'.6'12"'D6.1"/'@151"4'42,:;/'25-"'%""6'9:1',6'6,1.#"'%0'56'5:/.1',7'12"'4:%4./.5&0\4'%,,I4'.6'12"'0"5&'()))='L2.#2'25/'&"-"5;"/'599&,Y.$51";0'd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i&,#I$"0"&='#,$$"61"/',6'K-2J1"L'#*J&'6%&"]'L2"6'12"'@X8'%&.6A4'#25&A"4'5A5.641'56'"Y"#:1.-"':6/"&'@"#1.,6'()T5U',7'12"'XY#256A"'3#1='.1'.4'R4.A65;.6A'1251'.1'%";."-"4'12"&"'5&"'&"/'7;5A4S'12"'"Y"#:1.-"4'R42,:;/'25-"'%""6''



28

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2. Risk Mitigation

XY"#:1.-"4'42,:;/'2""/'12"'@X8\4'L5&6.6A'56/'&"$5.6'5;"&1'1,'56012.6A'1251'12"'@X8'#,:;/'.6'12"'7:1:&"'.61"&9&"1'54'&"/'7;5A4='56/'#5&"7:;;0'/,#:$"61'12".&'/.;.A"6#"'.6'$.1.A51.6A'12"$M''+,1"61.5;'&"/'7;5A4'.6#;:/"]''

! D6,&12,/,Y'950$"61'$"12,/4='4:#2'54'#542=',7742,&"'5##,:614='56/'950$"614'1,'12.&/'95&1."4^'

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'

G. Accounting and Internal Control Provisions

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1. Books and Records

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!


29

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a. Civil Liability

J,;;,L.6A'95445A"',7'12"'J8+3='12"'@X8'5/,91"/'1L,'T(U'&:;"4'9&,$:;A51"/':6/"&'12"'XY#256A"'3#1]''

*U' 'h:;"'*B%(K*='L2.#2'9&,2.%.14'75;4.7.#51.,6',7'12"'%,,I4'56/'&"#,&/4'&"N:.&"/'1,'%"'I"91':6/"&'@"#1.,6'*BT%UT(UT3U^'56/'

(U' h:;"'*B%(K(='L2.#2'9&,2.%.14'560',77.#"&',&'/.&"#1,&'7&,$'$5I.6A'$51"&.5;;0'75;4"',&'$.4;"5/.6A'4151"$"614',&',$.11.6A'1,'4151"'560'$51"&.5;'75#14'1,'5##,:615614',&'5:/.1,&4'.6'#,66"#1.,6'L.12'5:/.14',&'12"'9&"95&51.,6',7'7.;.6A4'&"N:.&"/'%0'12"'XY#256A"'3#1M''''

E2"4"'&"A:;51.,64'/,'6,1'.6#;:/"'5'I6,L;"/A"'&"N:.&"$"61MVW''J,&'"Y5$9;"='.6'J"%&:5&0'())V='12"'@X8'4"11;"/'L.12'5'#,&9,&51.,6'7,&'#25&A"4'&";51.6A'1,'.$9&,9"&'5##,:61.6A',7'950$"614'$5/"'1,'82.6"4"',77.#.5;4'%0'.14'82.6"4"'4:%4./.5&0MVd''E2"'#,$9;5.61'#,615.6"/'6,'5;;"A51.,6'1251'12"'#,&9,&51.,6'25/'I6,L;"/A"',7'12"'4:%4./.5&0\4'5##,:61.6A'$.4#,6/:#1MVV'

b. Criminal Liability

8&.$.65;';.5%.;.10'7,&'-.,;51.,6',7'12"'5##,:61.6A'9&,-.4.,64'$50'5&.4"'L2"6'56'.44:"&'I6,L.6A;0'75;4.7."4'5'%,,I='&"#,&/=',&'5##,:61',7'12"'.44:"&M*))''RG6,L.6A;0S'.4'6,1'/"7.6"/'%0'12"'4151:1"='56/'54'/.4#:44"/'5%,-"':6/"&'@"#1.,6'F='12"&"'5&"'7"L'J8+3K49"#.7.#'#54"4'5//&"44.6A'12"'4156/5&/M'

c. Foreign Subsidiaries

36'.44:"&'#56'%"'2";/';.5%;"'7,&'%,,I4'56/'&"#,&/4'-.,;51.,64',7'5'$5Q,&.10K,L6"/'7,&".A6'4:%4./.5&0M*)*''?2"&"'12"'.44:"&'2,;/4';"44'1256'<)'9"&#"61',7'12"'7,&".A6'"61.10='56/'12"&"7,&"'$50'6,1'25-"'12"'5%.;.10'1,'#,61&,;'12"'7,&".A6'"61.10='12"'.44:"&'$:41'R9&,#""/'.6'A,,/'75.12'1,':4"'.14'.67;:"6#"'1,'12"'"Y1"61'&"54,65%;"':6/"&'12"'#.&#:$4156#"4'1,'#5:4"'k12"'577.;.51"l'1,'/"-.4"'56/'$5.615.6'5'4041"$',7'.61"&65;'#,61&,;4MS*)('

2. Internal Controls

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30

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!


31

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III. Department of Justice

A. Role and Organization

E2"'!"95&1$"61',7'a:41.#"'.4'&"49,64.%;"'7,&'#&.$.65;'"67,&#"$"61',7'12"'J8+3M''?2.;"'-.,;51.,64',7'$,41',12"&'7"/"&5;'#&.$.65;'4151:1"4'5&"'109.#5;;0'.6-"41.A51"/'56/'9&,4"#:1"/'%0';,#5;'D6.1"/'@151"4'311,&6"04\'f77.#"4'5#&,44'12"'#,:61&0='J8+3'.6-"41.A51.,64'56/'9&,4"#:1.,64'5&"'#,6/:#1"/'%0'1&.5;'511,&6"04'.6'12"'J&5:/'@"#1.,6'.6'12"'!fa\4'8&.$.65;'!.-.4.,6M''f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a:41.#"'7,&'12"'#"61&5;.c"/'#&.$.65;'"67,&#"$"61',7'J8+3'%0'12"'J&5:/'@"#1.,6M'E2"'J"/"&5;'i:&"5:',7'F6-"41.A51.,6='L,&I.6A':6/"&'12"'4:9"&-.4.,6',7'12"'J&5:/'@"#1.,6='.4'12"'9&.$5&0';5L'"67,&#"$"61'5A"6#0'5:12,&.c"/'1,'.6-"41.A51"'J8+3'-.,;51.,64M''E2"'JiF\4'?542.6A1,6'J.";/'f77.#"'254'5'49"#.5;.c"/'4N:5/'/"/.#51"/'1,'12"'.6-"41.A51.,6',7'J8+3'-.,;51.,64M'



32

B. Prosecution Policies and Practices

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!


33

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C. Interacting with the DOJ

H560'#,$956."4'L.;;'25-"'6,'#2,.#"'5%,:1'.61"&5#1.6A'L.12'12"'!"95&1$"61',7'a:41.#"M''@.$9;0'9:1='12"0'$50';"5&6'5%,:1'56'J8+3'.6-"41.A51.,6'%0'&"#".91',7'5'A&56/'Q:&0'4:%9,"65'7,&'/,#:$"614='L2"6'"$9;,0""4'5&"'.61"&-."L"/'%0'JiF'5A"614=',&'L2"6',77.#"4'5&"'4"5&#2"/='56/'12"'#,$9560'L.;;'%"'7,&#"/'1,'&"49,6/M''F6'1251'#54"='12"'J8+3'.6-"41.A51.,6'L.;;'9&,#""/';.I"'560',12"&'#&.$.65;'.6-"41.A51.,6]'12"'A,-"&6$"61'$50'&"N:"41'#,,9"&51.,6=';5L'"67,&#"$"61'5A"614'$50'.61"&-."L'L.16"44"4='56/'9&,4"#:1,&4'$50':4"'12"'A&56/'Q:&0'1,'4:%9,"65'/,#:$"614'56/'1"41.$,60'%0'L.16"44"4M'e,L"-"&='$560',12"&'#,$956."4'L.;;';"5&6'5%,:1'9,44.%;"'J8+3'-.,;51.,64',6'12".&',L6='.6#;:/.6A'12&,:A2'12".&'#,&9,&51"'#,$9;.56#"'9&,A&5$4M''f12"&'#,$956."4'$50'%"'#,64./"&.6A'5'#,:&4"',7'#,6/:#1='56/'L,6/"&.6A'L2"12"&'!fa'L,:;/'#,64./"&'12"'#,6/:#1'1,'%"'5'-.,;51.,6',7'12"'J8+3M''F6'%,12'#54"4='#,$956."4'$50'#2,,4"'1,'.6.1.51"'#,615#1'L.12'!fa'%0'-,;:615&.;0'/.4#;,4.6A'12"'4:49"#1"/'-.,;51.,6',&'4""I.6A'5'7,&$5;',9.6.,6'7&,$'!fa'&"A5&/.6A'12"';"A5;.10',7'12"'7:1:&"'#,6/:#1M'

1. Voluntary Disclosures to DOJ

34'95&1',7'!fa\4'#&5#I/,L6',6'#,&&:91.,6'56/'%&.%"&0='!fa',77.#.5;4'7&"N:"61;0'9&"5#2'12"'%"6"7.14',7'-,;:615&0'/.4#;,4:&"',7'J8+3'-.,;51.,64M''F6/""/='5'4:%41561.5;'6:$%"&',7'J8+3'9&,4"#:1.,64'415&1'54'-,;:615&0'/.4#;,4:&"4'%0'#,$956."4'4""I.6A';"6."6#0'7&,$'!faM''E2"'#,6-"61.,65;'L.4/,$',6'-,;:615&0'/.4#;,4:&"'.4'1251'12"'#,$9560'42,:;/':6/"&15I"'5'12,&,:A2'.61"&65;'.6-"41.A51.,6'4,'1251'.1'#56'9&,9"&;0'#25&5#1"&.c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



34

9&,/:#1'9&,1"#1.,6'.6'560'4:%4"N:"61';.1.A51.,6M''F6'&"49,64"'1,'4:#2'#,6#"&64='344.41561'311,&6"0'b"6"&5;'i&":"&'&"#"61;0'4151"/='RF7'0,:'-,;:615&.;0'/.4#;,4"'56'J8+3'-.,;51.,6='0,:'L.;;'&"#".-"'$"56.6A7:;'#&"/.1'7,&'1251'/.4#;,4:&"M''36/'.7'0,:'#,,9"&51"'L.12'12"'!"95&1$"61\4'.6-"41.A51.,6='0,:'L.;;'&"#".-"'5'$"56.6A7:;'%"6"7.1'7,&'1251'#,,9"&51.,6[L.12,:1'560'&"N:"41',&'&"N:.&"$"61'1251'0,:'/.4#;,4"'9&.-.;"A"/'$51"&.5;MS**(''>,1''4:&9&.4.6A;0='i&":"&'5;4,'L5&6"/'1251'R12"'#,414',7'6,1'/,.6A'12"'&"49,64.%;"'12.6A'#56'%"'$:#2'2.A2"&[.6#;:/.6A'4.A6.7.#561'#&.$.65;'7.6"4'7,&'12"'#,&9,&51.,6=':6L561"/'6"A51.-"'9:%;.#.10='5'9,1"61.5;;0'/"-54151.6A'.$95#1',6'41,#I'9&.#"4='56/'9,44.%;"'"Y#;:4.,6'7&,$'kA,-"&6$"61'9&,A&5$4'4:#2'54l'H"/.#5&"'56/'H"/.#5./MS**B E,'.;;:41&51"'2.4'9,.61='i&":"&'254'9,.61"/',:1'1251'12"'Z`<)'$.;;.,6'7.6"'1251'@."$"64'3b'95./'1,'12"'a:41.#"'!"95&1$"61='5;12,:A2'N:.1"'4:%41561.5;='L54'CW'1,'d`'9"&#"61';"44'1256'L251'.1',12"&L.4"'#,:;/'25-"'75#"/':6/"&'12"'DM@M'@"61"6#.6A'b:./";.6"4'.7'.1'25/'6,1'9&,-./"/'"Y1&5,&/.65&0'#,,9"&51.,6'56/'#5&&."/',:1'"Y1"64.-"'&"$"/.51.,6M**`'E2"'!fa'.4'5;4,'"6#,:&5A.6A'"5&;."&'/.4#;,4:&"4M''i&":"&'254':&A"/'#,&9,&51.,64'1,'R4"&.,:4;0'#,64./"&'4""I.6A'12"'A,-"&6$"61\4'.69:1'51'12"'7&,61'"6/',7'12"'.6-"41.A51.,6M''?"'"6#,:&5A"'5'#,$9560'1,'#,$"'.6'56/'/"4#&.%"'.14'L,&I'9;56'7,&'#,6/:#1.6A'12"'.6-"41.A51.,6M'M'M'M''f71"6'L"'25-"'N:"41.,64=',&'2";97:;'4:AA"41.,64'M'M'M'12"'/.5;,A:"'#56'%"'-"&0'2";97:;'.6'"64:&.6A'51'12"',:14"1'1251'12"'#,&9,&51.,6'254'56'"77"#1.-"='#,41K"77"#1.-"'9;56'.6'9;5#"'1,'.6-"41.A51"'56/'/"5;'L.12'12"'9&,%;"$MS**<''F1'&"$5.64'1,'%"'4""6'L2"12"&'"5&;."&'/.4#;,4:&"'56/'#,,9"&51.,6'L.;;'&"4:;1'.6';"44'"Y9"64.-"'.6-"41.A51.,64',&'&"4:;1'.6'$,&"'R#&"/.1S'%0'!fa'L2"6'$5I.6A'#25&A.6A'/"#.4.,64M''H,&",-"&='#,$956."4'$50':6/"&4156/5%;0'%"'599&"2"64.-"'5%,:1'$5I.6A'5'/.4#;,4:&"'1,'!fa'%"7,&"'12"0'I6,L'"Y5#1;0'L251'12"0'5&"'/.4#;,4.6AM''J,&'56'.6K/"912'/.4#:44.,6',7'-,;:615&0'/.4#;,4:&"=''""#@"#1.,6'gF='R8,64./"&.6A'?2"12"&'1,'@";7Kh"9,&1MS'

2. DOJ FCPA Opinion Process

E2"'!fa'J8+3'f9.6.,6'+&,#"44'9&,-./"4'5'$"564'%0'L2.#2'5'DM@M'#,$9560',&'.44:"&'#56'4""I'5'4151"$"61',7'!fa\4'9&"4"61'"67,&#"$"61'.61"61.,64'&"A5&/.6A'49"#.7.#='9&,49"#1.-"'%:4.6"44'#,6/:#1M''E2"'&"N:"41'7,&'56',9.6.,6'$:41'%"'$5/"'.6'L&.1.6A'56/'$:41'.6#;:/"'5;;'&";"-561'56/'$51"&.5;'.67,&$51.,6'%"5&.6A',6'12"'#,6/:#1'7,&'L2.#2'12"',9.6.,6'.4'&"N:"41"/M''F1'$:41'%"'4.A6"/'%0'56'599&,9&.51"'4"6.,&',77.#"&'L.12',9"&51.,65;'&"49,64.%.;.10'7,&'4:#2'#,6/:#1M**C''F6'&"49,64"='!fa'L.;;'.44:"'56',9.6.,6'4151.6A'.14'-."L',7'L2"12"&'12"'9&,49"#1.-"'#,6/:#1'L,:;/'-.,;51"'12"'561.K%&.%"&0'9&,-.4.,64',7'12"'J8+3M''3'75-,&5%;"',9.6.,6'#&"51"4'5'&"%:115%;"'9&"4:$91.,6='599;.#5%;"',6;0'.6'560'4:%4"N:"61'"67,&#"$"61'5#1.,6'5A5.641'12"'&"N:"41,&='1251'12"'#,6/:#1'/"4#&.%"/'.6'12"'&"N:"41'#,67,&$"/'1,'12"'J8+3M**W'E2"'J8+3'f9.6.,6'+&,#"44'.4'56':6/"&:1.;.c"/'9&,#"/:&"='"49"#.5;;0'.6';.A21',7'12"'/"5&12',7'Q:/.#.5;',9.6.,64'565;0c.6A'12"'599;.#5%.;.10',7'12"'J8+3'1,'5'-5&."10',7'4.1:51.,64'#,$$,6;0'75#"/'%0'#,$956."4'/,.6A'%:4.6"44'5%&,5/M''E2:4'75&='6,'$,&"'1256'7,:&',9.6.,64'25-"'%""6'.44:"/'.6'560',6"'0"5&M''!fa'.44:"4'&";"54"4'1251'/"4#&.%"'12"'./"61.10',7'12"'&"N:"41"&'56/'12"'7,&".A6'#,:61&0='12"'A"6"&5;'#.&#:$4156#"4',7'12"'9&,9,4"/'#,6/:#1='56/'12"'5#1.,6'15I"6'%0'!fa'.6'&"49,64"'1,'12"'&"N:"41M**d''3;12,:A2'!fa\4',9.6.,64'#566,1'%"'&";."/',6'%0'560,6"',12"&'1256'12"'&"N:"41,&='12"4"'&";"54"4'4:99;0'A:./56#"',6'!fa\4'-."L',7'12"'599;.#5%.;.10',7'12"'J8+3'561.K%&.%"&0'9&,-.4.,64'1,'5'-5&."10',7'4.1:51.,64M''

!


35

IV. Securities and Exchange Commission

A. Role and Organization

E2"'@"#:&.1."4'56/'XY#256A"'8,$$.44.,6'.4'12"'9&.$5&0'&"A:;51,&',7'12"'651.,6\4'4"#:&.1."4'$5&I"14M''34'4:#2='.1='5;,6A'L.12'12"'!"95&1$"61',7'a:41.#"='.4'&"49,64.%;"'7,&'"67,&#.6A'12"'J8+3M''?2.;"'12"'!fa'#&.$.65;;0'"67,&#"4'12"'J8+3\4'561.K%&.%"&0'9&,-.4.,64='12"'@X8'254'5AA&"44.-";0'4,:A21'1,'#.-.;;0'"67,&#"'%,12'12"'561.K%&.%"&0'9&,-.4.,64'56/'12"'5##,:61.6A'56/'%,,I4'56/'&"#,&/4'9&,-.4.,64',7'12"'J8+3M'''F6'3:A:41'())V='12"'@X8'!.-.4.,6',7'X67,&#"$"61'566,:6#"/'12"'#&"51.,6',7'5'6"L'49"#.5;.c"/':6.1'/"/.#51"/'1,'J8+3'"67,&#"$"61M''RE2"'k6"L'J8+3l':6.1'L.;;'7,#:4',6'6"L'56/'9&,5#1.-"'599&,5#2"4'1,'./"61.70.6A'-.,;51.,64',7'12"'kJ8+3lM'M'M'M''?2.;"'L"'25-"'%""6'5#1.-"'.6'12.4'5&"5='$,&"'6""/4'1,'%"'/,6"='.6#;:/.6A'%".6A'$,&"'9&,5#1.-"'.6'.6-"41.A51.,64='L,&I.6A'$,&"'#;,4";0'L.12',:&'7,&".A6'#,:61"&95&14='56/'15I.6A'5'$,&"'A;,%5;'599&,5#2'1,'12"4"'-.,;51.,64MS**V'''F6'a56:5&0'()*)='82"&0;'@#5&%,&,'L54'65$"/'82."7',7'12"'@X8\4'J8+3'49"#.5;.c"/':6.1M''f6'2"&'599,.61$"61='@#5&%,&,'4151"/]'

3'9&.$5&0'$.44.,6',7'12.4'D6.1'.4'1,'/"-.4"'L504'7,&':4'1,'%"'$,&"'9&,5#1.-"'.6',:&'"67,&#"$"61',7'12"'J8+3M''H"$%"&4',7'12"'J8+3'D6.1'L.;;'A5.6'.6K/"912'I6,L;"/A"',7'.6/:41&."4'56/'&"A.,65;'9&5#1.#"4'4,'L"'#56':6#,-"&'#,&&:91'9&5#1.#"4'1251'$.A21',12"&L.4"'A,':6/"1"#1"/M''?"'L.;;'5;4,'#,6/:#1'$,&"'15&A"1"/'4L""94'56/'4"#1,&KL./"'.6-"41.A51.,64='5;,6"'56/'L.12',12"&'&"A:;51,&0'#,:61"&95&14'%,12'2"&"'56/'5%&,5/M*()'

B. Policies and Practices

1. Broad Investigative Authority

E2"'@X8'!.-.4.,6',7'X67,&#"$"61'254'%&,5/'.6-"41.A51.-"'5:12,&.10'.6'/"1"&$.6.6A'L2"12"&'12"&"'254'%""6'5'-.,;51.,6',7'12"'J8+3M''F1'L.;;',71"6'%"A.6'56'.6-"41.A51.,6'.67,&$5;;0='54I.6A'7,&'-,;:615&0'9&,/:#1.,6',7'/,#:$"614'56/',12"&'.67,&$51.,6M''e,L"-"&='.7'12"'@X8'"67,&#"$"61'41577'%";."-"4'1251'5'-.,;51.,6'.4';.I";0'1,'25-"',##:&&"/='.1'L.;;'5;$,41'#"&15.6;0'4""I'5'R7,&$5;',&/"&S',7'.6-"41.A51.,6='5;;,L.6A'12"'41577'1,'.44:"'4:%9,"654'1,'#,$9";'12"'9&,/:#1.,6',7'&";"-561'/,#:$"614'56/'12"'1"41.$,60',7'.6/.-./:5;4'L2,'$50'9,1"61.5;;0'25-"'.$9,&1561'.67,&$51.,6M''31'12.4'9,.61='#,$9;.56#"'L.12'12"'@X8\4'&"N:"414'.4'6,';,6A"&'-,;:615&0='54'.14'4:%9,"654'5&"'"67,&#"5%;"'%0'7"/"&5;'#,:&1M'

2. Cooperation with Foreign Countries

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



36

3. Streamlined Procedures

E2"'@X8'254'5;4,'&"#"61;0'5/,91"/'-5&.,:4'9,;.#."4'56/'9&,#"/:&"4'1,'2";9'.6'.14'.6-"41.A51.,64',7'12"'7"/"&5;'4"#:&.1."4';5L4='.6#;:/.6A'12"'J8+3M''J,&'"Y5$9;"='12"'@X8'254'/";"A51"/'56/'41&"5$;.6"/'12"'9&,#"44'%0'L2.#2'56'.6-"41.A51.,6'#56'%"#,$"'R7,&$5;=S'5;;,L.6A'12"'41577'1,'N:.#I;0'.44:"'4:%9,"654'56/'#,$9";'12"'9&,/:#1.,6',7'.67,&$51.,6'%0'#,$956."4'56/'.6/.-./:5;4M''F6'5//.1.,6='.6'a56:5&0'()*)='12"'!.-.4.,6',7'X67,&#"$"61'566,:6#"/'5'6"L'R#,,9"&51.,6'.6.1.51.-"S'.6'56'"77,&1'1,'9&,-./"'.6#"61.-"4'7,&'.6/.-./:5;4'L.12'I6,L;"/A"',7'J8+3'-.,;51.,64'1,'#,$"'7,&L5&/'56/'#,,9"&51"'L.12'12"'@X8M*(*'

4. SEC Remedies for Violations

f6#"'12"'@X8'254'/"1"&$.6"/'1251'5'-.,;51.,6',7'12"'J8+3'254',##:&&"/='.1'$50'9:&4:"'56'5#1.,6'".12"&'.6'56'5/$.6.41&51.-"'9&,#""/.6A',&'.6'7"/"&5;'#,:&1M''e.41,&.#5;;0='2,L"-"&='12"'A&"51'$5Q,&.10',7'J8+3'5#1.,64'25-"'%""6'%&,:A21'.6'7"/"&5;'#,:&1='4""I.6A'5$,6A',12"&'12.6A4='56'.6Q:6#1.,6'5A5.641'7:1:&"'-.,;51.,64',7'12"'J8+3='/.4A,&A"$"61',7'560'9&,7.14'&"4:;1.6A'7&,$'12"'.;;"A5;'5#1.-.10='56/'5'$,6"15&0'9"65;10M''34'/.4#:44"/'%";,L='2,L"-"&='#,,9"&51.,6'L.12'12"'A,-"&6$"61'$50'4"&-"'1,';,L"&'12"'456#1.,64'.$9,4"/'%0'12"'@X8M'

C. Interacting with the SEC

F/"5;;0='L2"6'5'#,$9560'254'5'9,1"61.5;'J8+3'9&,%;"$='.1'.4'12"'7.&41'1,'7.6/',:1M''e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i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i0'/,.6A'4,='12"'#,$9560'L.;;'%"'5%;"'6,1',6;0'1,'/"7.6"'12"'9&,%;"$'7,&'.14";7='%:1'5;4,'1,'9:1'.6'9;5#"'&"$"/.5;'$"54:&"4='/"1"&$.6"'L2"12"&'56/'1,'L251'"Y1"61'.1'/"4.&"4'1,'#,,9"&51"'L.12'12"'A,-"&6$"61='"6256#"'.14'.61"&65;'J8+3'#,61&,;4'56/'9&,#"/:&"4='56/'9:1',6'5'/"7"64"'1,'12"'.6"-.15%;"'"67,&#"$"61'5#1.,64'56/'9&.-51"';5L4:.14M'8,$956."4'1251'#2,,4"'1,'#,,9"&51"'L.12'12"'@X8'.6'.14'.6-"41.A51.,6'42,:;/'&"-."L'56/'#,64./"&'12"'@X8\4'*"-84-1!#N"/412'#,6#"&6.6A='5$,6A',12"&'12.6A4='#,,9"&51.,6'%0'#,$956."4M*((''F6'1251'

!


