.....................Contents of this web page:
[1] US Foreign Corrupt Practices Act
(1997)
[2] US International Bribery and Fair Competition Act (1998)

Author's Note: The selected statutes are representative and are not the entire 1977 and 1998 Acts, portions of which appear in different titles of the federal code (USC). Bolding has been added to certain headings. Section numbers of the 1977 Act, appearing in this edited versin of the statute, and in red, have been amended by the 1998 Act which follows.

.....[1] FOREIGN CORRUPT PRACTICES ACT (1977)
................United States Congress (15 US Code Sec. 78dd-1)

(a) Prohibition
......It shall be unlawful for any issuer which has a class of securities registered pursuant to section 78l of this title or which is required to file reports under section 78o(d) of this title, or for any officer, director, employee, or agent of such issuer or any stockholder thereof acting on behalf of such issuer, to make use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay, or authorization of the payment of any money, or offer, gift, promise to give, or authorization of the giving of anything of value to--
(1) any foreign official for purposes of--

(A) (i) influencing any act or decision of such foreign official in his official capacity, or (ii) inducing such foreign official to do or omit to do any act in violation of the lawful duty of such official, or
(B) inducing such foreign official to use his influence with a foreign government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, in order to assist such issuer in obtaining or retaining business for or with, or directing business to, any person;

(2) any foreign political party or official thereof or any candidate for foreign political office for purposes of--

(A) (i) influencing any act or decision of such party, official, or candidate in its or his official capacity, or (ii) inducing such party, official, or candidate to do or omit to do an act in violation of the lawful duty of such party, official, or candidate,
(B) inducing such party, official, or candidate to use its or his influence with a foreign government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality.

(3) any person, while knowing that all or a portion of such money or thing of value will be offered, given, or promised, directly or indirectly, to any foreign official, to any foreign political party or official thereof, or to any candidate for foreign political office, for purposes of--

.....(A) (i) influencing any act or decision of such foreign official, political party, party official, or candidate in his or its official capacity, or (ii) inducing such foreign official, political party, party official, or candidate to do or omit to do any act in violation of the lawful duty of such foreign official, political party, party official, or candidate, or
.....(B) inducing such foreign official, political party, party official, or candidate to use his or its influence with a foreign government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, in order to assist such issuer in obtaining or retaining business for or with, or directing business to, any person.

(b) Exception for routine governmental action
......Subsection (a) of this section shall not apply to any facilitating or expediting payment to a foreign official, political party, or party official the purpose of which is to expedite or to secure the performance of a routine governmental action by a foreign official, political party, or party official.

(c) Affirmative defenses
......It shall be an affirmative defense to actions under subsection (a) of this section that--
......(1) the payment, gift, offer, or promise of anything of value that was made, was lawful under the written laws and regulations of the foreign official's, political party's, party official's, or candidate's country; or
......(2) the payment, gift, offer, or promise of anything of value that was made, was a reasonable and bona fide expenditure, such.as travel and lodging expenses, incurred by or on behalf of a foreign official, party, party official, or candidate and was directly related to--

(A) the promotion, demonstration, or explanation of products or services; or
(B) the execution or performance of a contract with a foreign government or agency thereof.

(d) Guidelines by Attorney General
......Not later than one year after August 23, 1988, the Attorney General, after consultation with the Commission, the Secretary of Commerce, the United States Trade Representative, the Secretary of State, and the Secretary of the Treasury, and after obtaining the views of all interested persons through public notice and comment procedures, shall determine to what extent compliance with this section would be enhanced and the business community would be assisted by further clarification of the preceding provisions of this section and may, based on such determination and to the extent necessary and appropriate, issue--
.....(1) guidelines describing specific types of conduct, associated with common types of export sales arrangements and business contracts, which for purposes of the Department of Justice's present enforcement policy, the Attorney General determines would be in conformance with the preceding provisions of this section; and
.....(2) general precautionary procedures which issuers may use on a voluntary basis to conform their conduct to the Department of Justice's present enforcement policy regarding the preceding provisions of this section.
.................................................................................
(f) Definitions
......For purposes of this section:
......(1) The term "foreign official" means any officer or employee of a foreign government or any department, agency, or instrumentality thereof, or any person acting in an official capacity for or on behalf of any such government or department, agency, or instrumentality.
......(2) (A) A person's state of mind is "knowing" with respect to conduct, a circumstance, or a result if--
.................(i) such person is aware that such person is engaging in such conduct, that such circumstance. exists, or that such result is substantially certain to occur; or
.................(ii) such person has a firm belief that such circumstance exists or that such result is substantially
certain to occur.
............(B) When knowledge of the existence of a particular circumstance is required for an offense, such knowledge is established if a person is aware of a high probability of the existence of such circumstance, unless the person actually believes that such circumstance does not exist.
......(3)(A) The term "routine governmental action" means only an action which is ordinarily and commonly performed by a foreign official in--

