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FCPA Scenarios
Foley has developed FCPA Scenarios to raise questions relating to the various issues and problems you may face as a compliance professional. While these hypothetical situations will not always apply to your company, they could trigger questions concerning your business that you may want to address. As always, if you have any questions about these scenarios, please feel free to contact us.
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Allegations of Improper Payments by Third-parties
You work for a U.S. multinational that is an “issuer” within the meaning of the Exchange Act. After investigating an allegation of improper payments by your Chinese affiliate, you conclude that the affiliate’s president, a U.S. citizen residing in China, authorized a third-party representative to pay a cash bribe of $1,000 to secure a contract. The payment is recorded on the affiliate’s books as a “consulting fee.”
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Client Travel
The company is introducing a new product and wants to organize a conference to demonstrate its use.
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Foreign Business License Applications
In order to bid on a particular government contract, your company must first be licensed to transact business. Your company’s application has been pending for several months and without the license you will be technically disqualified. You have received a call from the country manager seeking your approval to pay $500 to a government clerk to “jump the licensing queue.” What is your advice?
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Foreign Subsidiary
AmeriCo, a company which trades on the NYSE, owns 40% of an electronics manufacturing subsidiary in Japan; its two Japanese investment partners own 40% and 20%, respectively.
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Gift to Government Official
You are about to close a big deal with your company’s governmental partner, the Ministry of the Interior. To commemorate the occasion, you give to the Minister a gold-plated fire extinguisher engraved with the closing date and the parties’ names. Your assistant characterizes the gift as a “promotional expense” and identifies the recipient and the purpose of the payment.
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Payment to Local Counsel to Settle Dispute with Foreign Government
Opportune Oil & Gas constructs a natural gas pipeline for the Government of Offshoreslavia. After construction is complete and the pipeline is running at full capacity, Opportune presents its final invoice for a significant sum to the Offshore government but it refuses to honor the obligation.
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Red Flag or Green Light?
A large international company, with the help of a foreign agent, is preparing a bid on an RFP to provide security services and equipment for a government building complex in Jakarta, Indonesia.
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Trade Show
CorpCo has decided to rent a large exhibit space at the year’s premier motorcycling trade show in order to demonstrate its newest line.
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Violation Disclosures
You have conducted an internal investigation of questionable payments made in connection with securing a $400 million contract with a foreign government and have concluded that the payments arguably violated the FCPA.
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Work Visas
You are an employee of a company subsidiary in Offshoreslavia. It is your responsibility to ensure that expatriate employees obtain their work visas to assist the company’s operations in the country.
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