37

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V. Enforcement Trends

A. More Aggressive Prosecutions

E2"'6:$%"&',7'J8+3'.6-"41.A51.,64'254'&.4"6'425&9;0'.6'&"#"61'0"5&4M''f6"'7,&$"&'!fa',77.#.5;'4151"/'1251'12"&"'L"&"'``'6"L'.6-"41.A51.,64'.6'())V='5'4:%41561.5;'.6#&"54"'7&,$'6.6"'.6'())d='1"6'.6'())W='56/'4.Y'.6'())CM*(`''@.6#"'())<='12"'J&5:/'@"#1.,6'254'&"4,;-"/'BC'#,&9,&51"'J8+3'56/'7,&".A6'%&.%"&0K&";51"/'#54"4='L.12'7.6"4'1,15;.6A'$,&"'1256'Z*M<'%.;;.,6M''E2.4'.6#;:/"4'#25&A"4'5A5.641'WW'.6/.-./:5;4M''J,&10K4.Y',7'12"4"'.6/.#1$"614'25-"'%""6'%&,:A21'4.6#"'12"'%"A.66.6A',7'())V'5;,6"M*(<''@.$.;5&;0='12"'6:$%"&',7'@X8'J8+3'"67,&#"$"61'$511"&4'254'.6#&"54"/'7&,$'B'.6'())`'1,'*`'.6'())VM''E2"'@X8'%&,:A21'6.6"'J8+3'"67,&#"$"61'5#1.,64'.6'12"'7.&41'25;7',7'()*)M'E2"'6:$%"&',7'J8+3'9&,4"#:1.,64'.4';.I";0'1,'#,61.6:"'1,'&.4"M''!fa',77.#.5;4'7&"N:"61;0'"$9254.c"'.6'12".&'9:%;.#'4151"$"614'1251'"67,&#"$"61',7'12"'J8+3'.4'5'2.A2'9&.,&.10'7,&'12"'!fa='%,12'%"#5:4"'.1'.4'56'.$9,&1561'95&1',7'12"'/"95&1$"61\4'$56/51"'1,'#,$%51'9:%;.#'#,&&:91.,6'56/'%"#5:4"''"67,&#"$"61'L.;;';"-";'12"'9;50.6A'7.";/'7,&';5LK5%./.6A'DM@M'%:4.6"44"4M''i0',6"'5##,:61='12"'J&5:/'@"#1.,6'.4'"Y9"#1"/'1,'A&,L'%0'54'$:#2'54'<)q'.6'4.c"',-"&'12"'6"Y1'1L,'0"5&4M*(C''E2"'/"/.#51"/'J8+3'4N:5/',7'JiF'5A"614'.6'12"'JiF\4'?542.6A1,6'J.";/'f77.#"'254'5;4,'A&,L6'.6'&"#"61'0"5&4M''34''



38

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B. Larger Financial Penalties

E2"'.6#&"54"/'&"4,:&#"4'%".6A'/"/.#51"/'1,='56/'$,&"'5AA&"44.-"'9&,4"#:1.,6',7='J8+3'#&.$"4'.4'25-.6A'5'#;"5&'56/'/.&"#1'.$95#1]'#,$956."4'5&"'950.6A';5&A"&'7.6"4'1256'"-"&'%"7,&"'.6'12"'2.41,&0',7'12"'J8+3M''E2"'1"6'2.A2"41'4"11;"$"614'.6'12"'2.41,&0',7'12"'J8+3'5;;',##:&&"/'L.12.6'12"';541'7.-"'0"5&4M''F6'12"4"'4"11;"$"614'5;,6"='1,15;'7.6"4'56/'/.4A,&A"$"61',7'9&,7.14'5//"/':9'Z(Md'%.;;.,6M''3$,6A'12"';5&A"41'5&"'12"'7,;;,L.6A]''

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!


39

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C. Prosecution of Individuals

F6'&"#"61'0"5&4='!fa',77.#.5;4'25-"'&"9"51"/;0'4151"/'1251'6,1L.124156/.6A';5&A"'7.6"4'95./'%0'#,&9,&51.,64='7,&'12"'!"95&1$"61\4'"67,&#"$"61'"77,&14'1,'25-"'&"5;'/"1"&&"61'"77"#1='#:;95%;"'.6/.-./:5;4'$:41'%"'9&,4"#:1"/'56/'A,'1,'Q5.;M*B(''F6'5'&"#"61'49""#2='344.41561'311,&6"0'b"6"&5;'P5660'3M'i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fa'9&,4"#:1"/'``'.6/.-./:5;4'7,&'J8+3'-.,;51.,64M''''E251'.4'56'.6#&"54"'7&,$'6.6"'.6/.-./:5;4'.6'())d='1"6'.6/.-./:5;4'.6'())W='56/'4.Y'.6/.-./:5;4'.6''



40

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! F6'())W='7,&$"&'8,6A&"44$56'?.;;.5$'aM'a"77"&4,6'%"#5$"'12"'7.&41'DM@M'9:%;.#',77.#.5;'"-"&'#25&A"/'L.12'J8+3'-.,;51.,64M''E2"'#25&A"4'5;;"A"/'1251='L2.;"'4"&-.6A'54'5'$"$%"&',7'12"'DM@M'e,:4"',7'h"9&"4"6151.-"4='2"':4"/'2.4'9,4.1.,6'56/'2.4',77.#"'1,'#,&&:91;0'4""I='4,;.#.1='56/'/.&"#1'1251'12.6A4',7'-5;:"'%"'95./'1,'2.$'56/'2.4'75$.;0'$"$%"&4'.6'"Y#256A"'7,&'2.4'9"&7,&$56#"',7',77.#.5;'5#14M''e"'L54'5;4,'5;;"A"/'1,'25-"',77"&"/'950$"614'1,'7,&".A6',77.#.5;4'1,'5/-56#"'%:4.6"44'"6/"5-,&4'.6'L2.#2'2.4'75$.;0'25/'7.656#.5;'.61"&"414='.6#;:/.6A'5'>.A"&.56'1";"#,$$:6.#51.,64'Q,.61'-"61:&"M''J,;;,L.6A'5'6.6"mL""I'1&.5;='a"77"&4,6'L54'5#N:.11"/',7'12"'J8+3'#25&A"4='%:1'2"'L54'#,6-.#1"/',7',6"'#,:61',7'#,649.&5#0M''f6'>,-"$%"&'*B='())V='2"'L54'4"61"6#"/'1,'12.&1""6'0"5&4'.6'9&.4,6'56/',&/"&"/'1,'7,&7".1'Z`W)=)))M''e"'.4'#:&&"61;0'599"5;.6A'2.4'4"61"6#"M'''

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D. FCPA Whistleblowers

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!


41

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42

E. Sector or Industry-wide Investigations

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1. The Energy Industry

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2. The Healthcare Industry

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F6'12"'9541='$,41'J8+3'2"5;12#5&"'.6-"41.A51.,64'25-"'7,#:4"/',6'$"/.#5;'/"-.#"4M''

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!


43

95&1.#.9561'.6'12"'$"/.#5;'/"-.#"'.6/:41&0='56/'4""I4'560'.67,&$51.,6'#,6#"&6.6A'#"&15.6'109"4',7'950$"614'$5/"'/.&"#1;0',&'.6/.&"#1;0'1,'A,-"&6$"61K"$9;,0"/'/,#1,&4M''3'6:$%"&',7'#,$9"1.1,&4'25-"'9:%;.#;0'/.4#;,4"/'&"#".-.6A'4.$.;5&';"11"&4MS*Bd''E2.4'.6-"41.A51.,6'/"$,641&51"4'12"'9,1"61.5;'7,&'12"'!fa',&'@X8'1,'15I"'5'4.6A;"K#,$9560'.6N:.&0',&'.6-"41.A51.,6'56/'1:&6'.1'.61,'56'.6/:41&0KL./"'9&,%"M''

H,&"'&"#"61;0='12"'!fa'566,:6#"/'.14'9;564'1,'7,#:4'$,&"'#&.$.65;'"67,&#"$"61'"6"&A0',6'12"'925&$5#":1.#5;'.6/:41&0M''31'12"'+25&$5#":1.#5;'h"A:;51,&0'56/'8,$9;.56#"'8,6A&"44'56/'i"41'+&5#1.#"4'J,&:$'.6'>,-"$%"&'())V='344.41561'311,&6"0'b"6"&5;'i&":"&'6,1"/'12"'/"912',7'A,-"&6$"61'.6-,;-"$"61'.6'7,&".A6'2"5;12#5&"'4041"$4'56/'12"'R4.A6.7.#561'&.4I'1251'#,&&:91'950$"614'L.;;'.67"#1'12"'9&,#"44MS*BV''e"'"Y9;5.6"/'1251'Z*))'%.;;.,6=',&'&,:A2;0',6"K12.&/',7'1,15;'45;"4=',7'5;;'DM@M'925&$5#":1.#5;'#,$956."4\'45;"4'5&"'A"6"&51"/'.6'7,&".A6'Q:&.4/.#1.,64'RL2"&"'2"5;12'4041"$4'5&"'&"A:;51"/=',9"&51"/='56/'7.656#"/'%0'A,-"&6$"61'"61.1."4'1,'5'4.A6.7.#561;0'A&"51"&'/"A&""'1256'.6'12"'D6.1"/'@151"4MS*`)''i&":"&'4151"/'1251'12"'!fa'RL.;;'%"'.61"64";0'7,#:4"/',6'&,,1.6A',:1'7,&".A6'%&.%"&0'.6'k12"'925&$5#":1.#5;l'.6/:41&0M''E251'L.;;'$"56'.6-"41.A51.,6'56/='.7'L5&&561"/='9&,4"#:1.,6',7'#,&9,&51.,64='1,'%"'4:&"='%:1'5;4,'.1'L.;;'.6-,;-"'.6-"41.A51.,6'56/'9&,4"#:1.,6',7'4"6.,&'"Y"#:1.-"4MS*`*'34'12"'!fa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

F6'2.4'I"06,1"'5//&"44'%"7,&"'12"'+25&$5#":1.#5;'h"A:;51,&0'56/'8,$9;.56#"'8,6A&"44'56/'i"41'+&5#1.#"4'J,&:$='i&":"&',77"&"/'5/-.#"'&"A5&/.6A'L251'#,&9,&51.,64'42,:;/'/,'1,'9&,1"#1'12"$4";-"4'7&,$'J8+3'&.4I4'56/'#,414M''J.&41='2"'41&"44"/'1251'"-"&0'#,&9,&51.,6'42,:;/'25-"'5'R&.A,&,:4'J8+3'#,$9;.56#"'9,;.#0'1251'.4'75.127:;;0'"67,&#"/MS*`(''@"#,6/='L2"6'5'#,&9,&51.,6'/.4#,-"&4'5'9,1"61.5;',&'5#1:5;'J8+3'-.,;51.,6='.1'42,:;/'R4"&.,:4;0'#,64./"&'-,;:615&.;0'/.4#;,4.6A'12"'-.,;51.,6'56/'#,,9"&51.6AS'.6'12"'.6-"41.A51.,6'.6',&/"&'1,'&"#".-"'R$"56.6A7:;'#&"/.1S'7,&'12"'/.4#;,4:&"'56/'12"'R$"56.6A7:;'%"6"7.1S',7'12"'#,,9"&51.,6M*`B''J.65;;0='2"'6,1"/'1251'.7'5'#,&9,&51.,6'R&"$"/.51"k4l'12"'9&,%;"$'56/'15I"k4l'41"94'1,'"64:&"'1251'.1'/,"4'6,1'&"#:&='k.1l'L.;;'%"6"7.1'7&,$'1251'54'L";;MS*``''E2"4"'4:AA"41.,64'599;0'6,1'Q:41'1,'12"'925&$5#":1.#5;'.6/:41&0='%:1'5;;'.6/:41&."4'56/'#,&9,&51.,64'/,.6A'%:4.6"44',&'4""I.6A'1,'/,'%:4.6"44'.6'7,&".A6'$5&I"14M''X77"#1.-"='#,$9&"2"64.-"='56/'L";;K#,$$:6.#51"/'J8+3'#,$9;.56#"'9,;.#."4'56/'9&,#"/:&"4'5&"'I"0'1,'9&"-"61.,6M'



44

F. Multinational Cooperation

F6'5'49""#2'1,'12"'8,:6#.;',6'J,&".A6'h";51.,64'.6'H50'()*)='344.41561'311,&6"0'b"6"&5;'P5660'i&":"&'/.4#:44"/'R12"'A;,%5;'#,64"64:4'1251'#,&&:91.,6'.4':65##"915%;"S'56/'12"'&.4"',7'5':6.-"&45;''561.#,&&:91.,6'9&.6#.9;"M*`<''E2"'75#1,&4'2"'511&.%:1"/'1,'12.4'/"-";,9$"61'.6#;:/"'R12"'"$"&A"6#"',7'#.-.;'4,#."10\4'-,.#"'5A5.641'#,&&:91.,6';"/'%0',&A56.c51.,64'4:#2'54'E&56495&"6#0'F61"&651.,65;'56/',12"&4';.I"'.1^'12"'75;;',7'12"'@,-."1'D6.,6='"Y9,4.6A'.641.1:1.,65;.c"/'#,&&:91.,6^'6"L4'$"/.5'511"61.,6^'56/'7.65;;0='12"'/"-";,9$"61',7'$,/";4',7'2,L'#,&&:91.,6'#,:;/'4:##"447:;;0'%"'7,:A21MS*`C''E2"',:1#,$"'254'%""6'56'"Y956/.6A'4"1',7'.61"&651.,65;'#,6-"61.,64]'12"'f&A56.c51.,6',7'3$"&.#56'@151"4'TRf3@SU'#,6-"61.,6='L2.#2'L54'12"'7.&41'$:;1.;51"&5;'#,6-"61.,6'5A5.641'#,&&:91.,6^'12"'f&A56.451.,6'7,&'X#,6,$.#'8,K,9"&51.,6'56/'!"-";,9$"61'TRfX8!SU'561.K%&.%"&0'#,6-"61.,6^'12"'8,:6#.;',7'X:&,9"'#,6-"61.,64^'56/'$,41'&"#"61;0'12"'D6.1"/'>51.,64'8,6-"61.,6'3A5.641'8,&&:91.,6='L2.#2'.4'12"'7.&41'A;,%5;'561.#,&&:91.,6'#,6-"61.,6M''E2"4"'#,6-"61.,64'T/.4#:44"/'.6'$,&"'/"15.;'%";,LU='"415%;.42'.61"&651.,65;'4156/5&/4'56/'.6#;:/"'9&,-.4.,64'1251'75#.;.151"'#&,44K%,&/"&'.6-"41.A51.,64'56/'"67,&#"$"61',7'561.#,&&:91.,6';5L4'5$,6A'4.A651,&0'4151"4M'

1. The OAS Convention

F6'*VVC='12"'f3@'#&"51"/'12"'F61"&K3$"&.#56'8,6-"61.,6'3A5.641'8,&&:91.,6='L2.#2'%"#5$"'"77"#1.-"',6'H5&#2'C='*VVWM*`W''E2"'D6.1"/'@151"4='8565/5='56/'5;;'$5Q,&'P51.6'3$"&.#56'"#,6,$."4'5&"'$"$%"&4',7'12"'8,6-"61.,6='L2.#2'L54'5/,91"/'/:"'1,'5'&"#,A6.c"/'R6""/'7,&'M'M'M'56'.61"&651.,65;'.641&:$"61'1,'9&,$,1"'56/'75#.;.151"'.61"&651.,65;'#,,9"&51.,6'.6'7.A21.6A'#,&&:91.,6'56/='"49"#.5;;0='.6'15I.6A'599&,9&.51"'5#1.,6'5A5.641'9"&4,64'L2,'#,$$.1'5#14',7'#,&&:91.,6'.6'12"'9"&7,&$56#"',7'9:%;.#'7:6#1.,64MS*`d''H"$%"&'4151"4'5&"'&"N:.&"/'1,'#&.$.65;.c"'%&.%"&0',7'%,12'/,$"41.#'56/'7,&".A6',77.#.5;4='54'L";;'54'4,;.#.151.,6',&'5##"9156#"',7'5'%&.%"M''E2"'8,6-"61.,6'"6#,:&5A"4'$:;1.651.,65;'#,,9"&51.,6'%0'9&,-./.6A'7,&'"Y1&5/.1.,6='544.4156#"'L.12'12"'A512"&.6A',7'"-./"6#"='56/'544.4156#"'L.12'"67,&#.6A'Q:/A$"614'56/'4".c.6A'12"'544"14',7',77"6/.6A'95&1."4M''>,6K$56/51,&0'9&,-.4.,64',7'12"'8,6-"61.,6'"6#,:&5A"'$"$%"&'4151"4'1,'$5.615.6'56/'41&"6A12"6'A,-"&6$"61'"12.#4'56/'1&5.6.6A'9&,A&5$4='4041"$4'1,'9&,1"#1'L2.41;"%;,L"&4='56/'$"#256.4$4'1,'"64:&"'9:%;.#;0K2";/'#,$956."4'$5.615.6'%,,I4'56/'&"#,&/4'1251'5##:&51";0'&"7;"#1'12"'5#N:.4.1.,6'56/'/.49,4.1.,6',7'544"14M'

2. The OECD Anti-Bribery Convention

E2"'fX8!'8,6-"61.,6',6'8,$%51.6A'i&.%"&0',7'J,&".A6'+:%;.#'f77.#.5;4'.6'F61"&651.,65;'i:4.6"44'E&5645#1.,64'%"#5$"'"77"#1.-"',6'J"%&:5&0'*<='*VVVM*`V''34'/.4#:44"/'.6'$,&"'/"15.;'.6'@"#1.,6'ng'TRE2"'fX8!'8,6-"61.,6SU='12.&10K".A21'#,:61&."4'25-"'&51.7."/'12"'8,6-"61.,6='L2.#2'%&,5/;0'/"7.6"4'%&.%"&0='&"N:.&"4'$"$%"&'4151"4'1,'.$9,4"'/.44:54.-"'456#1.,64='#,$$.14'$"$%"&'4151"4'1,'9&,-./.6A'$:1:5;';"A5;'544.4156#"='56/'#5;;4'7,&'$"$%"&'4151"4'1,'4"1'%,,I4'56/'&"#,&/4'4156/5&/4M''E2"'8,6-"61.,6'&"N:.&"4'12"'"65#1$"61',7'651.,65;';5L4'#&.$.65;.c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c:&"='$:1:5;'

!


45

;"A5;'544.4156#"='56/'#,,9"&51.,6'%"1L""6'$"$%"&'4151"4'.6'12"'.6-"41.A51.,6'56/'9&,4"#:1.,6',7'1&564651.,65;'%&.%"&0M''F6'5//.1.,6='.1'/"4#&.%"4'4156/5&/4'7,&'5//&"44.6A'Q:&.4/.#1.,65;'#,67;.#14'%"1L""6'4151"4M'

3. The Council of Europe Conventions

E2"'D6.1"/'@151"4'254',%4"&-"&'4151:4'.6'12"'8,:6#.;',7'X:&,9"='L2.#2'254'5/,91"/'1L,'#,6-"61.,64'&";51"/'1,'1&564651.,65;'#,&&:91.,6M''E2"'8&.$.65;'P5L'8,6-"61.,6',6'8,&&:91.,6'%"#5$"'"77"#1.-"',6'a:;0'*='())(M*<(''E2"'8.-.;'P5L'8,6-"61.,6',6'8,&&:91.,6='L2.#2'.4'/"-,1"/'1,'12"'.44:"',7'#.-.;';.5%.;.10'7,&'#,&&:91'9&5#1.#"4='%"#5$"'"77"#1.-"',6'a56:5&0'**='())BM*<B''E2"'D6.1"/'@151"4'254'4.A6"/='%:1'6,1'&51.7."/='12"'8&.$.65;'P5L'8,6-"61.,6=*<`'56/'254'6,1'4.A6"/'12"'8.-.;'P5L'8,6-"61.,6M'E2"'8&.$.65;'P5L'8,6-"61.,6'&"N:.&"4'$"$%"&'4151"4'1,'#&.$.65;.c"'%,12'12"'$5I.6A'56/'12"'&"#".91',7'%&.%"4='1&5/.6A'.6'.67;:"6#"='$,6"0';5:6/"&.6A='56/'#"&15.6'5##,:61.6A',77"64"4'&";51"/'1,'#,&&:91.,6M''E2"'4#,9"',7'12"'8,6-"61.,6'.4'%&,5/"&'1256'%,12'12"'f3@'56/'fX8!'8,6-"61.,64='54'.1'&"N:.&"4'#&.$.65;.c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

4. The U.N. Convention Against Corruption

E2"'D6.1"/'>51.,64'8,6-"61.,6'3A5.641'8,&&:91.,6'%"#5$"'"77"#1.-"',6'!"#"$%"&'*`='())<M*<C''E2"'8,6-"61.,6'&"#,A6.c"4'12"'.$9,&156#"',7'9&"-"61.,6'.6'#,$%51.6A'#,&&:91.,6'.6'%,12'12"'9:%;.#'56/'9&.-51"'4"#1,&4M''E,'12.4'"6/='.1'"6#,:&5A"4'$"$%"&'4151"4'1,'"415%;.42'56/'9&,$,1"'$"54:&"4'5.$"/'51'9&"-"61.6A'#,&&:91.,6M''E2"4"'$"54:&"4'.6#;:/"'/"-";,9.6A'$,/";'9&"-"61.-"'9,;.#."4'&"A5&/.6A='7,&'"Y5$9;"='12"'"415%;.42$"61',7'561.#,&&:91.,6'%,/."4'56/'"6256#"/'1&56495&"6#0'.6'$511"&4',7'9:%;.#'7.656#"M''E2"'8,6-"61.,6'5;4,'&"N:.&"4'4151"4'1,'"415%;.42'#&.$.65;'56/',12"&',77"64"4'#,-"&.6A'5'L./"'&56A"',7'#,&&:91'5#14='.6#;:/.6A'%54.#'7,&$4',7'#,&&:91.,6'4:#2'54'%&.%"&0'56/'12"'"$%"cc;"$"61',7'9:%;.#'7:6/4^'.1'5;4,'#,-"&4'1&5/.6A'.6'.67;:"6#"'56/'12"'#,6#"5;$"61'56/';5:6/"&.6A',7'12"'9&,#""/4',7'#,&&:91.,6M''F6'5//.1.,6'1,'9&"-"61.,6'56/'#&.$.65;.c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c.6A='4".c:&"='56/'#,67.4#51.,6',7'544"14M'F6'1"41.$,60'1,'12"'@"651"'J,&".A6'h";51.,64'8,$$.11""'.6'4:99,&1',7'DM@M'&51.7.#51.,6',7'12"'8,6-"61.,6='!"9:10'344.41561'311,&6"0'b"6"&5;'i&:#"'@L5&1c'"Y9;5.6"/'1251'12"'9&,-.4.,64',7'12"'8,6-"61.,6'R9&,-./"'.$9,&1561'6"L'1,,;4'1,'DM@M';5L'"67,&#"$"61MS*<W''@9"#.7.#5;;0='12"''



46

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5. Case Examples

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!