.......(i) obtaining permits, licenses, or other official documents to qualify a person to do business in a foreign country;
.......(ii) processing governmental papers, such as visas and work orders;
.......(iii) providing police protection, mail pick-up and delivery, or scheduling inspections associated with contract performance or inspections related to transit of goods across country;
.......(iv) providing phone service, power and water supply, loading and unloading cargo, or protecting perishable products or commodities from deterioration; or
.......(v) actions of a similar nature.

.........(B) The term "routine governmental action" does not include any decision by a foreign official whether, or on what terms, to award new business to or to continue business with a particular party, or any action taken by a foreign official involved in the decision-making process to encourage a decision to award new business to or continue business with a particular party.
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[2] INTERNATIONAL BRIBERY AND FAIR COMPETITION ACT (1998)
...............United States Congress (Public Law 105-366, 1998 Sec. 2375)

.....An Act to amend the Securities Exchange Act of 1934 and the Foreign Corrupt Practices Act of 1977 to improve the competitiveness of American business and promote foreign commerce, and for other purposes.
.....Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.
This Act may be cited as the "International Anti-Bribery and Fair Competition Act of 1998".

SEC. 2. AMENDMENTS TO THE FOREIGN CORRUPT PRACTICES ACT GOVERNING [SECURITIES] ISSUERS.
(a) PROHIBITED CONDUCT
.-- ... [15 U.S.C. 78dd-1(a)] is amended--
......(1) by amending subparagraph (A) of paragraph (1) to read as follows:

"(A)(i) influencing any act or decision of such foreign official in his official capacity, (ii) inducing such foreign official to do or omit to do any act in violation of the lawful duty of such official, or (iii) securing any improper advantage; or";

......(2) by amending subparagraph (A) of paragraph (2) to read as follows:

..........."(A)(i) influencing any act or decision of such party, official, or candidate in its or his official capacity, (ii) inducing such party, official, or candidate to do or omit to do an act in violation of the lawful duty of such party, official, or candidate, or (iii) securing any improper advantage; or"; and

......(3) by amending subparagraph (A) of paragraph (3) to read as follows:
..........."(A)(i) influencing any act or decision of such foreign official, political party, party official, or candidate in his or its official capacity, (ii) inducing such foreign official, political party, party official, or candidate to do or omit to do any act in violation of the lawful duty of such foreign official, political party, party official, or candidate, or (iii) securing any improper advantage; or".

(b) OFFICIALS OF INTERNATIONAL ORGANIZATIONS.--Paragraph (1) of ... [15 U.S.C. 78dd-1(f)(1)] is amended to read as follows:

"(1)(A) The term 'foreign official' means any officer or employee of a foreign government or any department, agency, or instrumentality thereof, or of a public international organization, or any person acting in an official capacity for or on behalf of any such government or department, agency, or instrumentality, or for or on behalf of any such public international organization.
......"(B) For purposes of subparagraph (A), the term 'public international organization' means--
............."(i) an organization that is designated by Executive order pursuant to section 1 of the International Organizations Immunities Act (22 U.S.C. 288); or
............."(ii) any other international organization that is designated by the President by Executive order for the purposes of this section, effective as of the date of publication of such order in the Federal Register.".