47

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VI. Considering Whether to Self-Report >,';5L'1"OJ%1"''#,$956."4'1,'4";7K&"9,&1'5#1:5;',&'9,1"61.5;'J8+3'-.,;51.,64'1,'12"'!fa',&'@X8M''34'/.4#:44"/'%";,L='12"'!fa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h"A5&/;"44',7'12"':;1.$51"'/"#.4.,6='12"'#,$9560'42,:;/'#,$9;"1"'5'12,&,:A2'.6-"41.A51.,6='56/'451.470'.14";7'1251'.1'254'./"61.7."/'5;;'.6#./"614',7'$.4#,6/:#1'T6,1'Q:41'12"'65&&,L'4"1',7'#.&#:$4156#"4'.6'L2.#2'12"'#,6#"&6'5&,4"UM''E2"'I6,L;"/A"'A5.6"/'7&,$'12"'.6-"41.A51.,6'42,:;/'%"':4"/'1,'/"4.A6'56/'.$9;"$"61'12,&,:A2'&"$"/.5;'5#1.,6'1,'"6256#"'J8+3'#,$9;.56#"'L.12'12"'A,5;',7'9&"-"61.6A'56/'/"1"#1.6A'7:1:&"'-.,;51.,64M'

A. Primary Advantage of Self-reporting: Mitigation of Criminal and Civil Penalties

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48

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B. Factors to Consider in Deciding Whether to Self-report

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49

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50

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VII. Red Flags: Facts That Raise FCPA Compliance Issues

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A. Reported Cases175

1. Lucent

i"1L""6'()))'56/'())B='P:#"61'49"61'599&,Y.$51";0'Z*)'$.;;.,6'1,'15I"'599&,Y.$51";0'*=)))'82.6"4"',77.#.5;4',6'$,&"'1256'B))'1&.94'1,'12"'DM@M''P:#"61'&"#,&/"/'.6'#,$9560'&"#,&/4'1251'12"4"'1&.94'L"&"'7,&'75#1,&0'.649"#1.,64'56/'1&5.6.6A4',6'P:#"61'4,71L5&"M''e,L"-"&='$,41'1&.94'L"&"'1,';,#51.,64'L2"&"'P:#"61'/./'6,1'25-"'560'75#.;.1."4='.6#;:/.6A'e5L5..='P54'g"A54='12"'b&56/'8560,6='>.5A5&5'J5;;4='>"L'j,&I'8.10='56/'f&;56/,='JPM'P:#"61':;1.$51";0'95./'Z(M<'$.;;.,6'.6'7.6"4'56/'9"65;1."4'1,'12"'!fa'56/'@X8M''E2"',6;0'-.,;51.,64'.6'12.4'#54"'.6-,;-"/'950.6A'7,&',77.#.5;4\'"Y9"64"4'7,&'1&5-";'1,'12"'DM@M'56/'$.4#25&5#1"&.c.6A'12,4"'950$"614'.6'12"'#,$9560\4'&"#,&/4M''E2"'950$"61'&"#.9."614'L"&"'"$9;,0""4',7'82.6"4"'4151"K,L6"/',&'#,61&,;;"/'1";"#,$$:6.#51.,64'#,$956."4M''E2"'@X8\4'#,$9;5.61'49"#.7.#5;;0'6,1"/'1251'"$9;,0""4'L"&"'6,1'9&,9"&;0'1&5.6"/',6'12"'4151:4',7'P:#"61\4'#:41,$"&4'54'7,&".A6',77.#.5;4'7,&'9:&9,4"4',7'12"'J8+3M'''M$7%J*"2#]#P5&A"',&'7&"N:"61'1&5-";'950$"614^',9"&51.6A'.6'5'2.A2K&.4I'Q:&.4/.#1.,6M'

2. Avery Dennison

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!


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3. Siemens

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4. General Electric/InVision

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5. KBR

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6. General Electric/Oil for Food

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52

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B. Risk Mitigation

1. Generally

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2. Third Parties (Agents, Consultants, Joint Venture Partners, etc.)

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53

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3. Gifts, Entertainment, Travel, and Hospitality

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54

A. Tone at the Top

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B. The Audience

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C. What to Cover

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!


55

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56

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D. Format

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E. Frequency

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!


57

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F. Documentation

3;;'549"#14',7'5'#,$9560\4'1&5.6.6A'9&,A&5$'42,:;/'%"'/,#:$"61"/='.6#;:/.6A'#,61"614='/51"4='56/'511"6/56#"M''E2"4"'&"#,&/4'#56'2";9'/"$,641&51"'"77"#1.-"'#,$9;.56#"'.7'12"'#,$9560'.4'.6-"41.A51"/'7,&'J8+3'-.,;51.,64M'

G. Case Example: U.S. v. Panalpina

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IX. M&A Due Diligence

A. Importance of Pre-acquisition Due Diligence

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1. Successor Liability

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58

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2. Benefits of Pre-transaction Due Diligence

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a. Delay the transaction

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b. Reduce the transaction price or abandon the transaction altogether

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!


59

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c. Obtain an opinion release from the DOJ to remediate violations post-transaction

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B. Due Diligence Plan

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!


61

X. Suspension and Debarment of Government Contractors

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A. Bases for Suspension and Debarment

1. Violations that Potentially Trigger Debarment

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62

2. Indictments, Convictions, Pleas, or Settlements that Give Rise to Suspension and Debarment

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3. Violation of Mandatory Disclosure Requirements

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!


63

B. Scope of Suspension and Debarment

1. Government-wide Ban on Future Procurement and Participation in Government Programs

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2. Duration of Debarment

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3. Effect of Suspension and Debarment on Existing Contracts

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4. Liability of Related Companies

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64

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• L2"&"'5'#,$9560'%"6"7.14'7&,$'12"',12"&\4'$.4#,6/:#1M(**''

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C. Procedures and Timing for Suspension and Debarment

E2"'9&,#"/:&"4'7,&'4:49"64.,6'56/'/"%5&$"61'5&"'/.&"#1"/'1,'%"'R54'.67,&$5;'54'.4'9&5#1.#5%;"='#,64.41"61'L.12'7:6/5$"615;'75.&6"44MS(*(''X5#2'5A"6#0'.4'"61.1;"/'1,'/"1"&$.6"'.14',L6'9&,#"/:&"4='5;12,:A2'12"'J3h'.$9,4"4'#"&15.6'$.6.$5;'/:"'9&,#"44'&"N:.&"$"614'#,6#"&6.6A'6,1.#"'56/'56',99,&1:6.10'1,'%"'2"5&/M'

1. Notice

E2"'A,-"&6$"61'$:41'9&,$91;0'A.-"'56'577"#1"/'#,$9560'6,1.#"',7'4:49"64.,6',&'/"%5&$"61='56/'$:41'/"4#&.%"'12"'75#1:5;'%54.4'7,&'12"'9&,9,4"/'/"%5&$"61M(*B''i"#5:4"'5'6,1.#"',7'4:49"64.,6',&'9&,9,4"/'/"%5&$"61'#&"51"4'56'.$$"/.51"'%5&'1,'&"#".-.6A'6"L'#,61&5#14'7&,$'12"'A,-"&6$"61='5A"6#."4'4,$"1.$"4'.44:"'5'R42,L'#5:4"S'6,1.#"M''3'42,L'#5:4"'6,1.#"'4151"4'1251'12"'#,$9560'.4'%".6A'#,64./"&"/'7,&'4:49"64.,6',&'/"%5&$"61='%:1'/,"4'6,1'25-"'12"'"77"#1',7'.$$"/.51"'"Y#;:4.,6='56/'109.#5;;0'9&,-./"4'12"'#,61&5#1,&'5'4"1'9"&.,/',7'1.$"'1,'&"49,6/M''E2"'/"#.4.,6'1,'.44:"'5'42,L'#5:4"';"11"&'.4'9:&";0'/.4#&"1.,65&0M'

2. Response to Proposed Debarment

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!


65

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3. Hearing

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4. Decision

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5. Reconsideration and Appeal

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goatley



66

D. Strategies and Procedures for Avoiding Suspension and Debarment

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1. Be Proactive in Investigating Potential Wrongdoing

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2. Be Proactive in Implementing Corrective Measures

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3. Approach the Government Promptly Once the Pertinent Facts are Known

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!


67

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4. Identify and Isolate Divisions Responsible

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5. Coordinate Resolution Between DOJ and the Contracting Agencies

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68

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XI. Related Crimes and Commercial Bribery E2"'J8+3'.4'6,1'12"',6;0'L"59,6'.6'12"'A,-"&6$"61\4'561.#,&&:91.,6'5&4"65;M''8,6/:#1'1251'-.,;51"4'12"'J8+3'$50'5;4,'.6-,;-"',12"&'#&.$.65;'4151:1"4='.6#;:/.6A'12"'E&5-";'3#1='561.K$,6"0';5:6/"&.6A';5L4='15Y'4151:1"4='56/'12"'$5.;'56/'L.&"'7&5:/'4151:1"4M''i,;41"&.6A'12"'J8+3'#;5.$4'L.12'#&.$"4'.6#./"615;'1,'12"'.$9&,9"&'950$"614'#56'"6256#"'12"'A,-"&6$"61\4'5%.;.10'1,'4""I'5AA&"44.-"'9"65;1."4='4:#2'54';,6A"&'9&.4,6'1"&$4'7,&'.6/.-./:5;4'56/'41""9"&'7.6"4'56/';5&A"&'7,&7".1:&"4'7&,$'#,$956."4M''i0'5//.6A',12"&'#&.$.65;'#25&A"4='12"'A,-"&6$"61'.4'.6#&"54.6A;0'4""I.6A'1,'#591:&"'12"'7:;;'4#,9"',7'12"'5;;"A"/'#,6/:#1M''3;4,='9"&2594'$,41'.$9,&1561='12"'/"#.4.,6'1,'#25&A"'5//.1.,65;'#&.$"4'5;4,'254'12"'"77"#1',7'%,;41"&.6A'56'J8+3'#54"'L2"&"'12"'J8+3'-.,;51.,6'.14";7'L,:;/',12"&L.4"'25-"'%""6'L"5I',&'.64:77.#."61M'

A. Recent Cases

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!


69

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B. Commercial Bribery and the Travel Act

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70

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C. Intersection with Other Crimes

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D. Reaching the Corrupt Payment Recipient

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!


71

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XII. Tag-Along Civil Litigation E2"'/.4#;,4:&"',7'56'J8+3'.44:"'#,:;/'9&,$91'R15AK5;,6AS'#.-.;';.1.A51.,6'.6'12"'7,&$',7'5'425&"2,;/"&'#;544'5#1.,6='5'/"&.-51.-"'5#1.,6=',&'56'XhF@3'#;544'5#1.,6M''E2.4'4"#1.,6'9&,-./"4'56',-"&-."L',7'"5#2',7'12,4"'109"4',7'5#1.,64M'

A. Securities Class Actions

1. Types of Claims

a. Securities Exchange Act of 1934: Section 10(b), Section 20(a), and SEC Rule 10b-5

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b. Securities Act of 1933: Sections 11, 12, and 15

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72

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2. Likely Bases of Allegations

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a. Statements Regarding Overseas Business

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b. Statements Regarding Compliance with the Law

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!


73

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c. Statements Describing the FCPA Issue

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3. Motion to Dismiss

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a. Falsity

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b. Scienter

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74

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c. Discovery and Post-Motion to Dismiss

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B. Derivative Suits

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1. Claims

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a. Fiduciary Duties

i. Duty of Loyalty

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76

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ii. Duty of Care

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b. Forum

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c. Demand Futility as Grounds for Dismissal

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!


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4. Special Litigation Committee

F6'#"&15.6'4.1:51.,64='#,&9,&51.,64'$50'7.6/'.1'599&,9&.51"=':9,6'5'2,;/.6A'1251'12"'9;5.61.77'254'5/"N:51";0'5;;"A"/'/"$56/'7:1.;.10='56/'12"'4:%4"N:"61'/"6.5;',7'12"'$,1.,6'1,'/.4$.44='1,'599,.61'5'@9"#.5;'P.1.A51.,6'8,$$.11""'TR@P8SU'1,'#,64./"&'L2"12"&'12"'#,&9,&51.,6'42,:;/'15I"'#,61&,;',7'12"'#;5.$4M''b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

5. Discovery

3'9;5.61.77'$50'6,1'4""I'/.4#,-"&0'1,'7.6/'75#14'1,'%,;41"&'5'42,L.6A',7'/"$56/'7:1.;.10M''R+;5.61.774'.6'5'/"&.-51.-"'4:.1'5&"'6,1'"61.1;"/'1,'/.4#,-"&0'1,'544.41'12".&'#,$9;.56#"'L.12'12"'95&1.#:;5&.c"/'9;"5/.6A'4156/5&/MS(<C'''@25&"2,;/"&'9;5.61.774'$50'7.;"'56'5#1.,6'1,'"Y"&#.4"'4151:1,&0'&.A214'1,'.649"#1'R%,,I4'56/'&"#,&/4=S'4:#2'54'9:&4:561'1,'!";5L5&"'b"6"&5;'8,&9,&51.,6'P5L'u'(()M''h"#"61'!";5L5&"'#54"4'25-"'/"6."/'&"N:"414'1,'.649"#1='2,;/.6A'1251'$5I.6A'4:#2'&"N:"414'571"&'7.;.6A'5'/"&.-51.-"'5#1.,6'/,"4'6,1'451.470'12"'4151:1,&0'&"N:.&"$"61'1251'12"'&"N:"41'%"'7,&'5'R9&,9"&'9:&9,4"MS(<W''T>,1"='2,L"-"&='1251'51'12"'1.$"',7'9:%;.#51.,6='12"'!";5L5&"'@:9&"$"'8,:&1'254'.6/.#51"/'1251'.1'L.;;'2"5&'5&A:$"614',6'12.4'.44:"MU''3'9;5.61.77'1251'.4'L.;;.6A'1,'&.4I'7.;.6A'.14'/"&.-51.-"'5#1.,6'571"&'12"'.6.1.5;'&:42',7'#;544'5#1.,64'56/'/"&.-51.-"'5#1.,64='.6',&/"&'1,'7.&41':1.;.c"'12"'%,,I4'56/'&"#,&/4'.649"#1.,6'&.A21='$50'%"#,$"'12"'7.&41'15AK5;,6A';.1.A561'L2,'%&.6A4'56'5#1.,6'1,'5'9,.61'51'L2.#2'12"'#,&9,&51.,6'$50'25-"'1,'/.4#;,4"'5//.1.,65;'.67,&$51.,6'5%,:1'12"'"-"614':6/"&;0.6A'12"'J8+3'.44:"M'34'L.12'425&"2,;/"&'#;544'5#1.,64='/.4#,-"&0'$50',##:&',-"&4"54='56/'&";"-561'7,&".A6';5L4='.6#;:/.6A'12"'e5A:"'8,6-"61.,6='42,:;/'%"'#,64:;1"/M'



78

C. ERISA Litigation

3'12.&/'109"',7'15AK5;,6A'#54"'.4',6"'544"&1.6A'#;544'#;5.$4':6/"&'12"'X$9;,0""'h"1.&"$"61'F6#,$"'@"#:&.10'3#1'TRXhF@3SU='(V'DM@M8M'u'*))*='"1'4"NM''E2.4'109"',7'#54"'109.#5;;0'.4'%&,:A21',6'%"25;7',7'"$9;,0""4',7'12"'#,&9,&51.,6'L2,'.6-"41"/'`)*TIU'#,61&.%:1.,64'.6'#,$9560'41,#IM''H560'#,$956."4',77"&'12".&',L6'41,#I'54',6"',7'4"-"&5;'.6-"41$"61',91.,64M''36'XhF@3'9;5.61.77'L.;;'4""I'&"#,-"&0'7,&'12"';,44'1,'9;56'95&1.#.95614\'2,;/.6A4'.6'#,$9560'41,#I'1251'5;;"A"/;0'&"4:;1"/'7&,$'56'.67;51.,6='56/'4:%4"N:"61'/"#;.6"=',7'12"'41,#I\4'9&.#"'/:"'1,'75;4"'4151"$"614',&',$.44.,64'&"A5&/.6A'12"'"-"614':6/"&;0.6A'12"'J8+3'.44:"M'!"7"6/5614'.6'56'XhF@3'5#1.,6'109.#5;;0'.6#;:/"'12"'$"$%"&4',7'12"'%,5&/'TL2"&"'12"'%,5&/'/";"A51"4'5:12,&.10'1,'$,6.1,&'12"'%"6"7.1'9;56'1,'5'%,5&/'#,$$.11""',&'1,'5'$565A"$"61'#,$$.11""U='$"$%"&4',7'12"'$565A"$"61'#,$$.11""='56/',12"&4'L2,'2";/'5'7./:#.5&0'4151:4'L.12'12"'9;56M'+;5.61.774'109.#5;;0'5;;"A"'1251'12"'/"7"6/5614'75.;"/'1,'451.470'XhF@3\4'&"N:.&"$"61',7'9&:/"61'$565A"$"61'56/'$,6.1,&.6A='4:#2'54'%0'75.;.6A'1,'/.-"&4.70'12"'9;56\4'.6-"41$"61',91.,64='.6#;:/.6A'#,$9560'41,#I'54'56'.6-"41$"61',91.,6='56/'75.;.6A'1,'&"/:#"'12"'9;56\4'2,;/.6A4',7''#,$9560'41,#IM''+;5.61.774'L.;;'5;;"A"'1251'12"'7./:#.5&."4'I6"L',&'42,:;/'25-"'I6,L6'5%,:1'12"'J8+3'$.4#,6/:#1M''+;5.61.774'$50'5;4,'5;;"A"'1251'12"'#,$9560',&',12"&4'9&,-./"/'75;4"',&'$.4;"5/.6A=',&'I6,L.6A;0':6.67,&$"/='/"4#&.91.,64',7'J8+3'#,$9;.56#"',&'12"'"Y1"61',7'$.4#,6/:#1='%:1'6,6"12";"44'#,61.6:"/'1,',77"&'#,$9560'41,#I'54'56'.6-"41$"61',91.,6M''+;5.61.774'L.;;'5;4,'5;;"A"'1251'7./:#.5&."4'75.;"/'1,'$565A"',&'$,6.1,&'12"'9;56M(<d''D6;.I"'5'425&"2,;/"&'#;544'5#1.,6'1251'.4'4:%Q"#1'1,'12"'h"7,&$'3#1\4'/.4#,-"&0'4150='56'XhF@3'#;544'5#1.,6'.4'6,1'4:%Q"#1'1,'5'4150='56/',71"6'9&,#""/4'$,&"'N:.#I;0'1256'5'425&"2,;/"&'#;544'5#1.,6',&'/"&.-51.-"'5#1.,6M'

D. Suits by Foreign Governments

J,&".A6'A,-"&6$"614'25-"'&";."/',6'12"'J8+3'1,'4:"'D6.1"/'@151"4'#,&9,&51.,64'56/'.6/.-./:5;'/"7"6/5614='.6'511"$914'1,'&"#,-"&'/5$5A"4'7,&'12".&'#.1.c"64',&'1,'1"&$.651"'#,61&5#14M''E2"4"'4:.14'5&"':6#,$$,6='.6'95&1'%"#5:4"'7,&".A6'A,-"&6$"614'$50'%"'599&"2"64.-"'1251'DM@M'410;"'/.4#,-"&0'L.;;'"Y9,4"'12"'7,&".A6'A,-"&6$"614\',L6'"$%5&&544.6A',&'.;;"A5;'5#1.,64M(<V''>,6"12";"44='4"-"&5;'7,&".A6'A,-"&6$"614'25-"'%&,:A21'J8+3K%54"/'4:.14'.6'DM@M'#,:&1M'E2"'J8+3'/,"4'6,1'A.-"'5'9&.-51"'&.A21',7'5#1.,6'1,'7,&".A6'A,-"&6$"614M''J,&".A6'A,-"&6$"614'.641"5/'25-"'5;;"A"/'J8+3'-.,;51.,64'54'12"'%54.4'7,&'&";."7M''E2"4"'#;5.$4'25-"'.6#;:/"/'hF8f'#;5.$4='.6'L2.#2'12"'J8+3'-.,;51.,6'.4'12"'5;;"A"/'9&"/.#51"'5#1'7,&'hF8f';.5%.;.10M''F7'12"'5;;"A"/'#,649.&5#0',&'&5#I"1""&.6A'/./'6,1'/.&"#1;0'#5:4"'12"'5;;"A"/'.6Q:&0=',&'12"'7,&".A6'A,-"&6$"61'#566,1'42,L'5';"6A120='#,61.6:,:4'9511"&6',7'&5#I"1""&.6A='12"'hF8f'#;5.$'$50'%"'/.4$.44"/M''''

! !"#$%&'"()*$?'F6'C4$%&%3-&#N"/J8.%3#+)#P<*#=41/M='`CC'JM'@:99M'(/'Cd)'TXM!M'Q-)#RSSTU='12"'!,$.6.#56'h"9:%;.#'%&,:A21'hF8f'#;5.$4'%54"/',6'J8+3'-.,;51.,64'5A5.641'4"-"&5;'DM@M'#,&9,&51.,64'7,&'#,649.&.6A'1,'#5&&0',:1'%&.%"4'56/'/"512'12&"514'.6',&/"&'1,'/.49,4"'.6"Y9"64.-";0',7'#,5;'542'.6'12"'!,$.6.#56'h"9:%;.#M''E2"'#,:&1'/.4$.44"/'12"'hF8f'#;5.$4'7,&'1L,'&"54,64M''J.&41='.1'L54'12"'#,$956."4\'$.4256/;.6A',7'#,5;='6,1'12"'

!


79

5;;"A"/'%&.%"&0'1251'9,;;:1"/'12"'!,$.6.#56'h"9:%;.#\4';56/'56/'#5:4"/'12"'"6-.&,6$"615;'.6Q:&."4M''@"#,6/='12"'!,$.6.#56'h"9:%;.#'#,:;/'6,1'"415%;.42'#,61.6:.10='L2.#2'&"N:.&"4'5'4"&."4',7'&";51"/'9&"/.#51"'5#14'1251',##:&',-"&'5'4:%41561.5;'9"&.,/',7'1.$"'56/'#5&&0'12"'7:1:&"'12&"51',7'&"9"1.1.,6='1,'9&,-"'5'R9511"&6',7'&5#I"1""&.6AS':6/"&'hF8f='%"#5:4"'12"'9&"/.#51"'5#14'"Y1"6/"/',-"&',6;0'5',6"'0"5&'9"&.,/'56/'12"'2.41,&0',7'/:$9.6A'#,5;'542'/./'6,1'9&"/.#1'560'7:1:&"'#&.$.65;'#,6/:#1M'

%

J,&".A6'A,-"&6$"614'25-"'5;4,'5;;"A"/'-.,;51.,64',7'12"'h,%.64,6K+51$56'3#1='*<'DM@M8M'u'*B'T9&,2.%.1.6A'9&.#"'/.4#&.$.651.,6U='12"'H,6"0'P5:6/"&.6A'8,61&,;'3#1='*d'DM@M8M'u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c"64M''>,'7,&".A6'A,-"&6$"61'599"5&4'1,'25-"'%&,:A21'4:.1'4,;";0'5A5.641'56'.6/.-./:5;',&'.6/.-./:5;4'L.12,:1'5'#,$9560'/"7"6/561M'+;5.61.774'25-"'.6#;:/"/'F&5N.'#.1.c"64'L2,'L"&"'.61"6/"/'%"6"7.#.5&."4',7'12"'D6.1"/'>51.,64'f.;'7,&'J,,/'+&,A&5$='5'#,$9560'1251'L54'$5Q,&.10K,L6"/'%0'12"'A,-"&6$"61',7'i52&5.6='56/'12"'7,&".A6'A,-"&6$"614'12"$4";-"4M''E2"'./"61.10',7'12"'9;5.61.77'$50'/"1"&$.6"'L2"12"&'12"'#54"'L.;;'4:&-.-"'12"'/"7"6/561'#,&9,&51.,6\4'$,1.,6'1,'/.4$.44M''?2"&"'5'7,&".A6'A,-"&6$"61'5;;"A"4'25&$4'1251'5&"'-5A:"='209,12"1.#5;=',&'6,1'49"#.7.#'1,'12"'9;5.61.774='12"'#;5.$'$50'%"'-:;6"&5%;"'1,'/.4$.445;'/:"'1,';5#I',7'4156/.6AM''''

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F6'51';"541'1L,'9"6/.6A'#54"4=(C)'12"'#,:&14'A&561"/'5'4150'&"N:"41'%0'12"'DM@M'A,-"&6$"61'1,'5;;,L'12"'!fa'1,'.6-"41.A51"'56/'9,1"61.5;;0'9&,4"#:1"'J8+3'-.,;51.,64'1251'L"&"'%&,:A21'1,'12"'!fa\4'511"61.,6'%0'12"'7,&".A6'A,-"&6$"61\4'5;;"A51.,64M''E2"'#,:&14'A&561"/'12"'41504'1,'9&"-"61'/.4#,-"&0'.6'12"'9&.-51"';.1.A51.,6'7&,$'.61"&7"&.6A'L.12'12"'A,-"&6$"61\4'.6-"41.A51.,6',7'9,1"61.5;'#&.$.65;'L&,6A/,.6AM'P"A.4;51.,6'.4'#:&&"61;0'9"6/.6A'%"7,&"'8,6A&"44'1251='.7'9544"/='L.;;'5;;,L'DM@MK%54"/'"61.1."4'56/'.6/.-./:5;4'1,'%&.6A'9&.-51"'4:.14'5A5.641'7,&".A6'#,6#"&64'1251'-.,;51"'12"'J8+3M''*""#@"#1.,6'nFgTiU='RJ,&".A6'i:4.6"44'i&.%"&0'+&,2.%.1.,6'3#1',7'())VMS''



80

E. Suits by Business Partners F61"&651.,65;'%:4.6"44'#,61&5#14',71"6'#,615.6'5'#;5:4"'&"N:.&.6A'%,12'95&1."4'1,'#,$9;0'L.12'12"'J8+3M''36'5/$.11"/',&'4:49"#1"/'J8+3'-.,;51.,6'%0',6"'95&10'1,'5'#,61&5#1'#56'9&,$91';.1.A51.,6'%"1L""6'12"'T5;;"A"/;0U'-.,;51.6A'95&10'56/'12"'6,6K-.,;51.6A'95&10M''E2"'6,6K-.,;51.6A'95&10'#,:;/'%"'$,1.-51"/'1,'$5I"'.14";7';,,I'A,,/'1,'"67,&#"$"61'5A"6#."4='12"'$"/.5='56/'12"'9:%;.#='1,'$5I"'56/'566,:6#"'5'%&"5I'L.12'12"'-.,;51.6A'95&10='56/'1,'4151"'1251'.1'25/'6,'.6-,;-"$"61'.6'12"'J8+3K-.,;51.6A'#,6/:#1M''E2"'6,6K-.,;51.6A'95&10'#,:;/'4:"'7,&'5'/"#;5&51,&0'Q:/A$"61'1251'12"'#,61&5#1'.4'1"&$.651"/'%"#5:4"',7'12"'-.,;51.6A'95&10\4'%&"5#2'56/'#,:;/'5;4,'4:"'7,&'/5$5A"4'5;;"A"/;0'#5:4"/'%0'12"'%&"5#2M''J,&'.14'95&1='12"'-.,;51.6A'95&10'$.A21'&"49,6/'1,'5'6,1.#"',7'1"&$.651.,6'%0'4:.6A'7,&'%&"5#2',7'#,61&5#1M'''''?2"6'4:.6A'7,&'$,6"15&0'&"#,-"&0='6,6K-.,;51.6A'95&1."4'25-"'4:"/':6/"&'hF8f'1,'&"#,-"&'5$,:614'1251'12"'-.,;51.6A'95&10'5;;"A"/;0':4"/'1,'950'%&.%"4'1,'7,&".A6',77.#.5;4M''8,:&14'25-"'9"&$.11"/'6,6K-.,;51.6A'95&1."4'1,'%54"'hF8f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

F. Suits by Business Competitors

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!


81

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G. Employment Suits by Whistleblowers

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1. Retaliation and Wrongful Discharge

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2. RICO

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XIII. Role of Outside Counsel in Internal Investigations

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82

A. Conducting an Internal Investigation

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B. Pros and Cons of Retaining Outside Counsel

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1. Pros of Retaining Outside Counsel

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!


83

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2. Cons of Retaining Outside Counsel

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C. Other Issues to Consider When Retaining Outside Counsel

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84

XIV. Pending Legislation (as of December 2010) E2"'%&"5/12',7'9"6/.6A';"A.4;51.,6'$5I"4'#;"5&'12"'7"/"&5;'A,-"&6$"61\4'A,5;',7'#,$%51.6A'#,&&:91.,6'%0'/,$"41.#'.6/.-./:5;4'56/'#,$956."4',9"&51.6A',:14./"'12"'D6.1"/'@151"4='54'L";;'54'12"'.$9,&156#"',7'J8+3'#,$9;.56#"M''E2.4'4"#1.,6'9&,-./"4'5'%&."7'4:$$5&0',7';"A.4;51.,6'#:&&"61;0'9"6/.6A'.6'8,6A&"44'56/'.14'9,1"61.5;'.$95#1',6'J8+3'"67,&#"$"61'56/'#,$9;.56#"M'

A. H.R. 5366—Overseas Contractor Reform Act

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B. H.R. 2152—Foreign Business Bribery Prohibition Act of 2009

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C. H.R. 5837—Certification Prior to Award of Federal Contracts

f6'a:;0'((='()*)='eMhM'<dBW'L54'.61&,/:#"/'56/'&"7"&&"/'1,'12"'e,:4"'8,$$.11""',6'f-"&4.A21'

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D. H.R. 4326 and S. 445—Attorney-Client Privilege Protection Act of 2009

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E. Amendments to the U.S. Sentencing Guidelines

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XV. The OECD Convention F6'>,-"$%"&',7'*VVW='12"'f&A56.451.,6'7,&'X#,6,$.#'8,K,9"&51.,6'56/'!"-";,9$"61'TRfX8!SU'5/,91"/'12"'8,6-"61.,6',6'8,$%51.6A'i&.%"&0',7'J,&".A6'+:%;.#'f77.#.5;4'.6'F61"&651.,65;'i:4.6"44'E&5645#1.,64'T12"'RfX8!'8,6-"61.,6SUM''E2"'fX8!'8,6-"61.,6'&"N:.&"4'.14'4.A651,&0'#,:61&."4'TR+5&1."4SU'1,'#&.$.65;.c"'%&.%"&0',7'7,&".A6',77.#.5;4M''F1'%&,5/;0'/"7.6"4'%&.%"&0='&"N:.&"4'+5&1."4'1,'.$9,4"'/.44:54.-"'456#1.,64='#,$$.14'+5&1."4'1,'9&,-./.6A'$:1:5;';"A5;'544.4156#"='56/'#5;;4'7,&'+5&1."4'1,'4"1'%,,I4'56/'&"#,&/4'4156/5&/4M'''E2"'fX8!'8,6-"61.,6'%"#5$"'"77"#1.-"',6'J"%&:5&0'*<='*VVV='56/'54',7'12.4'L&.1.6A='12.&10K".A21'#,:61&."4'25-"'&51.7."/'.1]''3&A"61.65='3:41&5;.5='3:41&.5='i";A.:$='i&5c.;='i:;A5&.5='8565/5='82.;"='8c"#2'h"9:%;.#='!"6$5&I='X41,6.5='J.6;56/='J&56#"='b"&$560='b&""#"='e:6A5&0='F#";56/='F&";56/='F4&5";='F15;0='a5956='G,&"5='P:Y"$%,:&A='H"Y.#,='>"12"&;56/4='>"L'v"5;56/='>,&L50='+,;56/='+,&1:A5;='@;,-5I'h"9:%;.#='@;,-"6.5='@,:12'37&.#5='@95.6='@L"/"6='@L.1c"&;56/='E:&I"0='D6.1"/'G.6A/,$='56/'12"'D6.1"/'@151"4M'E2"'%54.#4',7'12"'fX8!'8,6-"61.,6'5&"'4"1'7,&12'%";,LM''F1'.4'.$9,&1561'1,'6,1"='2,L"-"&='1251'L2.;"'12"'fX8!'8,6-"61.,6'4"14'4156/5&/4'7,&'+5&1."4\';5L4'9&,2.%.1.6A'12"'%&.%"&0',7'7,&".A6'9:%;.#',77.#.5;4='12"'+5&1."4'1,'12"'8,6-"61.,6'$50'25-"';5L4'#,615.6.6A'$,&"'41&.6A"61'/"7.6.1.,64',&'&"N:.&"$"614M''F1'.4'12"&"7,&"'.$9,&1561'1,'%"'5L5&"',7'12"'49"#.7.#';5L4'.6'560'#,:61&0'1251'254'&51.7."/'12"'fX8!'8,6-"61.,6'.6'L2.#2'5'#,$9560'.4'/,.6A'%:4.6"44'.6',&/"&'1,'"64:&"'#,$9;.56#"M'''E2"'fX8!'8,6-"61.,6'5;4,'6,1"4'1251'"5#2'+5&10'$:41'.6-"41.A51"'56/'9&,4"#:1"'12"'%&.%"&0',7'5'7,&".A6',77.#.5;':6/"&'.14'599;.#5%;"'&:;"4'56/'9&.6#.9;"4M''+5&1."4'$:41'6,1'%"'.67;:"6#"/'.6'12".&'.6-"41.A51.,6'56/'9&,4"#:1.,6'%0'#,64./"&51.,64',7'651.,65;'"#,6,$.#'.61"&"41='9,1"61.5;'&";51.,64'L.12'56,12"&'+5&10=',&'12"'./"61.1."4',7'12"'9"&4,64'.6-,;-"/M(WC'



88

A. Prohibited Conduct

P.I"'12"'J8+3='12"'fX8!'8,6-"61.,6'#,615.64'%,12'T*U'561.K%&.%"&0'9&,-.4.,64^'56/'T(U'5##,:61.6A'&"N:.&"$"614M'''

1. Anti-bribery Provisions

a. Natural Persons

E2"'fX8!'8,6-"61.,6'&"N:.&"4'+5&1."4'1,'"415%;.42'1251'.1'.4'5'#&.$.65;',77"64"':6/"&'12".&'&"49"#1.-"';5L4'7,&'560'9"&4,6'1,]''

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.61"&651.,65;'%:4.6"44M(WW''

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!


89

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.6#;:/"4'560':4"',7'12"',77.#.5;\4'9,4.1.,6='"-"6'.7'6,1'L.12.6'2.4'5:12,&.c"/'#,$9"1"6#"M'''! R<+4*#'$50#"0*#':39:&+:8*S'$"564'4,$"12.6A'1,'L2.#2'12"'#,$9560'L54'6,1'#;"5&;0'

"61.1;"/='"MAM=#56',9"&51.6A'9"&$.1'7,&'5'75#1,&0'1251'75.;4'1,'$""1'&"N:.&"$"614M'''E2"'fX8!'8,6-"61.,6'5;4,'&"N:.&"4'+5&1."4'1,'9&,-./"'.6'12".&';5L4'1251'."501$.$+2'$&':&':.+'"6'=#$=*#2'"6':'6"#*$8&'0/=1$.'"66$.$:1='.6#;:/.6A'R.6#.1"$"61='5./.6A'56/'5%"11.6A=',&'5:12,&.c51.,6',7'56'5#1',7'%&.%"&0',7'5'9:%;.#',77.#.5;=S'.4'5'#&.$.65;',77"64"'54'L";;M''J:&12"&='"5#2'+5&10\4';5L'$:41'9&,-./"'1251':++*50+':&3'."&%0$#:.2'1,'%&.%"'5'7,&".A6'9:%;.#',77.#.5;'5&"'#&.$.65;',77"64"4'1,'12"'45$"'"Y1"61'54'511"$91'56/'#,649.&5#0'1,'%&.%"'5'9:%;.#',77.#.5;'5&"'#&.$.65;',77"64"4',7'12"'+5&10M(dB'+5&1."4'1251'25-"'$5/"'%&.%"&0',7'12".&',L6'9:%;.#',77.#.5;4'5'9&"/.#51"',77"64"':6/"&'12".&'$,6"0';5:6/"&.6A'4151:1"4'$:41'/,'4,',6'12"'45$"'1"&$4'7,&'%&.%"&0',7'5'7,&".A6',77.#.5;M(d`'

b. Legal Persons

?.12'&"49"#1'1,'#,&9,&51.,64'56/',12"&'"61.1."4='12"'fX8!'8,6-"61.,6'&"N:.&"4'"5#2'+5&10'1,'15I"'$"54:&"4'.6'5##,&/56#"'L.12'.14';"A5;'9&.6#.9;"4'1,'"415%;.42'12"';.5%.;.10',7'R;"A5;'9"&4,64S'7,&'12"'%&.%"&0',7'5'7,&".A6'9:%;.#',77.#.5;M(d<'

2.. Accounting Requirements

E2"'fX8!'8,6-"61.,6'&"N:.&"4'"5#2'+5&10='L.12.6'12"'7&5$"L,&I',7'.14',L6';5L4'&"A5&/.6A'%,,II""9.6A'56/'5##,:61.6A='1,'9&,2.%.1'12"'"415%;.42$"61',7',77K12"'%,,I4'5##,:614='12"'$5I.6A',7',77K12"K%,,I4',&'.65/"N:51";0'./"61.7."/'1&5645#1.,64='12"'&"#,&/.6A',7'6,6K"Y.41"61'"Y9"6/.1:&"4',&'.6#,&&"#1;0'./"61.7."/';.5%.;.1."4='56/'12"':4"',7'75;4"'/,#:$"614='7,&'12"'9:&9,4"',7'%&.%.6A',&'2./.6A'12"'%&.%"&0',7'7,&".A6'9:%;.#',77.#.5;4M(dC'''

3. Comparison with FCPA

E2"'fX8!'8,6-"61.,6',&.A.65;;0'/.77"&"/'7&,$'12"'J8+3'.6'5'6:$%"&',7'.$9,&1561'L504M''E2"'D6.1"/'@151"4'"65#1"/'12"'F61"&651.,65;'361.Ki&.%"&0'3#1',7'*VVd'TRF3i3SU'.6',&/"&'1,'#,$9;0'L.12'.14'/:1."4':6/"&'12"'fX8!'8,6-"61.,6M''E2"'F3i3'"65#1"/'5'6:$%"&',7'9&,-.4.,64'1,'7.;;'12"'A59'%"1L""6'fX8!'8,6-"61.,6'56/'J8+3'&:;"4M(dW''J,&'"Y5$9;"='12"'F3i3'*Q0:&3*3'+4*'3*6$&$+$"&'"6'6"#*$8&'"66$.$:1%'1,'.6#;:/"'12"',77.#.5;4',7'9:%;.#'.61"&651.,65;',&A56.c51.,64M(dd''E2"'";"$"614',7'12"'A"6"&5;'%&.%"&0',77"64"'L"&"'5;1"&"/'4,'1251'950$"614'1,'4"#:&"'R:&2'$50#"0*#':39:&+:8*S'5;4,'7";;'L.12.6'12"'5$%.1',7'12"'4151:1"M(dV'''E2"'F3i3'5;4,'";.$.651"/'12"'R5#1'.6'.61"&4151"'#,$$"&#"S'&"N:.&"$"61='54'599;."/'1,'DM@M'%:4.6"44"4'56/'651.,65;4='56/'/&5$51.#5;;0'#256A"/'12"'4#,9"',7'9"&4,64'56/';"A5;'"61.1."4'#,-"&"/'%0'12"'7,&".A6'%&.%"&0'9&,2.%.1.,6M''E2"'#256A"4'5.$'1,'"64:&"'1251'7,&".A6'651.,65;4'56/''



90

'9"&4,64'L2,'#,$$.1'56'5#1'.6'7:&12"&56#"',7'5'7,&".A6'%&.%"'L2.;"'.6'12"'D6.1"/'@151"4'5&"'4:%Q"#1'1,'J8+3';.5%.;.10M(V)''''e,L"-"&='12"'J8+3'41.;;'/,"4'6,1'#,-"&'12"'"61.&"'4#,9"',7'12"'fX8!'8,6-"61.,6M''E2"'J8+3'.4'4.;"61',6';.5%.;.10'5&.4.6A',:1',7'%&.%"4'$5/"'6,1'1,'12"'7,&".A6',77.#.5;='%:1'1,'5'12.&/'95&10'%"6"7.#.5&0M(V*''3;4,='12"'J8+3\4'577.&$51.-"'/"7"64"'7,&'&"54,65%;"'56/'%,65'7./"'"Y9"6/.1:&"4='/.4#:44"/'5%,-"'.6'@"#1.,6'FFTiU='.4'6,1'5-5.;5%;"':6/"&'12"'fX8!'8,6-"61.,6M(V(''''

B. Sanctions

E2"'f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`'''J:&12"&='L.12'&"49"#1'1,'651:&5;'9"&4,64='12"'+5&1."4\'456#1.,64'$:41'.6#;:/"'/"9&.-51.,6',7';.%"&10'4:77.#."61'1,'"64:&"'1251'12"'9"&4,6'#56'%"'9&,4"#:1"/'56/r,&'"Y1&5/.1"/'%0'56,12"&'+5&10M(V<'F7'5'+5&10\4';"A5;'4041"$'/,"4'6,1'9&,-./"'7,&'#&.$.65;'&"49,64.%.;.10'7,&'R;"A5;'9"&4,64=S'12"6'12"'+5&10'$:41'9&,-./"'R"77"#1.-"='9&,9,&1.,651"'56/'/.44:54.-"'6,6K#&.$.65;'456#1.,64='.6#;:/.6A'$,6"15&0'456#1.,64=S'599;.#5%;"'1,';"A5;'9"&4,64M(VC'?.12'&"49"#1'1,'12"'5##,:61.6A'9&,-.4.,64='"5#2'+5&10'$:41'9&,-./"'R*66*.+$9*H'0#"0"#+$"&:+*':&3'3$%%/:%$9*'.$9$1H':35$&$%+#:+$9*'"#'.#$5$&:1'0*&:1+$*%S'7,&',$.44.,64'56/'75;4.7.#51.,64',7'&"#,&/4M(VW'''E2"'fX8!'h"#,$$"6/51.,6'&"#,$$"6/4'1,'+5&1."4'1251'12".&';5L4'9"&$.1'5:12,&.1."4'1,'4:49"6/'"61.1."4'1251'25-"'%&.%"/'7,&".A6'9:%;.#',77.#.5;4'7&,$'#,$9"1.1.,6'7,&'9:%;.#'#,61&5#14M'''

C. Enforcement

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XVI. Overview of Anti-Corruption Laws in Other Countries

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A. The United Kingdom and the UK Bribery Act 2010

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1. Key Definitions

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2. General Offenses

a. Offering a Bribe

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b. Receiving a Bribe

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c. Bribery of a Foreign Official

F6'5//.1.,6'1,'12"'A"6"&5;'%&.%"&0',77"64"4',7'@"#1.,64'*'56/'(',7'12"'3#1='12"&"'5&"'49"#.7.#'9&,-.4.,64'.6'12"'3#1'9&,2.%.1.6A'12"'%&.%"&0',7'7,&".A6'9:%;.#',77.#.5;4M''F1'.4'.$9,&1561'1,'6,1"'1251'12"'3#1',6;0'#,-"&4'12"',77"&.6A='9&,$.4.6A=',&'A.-.6A',7'%&.%"4='%:1'6,1'12"'5##"91.6A',7'%&.%"4'%0'5'7,&".A6'9:%;.#',77.#.5;M''F6',&/"&'1,'%"'A:.;10',7'56',77"64"':6/"&'@"#1.,6'C='Ri&.%"&0',7'5'J,&".A6'+:%;.#'f77.#.5;=S'%,12'5'#,6/:#1'".7'56'.61"61.,6'";"$"61'$:41'%"'9&,-"6'5A5.641'+]''

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!


95

3. Specific Issues for Commercial Organizations

a. Liability under the Act

8,&9,&51.,64'#56'5;4,'#,$$.1',77"64"4':6/"&'@"#1.,6'*='(=',&'C',7'12"'3#1M''F7'12,4"'%&.%"&0',77"64"4'5&"'#,$$.11"/'L.12'12"'#,64"61',&'#,66.-56#"',7'5'4"6.,&',77.#"&',7'5'#,&9,&51.,6='12"6'12"'#,&9,&51.,6='54'L";;'54'12"'.6/.-./:5;='5&"'A:.;10',7'12"',77"64"M''@"#1.,6'*`T`U',7'12"'3#1'/"7.6"4'R4"6.,&',77.#"&S'54'5'#,$9560\4'R/.&"#1,&='$565A"&='4"#&"15&0=',&',12"&'4.$.;5&',77.#"&MS'e,L"-"&='A.-"6'12"'7,#:4='%,12'L.12.6'12"'DG'56/'.61"&651.,65;;0=',6'12"'9&"-"61.,6',7'R#,&9,&51"'49,64,&"/S'#,&&:91.,6='12"&"'5&"'#"&15.6',77"64"4'56/'/"7"64"4'1251'15&A"1'#,$$"&#.5;',&A56.c51.,64'56/'42,:;/'12"&"7,&"'%"',7'95&1.#:;5&'#,6#"&6'1,'.6K2,:4"'#,:64";M'

b. The Offense of Failure to Prevent Bribery

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c. The “Adequate Procedures” Defense

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4. Scope and Penalties

a. Extra-territoriality

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96

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b. Penalties

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5. Implications of the Bribery Act

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a. Anti-bribery Policies

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!


97

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b. Risk Mitigation

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!