(c) ALTERNATIVE JURISDICTION OVER ACTS OUTSIDE THE UNITED STATES.-- ...
[15 U.S.C. 78dd-1] is amended--
.....(1) by adding at the end the following:
.........................................................................................
..........(g) ALTERNATIVE JURISDICTION.--

"(1) It shall also be unlawful for any issuer organized under the laws of the United States, or a State, territory, possession, or commonwealth of the United States or a political subdivision thereof and which has a class of securities registered pursuant to section 12 of this title or which is required to file reports under section 15(d) of this title, or for any United States person that is an officer, director, employee, or agent of such issuer or a stockholder thereof acting on behalf of such issuer, to corruptly do any act outside the United States in furtherance of an offer, payment, promise to pay, or authorization of the payment of any money, or offer, gift, promise to give, or authorization of the giving of anything of value to any of the persons or entities set forth in paragraphs (1), (2), and (3) of subsection (a) of this section for the purposes set forth therein, irrespective of whether such issuer or such officer, director, employee, agent, or stockholder makes use of the mails or any means or instrumentality of interstate commerce in furtherance of such offer, gift, payment, promise, or authorization.

"(2) As used in this subsection, the term 'United States person' means a national of the United States (as defined in section 101 of the Immigration and Nationality Act (8 U.S.C. 1101)) or any corporation, partnership, association, joint-stock company, business trust, unincorporated organization, or sole proprietorship organized under the laws of the United States or any State, territory, possession, or commonwealth of the United States, or any political subdivision thereof.";
....................................................................................
"(e) PENALTIES.
--
......"(1)(A) Any juridical person that violates subsection (a) of this section shall be fined not more than $2,000,000.
..........."(B) Any juridical [corporate] person that violates subsection (a) of this section shall
be subject to a civil penalty of not more than $10,000 imposed in an action brought by the Attorney General.
......"(2)(A) Any natural person who willfully violates subsection (a) of this section shall be fined not more than $100,000 or imprisoned not more than 5 years, or both.
..........."(B) Any natural person who violates subsection (a) of this section shall be subject to a civil penalty of not more than $10,000 imposed in an action brought by the Attorney General.
......"(3) Whenever a fine is imposed under paragraph (2) upon any officer, director, employee, agent, or stockholder of a person, such fine may not be paid, directly or indirectly, by such person.

......."(f) DEFINITIONS.--For purposes of this section:
............."(1) The term "person', when referring to an offender, means any natural person other than a national of the United States (as defined in section 101 of the Immigration and Nationality Act (8 U.S.C. 1101) or any corporation, partnership, association, joint-stock company, business trust, unincorporated organization, or sole proprietorship organized under the law of a foreign nation or a political subdivision thereof.

.............."(2)(A) The term 'foreign official' means any officer or employee of a foreign government or any department, agency, or instrumentality thereof, or of a public international organization, or any person acting in an official capacity for or on behalf of any such government or department, agency, or instrumentality, or for or on behalf of any such public international organization.
...................."(B) For purposes of subparagraph (A), the term 'public international organization' means--
..........................."(i) an organization that is designated by Executive order pursuant to section 1 of the International Organizations.Immunities Act (22 U.S.C. 288); or
..........................."(ii) any other international organization that is designated by the President by Executive order for the purposes of this section, effective as of the date of publication of such order in the Federal Register.
................"(3)(A) A person's state of mind is knowing, with respect to conduct, a circumstance or a result if--
............................"(i) such person is aware that such person is engaging in such conduct, that such circumstance exists, or that such ....result is substantially certain to occur; or
............................"(ii) such person has a firm belief that such circumstance exists or that such result is substantially certain to occur.
......................"(B) When knowledge of the existence of a particular circumstance is required for an offense, such knowledge is established if a person is aware of a high probability of the existence of such circumstance, unless the person actually believes that such circumstance does not exist.