99

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6. The Future of the Act

E2"'9&,-.4.,64',7'12"'i&.%"&0'3#1'()*)'5&"'#;"5&;0'.61"6/"/'1,'%"'75&K&"5#2.6A'56/'/&5#,6.56M''E2"'3#1'9&,-./"4'12"'DG'5:12,&.1."4'L.12'12"'6"#"445&0'1,,;4'1,'"77"#1.-";0'9:&4:"'#,&9,&51.,64'1251'"6A5A"'.6'#,&&:91'9&5#1.#"4'56/'&"N:.&"4'560'#,&9,&51.,6'L.12';.6I4'1,'12"'D6.1"/'G.6A/,$'1,'#,$9;0'L.12'12"'3#1M'E2"'6"L';"A.4;51.,6'95-"4'12"'L50'7,&'1,:A2"&'5#1.,6'5A5.641'A;,%5;'#,$956."4M'e,L"-"&='N:"41.,64'41.;;'&"$5.6'54'1,'12"'"67,&#"$"61',7'12"'3#1M''8"&15.6',7'.14'#,&"'5&"54'5&"'-5A:"='4:#2'54'12"'.$95#1',7'12"'3#1',6'#,&9,&51"'2,49.15;.10'56/'12"'4#,9"'56/'#,61"61',7'9&,#"/:&"4'1251'#,$956."4'$:41'25-"'.6'9;5#"'.6',&/"&'1,'544"&1'12"'R5/"N:51"'9&,#"/:&"4S'/"7"64"':6/"&'@"#1.,6'WT(U',7'12"'3#1M'F1'5;4,'&"$5.64'1,'%"'4""6'L2"12"&'12"'DG'5:12,&.1."4'L.;;':1.;.c"'12"4"'6"L'1,,;4'56/'&,%:41;0'9&,4"#:1"'#,$956."4'"6A5A"/'.6'#,&&:91'9&5#1.#"4M''E2"'H.6.41&0',7'a:41.#"'.$95#1'4151"$"61'&"7"&4'1,'5'-"&0'4$5;;'.6#&"54"'.6'12"'6:$%"&',7'9&,4"#:1.,64',##:&&.6A'"5#2'0"5&'7,&',77"64"4':6/"&'12"'3#1M''E2.4'254';"/'4,$"'1,'49"#:;51"'1251='5;12,:A2'12"'6"L';"A.4;51.,6'&"N:.&"4'#,&9,&51.,64'1,'.$9;"$"61'5/"N:51"'9&,#"/:&"4'5A5.641'#,&&:91'9&5#1.#"4='12"'&.4I',7'9&,4"#:1.,6'7,&'75.;:&"'1,'#,$9;0'L.12'12"'3#1'$50'&"$5.6'4$5;;M''b.-"6'12"'#:&&"61'"#,6,$.#'#;.$51"'56/'%:/A"1'#:14'5#&,44'12"'9:%;.#'4"#1,&='/,:%14'&"$5.6'54'1,'L2"12"&'12"'DG'5:12,&.1."4'L2,'9,;.#"'12.4'3#1'L.;;'%"'A.-"6'4:77.#."61'&"4,:&#"4'1,'.$9;"$"61'56/'"67,&#"'12"'9&,-.4.,64',7'12"'3#1'.6'7:;;M'

B. Australia

1. Overview

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100

'

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2. Foreign Bribery

@"#1.,6'W)M(',7'12"'8&.$.65;'8,/"'3#1',7'*VV<'9&,-./"4'1251'.1'.4'56',77"64"'1,]'''

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a. Defenses

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b. Penalties

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C. Japan

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!


101

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1. Prohibited Conduct

a. Anti-bribery Provisions

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i. Natural Persons

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9:%;.#',77.#.5;'1,'5#1',&'&"7&5.6'7&,$'5#1.6A'.6'5'95&1.#:;5&'L50'.6'&";51.,6'1,'1251',77.#.5;\4'/:1."4=''



102

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b. Give, offer or promise to give

E2"'D8+3'/,"4'6,1'&"N:.&"'1251'$,6"0',&'560',12"&'%"6"7.1'5#1:5;;0'%"'95./',&'A.-"6M''3'$"&"',77"&',&'9&,$.4"'1,'A.-"'.4'4:77.#."61'1,'#&"51"';.5%.;.10M''F6',12"&'L,&/4='12"'.61"6/"/'&"#.9."61',7'12"'%"6"7.1'6""/'6,1'5##"91'12"'%"6"7.1'7,&'5'-.,;51.,6',7'12"'D8+3'1,',##:&MB(d'''

c. Money or other benefit

E2"'D8+3'/,"4'6,1'&"N:.&"'1251'$,6"0',&',12"&'9"#:6.5&0'%"6"7.1'%"',77"&"/='9&,$.4"/',&'A.-"6MB(V''h512"&='56012.6A',7'-5;:"'#56'%"'#,64./"&"/'R$,6"0',&',12"&'%"6"7.14=S'.6#;:/.6A='5$,6A',12"&'12.6A4='9&,-./.6A'-5#51.,64='7&""'&"61=';,L'.61"&"41';,564='A:5&561""4',&'.6/"$6.1."4MBB)'''E2"'D8+3'/,"4'6,1'"Y9;.#.1;0'&"#,A6.c"'56'"Y#"91.,6'7,&'75#.;.151.,6'950$"614M''D6/"&'12"'D8+3='75#.;.151.,6'950$"614'#56'#,641.1:1"'.;;"A5;'%&.%"&0'.7'12"'950$"61'L54'$5/"'7,&'12"'9:&9,4"',7'',%15.6.6A'56'R.$9&,9"&'5/-5615A"MSBB*'P.I"'12"'fX8!='12"'D8+3'/,"4'6,1'9&,-./"'56'577.&$51.-"'/"7"64"'7,&'&"54,65%;"'56/'%,65'7./"'"Y9"6/.1:&"4'$5/"'7,&'12"'9:&9,4"',7'/"$,641&51.6A',&'9&,$,1.6A'A,,/4',&'4"&-.#"4',&'.6',&/"&'1,'9"&7,&$'5'#,61&5#1M''>,&'/,"4'12"'D8+3'9&,-./"'56'577.&$51.-"'/"7"64"'7,&'950$"614'1251'5&"';"A5;':6/"&'12"'L&.11"6';5L',7'12"'#,:61&0'L2"&"'12"0'5&"'$5/"M''

d. Foreign public official

3'-.,;51.,6',7'3&1.#;"'*d'&"N:.&"4'1251'5'%&.%"'%"',77"&"/='9&,$.4"/=',&'A.-"6'1,'5'R7,&".A6'9:%;.#',77.#.5;MS''+5&5A&592'(',7'3&1.#;"'*d'/"7.6"4'5'R7,&".A6'9:%;.#',77.#.5;S'54'5'9"&4,6'L2,'"6A5A"4'.6]''''

! 9:%;.#'4"&-.#"'7,&'5'7,&".A6='4151"=',&';,#5;'A,-"&6$"61^''! 4"&-.#"'7,&'56'"61.10'"415%;.42"/':6/"&'5'49"#.5;'7,&".A6';5L'1,'#5&&0',:1'49"#.7.#'5775.&4'

.6'12"'9:%;.#'.61"&"41^''! 5775.&4',7'56'"61"&9&.4"',7'L2.#2'12"'6:$%"&',7'-,1.6A'425&"4',&'#59.15;'4:%4#&.91.,6'.4'

$,&"'1256'<)'9"&#"61',L6"/'%0',6"',&'$,&"'7,&".A6='4151"=',&';,#5;'A,-"&6$"614=',&',7'L2.#2'12"'6:$%"&',7',77.#"&4'599,.61"/'%0',6"',&'$,&"',7'12"'7,&".A6'4151"4',&';,#5;'7,&".A6'A,-"&6$"614'.4'$,&"'1256'25;7'12"'1,15;'6:$%"&',7',77.#"&4='56/'1,'L2.#2'49"#.5;'&.A214'56/'.61"&"414'5&"'A&561"/'%0'12"'7,&".A6'4151"',&';,#5;'A,-"&6$"61'7,&'9"&7,&$56#"',7'.14'%:4.6"44=',&'5'9"&4,6'49"#.7."/'%0'85%.6"1'f&/"&'d'54'56'"N:.-5;"61'9"&4,6^'

! 9:%;.#'4"&-.#"'7,&'56'.61"&651.,65;',&A56.c51.,6'TL2.#2'$"564'56'.61"&651.,65;',&A56.c51.,6'#,641.1:1"/'%0'A,-"&6$"614',&'.61"&A,-"&6$"615;'.61"&651.,65;',&A56.c51.,64U^',&''

! 5775.&4':6/"&'12"'5:12,&.10',7'5'7,&".A6='4151"=',&';,#5;'A,-"&6$"61',&'56'.61"&651.,65;',&A56.c51.,6='56/'L2.#2'25-"'%""6'/";"A51"/'%0'4:#2',&A56.c51.,6M''

P.I"'12"'J8+3='12"'D8+3'.4'4.;"61'54'1,';.5%.;.10'5&.4.6A',:1',7'%&.%"4'$5/"'6,1'1,'12"'7,&".A6',77.#.5;='%:1'1,'5'12.&/K95&10'%"6"7.#.5&0M'

!


103

e. Improper advantage

F6',&/"&'7,&'%&.%"&0'1,'%"'9:6.425%;"':6/"&'12"'D8+3='12"'#,&&:91'5#1.-.10'$:41'%"'7,&'12"'9:&9,4"',7',%15.6.6A'R.$9&,9"&'5/-5615A"MS''D6/"&'a5956"4"';5L='R.$9&,9"&'5/-5615A"S'.4'%&,5/;0'/"7.6"/'54'560'A5.6'1251'.4'R#,:61"&'1,'9:%;.#',&/"&S',&'42,L.6A'5';5#I',7'RA,,/'75.12MSBB(''J,&'"Y5$9;"='.7'12"'#,&&:91'950$"61'.6/:#"4'5'7,&".A6'9:%;.#',77.#.5;'1,'%&"5#2'2.4r2"&',77.#.5;'/:1."4='12"6'.1'.4'.61"&9&"1"/'1,'%"'#,61&5&0'1,'9:%;.#',&/"&MBBB''RF$9&,9"&'5/-5615A"S'L,:;/'.6#;:/"',%15.6.6A'4:#2'%"6"7.14'54'5'&"/:#1.,6',&'L5.-"&',7'/:1."4',&'15Y"4',&',%15.6.6A'&"A:;51,&0'599&,-5;'L2"&"'4:#2'599&,-5;'L,:;/'6,1',12"&L.4"'%"'A&561"/MBB`'

(ii) Legal persons

F7'12"&"'.4'560'-.,;51.,6',7'12"'D8+3'%0'56'.6/.-./:5;'L2,'.4'5'&"9&"4"6151.-"='5A"61',&'"$9;,0""',7'5'a5956"4"'#,&9,&51.,6='12"'a5956"4"'#,&9,&51.,6'$50'%"';.5%;"'7,&'12"'-.,;51.,6M''E2"'D8+3'5;4,'599;."4'1,'6,6Ka5956"4"'#,&9,&51.,64'&"A.41"&"/'54'RA5.I,I:'A5.425S':6/"&'12"'8,$956."4'3#1MBB<'

f. Accounting

E2"'fX8!'8,6-"61.,6'&"N:.&"4'+5&1."4'1,'9&,2.%.1'12"':4"',7'.$9&,9"&'5##,:61.6A'9&5#1.#"4'1,'/.4A:.4"'#,&&:91'5#1.-.1."4M''?2.;"'12"'J8+3'254'5##,:61.6A'9&,-.4.,64'1251'&"N:.&"'#,$956."4'L.12'9:%;.#;0K1&5/"/'"N:.10',&'/"%1'4"#:&.1."4',6'5'DM@MK&"A:;51"/'"Y#256A"'1,'$""1'#"&15.6'4156/5&/4'&"A5&/.6A'12".&'5##,:61.6A'9&5#1.#"4'56/'.61"&65;'7.656#.5;'#,61&,;4'T12"'R%,,I4'56/'&"#,&/4S'9&,-.4.,64U='12"'D8+3'/,"4'6,1M''h512"&='.6'a5956='5##,:61.6A'&"N:.&"$"614'5&"'A"6"&5;;0'#,-"&"/'%0'12"'8,$956."4'P5L='12"'8,$9560'3##,:61.6A'h"A:;51.,64=BBC'56/'12"'J.656#.5;'F641&:$"614'56/'XY#256A"'P5LMBBW'BBd'

2. Sanctions

360'9"&4,6'7,:6/'1,'25-"'-.,;51"/'3&1.#;"'*d',7'12"'D8+3'$50'%"'9:6.42"/'%0'.$9&.4,6$"61'L.12'25&/';5%,&'7,&':9'1,'<'0"5&4'56/r,&'5'7.6"':9'1,'<'$.;;.,6'0"6MBBV''f77.#"&4'56/'/.&"#1,&4',7'5'#,$9560'#566,1'%"'2";/'/.&"#1;0';.5%;"':6;"44'12"0'95&1.#.951"/'.6'12"'.$9&,9"&'#,6/:#1='2,L"-"&='12"0'$50'%"'4:%Q"#1'1,'425&"2,;/"&'4:.14'7,&'%&"5#2',7'12"'/:10',7'#5&"',L"/'1,'12"'#,&9,&51.,6MB`)''J,&'"Y5$9;"='.7'56',77.#.5;',&'/.&"#1,&'&"#,A6.c"/'12"'&.4I',7'7,&".A6'%&.%"&0='%:1'/./'6,1'15I"'$"54:&"4'1,'#,&&"#1'9&,%;"$4='.6#;:/.6A'5/,91.6A'56'599&,9&.51"'#,$9;.56#"'9&,A&5$',&'.61"&65;'#,61&,;4='12"0'#56'%"'2";/'9"&4,65;;0';.5%;"'7,&'%&"5#2',7'12"'/:10',7'#5&"',L"/'1,'12"'#,&9,&51.,6M''F7'5'7.6"'.4'.$9,4"/',6'56'"$9;,0""=',77.#"&',&'/.&"#1,&='12"'7.6"'$50'6,1'%"'95./'%0'12"'#,&9,&51.,6',&'56,12"&'9"&4,6MB`*''J:&12"&='12"'7.6"'.4'599;.#5%;"'9"&'-.,;51.,6M'8,&9,&51.,64'7,:6/';.5%;"'7,&'-.,;51.,6',7'12"'D8+3\4'561.K#,&&:91.,6'9&,-.4.,64'#56'75#"'7.6"4',7':9'1,'B))'$.;;.,6'0"6MB`('''

3. Enforcement

E2"&"'25-"'%""6'-"&0'7"L'&"9,&1"/'-.,;51.,64',7'12"'D8+3\4'561.K#,&&:91.,6'9&,-.4.,64M''3;12,:A2'12"4"'9&,-.4.,64'L"&"'"65#1"/'.6'*VVd='a5956\4'7.&41'&"9,&1"/'9&,4"#:1.,6':6/"&'12"';5L'L54'6,1':61.;'())W='571"&'12"'fX8!'#&.1.#.c"/'a5956'.6'())C'7,&'%".6A'9544.-"'.6'.14'7.A21'5A5.641'#,&&:91.,6MB`B''@.6#"'())W='2,L"-"&='a5956"4"'"67,&#"$"61',77.#.5;4'599"5&'1,'25-"'15I"6'5'&"6"L"/'.61"&"41'.6'D8+3'-.,;51.,64M'''F6'())W='1L,'"$9;,0""4',7'5'4:%4./.5&0',7'G0:42:'X;"#1&.#'+,L"&'8,M'.6'12"'+2.;.99.6"4'L"&"'7.6"/''



104

'<))=)))'0"6'56/'())=)))'0"6'&"49"#1.-";0'7,&'A.-.6A'1L,',77.#.5;4',7'12"'+2.;.99.6"'>51.,65;'i:&"5:',7'F6-"41.A51.,6'A,;7'4"14'T12"'-5;:"',7'L2.#2'L54'599&,Y.$51";0'd))=)))'0"6U'.6'&";51.,6'1,'12"'4:%4./.5&0p4'"61&0'.61,'12"'+2.;.99.6"'$5&I"1MB``''F6'())d='12"'1.&"'$56:75#1:&"&'i&./A"41,6"'566,:6#"/'9:%;.#;0'1251'.1'25/'/.4#,-"&"/'"-./"6#"',7'9,1"61.5;;0'.6599&,9&.51"'950$"614'1,'i&./A"41,6"\4';,#5;'5A"614'.6'#,66"#1.,6'L.12'12"'/.41&.%:1.,6',7'$5&.6"'2,4"4='56/'1251'95&1',7'12,4"'950$"614'L"&"'9&,-./"/'1,'7,&".A6',77.#.5;4',7';,#5;'A,-"&6$"614'.6'P51.6'3$"&.#5'56/'@,:12"541'34.5MB`<''F6'12.4'#54"='5'a5956"4"',77.#"&'L54'.6/.#1"/'.6'12"'DM@M'/:"'1,'-.,;51.,6',7'12"'J8+3='56/'12"',77.#"&'L54'4"61"6#"/'7,&'1L,'0"5&4'.6'9&.4,6'.6'!"#"$%"&'())dMB`C'F6'())V='GG'+5#.7.#'8,64:;15614'F61"&651.,65;='5'a5956"4"'#,64:;1.6A'#,$9560='L54'7.6"/'W)=)))=)))'0"6'56/'7,&$"&'"Y"#:1.-"4'L"&"'4"61"6#"/'1,'*d'$,6124='()'$,6124='56/'1L,'0"5&4'.$9&.4,6$"61='&"49"#1.-";0='56/'L"&"'4:49"6/"/'7,&'12&""'0"5&4'7,&'950.6A'%&.%"4'1,'5'g."165$"4"',77.#.5;'.6',&/"&'1,'L.6'#,61&5#14'7,&',77.#.5;'/"-";,9$"61'544.4156#"'.6'g."165$MB`W''''F6'())V='12"'6"L4'$"/.5'&"9,&1"/'1251'12"'+&,4"#:1,&4'f77.#"'54I"/'E25.'&"A:;51,&0'5:12,&.1."4'1,'.6-"41.A51"'12"';,#5;',77.#"',7'>.42.$514:'8,641&:#1.,6'8,M='5';"5/.6A'#,641&:#1.,6'#,$9560='.6'&";51.,6'1,'A.-.6A'599&,Y.$51";0'`))=)))=)))'0"6'1,'A,-"&6$"61',77.#.5;4'.6'E25.;56/MB`d'

D. China

82.65'254'6,1'5##"/"/'1,'12"'361.Ki&.%"&0'8,6-"61.,6='5;12,:A2'.1'.4'5'4.A651,&0'1,'D>838M''82.65\4'9&.6#.95;'561.K%&.%"&0';"A.4;51.,6'.4'/"4#&.%"/'%";,LM'

1. Domestic bribery

a. Bribes to government officials

3&1.#;"'BdV',7'12"'8&.$.65;'P5L'9&,-./"4'1251'L2,"-"&='7,&'12"'9:&9,4"',7'4"#:&.6A'.$9&,9"&'%"6"7.14='A.-"4'$,6"0',&'9&,9"&10'1,'5'4151"'7:6#1.,65&0'425;;'%"'A:.;10',7',77"&.6A'5'%&.%"='56/'L2,"-"&='.6'"#,6,$.#'5#1.-.1."4='-.,;51"4'4151"';5L4',&'&"A:;51.,64'%0'A.-.6A'$,6"0',&'9&,9"&10',7'5'&";51.-";0'2.A2'-5;:"'1,'5'4151"'7:6#1.,65&0',&'%0'A.-.6A'2.$'560'I.6/',7'&"%51"4',&'4"&-.#"'#25&A"4'T.M"M='I.#I%5#I4U'425;;'%"'A:.;10',7',77"&.6A'5'%&.%"M'

(i) Defenses

360'9"&4,6'L2,',77"&4'$,6"0',&'9&,9"&10'1,'5'4151"'7:6#1.,65&0'%"#5:4"',7'"Y1,&1.,6='%:1'A5.64'6,'.$9&,9"&'%"6"7.14='L.;;'6,1'%"'&"A5&/"/'54'25-.6A',77"&"/'5'%&.%"M'

(ii) Penalties

F6/.-./:5;4'5&"'4:%Q"#1'1,'9"65;1."4',7':9'1,';.7"'.$9&.4,6$"61'56/'#,67.4#51.,6',7'9&,9"&10='/"9"6/.6A',6'12"'A&5-.10',7'12"'#&.$"M''X61.1."4'5&"'4:%Q"#1'1,'7.6"4M''E2"'9"&4,6'/.&"#1;0'.6'#25&A"',7'12"'"61.10',&'12"'9"&4,6'L2,'.4'/.&"#1;0'&"49,64.%;"'7,&'12"'#&.$"'$50'%"'.$9&.4,6"/'7,&':9'1,'7.-"'0"5&4M'

!


105

(iii) Gifts

3##,&/.6A'1,'56',77.#.5;',9.6.,6'Q,.61;0'.44:"/'%0'12"'@:9&"$"'+",9;"\4'8,:&1'56/'12"'@:9&"$"'+",9;"\4'+&,#:&51,&51"='12"'7,;;,L.6A'75#1,&4'/.41.6A:.42'%&.%"&0'7&,$'#:41,$5&0'A.71KA.-.6A]'''

! E2"'%5#IA&,:6/'56/'&";51.,642.9'%"1L""6'12"'95&1."4='4:#2'54'L2"12"&'12"'1L,'95&1."4'5&"'&";51.-"4',&'7&."6/4'56/'12"'4151:4'56/'"Y1"61',7'12".&'9&"-.,:4'&";51.,642.94^'

! E2"'5$,:61'T.6/.-./:5;;0'56/'.6'12"'5AA&"A51"U^''! E2"'&"54,6'7,&'12"'1&5645#1.,6'56/'L2"12"&'560'%"6"7.1'254'%""6'&"N:"41"/',&'A.-"6'.6'

"Y#256A"^'56/'! ?2"12"&'12"&"'254'%""6'560'5%:4"',7'9,4.1.,6'1,'75#.;.151"'56'5/-5615A"'7,&'12"'95&10'

$5I.6A'12"'950$"61M''

h"A:;51.,64'56/'8,$$:6.41'+5&10'&:;"4'9&,2.%.1',77.#.5;4'7&,$'511"6/.6A'560'%56N:"1',&'"61"&15.6$"61'1251'$50'577"#1'12".&'5%.;.10'1,'.$95&1.5;;0'#5&&0',:1'12".&',77.#.5;'/:1."4M'

b. Bribes to Government Entities

3&1.#;"'BV*',7'12"'8&.$.65;'P5L'9&,-./"4'1251'.1'.4'56',77"64"'1,'A.-"'9&,9"&10'1,'5'4151"'5:12,&.10='4151"K,L6"/'#,$9560='"61"&9&.4"='.641.1:1.,6=',&',&A56.c51.,6'7,&'12"'9:&9,4"',7'4"#:&.6A'.$9&,9"&'%"6"7.14=',&'1,':6;5L7:;;0'A.-"'I.#I%5#I4',&'#,$$.44.,64'.6'560'7,&$'1,'4:#2'56'"61.10'/:&.6A'56'"#,6,$.#'1&5645#1.,6M'F6/.-./:5;4'5&"'4:%Q"#1'1,'9"65;1."4',7':9'1,'12&""'0"5&4\'.$9&.4,6$"61M''E2"0'$50'%"'%5&&"/'7&,$'%"#,$.6A'5'#,$9560\4'/.&"#1,&='4:9"&-.4,&=',&'4"6.,&'$565A"$"61',77.#"&'7,&'7.-"'0"5&4'571"&'#,$9;"1.6A'12"'4"61"6#"M''X61.1."4'5&"'4:%Q"#1'1,'7.6"4M''E2"'9"&4,6'/.&"#1;0'.6'#25&A"',7'12"'"61.10',&'12"'9"&4,6'L2,'.4'/.&"#1;0'&"49,64.%;"'7,&'12"'#&.$"'$50'%"'.$9&.4,6"/'7,&':9'1,'12&""'0"5&4M'

2. Commercial Bribery

3'6:$%"&',7'82.6"4"';5L4'#,-"&'#,$$"&#.5;'%&.%"&0M'

a. Bribes to commercial entities

b. Bribes to commercial entities are prohibited by Article 391 of the Criminal Law, described above.

c. Bribes to individuals

D6/"&'3&1.#;"'*C`',7'12"'8&.$.65;'P5L='.1'.4'56',77"64"'1,'A.-"'9&,9"&10'1,'5'6,6K9:%;.#',77.#"&',7'5'#,$9560='"61"&9&.4"=',&',12"&'"61.10'7,&'12"'9:&9,4"',7'4"#:&.6A'.$9&,9"&'%"6"7.14M'

(i) Penalties:

F6/.-./:5;4'5&"'4:%Q"#1'1,'9"65;1."4',7':9'1,'*)'0"5&4\'.$9&.4,6$"61'56/'7.6"4M''X61.1."4'5&"'4:%Q"#1'1,'7.6"4M''E2"'9"&4,6'/.&"#1;0'.6'#25&A"',7'12"'"61.10',&'12"'9"&4,6'L2,'.4'/.&"#1;0'&"49,64.%;"'7,&'12"'#&.$"'$50'%"'.$9&.4,6"/'7,&':9'1,'*)'0"5&4M'



106

d. Receipt of a bribe (entities)

3&1.#;"'BdW',7'12"'8&.$.65;'P5L'$5I"4'.1'56',77"64"'7,&'560'4151"'5:12,&.10='4151"K,L6"/'#,$9560='"61"&9&.4"='.641.1:1.,6=',&',&A56.c51.,6'1,'4,;.#.1',&':6;5L7:;;0'&"#".-"'9&,9"&10'7&,$'56,12"&'9"&4,6'4,'54'1,'2";9'1251'9"&4,6',%15.6'56'.$9&,9"&'%"6"7.1^',&'4"#&"1;0'&"#".-"',77K12"K%,,I'I.#I%5#I4',&'#,$$.44.,64'.6'560'7,&$'/:&.6A'56'"#,6,$.#'1&5645#1.,6M'

(i) Penalties

X61.1."4'5&"'4:%Q"#1'1,'7.6"4M''E2"'9"&4,6'/.&"#1;0'.6'#25&A"',7'12"'"61.10',&'12"'9"&4,6'L2,'.4'/.&"#1;0'&"49,64.%;"'7,&'12"'#&.$"'$50'%"'.$9&.4,6"/'7,&':9'1,'7.-"'0"5&4M'

e. Receipt of a bribe (individuals)

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(i) Penalties

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3. Foreign Bribery

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E. Hong Kong

1. Independent Commission Against Corruption

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2. Domestic Bribery

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!


107

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a. Meals and Entertainment

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b. Penalties

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3. Foreign Bribery

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XVII. Unique Challenges of Doing Business in China

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108

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A. Foreign Officials

+&.-51"'"61"&9&.4"'.4'5'&";51.-";0'6"L'#,6#"91'.6'82.65M''P"44'1256'12.&10'0"5&4'5A,='9&.-51"'"61"&9&.4"4'L"&"'.;;"A5;M''E2:4='.1'.4'6,1'4:&9&.4.6A'1251'$,41',7'12"'"#,6,$0'&"$5.64'/,$.651"/'%0'@151"'fL6"/'X61"&9&.4"4'T@fX4UM''@fX4',9"&51"'54'7,&K9&,7.1'#,$956."4'12&,:A2,:1'12"'"#,6,$0='.6#;:/.6A'.6'7.";/4'1251'5&"'6,1'&";51"/'1,'L251'?"41"&6'#,$956."4'$50'#,64./"&'1,'%"'1&5/.1.,65;'A,-"&6$"61'7:6#1.,64M''E2"'9&"/,$.656#"',7'@f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fX4='82.65'9&"4"614'5'2".A21"6"/'J8+3'&.4I'%"#5:4"'5';5&A"'6:$%"&',7'599&,-5;4='9"&$.14='56/';.#"64"4'5&"'109.#5;;0'&"N:.&"/'1,'/,'%:4.6"44'.6'82.65M''f%15.6.6A'12"'&"N:.&"/'5:12,&.c51.,64',71"6'.6-,;-"4'$:;1.9;"'5A"6#."4'56/'-5&.,:4';50"&4',7'A,-"&6$"61M''34'#56'%"'"Y9"#1"/='"5#2'5//.1.,65;'1,:#2'9,.61'L.12'5'7,&".A6',77.#.5;'.6#&"54"4'12"'9,1"61.5;'7,&'J8+3';.5%.;.10M'

B. Agents, Distributors, and Third-Party Intermediaries

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!


109

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! /.41&.%:1,&':4"/'1,'950'Z(<=)))'I.#I%5#I'1,'82.6"4"',77.#.5;'/.41&.%:1,&''T3-"&0'!"66.4,6U''

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C. “Fapiao”—Official Receipts

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D. Gifts and Entertainment

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110

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112 The Foreign Corrupt Practices Act and Global Anti-Corruption Law

A. Sample FCPA due diligence checklist for potential acquisition

1. Identification of Government “Touch Points”

a. In what foreign countries does [TARGET COMPANY] do business?

b. How does [TARGET COMPANY] conduct business in each of those foreign countries?

c. Has [TARGET COMPANY] ceased conducting business in any country? If so, under what circumstances?

d. Do employees of [TARGET COMPANY] come into contact with employees of state-owned or state-controlled entities (e.g., buyers/customers, Customs, taxes, licenses, media, etc.)? If so, how and to what extent?

e. Does [TARGET COMPANY] have any employees who hold any government positions or serve on any boards of directors of government-owned entities?

2. Policies, Procedures, and Practices

a. Generally

(i) Does [TARGET COMPANY] have a written anticorruption policy?

(ii) How is the anticorruption policy distributed to employees? Is the policy distributed in employees’ native language(s)?

(iii) Does the anticorruption policy require an internal audit to ensure FCPA compliance and compliance with the policy?

(iv) Determine management knowledge of and compliance with anticorruption prohibitions and requirements.

(v) Determine local practices for dealing with government officials.

(vi) Determine local customary business dealings.

b. Payments to Government Officials

(i) Gifts, Meals, and Entertainment

(a) Does [TARGET COMPANY] provide gifts, meals, entertainment, or other payments to government officials?

(b) Are gifts, meals, entertainment, and other payments to government officials covered by [TARGET COMPANY’S] written anticorruption policy?


113

(c) What kinds of gifts, meals, entertainment, and similar payments are permitted? E.g., are cash gifts prohibited?

(d) Does [TARGET COMPANY] place low annual and per-payment limits on gifts, meals, entertainment, and similar payments?

(e) Is approval from the legal department or compliance officer required before providing a gift, meal, entertainment, or other payment?

(f) Does [TARGET COMPANY] maintain files related to the approval of gifts, meals, entertainment, or other payments?

(g) Are all gifts, meals, entertainment, and other payments completely and accurately recorded in [TARGET COMPANY’S] books and records?

(ii) Travel and Training

(a) Does [TARGET COMPANY] pay for travel for government officials (e.g., for company tours, or to train employees of state-owned enterprises)?

(b) Are travel payments covered by [TARGET COMPANY’S] written anticorruption policy?

(c) What kinds of travel payments are allowed? E.g., does [TARGET COMPANY] require payments to be made directly to service providers, such as airlines and hotels, rather than to government officials; prohibit per diems or other allowances; and require government officials to provide a receipt before receiving any reimbursement?

(d) Does [TARGET COMPANY] place low annual and per-payment limits on travel payments?

(e) Are payments for travel limited to event participants only?

(f) Are there any other restrictions on sponsored travel; e.g., prohibitions on first-class airfare or luxury accommodations?

(g) Is approval from the legal department or compliance officer required before making any travel payment?

(h) How are government officials chosen to attend trainings or similar events?

(i) Do [TARGET COMPANY] offices maintain a record of event participants?

(j) Does [TARGET COMPANY] maintain files related to the approval of travel payments?

(k) Are all travel payments completely and accurately recorded in [TARGET COMPANY’S] books and records?

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(iii) Charitable and Political Contributions

(a) Does [TARGET COMPANY] make any charitable or political contributions?

(b) Are charitable and political contributions covered by [TARGET COMPANY’S] written anticorruption policy?

(c) Is approval from the legal department or compliance officer required before making any political or charitable contribution?

(d) Does [TARGET COMPANY] maintain files related to the approval of charitable and political contributions?

(e) Are all charitable and political contributions completely and accurately recorded in [TARGET COMPANY’S] books and records?

(iv) Facilitating Payments

(a) Does [TARGET COMPANY] make payments to government officials to expedite or secure the performance of routine governmental actions?

(b) Are facilitating payments covered by [TARGET COMPANY’S] written anticorruption policy?

(c) Does [TARGET COMPANY] place low annual and per-payment limits on facilitating payments?

(d) Is approval from the legal department or compliance officer required before making any facilitating payment?

(e) Does [TARGET COMPANY] maintain files related to the approval of facilitating payments?

(f) Are all facilitating payments completely and accurately recorded in [TARGET COMPANY’S] books and records?

c. Agents, Consultants, Distributors, Joint Venture Partners, and Other Third Parties

(i) Does [TARGET COMPANY] engage agents, consultants, distributors, joint venture partners, or other third parties?

(ii) Are relationships with third parties covered by [TARGET COMPANY’S] written anticorruption policy?

(iii) Are third parties required to comply with the FCPA and [TARGET COMPANY’S] anticorruption policy?


115

(iv) Does [TARGET COMPANY] require that every engagement with a third party be subject to a written and executed agreement?

(v) Does [TARGET COMPANY] require thorough due diligence of all potential third parties?

(vi) Does [TARGET COMPANY] maintain files related to due diligence of all third parties?

(vii) Does [TARGET COMPANY] include FCPA compliance or similar anticorruption language and audit rights in all third-party contracts?

(viii) Does [TARGET COMPANY] conduct periodic reviews and certifications of all third parties?

(ix) Does [TARGET COMPANY] retain commission, retainer, and expense reimbursement information for all third parties, regardless of whether a formal agreement has been executed with such third parties?

d. Cash on hand

(i) Does [TARGET COMPANY] keep cash on hand for facilitating operations?

(ii) Is cash on hand covered by [TARGET COMPANY’S] written anticorruption policy?

(iii) Is physical custody of cash secured and supervised?

e. Control of the Company Seal

(i) Does [TARGET COMPANY] have a policy regarding control of the company seal?

(ii) Who has authority to use the company seal?

(iii) Who controls the company seal?

3. FCPA Compliance Training

a. Does [TARGET COMPANY] conduct FCPA compliance or similar anticorruption training?

b. Is any such training conducted for employees in the employees’ native language(s)?

c. Is any such training conducted for agents, consultants, distributors, joint venture partners, and other third parties in such parties’ native language(s)?

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4. Review of Payments to Government Officials

a. Identify gifts, meals, entertainment, travel reimbursements, or other payments to government officials or employees of state-owned enterprises.

b. Review employee expense reimbursement requests for appropriate “request form” completion, e.g., type of gift/entertainment/other payment, number and name of recipients/participants, value of payment, approval by appropriate supervisor, and supporting receipts/documentation.

c. Review to ensure that all payments are supported by receipts and other appropriate documentation:

(i) documents regarding gifts, meals, entertainment, and similar payments;

(ii) documents regarding travel payments, including receipts as well as documentation verifying the legitimate purpose of the travel and the number of participants;

(iii) documents regarding charitable and political contributions; and

(iv) documents regarding facilitating payments.

d. Review books and records to ensure that all payments are completely and accurately recorded and that payments are not recorded under vague categories such as “Sales-other” or “Miscellaneous.”

5. Review of Contracts with the Government and Government-Related Entities/Persons/State-Owned Enterprises

a. Identify formal/informal agreements with government and government-related entities.

b. Review contracts for language that may indicate inducements for the purpose of securing a business arrangement.

c. Review invoices for payments made to the government and government-related entities/persons/state-owned enterprises for consistency with contract terms.

6. Review of Contracts with Agents, Consultants, Distributors, Joint Venture Partners, and Other Third Parties

a. Does [TARGET COMPANY] use agents, consultants, distributors, joint venture partners, or other third parties in the absence of a written agreement?

b. Review:

(i) contracts with third parties for FCPA compliance or similar anticorruption language and audit rights;


117

(ii) contracts with third parties for unusual payment arrangements, inflated contract terms, lack of FCPA compliance or anticorruption language, and other red flags;

(iii) payment requests and reimbursements/payments to sales agents and other third-party intermediaries for consistency with contract;

(iv) reimbursement/payment requests from third parties for appropriate level of description as to reason for request and instances of missing or vague descriptions or payments beyond contractual reimbursement terms; and

(v) commission reports to verify that commissions paid are consistent with third-party agreements.

7. Cash On-hand

a. Identify sources of available currency on hand, such as petty cash or other cash maintained for facilitating operations.

b. Review cash draw requests and/or supporting receipts for:

(i) completeness of documentation of usage; and

(ii) any high-risk or potentially inappropriate usage.

c. Determine if physical custody of petty cash or other cash on hand is secured and supervised appropriately.

8. General Ledger/Chart of Accounts

a. Review chart of accounts for caption descriptions that may indicate or hide inappropriate activity.

b. Identify expense or payment accounts such as marketing, advertising, consulting, development, and other similar expense or payment accounts.

c. Request and review transaction details on such accounts for unusual or unsupported transactions.

9. Accounts Payable Subledger

a. Review accounts payable vendor listing for names of individuals or entities associated with the government or government-related entities.

b. Ask management about role/purpose of such individuals or entities to determine if payments may be inappropriate.

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10. Investigations

a. Has [TARGET COMPANY] ever been the subject of a corruption or related investigation by any government authority?

b. Does [TARGET COMPANY] maintain records related to any allegations of impropriety or questions related to improper payments or corruption from any person, including government authorities, internal and external auditors, company employees, and third parties?

c. Has [TARGET COMPANY] ever conducted an internal investigation involving improper payments or corruption?


119

B. Sample Contract Provisions for Agents/Distributors

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C. Sample Contract Provisions for Joint Ventures

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123

D. Sample FCPA Compliance Certification for Agents

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125

E. Sample FCPA Compliance Certification for Employees

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!



XIX. Endnotes!

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!1 H.R. Rep. No. 95-640, at 4 (1977). 2 Foreign Corrupt Practices Act of 1977, Pub. L. No. 95-213, 91 Stat. 1494 (amended 1988 and 1998), codified as amended at 15 U.S.C. §§ 78m; 78dd-1; 78dd-2. 3 15 U.S.C. §§ 78dd-1(a); 78dd-2(a). 4 S. Rep. No. 95-114, at 10 (1977); see also David D. Dorsky, Foreign Corrupt Practices Act, 46 AM. CRIM. L. REV. 671 N. 64 (2009) (citing United States v. Liebo, 923 F.2d 1308, 1312 (8th Cir. 1991); H.R. Rep. No. 95-640, at 8 (1977); S. Rep. No. 95-114, at 10 (1977)). 5 See Complaint, SEC v. Dow Chem. Co., No. 1:07-cv-00336 (D.D.C. Feb. 12, 2007). 6 15 U.S.C. § 78ff. 7 United States v. Kay, 513 F.3d 432, 447-50 (5th Cir. 2007). 8 15 U.S.C. §§ 78dd-1-3. 9SEC Press Release, SEC Charges Seven Oil Services and Freight Forwarding Companies for Widespread Bribery of Customs Officials (Nov. 4, 2010), available at http://www.sec.gov/news/press/2010/2010-214.htm; Complaint, SEC v. Panalpina (S.D. Tex. Nov. 4, 2010), available at http://www.sec.gov/litigation/complaints/2010/comp21727.pdf 10 See id.; Plea Agreement, U.S. v. Panalpina, Inc. (S.D. Tex.), available at http://www.justice.gov/opa/documents/panalpina-inc-plea-agreement.pdf. 11 18 U.S.C. §§ 1341, 1343; 18 U.S.C. § 1952. 12 15 U.S.C. § 78m. 13 For further discussion about the FCPA accounting provision, see infra Section II(G), “Accounting and internal control provisions.” 14 H.R. Rep. No. 100-576, at 916-17 (1988). 15 See, e.g., Non-Prosecution Agreement between Westinghouse Air Brake Techs. Corp. and the DOJ (Feb. 8, 2008), available at http://www.justice.gov/criminal/fraud/fcpa/cases/docs/02-08-08wabtec-agree.pdf. 16 Complaints and settlement releases may be downloaded from the DOJ’s and SEC’s websites at http://www.justice.gov/criminal/fraud/fcpa/cases/a.html and http://sec.gov/litigation.shtml, respectively.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!17 See 15 U.S.C. §§ 78dd-2(g)(1); 78dd-3(e)(1); 78ff(a), (c). 18 See infra, Section X, “Suspension and Debarment of Government Contractors.” 19 DOJ Press Release, Coordinated Enforcement Actions by DOJ, SEC and German Authorities Result in Penalties of $1.6 Billion (Dec. 15, 2008), available at http://washingtondc.fbi.gov/dojpressrel/pressrel08/wf121508.htm. 20 DOJ Press Release, Kellogg Brown & Root LLC Pleads Guilty to Foreign Bribery Charges and Agrees to Pay $402 Million Criminal Fine (Feb. 11, 2009), available at http://houston.fbi.gov/dojpressrel/pressrel09/ho021109.htm. 21 DOJ Press Release, Technip S.A. Resolves Foreign Corrupt Practices Act Investigation and Agrees to Pay $240 Million Criminal Penalty (June 28, 2010), available at http://www.justice.gov/opa/pr/2010/June/10-crm-751.html; Press Release, Snamprogetti Netherlands B.V. Resolves Foreign Corrupt Practices Act Investigation and Agrees to Pay $240 Million Criminal Penalty (July 7, 2010), available at http://www.justice.gov/opa/pr/2010/July/10-crm-780.html. 22 15 U.S.C. § 78ff(a). 23 See 15 U.S.C. §§ 78dd-2(g)(2); 78dd-3(e)(2); 78ff(c). 24 DOJ Press Release, Virginia Resident Sentenced to 87 Months in Prison for Bribing Foreign Government Officials (Apr. 19, 2010), available at http://www.justice.gov/criminal/fraud/fcpa/cases/docs/04-19-10jumet-pressrelease-usao-edva.pdf. 25 See McLean v. Int’l Harvester Co., 817 F.2d 1214, 1219 (5th Cir. 1987). 26 United States v. Kay, 359 F.3d 738 (5th Cir. 2004). 27 Non-Prosecution Agreement, Appendix A, at 5 (Feb. 8, 2008), available at http://www.justice.gov/criminal/fraud/fcpa/cases/docs/02-08-08wabtec-agree.pdf. 28 See Jury Charge at 27, United States v. Bourke, No. S2 05 Cr. 518 (SAS) (S.D.N.Y. May 12, 2005) (“When knowledge of the existence of a particular fact is an element of the offense, such knowledge may be established if a person is aware of a high probability of its existence and consciously and intentionally avoided confirming that fact. Knowledge may be proven in this manner if, but only if, the person suspects the fact, realized its high probability, but refrained from obtaining the final confirmation because he wanted to be able to


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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!deny knowledge.”), available at https://secure.traceinternational.org/compendium/view.asp?id=136 (follow “Jury Charge” hyperlink) 29 Complaint, SEC v. York Int’l Corp., No. 1:07-CV-01750 (D.D.C. Oct. 1, 2007). 30 Although moderately priced gifts in keeping with local custom may be permissible under the FCPA, companies must always be mindful that local law may prohibit such payments. In 2009, an employee of a Hong Kong construction contractor was sentenced by a Hong Kong court to two months in prison for giving 15 boxes of moon cakes to police officers with whom the employee had dealings. See Candice Mak, Moon Cake Case Exposes Risks of Hong Kong Bribery Ordinance, ASIA LAW (Mar. 2009), available at http://www.asialaw.com/Article/2163660/Channel/16709/Moon-cake-case-exposes-risks-of-Hong-Kong-bribery-ordinance.html. 31 DOJ Rev. Proc. Rel. No. 81-01, Foreign Corrupt Practices Act (1981), available at http://www.justice.gov/criminal/fraud/fcpa/review/1981/r8101.pdf. 32 Id. 33 Foreign Corrupt Practices Act of 1977, as amended, 15 U.S.C. §§ 78dd-1(c)(1); 78dd-2(c)(1); 78dd-3(c)(1). 34 Melissa Klein Aguilar, FCPA Decision Narrows Local-Law Defense, COMPLIANCE WEEK (Dec. 2, 2008). 35 15 U.S.C. §§ 78dd-1(c)(2); 78dd-2(c)(2); 78dd-3(c)(2). 36 15 U.S.C. §§ 78dd-1(b); 78dd-2(b); 78dd-3(b). Because this is an exception to the prohibition on corrupt payments, rather than an affirmative defense, the government has the burden to prove that a payment was not a facilitating payment. 37 United States v. Kay, 359 F.3d at 751. 38 See, e.g., 15 U.S.C. § 78dd-1(f)(3)(A). 39 Complaint, SEC v. Delta & Pine Land Co., No. 1:07-CV-01352 (RWR) (D.D.C. July 25, 2007), available at https://secure.traceinternational.org/compendium/view.asp?id=12 (follow “Complaint” hyperlink). 40 The amount involved was only $43,000 over a period of five years. 41 DOJ, Helmerich & Payne, Inc. Non-Prosecution Agreement (July 29, 2009), available at https://secure.traceinternational.org/compendium/view.asp?id=16 (follow “Non-Prosecution Agreement (July 29, 2009)” hyperlink). 42 This is often why facilitating payments are inaccurately recorded in the first place. 43 Dionne Searcey, Small-Scale Bribes Targeted by OECD, WALL STREET JOURNAL, Dec. 9, 2009.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!44 See, e.g., Cease-and-Desist Order, SEC v. Delta & Pine Land Co., No. 1:07-CV-01352 (RWR) (D.D.C. July 25, 2007), available at https://secure.traceinternational.org/compendium/view.asp?id=12 (follow “Cease-and Desist Order” hyperlink). 45 James Mintz Group, Where the Bribes Are, GLOBAL FACT GATHERING, June 2009, at 1, available at http://www.mintzgroup.com/pdf/GFG-issue4.pdf. 46 Transparency Int’l, Corruption Perceptions Index 2009, available at http://www.transparency.org/policy_research/surveys_indices/cpi/2009/cpi_2009_table. 47 Richard Pipes, Pride and Power, WALL STREET JOURNAL, Aug. 24, 2009, available at http://online.wsj.com/article/NA_WSJ_PUB:SB10001424052970203550604574358733790418994.html. 48 Id. 49 There have been reports that government supervisors routinely require their subordinates to collect bribes and remit the proceeds to their superiors. See, e.g., Clifford J. Levy, Videos Rouse Russian Anger Toward Police, N.Y. TIMES, July 27, 2010, available at http://www.nytimes.com/2010/07/28/world/europe/28russia.html. 50 William Spiegelberger, Russian Roulette: Doing Business in Russia in Compliance with Anti-Bribery Laws and Treaties, 2 N.Y.U. J. L. & BUS. 819, 821 (2006). 51 DOJ Press Release, Connecticut Investor Frederic Bourke Sentenced to Prison for Scheme to Bribe Government Officials in Azerbaijan (Nov. 11, 2009), available at https://secure.traceinternational.org/compendium/view.asp?id=136 (follow “DOJ Press Release: November 11, 2009” hyperlink). 52 Brief for Appellee-Cross-Appellant at 37, United States v. Bourke, No. 09-4704-cr(L) (2d Cir. appeal docketed Dec. 11, 2009), available at http://www.scribd.com/doc/35263345/Bourke-Reply. 53 Jury Charge, United States v. Bourke, No. 05 Cr. 518 (SAS) (S.D.N.Y. May 12, 2005). 54 Brief for Defendant-Appellant-Cross-Appellee at 42, No. 09-4704-cr(L) (2d Cir. appeal docketed Dec. 11, 2009), available at http://www.scribd.com/doc/29681595/Bourke-Appeal. 55 See http://www.transparency.org/policy_research/surveys_indices/cpi/2009/cpi_2009_table. 56 See generally Veronica Foley & Catina Haynes, The FCPA and Its Impact in Latin America, 17 CURRENTS INT’L TRADE L.J. 27 (2009).