................."(4)(A) The term 'routine governmental action' means only an action which is ordinarily and commonly performed by a foreign official in--
........................"(i) obtaining permits, licenses, or other official documents to qualify a person to do business in a foreign country;
........................."(ii) processing governmental papers, such as visas and work orders;
........................."(iii) providing police protection, mail pick-up and delivery, or scheduling inspections associated with contract performance or inspections related to transit of goods across country;
........................."(iv) providing phone service, power and water supply, loading and unloading cargo, or protecting perishable products or commodities from deterioration; or
........................."(v) actions of a similar nature.
............. .. ....."(B) The term 'routine governmental action' does not include any decision by a foreign official whether, or on what terms, to award new business to or to continue business with a particular party, or any action taken by a foreign official involved in the decision-making process to encourage a decision to award new business to or continue business with a particular party.

................."(5) The term 'interstate commerce' means trade, commerce, transportation, or communication among the several States, or between any foreign country and any State or between any State and any place or ship outside thereof, and such term includes the intrastate use of--
......................."(A) a telephone or other interstate means of communication, or
......................."(B) any other interstate instrumentality.".
....................................................................................... . . .
SEC. 6. ENFORCEMENT AND MONITORING.
(a) REPORTS REQUIRED
.--Not later than July 1 of 1999 and each of the 5 succeeding years, the Secretary of Commerce shall submit to the House of Representatives and the Senate a report that contains the following information with respect to implementation of the Convention:
....(1) RATIFICATION.--A list of the countries that have ratified the Convention, the dates of ratification by such countries, and the entry into force for each such country.
....(2) DOMESTIC LEGISLATION.--A description of domestic laws enacted by each party to the Convention that implement commitments under the Convention, and assessment of the compatibility of such laws with the Convention.
....(3) ENFORCEMENT.--As assessment of the measures taken by each party to the Convention during the previous year to fulfill its obligations under the Convention and achieve its object and purpose including--

(A) an assessment of the enforcement of the domestic laws described in paragraph (2);
(B) an assessment of the efforts by each such party to promote public awareness of such domestic laws and the achievement of such object and purpose; and
(C) an assessment of the effectiveness, transparency, and viability of the monitoring process for the Convention, including its inclusion of input from the private sector and nongovernmental organizations.

....(4) LAWS PROHIBITING TAX DEDUCTION OF BRIBES.--An explanation of the domestic laws enacted by each party to the Convention that would prohibit the deduction of bribes in the computation of domestic taxes.

....(5) NEW SIGNATORIES.--A description of efforts to expand international participation in the Convention by adding new signatories to the Convention and by assuring that all countries which are or become members of the Organization for Economic Cooperation and Development are also parties to the
Convention.

....(6) SUBSEQUENT EFFORTS.--An assessment of the status of efforts to strengthen the Convention by extending the prohibitions contained in the Convention to cover bribes to political parties, party officials, and candidates for political office.

....(7) ADVANTAGES.--Advantages, in terms of immunities, market access, or otherwise, in the countries or regions served by the organizations described in section 5(a), the reason for such advantages, and an assessment of progress toward fulfilling the policy described in that section.

....(8) BRIBERY AND TRANSPARENCY.--An assessment of anti-bribery programs and transparency with respect to each of the international organizations covered
by this Act.

....(9) PRIVATE SECTOR REVIEW.--A description of the steps taken to ensure full involvement of United States private sector participants and representatives of nongovernmental organizations in the monitoring and implementation of the Convention.

....(10) ADDITIONAL INFORMATION.--In consultation with the private sector participants and representatives of nongovernmental organizations described in paragraph (9), a list of additional means for enlarging the scope of the Convention and otherwise increasing its effectiveness. Such additional means shall include, but not be limited to, improved recordkeeping provisions and the desirability of expanding the applicability of the Convention to additional individuals and organizations and the impact on United States business of section 30A of the Securities Exchange Act of 1934 and sections 104 and 104A of the Foreign Corrupt Practices Act of 1977

(b) DEFINITION.--For purposes of this section, the term "Convention" means the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions adopted on November 21, 1997, and signed on December 17, 1997, by the United States and 32 other nations.

Approved November 10, 1998.

 Go To Chapter 13, Section 13.5, text p.663, after
Foreign Corrupt Practices Act reference to this web page.

..Last rev: 07/03/02
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