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!57 SEC Litig. Rel. No. 21335, SEC Charges Former Officer of Pride International with Violating the Foreign Corrupt Practices Act (Dec. 14, 2009), available at https://secure.traceinternational.org/compendium/view.asp?id=169 (follow “SEC Litigation Release: December 14, 2009” hyperlink). 58 DOJ Press Release, Former General Manager of Texas Business Arrested for Role in Alleged Scheme to Bribe Officials at Mexican State-Owned Electrical Utility (Nov. 23, 2009), available at https://secure.traceinternational.org/compendium/view.asp?id=164 (follow “DOJ Press Release: November 23, 2009” hyperlink). 59 SEC Litig. Rel. No. 21162, SEC Charges Nature’s Sunshine Products, Inc. with Making Illegal Foreign Payments (July 31, 2009), available at https://secure.traceinternational.org/compendium/view.asp?id=20 (follow “SEC Litigation Release: July 31, 2009” hyperlink). 60 Transparency Int’l, Transparency Int’l Progress Report 2010: Enforcement of the OECD Anti-Bribery Convention, at 68 (2010), available at http://www.transparency.org/publications/publications/conventions/oecd_report_2010 (follow “Download in PDF-English” hyperlink). 61 Id. at 66. See also id. at 18 (Argentina currently investigating more than six foreign companies or local subsidiaries), at 60 (investigations brought in Turkey against Italian business services provider and Swiss pharmaceutical company), available at http://www.transparency.org/publications/publications/conventions/oecd_report_2010 (follow “Download in PDF-English” hyperlink). 62 Convention on Combating Bribery of Foreign Officials in International Business Transactions, Dec. 18, 1997, S. Treaty Doc. 105-43, available at http://www.oecd.org/dataoecd/4/18/38028044.pdf. 63 Cheryl Scarboro, Chief, SEC Foreign Corrupt Practices Act Unit, Remarks at News Conference Announcing New SEC Leaders in Enforcement Division (Jan. 13, 2010), available at http://www.sec.gov/news/speech/2010/spch011310newsconf.htm#scarboro. 64 Transparency Int’l, Transparency Int’l Progress Report 2010: Enforcement of the OECD Anti-Bribery Convention, at 16. 65 Id. at 70-71. 66 Id. 67 Transparency Int’l, Transparency Int’l Progress Report 2009: Enforcement of the OECD Anti-Bribery Convention, at 28, 54 (2009), available at http://www.transparency.org/publications/publications/co

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!nventions/oecd_report_2009 (follow “Download in PDF-English” hyperlink). 68 See generally Arthur F. Mathews, Defending SEC and DOJ FCPA Investigations and Conducting Related Corporate Internal Investigations: The Triton Energy/Indonesia SEC Consent Decree Settlements, 18 NW. J. INT’L L. & BUS. 303 (1998). 69 15 U.S.C. § 78dd-2(h)(2). 70 See, e.g., DOJ, Opin. Proc. Rel. No. 93-02 (May 11, 1993) (without explanation, DOJ concluded that a quasi-commercial entity owned entirely by a foreign government was considered an “instrumentality” under the FCPA), available at http://www.justice.gov/criminal/fraud/fcpa/opinion/1993/9302.pdf. 71 See, e.g., H.R. Rep. No. 95-640, at 4-5 (1977) (expressing Congress’s intent that the FCPA be read broadly and should include commercial industries with significant government ownership, such as oil and gas, airlines and aerospace); H.R. Conf. Rep. No. 100-576, at 918-19 (1988) (expressing Congress’s intent that the prohibition of the FCPA extends to any corrupt payment related to the execution or performance of contracts, including commercial contracts, excluding only lobbying). 72 Unlike the FCPA, the Foreign Sovereign Immunities Act (“FSIA”) does define an “instrumentality” to be “an organ of a foreign state or political subdivision thereof, or a majority of whose shares or other ownership interest is owned by a foreign state or political subdivision thereof.” 28 U.S.C. § 1603(b)(2) (emphasis added). Case law interpreting the FSIA has found that “control” of an entity does not automatically transform the entity into an instrumentality because, under the FSIA, “[m]ajority ownership by a foreign state, not control, is the benchmark of instrumentality status.” Dole Food Co. v. Patrickson, 538 U.S. 468, 477 (2003) (emphasis added). Whether a court interpreting the FCPA would borrow from FSIA jurisprudence remains to be seen, but at least one court has declined the invitation. See Order Denying Motion to Dismiss Superseding Indictments, United States v. Nam Quoc Nguyen, et al., No. 08-522 at 1, 3, 4 & 5, Order Denying Motion to Dismiss without opinion (E.D. Pa. Dec. 30, 2009). 73 For example, U.S. regulators brought a case against KBR, Inc. and its former parent company Halliburton Co. for FCPA violations arising out of payments to officers and employees of Nigeria LNG Limited (“NLNG”). NLNG is owned 49% by the Nigerian government and 51% by a consortium of private oil companies—Shell, Total, and Eni. 74 See U.S. Attorneys Manual, Title 9, Criminal Resource Manual, § 1018, Prohibited Foreign Corrupt Practices, available at


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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!http://www.justice.gov/usao/eousa/foia_reading_room/usam/title9/crm01018.htm. 75 DOJ Opin. Proc. Rel. No. 94-01 (May 13, 1994), available at http://www.justice.gov/criminal/fraud/fcpa/opinion/1994/9401.pdf. 76 DOJ Opin. Proc. Rel. No. 10-01 (September 1, 2010), available at http://www.justice.gov/criminal/fraud/fcpa/opinion/2010/1003.pdf. 77 Defendant’s Motion to Dismiss Indictment for Failure to State a Criminal Offense, United States v. Nam Quoc Nguyen, et al., No. 08-522 (E.D. Pa. Oct. 16, 2009). 78 Id. at 1. 79 See infra, Section XI, “Related Crimes and Commercial Bribery.” 80 Superseding Indictment, United States v. Nam Quoc Nguyen, et al., No. 08-255, at 4-5 (E.D. Pa. Oct. 29, 2009), available at http://www.justice.gov/criminal/fraud/fcpa/cases/docs/nguyen-supersed-indict.pdf. 81 Defendant’s Motion to Dismiss Superseding Indictment for Failure to State a Criminal Offense, United States v. Nam Quoc Nguyen, et al., No. 08-255 (E.D. Pa. Nov. 9, 2009). 82 Id. at 9. 83 Id. at 9-10. 84 See supra note 65. 85 A mirroring motion to dismiss was filed in the recent case U.S. v. Esquenaz, pending in the Southern District of Florida. In that case, the defendant argued that employees of a Haitian-owned telecommunication company were not “government officials” under the FCPA. In a cursory opinion without substantive analysis, the Judge denied defendant’s motion. See Order Denying Motion to Dismiss, U.S. v. Esquenaz, No. 09-21010, at 2 (S.D. Fla. Nov. 19, 2010). 86 Christopher Cox, Speech by SEC Chairman: The Rise of Sovereign Business (Dec. 5, 2007), available at http://www.sec.gov/news/speech/2007/spch120507cc.htm 87 When a specific question arises regarding the status of a particular SOE, the DOJ encourages U.S. companies to use its FCPA Opinion Procedures (see 28 C.F.R. part 80 et seq.). See also infra, Section III(C)(2), “DOJ FCPA opinion process.” 88 17 C.F.R. § 230.405. 89 See H.R. Rep. No. 1383, 73d Cong., 2d Sess. 26 (1934) (“It would be difficult if not impossible to enumerate or to anticipate the many ways in which actual control may be exerted.”); Comments, Secondary Liability of Controlling

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!Persons Under the Securities Acts: Toward an Improved Analysis, 126 U. Pa. L. Rev. 1345, 1352-53 (1978) (“[T]he factual nature of the status issue has effectively prevented the development of universal standards.”). 90 See, e.g., Paracor Fin., Inc. v. Gen. Elec. Capital Corp., 96 F.3d 1151, 1163 (9th Cir. 1996) (stating that position as officer may be “a sort of red light” but does not create a presumption of control). 91 Complaint, SEC v. Nature’s Sunshine Prods., Inc., No. 2:09CV0672 (D. Utah July 31, 2009). 92 For an in-depth discussion of possible FCPA red-flags, see infra Section VII, “Red Flags: Facts That Raise FCPA Compliance Issues.” 93 15 U.S.C. § 78m(a). 94 15 U.S.C. § 78m(b)(2). 95 15 U.S.C. §§ 78m(a)(1), (b)(7). 96 Robert W. Tarun, THE FOREIGN CORRUPT PRACTICES ACT HANDBOOK 19 (Am. Bar Ass’n 2010). 97 See, e.g., SEC v. Collins & Aikman Corp., 524 F. Supp. 2d 477, 491 (S.D.N.Y. 2007). 98 SEC Litig. Rel. No. 20896, in SEC v. ITT Corp., No. 1:09-cv-00272 (D.D.C. Feb. 11, 2009), available at http://www.sec.gov/litigation/litreleases/2009/lr20896.htm. 99 Complaint, SEC v. ITT Corp., No. 1:09-cv-00272 (D.D.C. Feb. 11, 2009), available at http://www.sec.gov/litigation/complaints/2009/comp20896.pdf. 100 15 U.S.C. §§ 78m(b)(4), (b)(5). 101 See, e.g., SEC Litig. Rel. No. 16839, in SEC v. IBM Corp., No. 1:00CV03040 (JR) (D.D.C. Dec. 21, 2000). 102 15 U.S.C. § 78m(b)(6). 103 Foreign Corrupt Practices Act of 1977, SEC Securities Exchange Act Release No. 17500, 1981 SEC LEXIS 2167 (Jan. 29, 1981). 104 See, e.g., U.S. Sentencing Guidelines Manual Ch. 8; see also DOJ FCPA Review, Opin. Rel. No. 04-02 (July 12, 2004). 105 Lanny A. Breuer, Assistant Attorney General, DOJ, Prepared Remarks to the 24th National Conference on the Foreign Corrupt Practices Act (Nov. 16, 2010), available at http://www.justice.gov/criminal/pr/speeches/2010/crm-speech-101116.html. 106 Id. 107 Lanny A. Breuer, Assistant Attorney General, DOJ, Prepared Remarks to the Council on Foreign Relations, International Criminal Law Enforcement: Rule of Law, Anti-Corruption and Beyond (May 4, 2010) (“Breuer,

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!5/4/10 Speech”), available at http://www.justice.gov/criminal/icitap/pr/2010/05-04-10AAG-breuer-remarks.pdf. 108 Id. 109 United States Sentencing Comm’n, Federal Sentencing Guidelines Manual, § 8B2.1 (Nov. 1, 2009). 110 Organisation for Economic Co-operation and Development, Good Practice Guidance on Internal Controls, Ethics, and Compliance (Feb. 18, 2010), available at http://www.oecd.org/dataoecd/5/51/44884389.pdf. 111 Available at http://www.justice.gov/dag/morford-useofmonitorsmemo-03072008.pdf. 112 Lanny A. Breuer, Assistant Attorney General, DOJ, Prepared Keynote Address, The Tenth Annual Pharmaceutical Regulatory and Compliance Congress and Best Practices Forum (Nov. 12, 2009) (“Breuer, 11/12/09 Speech), available at http://www.justice.gov/criminal/pr/speeches-testimony/documents/11-12-09breuer-pharmaspeech.pdf. 113 Id. See also Lanny A. Breuer, Assistant Attorney General, DOJ, Remarks at the American Bar Association National Institute on White Collar Crime (February 25, 2010) (referencing “the Department’s commitment to meaningfully reward voluntary disclosures and full and complete cooperation will continue to be honored in both letter and spirit.”), available at http://www.justice.gov/criminal/pr/speeches-testimony/2010/02-25-10aag-AmericanBarAssosiation.pdf. ++,!Lanny A. Breuer, Assistant Attorney General, DOJ, Prepared Remarks to, Compliance Week 2010—5th Annual Conference for Corporate Financial, Legal, Risk, Audit & Compliance Officers (May 26, 2010), available at http://www.justice.gov/criminal/pr/speeches-testimony/2010/05-26-10aag-compliance-week-speech.pdf.!115 Id. 116 28 C.F.R. § 80.6. 117 Id. 118 See http://www.justice.gov/criminal/fraud/fcpa/opinion. 119 Speech by SEC Staff: Remarks Before the New York City Bar: My First 100 Days as Director of Enforcement (Aug. 5, 2009), available at http://www.sec.gov/news/speech/2009/spch080509rk.htm 120 Speech by SEC Staff: Remarks at News Conference Announcing New SEC Leaders in Enforcement Division (Jan. 13, 2010), available at

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!http://www.sec.gov/news/speech/2010/spch011310newsconf.htm#scarboro. 121 Id. 122 SEC Sec. Exchange Act Release, Report of Investigation Pursuant to Section 21(a) of the Securities Exchange Act of 1934 and Commission Statement on the Relationship of Cooperation to Agency Enforcement Decisions, Exchange Act Release No. 44969 (Oct. 23, 2001) (“SEC Exchange Act Release No. 44969”), available at http://www.sec.gov/litigation/investreport/34-44969.htm. 123 For an in-depth discussion of voluntary disclosure, see infra Section VI, “Considering Whether to Self-Report.” 124 David Hechler, DOJ Unit That Prosecutes FCPA to Bulk Up ‘Substantially’ (Feb. 26, 2010), available at http://www.law.com/jsp/article.jsp?id=1202444612530 (“Hechler, 2/26/10”). 125 Breuer, 5/4/10 Speech. 126 Hechler, 2/26/10. 127 Breuer, 11/12/09 Speech. 128 Breuer, 5/4/10 Speech. 129 Breuer, 2/25/10 Speech. 130 DOJ Press Release, Snamprogetti Netherlands B.V. Resolves Foreign Corrupt Practices Act Investigation and Agrees to Pay $240 Million Criminal Penalty (July 7, 2010), available at http://www.justice.gov/opa/pr/2010/July/10-crm-780.html. 131 Eric H. Holder, Jr., Attorney General, Prepared Remarks to, Opening Plenary VI Ministerial Global Forum on Fighting Corruption and Safeguarding Integrity, Doha, Qatar (Nov. 7, 2009), available at www.justice.gov/ag/speeches/2009/ag-speech-091107.html. 132 Breuer, 11/12/09 Speech. 133 Breuer, 3/15/10 Speech. 134 Lanny Breuer, Assistant Attorney General, DOJ, FCPA Takedown: Pen & Pad Remarks (Jan. 19, 2010), available at http://www.justice.gov/criminal/pr/speeches-testimony/documents/01-19-10AAG-remarks-FCPApenandpad_0.pdf. 135 15 U.S.C. § 78dd-1(f)(1)(A). 136 Order Instituting Cease-and-Desist Proceedings, SEC Exchange Act Release No. 51724, in In re Diagnostic Prods. Corp. (May 20, 2005), available at http://www.sec.gov/litigation/admin/34-51724.pdf. 137 Johnson & Johnson, Current Report on Form 8-K (Feb. 12, 2007).


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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!138 Medtronic, Quarterly Report on Form 10-Q (Dec. 4, 2007). 139 Breuer, 11/12/09 Speech. 140 Id. 141 Id. 142 Id. 143 Id. 144 Id. 145 Lanny Breuer, Assistant Attorney General, DOJ, International Criminal Law Enforcement: Rule of Law, Anti-Corruption and Beyond (May 4, 2010) (“Breuer, 5/4/2010 Speech”), available at http://www.mainjustice.com/wp-content/uploads/2010/05/AAG-Breuer-Remarks-at-CFR.pdf. 146 Id. 147 Inter-American Convention Against Corruption (Mar. 29, 1996), S. Treaty Doc. 105-39, 35 I.L.M. 724 (1996), available at http://www.oas.org/jurisdico/english/treaties/b-58.html. 148 Id. 149 Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, Dec. 18, 1997, S. Treaty Doc. 105-43, 37 I.L.M. 1 (1998), available at http://www.oecd.org/dataoecd/4/18/38028044.pdf. 150 Id. 151 Id. 152 Criminal Law Convention on Corruption (Jan. 27, 1999), Europ. T.S. 173, available at http://conventions.coe.int/treaty/en/Treaties/Html/173.htm 153 Civil Law Convention on Corruption (Nov. 4, 1999), Europ. T.S. 174, available at http://www.conventions.coe.int/Treaty/en/Treaties/Html/174.htm. 154 As a signatory, the United States is not bound by the Convention, but is obliged in good faith to refrain from acts that would defeat the object or purpose of the Convention. 155 See supra note 153. 156 United Nations Convention Against Corruption (Nov. 21, 2003), 43 I.L.M. 37 (2004), available at http://www.unodc.org/documents/treaties/UNCAC/Publications/Convention/08-50026_E.pdf. 157 Bruce C. Swartz, Deputy Assistant Att’y Gen., DOJ Criminal Div., Testimony Before the Comm. on Foreign Relations U.S. Senate Concerning the United Nations Convention Against Corruption (June 21, 2006), at 7,

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!available at http://www.globalsecurity.org/military/library/congress/2006_hr/060621-swartz.pdf. 158 Id. 159 DOJ Press Release, Siemens AG and Three Subsidiaries Plead Guilty to Foreign Corrupt Practices Act Violations and Agree to Pay $450 Million in Combined Criminal Fines; Coordinated Enforcement Actions by DOJ, SEC and German Authorities Result in Penalties of $1.6 Billion (Dec. 15, 2008), available at http://www.justice.gov/opa/pr/2008/December/08-crm-1105.html. 160 Id. 161 Id. 162 Press Release, Serious Fraud Office, BAE Systems plc (Feb. 5, 2010), available at http://www.sfo.gov.uk/press-room/latest-press-releases/press-releases-2010/bae-systems-plc. 163 DOJ Press Release, Twenty-Two Executives and Employees of Military and Law Enforcement Products Companies Charged in Foreign Bribery Scheme (Jan. 19, 2010), available at http://www.justice.gov/opa/pr/2010/January/10-crm-048.html. 164 Id. 165 Available at http://www.usdoj.gov/dag/cftf/corporate_guidelines.htm. 166 Id. at 5. 167 SEC Exchange Act Release No. 44969. 168 United States Sentencing Comm’n, Federal Sentencing Guidelines Manual, § 8C2.5. 169 Robert S. Khuzami, Dir., SEC Enforcement Div., Remarks at News Conference Announcing Enforcement Cooperation Initiative & New Senior Leaders (Jan. 13, 2010), available at www.sec.gov/news/press/2010/2010-6.htm. 170 Lucinda A. Low, et al., The Uncertain Calculus of FCPA Voluntary Disclosures, presented to the American Conference Institute 17th National Conference, Foreign Corrupt Practices Act (Mar. 2007), at 24. 171 Bruce Hinchey, Punishing the Penitent: Disproportionate Fines in Recent FCPA Enforcements and Suggested Improvements (July 15, 2010), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1650925, at 18. 172 Id. 173 For a description of the Dodd-Frank Act whistleblower provision, see supra Section V(D), “FCPA whistleblowers.”

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!174 SEC Enforcement Div. Enforcement Manual (Jan. 13, 2010), available at http://www.sec.gov/divisions/enforce/enforcementmanual.pdf at § 6. 175 The information in this section has been compiled using summaries and case documents compiled by Trace International and available at https://secure.traceinternational.org/compendium. 176 Cheryl Scarboro, Chief, Sec. Exch. Comm’n Foreign Corrupt Practices Act Unit, Remarks at News Conference Announcing New SEC Leaders in Enforcement Division (Jan. 13, 2010), available at http://www.sec.gov/news/speech/2010/spch011310newsconf.htm#scarboro. 177 An effective compliance program is also central for a company’s compliance with the UK Bribery Act 2010. The new law will introduce a corporate offense of failure to prevent bribery by employees working for a business, and an effective compliance program will be necessary for a company to avail itself of the law’s “adequate procedures” affirmative defense. See Ministry of Justice, “Consultation on Guidance about Commercial Organisations Preventing Bribery,” Sept. 14, 2010, available at http://www.justice.gov.uk/consultations/briberyactconsultation.htm. For a detailed discussion of the UK Bribery Act, see infra Section XVI(A). 178 United States Sentencing Comm’n, Federal Sentencing Guidelines Manual, § 8B2.1. 179 For a description of the Dodd-Frank Act whistleblower provision, see supra Section V(D), “FCPA whistleblowers.” 180 DOJ Press Release, Oil Services Companies and a Freight Forwarding Company Agree to Resolve Foreign Bribery Investigations and to Pay More Than $156 Million in Criminal Penalties (Nov. 4, 2010), available at http://www.justice.gov/opa/pr/2010/November/10-crm-1251.html; SEC Press Release, SEC Charges Seven Oil Services and Freight Forwarding Companies for Widespread Bribery of Customs Officials (Nov. 4, 2010), available at http://www.sec.gov/news/press/2010/2010-214.htm. 181 See Plea Agreement, U.S. v. Panalpina, Inc. (S.D. Tex.), available at http://www.justice.gov/opa/documents/panalpina-inc-plea-agreement.pdf; Plea Agreement, United States v. Pride Forasol S.A.S. (S.D. Tex.), available at http://www.justice.gov/opa/documents/pride-forasol-plea-agreement.pdf; Deferred Prosecution Agreement, U.S. v. Pride Int’l (S.D. Tex.), available at http://www.justice.gov/opa/documents/pride-intl-dpa.pdf; Deferred Prosecution Agreement, U.S. v. Tidewater Marine Int’l (S.D. Tex.), available at http://www.justice.gov/opa/documents/tidewater-dpa.pdf;

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!Deferred Prosecution Agreement, U.S. v. Transocean, Inc. (S.D. Tex.), available at http://www.justice.gov/opa/documents/transocean-dpa.pdf; Nonprosecution Agreement, U.S. v. Noble Corp. (S.D. Tex.), available at http://www.justice.gov/opa/documents/noble-npa.pdf; Deferred Prosecution Agreement, U.S. v. Shell Nigeria and Exploration Prod. Co. Ltd. (S.D. Tex.), available at http://www.justice.gov/opa/documents/shell-dpa.pdf. 182 See id. 183 SEC Litig. Rel. No. 21602, in SEC v. Gen. Elec. Co., No. 1:10-CV-01258 (D.D.C. July 27, 2010), available at http://sec.gov/litigation/litreleases/2010/lr21602.htm. 184 SEC Press Release, SEC Charges General Electric & Two Subsidiaries with FCPA Violations (July 27, 2010), available at http://www.sec.gov/news/press/2010/2010-133.htm 185 See Complaint, In re General Electric Co., FTC Docket No. C-4119 (Sept. 9, 2004), at ¶ 7. 186 See DOJ Press Release, InVision Technologies, Inc. Enters Into Agreement With the United States (Dec. 6, 2004), available at http://www.usdoj.gov/opa/pr/2004/December/04_crm_780.htm. 187 See id. 188 See Complaint, SEC v. Titan Corp., No. 05-0411 (D.D.C. Mar. 1, 2005), at ¶ 8. 189 See Lockheed Martin Press Release, Lockheed Martin Terminates Merger Agreement with The Titan Corporation (June 26, 2004), available at http://www.lockheedmartin.com/news/press_releases/2004/LockheedMartinTerminatesMergerAgree.html. 190 Id. 191 SEC Litig. Rel. 19107, in SEC v. Titan Corp., No. 05-0411 (D.D.C. Mar. 1, 2005). 192 See DOJ, Opin. Proc. Rel. No. 08-02 (June 13, 2008), available at http://www.justice.gov/criminal/fraud/fcpa/opinion/2008/0802.pdf. 193 Id. 194 Id. 195 Overseas Contractor Reform Act, H.R. 5366, 111th Cong. (2010), available at http://thomas.loc.gov/home/gpoxmlc111/h5366_ih.xml. 196 48 C.F.R. § 9.406-2. 197 See, e.g., American Floor Consultants & Installations, Inc. v. United States, 70 Fed. Cl. 235 (2006). 198 48 C.F.R. § 2.101.


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!199 See 22 U.S.C.A. §§ 2751 to 2799aa-2. 200 48 C.F.R. § 52.203-13. 201 48 C.F.R. § 52.203-13(b)(3)(i). 202 48 C.F.R. § 9.406-2(b)(1)(vi). 203 48 C.F.R. § 9.407-4(a). 204 48 C.F.R. § 9.405. 205 48 C.F.R. § 9.406-4. 206 48 C.F.R. §§ 9.407-1, 9.407-4(a). 207 48 C.F.R. § 9.405-1(a). 208 48 C.F.R. § 9.405-1(b). 209 48 C.F.R. §§ 9.406-5(a), 9.407-5. 210 48 C.F.R. § 9.406-5(a). 211 48 C.F.R. § 9.406-5(c). 212 48 C.F.R. §§ 9.406-3(b)(1), 9.407-3(b)(1). 213 48 C.F.R. §§ 9.407-3(d)(4), 9.406-3(c). 214 48 C.F.R. §§ 9.406-3(c)(4), 9.407-3(c)(5). 215 48 C.F.R. § 9.406(1)(a). 216 48 C.F.R. § 9.406-1(a)(1)-(10). The government may, but is not required to, consider these factors before imposing a suspension. 217 48 C.F.R. § 9.407-3(b)(2). 218 48 C.F.R. §§ 9.406-3(b)(2), 9.407-3(b)(2). 219 48 C.F.R. §§ 9.406-3(b)(2), 9.407-3(b)(2). 220 5 U.S.C.A. § 706. 221 5 U.S.C.A. § 706(2)(A). 222 18 U.S.C. § 1952. 223 At least 35 states have commercial bribery statutes on their books. See Jeffrey J. Ansley, et al., Bribery in Foreign Commerce, available at http://www.callawyer.com/story.cfm?pubdt=NaN&eid=910383&evid=1. 224 Thomas Fox, Robert Kennedy, the Travel Act, and the FCPA (Feb. 22, 2010), available at http://www.corporatecomplianceinsights.com/2010/robert-kennedy-travel-act-fcpa/. 225 See Jury Charge, United States v. Bourke, No. S2 05 Cr. 518 (SAS) (S.D.N.Y. 2005). 226 Information, United States v. Control Components, Inc., No. 09-00162, (C.D. Cal. July 22, 2009), available at http://www.justice.gov/criminal/fraud/fcpa/cases/docs/cci-info.pdf.

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!227 See Deferred Prosecution Agreements, United States v. Schnitzer Steel Indus., Inc., available at http://www.justice.gov/criminal/fraud/fcpa/cases/docs/schnitzer_steel_deferred_prosecution_agmt.pdf; and U.S. v. Baker Hughes Inc., available at http://www.justice.gov/criminal/fraud/fcpa/cases/docs/04-11-07bakerhughes-prosecution.pdf. 228 See DOJ Press Release, Virginia Physicist Sentenced to 51 Months in Prison for Illegally Exporting Space Launch Data to China and Offering Bribes to Chinese Officials (April 7, 2009), available at http://www.justice.gov/opa/pr/2009/April/09-nsd-317.html. 229 Gary Spratling, Deputy Assistant Attorney General, International Cartels: The Intersection Between FCPA Violations and Antitrust Violations, American Conference Institute (Dec. 9, 1999), available at http://www.justice.gov/atr/public/speeches/3981.htm. 230 See, e.g., In re Marine Hose Antitrust Litig., No. 1:08-md-01888 (S.D. Fla. Feb. 29, 2008). 231 See Scott Hammond & Belinda Barnett, DOJ, Frequently Asked Questions Regarding the Antitrust Division’s Leniency Program and Model Leniency Letters (Nov. 19, 2008),” available at http://www.justice.gov/atr/public/criminal/239583.htm. 232 See DOJ Press Release Two Florida Executives, One Florida Intermediary and Two Former Haitian Government Officials Indicted for Their Alleged Participation in Foreign Bribery Scheme (Dec. 7, 2009), available at http://www.justice.gov/opa/pr/2009/December/09-crm-1307.html. 233 See DOJ Press Release, Former Haitian Government Official Sentenced to Prison for His Role in Money Laundering Conspiracy Related to Foreign Bribery Scheme (June 2, 2010), available at http://www.justice.gov/opa/pr/2010/June/10-crm-639.html. 234 See, e.g., In re Syncor Int’l Corp. Sec. Litig., 239 F. App’x 318, 320 (9th Cir. 2007). 235 Glazer Capital Mgmt., LP v. Magistri, 549 F.3d 736, 741-42 (9th Cir. 2008). 236 In re Immucor Inc. Sec. Litig., No.1:05-cv-2276, 2006 WL 3000133, at *4 (N.D. Ga. Oct. 4, 2006). 237 Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 313 (2007). 238 See id. at 319 n.3. 239 Id. at 324.

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!240 Id. at 314. 241 Immucor Inc. Sec. Litig., 2006 WL 3000133, at *18. 242 In re Faro Tech. Sec. Litig., 534 F. Supp. 2d 1248, 1263 (M.D. Fla. 2007). 243 Immucor Inc. Sec. Litig., 2006 WL 3000133, at *18. 244 In re Nature’s Sunshine Prods. Sec. Litig., 486 F. Supp. 2d 1301, 1310 (D. Utah 2007). 245 Glazer Capital Mgmt., 549 F.3d at 746. 246 Id. at 747. 247 Id. at 747-48. 248 Id. at 748. 249 In re Caremark Int’l Derivative Inc. Litig., 698 A.2d 959, 967 (Del. Ch. 1996). 250 Id. at 971. 251 Stone v. Ritter, 911 A.2d 362, 370 (Del. 2006). 252 Midwestern Teamsters Pension Trust Fund v. Deaton, No. H-08-1809, 2009 U.S. Dist. LEXIS 50521, at *28 (S.D. Tex. May 7, 2009). 253 See In re Walt Disney Co. Derivative Litig., 906 A.2d 27, 67 (Del. 2006). 254 In re Walt Disney Co. Derivative Litig., 825 A.2d 275, 285 (Del. Ch. 2003) (citing Aronson v. Lewis, 473 A.2d 805, 814 (Del. 1984)). 255 In re Baxter Int'l S'holders Litig., 654 A.2d 1268, 1270 (Del. Ch. 1995) (quoting Rales v. Blasband, 634 A.2d 927, 936 (Del. 1993)). 256 Scattered Corp. v. Chicago Stock Exchange, Inc., 701 A.2d 70, 77 (Del. 1997), overruled on other grounds by Brehm v. Eisner, 746 A.2d 244 (Del. 2000). 257 See, e.g., King v. VeriFone Holdings, Inc., 994 A.2d 354, 361 (Del. Ch. 2010). 258 Some courts apply a presumption that it is prudent for fiduciaries to allow a plan to hold the company’s stock. See Moench v. Robertson, 62 F.3d 553 (3d Cir. 1995); see also Quan v. Computer Sciences Corp., No. 09-56190, 2010 U.S. Dist. LEXIS 20199, *23 (9th Cir. Sept. 30, 2010) (adopting Moench presumption); Kirschbaum v. Reliant Energy, Inc., 526 F.3d 243, 253 (5th Cir. 2008) (same); Kuper v. Iovenko, 66 F.3d 1447, 1459 (6th Cir. 1995) (same). 259 See generally Restatement (Third) of the Foreign Relations Law of the United States. 260 See Aluminium Bahrain BSC v. Alcoa Inc., No. 08-cv-299 (W.D. Pa. Feb. 27, 2008); Aluminium Bahrain BSC v. Sojitz Corp., No. 09-cv-04032 (S.D. Tex. Dec. 18, 2009).

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!261 See Fabri v. United Techs. Int’l, Inc., 387 F.3d 109 (2d Cir. 2004). 262Rotec Indus. Inc. v. Mitsubishi Corp., 348 F.3d 1115 (9th Cir. 2003). 263 Overseas Contractor Reform Act, H.R. 5366, 111th Cong. (2010), available at http://thomas.loc.gov/home/gpoxmlc111/h5366_ih.xml. 264 Id. The bill provides an exemption if the “head of a Federal agency” delivers a waiver to Congress “along with an accompanying justification.” Id. 265 Foreign Business Bribery Prohibition Act of 2009, H.R. 2152, 111th Cong. (2009), available at http://www.govtrack.us/congress/billtext.xpd?bill=h111-2152. 266 Id. 267 Id. 268 To Require Persons to Certify That They Have Not Violated Foreign Corrupt Practices Statutes Before Being Awarded Government Contracts, and for Other Purposes, H.R. 5837, 111th Cong. (2009), available at http://thomas.loc.gov/cgi-bin/query/z?c111:H.R.5837.IH. 269 Id. 270 Attorney-Client Privilege Protection Act of 2009, S. 445, 111th Cong. (2009), available at http://www.govtrack.us/congress/billtext.xpd?bill=s111-445. 271 Attorney-Client Privilege Protection Act of 2009, H.R. 4326, 111th Cong. (2009), available at http://www.govtrack.us/congress/billtext.xpd?bill=h111-4326. 272 United States Sentencing Comm’n, Supplement to 2010 Guidelines Manual (Nov. 1, 2010), available at http://www.ussc.gov/2010guid/PDF_Supplement_2010_Guidelines_Manual.pdf. 273 Gary G. Grindler, Acting Deputy Att’y Gen. Gary G. Grindler Speaks at the 2010 Compliance Week Conference (May 25, 2010), available at http://www.justice.gov/dag/speeches/2010/dag-speech-100525.html. 274 SEC Cease-and-Desist Order, In re NATCO Group, Inc. (Jan. 11, 2010), available at https://secure.traceinternational.org/compendium/view.asp?id=171 (follow “SEC Cease-and-Desist Order” hyperlink). 275 Id. 276 OECD Convention, Article 5. 277 Id., Article 1. 278 Id.


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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!279 Id., Commentary No. 16. 280 Id., Commentary No. 14. 281 Id., Commentary Nos. 7, 8. 282 Id., Commentary No. 9. 283 Id., Article 1. 284 Id., Article 7. 285 Id., Article 2. 286 Id., Article 8. 287 S. Comm. On Banking, Housing, and Urban Affairs, International Anti-Bribery Act of 1998, S. Rep. No. 105-277, at *2 (1998) (“This Act amends the FCPA to confirm it to the requirements of and to implement the OECD Convention.”). 288 Id. 289 Id. 290 Id. 291 Organization for Economic Cooperation and Development - Directorate for Financial, Fiscal and Enterprise Affairs, United States: Phase 2 Report on application of the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions and the 1997 Recommendation on Combating Bribery in International Business Transactions, at 32, available at http://www.oecd.org/dataoecd/52/19/1962084.pdf (last visited Oct. 18, 2010). 292 Id. at 35. 293 OECD Convention, Article 3. 294 Id. 295 Id. 296 Id. 297 Id., Article 8. 298 Id., Article 4. 299 Id., Article 9. 300 Id., Article 10. 301 OECD, Data On Enforcement of the Anti-Bribery Convention, available at http://www.oecd.org/document/3/0,3343,en_2649_34859_45452483_1_1_1_1,00.html 302 Fritz Heimann and Gillian Dell, Progress Report 2010: Enforcement of the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, Transparency International, at 8-10, available at http://www.transparency.org/content/download/53670/85

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!6410/file/2010+PROGRESS+REPORT.pdf (last visited Oct. 18, 2010). 303 Id. at 8. 304 Id. 305 See id. at 11. 306 See id. 307 Id. at 8. 308 See id. at 9. 309 Each jurisdiction discussed has a number of laws at the national and local levels that are relevant to corrupt practices. This section discusses the most prominent national-level laws only. 310 UK Bribery Act 2010, available at http://www.legislation.gov.uk/ukpga/2010/23/data.pdf. 311 Id. Section 3. 312 Id. Section 4. 313 Id. Section 5. 314 Approach of the Serious Fraud Office to Dealing with Overseas Corruption, Serious Fraud Office (July 21, 2009), available at http://www.sfo.gov.uk/media/28313/approach%20of%20the%20sfo%20to%20dealing%20with%20overseas%20corruption.pdf. 315 See http://www.justice.gov.uk/publications/docs/bach-letter-adequate-procedures-guidance.pdf. 316 See Ministry of Justice, “Consultation on Guidance about Commercial Organisations Preventing Bribery,” Sept. 14, 2010, available at http://www.justice.gov.uk/consultations/briberyactconsultation.htm. 317 See id. 318 Keihou [Pen. C.], Act No. 45 of 1907, English translation available at http://www.japaneselawtranslation.go.jp/law/detail/?id=3&vm=04&re=02. 319 OECD Convention on Combating Bribery of Foreign Pub. Officials in Int’l Bus. Translations (Nov. 21, 1997), available at http://www.oecd.org/dataoecd/4/18/38028044.pdf. 320 Fusei Kyousou Boushiho [Unfair Competition Prevention Act], Act No. 47 of 1993, English translation available at http://www.japaneselawtranslation.go.jp/law/detail/?id=83&vm=04&re=01. 321 As to commentaries provided by lawmakers, please see The Ministry of Economy, Trade and Industry, Industrial Policy Bureau, Office of Intellectual Property Policy, Gaikoku Koumuin e no Fusei Rieki Kyouyo no Boushi ni

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!kakaru Fusei Kyousou Boushiho no Kaisei [Amendments of the Unfair Competition Prevention Act regarding Prevention of Provision of Improper Advantage to Foreign Public Officials], 1507 Shoji Houmu 4 (1998) (the “METI Article”); Tadashi Nishiyama, Fusei Kyousou Boushiho Kaiseiho no Gaiyou [Summary of Amendments to the Unfair Competition Prevention Act], 660 NBL 12 (1999). See also Kanji Kawamura, Gaikoku Koumuin e no Zouwai Kinshiho no Seiritsu [Enactment of Anti-Bribery Law to Foreign Public Officials], Kokusai Shoji Houmu, Vol. 27 No. 1, 21 (1999). 322 Fusei Kyousou Boushihou Dai-Juuhachijou Dai-nikou Dai-sangou no Gaikoku Koumuin tou de Seirei de Sadameru Mono o Sadameru Seirei [Cabinet Order for Defining Foreign Public Officers under Paragraph 2, Item 3 of Article 18 of the UCPA], Cabinet Order No. 388 of 2001. 323 METI Guidelines (Jan. 29, 2007), original Japanese version available at http://www.meti.go.jp/policy/economy/chizai/zouwai/pdf/190130shishin.pdf and English translation available at http://www.meti.go.jp/policy/economy/chizai/zouwai/pdf/guidelines.pdf. 324 It should also be noted that the ultimate legal interpretation as to each individual cases is necessarily deferred to the courts. See the METI Article, supra note 310, at 4. 325 Pen. C., Article 1; Article 8. The Penal Code sets forth the basic principles for the application of Japan’s criminal laws and applies the principle of territorial jurisdiction, under which Japan’s criminal law applies to offenses committed within the territory of Japan, irrespective of the nationality of the offender. The Penal Code applies over any criminal penalties provided under any other laws in Japan, and thus this principles of territorial jurisdiction applies to Article 18 of the UPCA. 326 The amendments to the UCPA in 2005 expanded the jurisdictional reach of the UCPA by criminalizing bribes made to foreign public officers by Japanese nationals outside of Japan. Prior to the amendments in 2005, only corrupt acts conducted within Japan could be punished. See UCPA, Article 21 ¶ 6; Pen. C., Article 3. 327 UCPA, Article 18, ¶ 1 (emphasis added). 328 In all reported cases of prosecutions under the UCPA, however, bribes were actually paid and accepted by foreign public officials. 329 See METI Article, supra note 310, at 6; Nishiyama, supra note 310, at 14; METI Guidelines, Ch. 3, § 1(7). 330Id. 331 See METI Guidelines, Ch. 3, § 1(4)(ii).

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!332 See METI Article, supra note 310, at 5; Nishiyama, supra note 310, at 14; METI Guidelines, Ch. 3, §1(4)(ii). 333 Id. 334 Id. 335 Kaisya Hou [Companies Act], Act No. 86 of 2005, English translation available at http://www.japaneselawtranslation.go.jp/law/detail/?co=1&yo=&gn=&sy=&ht=&no=&bu=&ta=&x=0&y=0&ky=%E4%BC%9A%E7%A4%BE%E6%B3%95&page=7&re=02; http://www.japaneselawtranslation.go.jp/law/detail/?ft=1&re=01&dn=1&co=01&ky=%E4%BC%9A%E7%A4%BE%E6%B3%95&page=8. In such cases, non-Japanese companies are generally treated as equivalent to Japanese corporations pursuant to Article 823 of the Companies Act. See METI Guidelines, Ch. 3, § 3(3)(iv). 336 Kaisha Keisan Kisoku [Company Accounting Regulations], Ministry of Justice Order No. 13 of 2006. 337 Kin’yu Shouhin Torihiki Hou [Financial Instruments and Exchange Act], Act No. 25 of 1948. 338 Further, the Companies Law requires large companies (companies with stated capital greater than 500 million yen or debt of 20 billion yen) listed on a registered exchange to prepare accurate financial statements, including those of its overseas subsidiaries where the Japanese company holds a majority of voting rights (See Companies Act, Article 444 ¶ 3). 339 UCPA, Article 21, ¶ 2. 340 Kaisha Hou [Companies Act], Act No. 86 of 2005, Article 423; Article 847, English translation available at http://www.japaneselawtranslation.go.jp/law/detail/?id=177&vm=04&re=01; http://www.japaneselawtranslation.go.jp/law/detail/?id=149&vm=04&re=01. 341 Dai Konmenta-ru Keihou Dainihan [Great Commentaries of Penal Code, Second Edition] vol. 1 at 370 (Seirin Shoin, 2004). 342 UCPA, Article 22, ¶ 1. 343 OECD Press Release, OECD Says Japan Needs to be Proactive in Foreign Bribery Cases (June 26, 2006), available at http://www.oecd.org/document/35/0,3343,en_2649_37447_37020515_1_1_1_1,00.html. 344 Takashi Tezuka, Gaikoku Koumuin e no Zouwai Kitei no Naiyou [Contexts of Bribery Regulations to Foreign Public Officials], Bijinesu Houmu at 30 (Nov. 2008). 345 See press release by Bridgestone (Feb 12, 2008), available at http://www.bridgestone.co.jp/info/news/2008021201.html.


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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!346 See press release by the Department of Justice (Dec 10, 2008), available at http://www.usdoj.gov/atr/public/press_releases/2008/240307.htm. 347 Takashi Tezuka, Gaikoku Koumuin e no Zouwai Kitei no Naiyou [Contexts of Bribery Regulations to Foreign Public Officials], Bijinesu Houmu at 30 (Nov. 2008). 348 Asahi News Article (Mar 28, 2009), original Japanese version available at http://www.asahi.com/special/09002/TKY200903280002.html; see also Sankei News Article (Feb 1, 2009), original Japanese version available at http://sankei.jp.msn.com/affairs/crime/090201/crm0902011419009-n1.htm. 349 Transparency Int’l, Transparency Int’l Progress Report 2010: Enforcement of the OECD Anti-Bribery Convention, at 67. 350 See http://www.transparency.org/policy_research/surveys_indices/cpi/2010/results. 351 Id. 352 See Stanley Lubman, Bird in a Cage: Chinese Law Reform After Twenty Years, 20 N.W. JOURNAL INT’L LAW & BUSINESS 383, 404 (2000), citing US-China Business Council, China’s Political Developments, in US-China Business Council Comp., China Operations 1998 (Feb. 17-18, 1998). 353 15 U.S.C. § 78dd-1(a). 354 See supra Section II(A). 355 Measures of the People’s Republic of China for the Control of Invoices, Article 20 (Ministry of Finance: 23 Dec. 1993). 356 See, e.g., the discussion of the Lucent case supra in Section VII(A)(1). See also SEC Litig. Rel. No. 21357, SEC Charges California Telecom Company with Bribery and Other FCPA Violations (Dec. 31, 2009), available at http://sec.gov/litigation/litreleases/2009/lr21357.htm (company agreed to pay $3 million in fines and penalties to settle allegations arising from company’s practice to provide overseas trips to government officials). 357 For further discussion of acceptable expenses under the FCPA generally, see supra Section II(B), “Gifts, entertainment, travel, and hospitality.”

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XX. About the Authors H,&&.4,6'O'J,"&41"&\4'J8+3'O'361.K8,&&:91.,6'E54I'J,&#"'.4'9;"54"/'1,'5:12,&'12.4'F67,+3G'.6'#,6Q:6#1.,6'L.12'388M'''?"'25-"'-541'"Y9"&."6#"'5#&,44'5'%&,5/'&56A"',7'$511"&4'.6-,;-.6A'12"'J,&".A6'8,&&:91'+&5#1.#"4'3#1'TtJ8+3tU'56/'561.K#,&&:91.,6';5L4'A"6"&5;;0M''f:&'J8+3'O'361.K8,&&:91.,6'E54I'J,&#"'49"#.5;.c"4'.6'L,&I.6A'L.12'#,$956."4'1,'$565A"'12".&'&.4I'56/'"Y9,4:&"'.6'561.K#,&&:91.,6'.44:"4M''H,&&.4,6'O'J,"&41"&'254'256/;"/'4#,&"4',7'561.K#,&&:91.,6'$511"&4'7,&'A;,%5;'#,$956."4'56/'.6/.-./:5;4'.6'$560'.6/:41&."4'56/'&"A.,64='.6#;:/.6A'#,6/:#1.6A'#&,44K%,&/"&'.61"&65;'.6-"41.A51.,64',6'%"25;7',7'i,5&/4',7'!.&"#1,&4'56/'#,$956."4='&"9&"4"61.6A'#,$956."4'56/'.6/.-./:5;4'.6'.6-"41.A51.,64'%0'12"'!fa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b&,:9'L2.#2'.4'#,$9&.4"/',7'$,&"'1256'*<)'511,&6"04'.6'*C',77.#"4'L,&;/L./"'56/'.6#;:/"4'$560'7,&$"&'7"/"&5;'56/'4151"'#&.$.65;'9&,4"#:1,&4='7,&$"&'@"#:&.1."4'56/'XY#256A"'8,$$.44.,6'T@X8U'"67,&#"$"61'511,&6"04='56/'.6K2,:4"'5##,:61.6A'"Y9"&14'L.12'/"#5/"4',7'9:%;.#'5##,:61.6A'"Y9"&."6#"M''''J,&'$,&"'.67,&$51.,6='9;"54"'-.4.1'www.mofo.com'1,';"5&6'$,&"'5%,:1'Morrison & Foerster’s expertise in this area',&'#,615#1',:&'FCPA & Anti-Corruption Task Force]'

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