FCPA: Assisting in Obtaining and Retaining Business

For a violation of the FCPA, one of the elements of the anti-bribery provisions requires that the improper inducement be made to a foreign official in order to assist the individual or entity in obtaining or retaining business for or with, or directing business to, any individual or entity.  The inducement must be intended to induce the official to act on the inducer’s behalf to assist the individual or entity making the inducement in obtaining or retaining business.[1]

The anti-bribery provisions “apply broadly to [inducements] intended to assist the payor, either directly or indirectly, in obtaining or retaining business for some person.”[2]  They should be presumed to extend to official acts or inaction that indirectly assist the individual or entity making the inducement.  Seeking official action favorable to carrying on or maintaining a business enterprise satisfies the business purpose element of the anti-bribery provisions.[3]  This includes making it easier to do more business, whether, for example, it be a reduction of taxes or customs duties.[4]

The term “assist” in the anti-bribery provisions is to be interpreted broadly.[5]   Actions can assist a particular goal simply by making the eventual realization of that goal more likely.  This might include payments to circumvent quotas, bypass licensing requirements, obtain concessions, or reduce taxes.  In so doing, an improper inducement assists in obtaining or retaining business by increasing the amount of produce available for sale or reducing an inducer’s expenses of sale.  This could extend to, for example, to increasing or maintaining the quantity of its sales or other economic dealings.

No requirement exists for the foreign official to be directly involved in awarding or directing the business. Retaining business is not limited to the renewal of contracts or other business.  The prohibition extends to more than the renewal or award of a contract.  It extends to corrupt payments related to the execution or performance of a contract or the carrying out of existing business. It also extends to inducements to a foreign official for the purpose of obtaining more favorable treatment.

[1]United States v. Kay, 359 F.3d 738, 742 (5th Cir. 2004).

[2]Id., at 755.

[3]”The congressional target was bribery paid to engender assistance in improving the business opportunities of the payor or his beneficiary, irrespective of whether that assistance be direct or indirect, and irrespective of whether it be related to administering the law, awarding, extending, or renewing a contract, or executing or preserving an agreement.” Kay II, 359 F.3d at 750. In implementing the OECD Convention, “Congress reaffirmed its intention for the statute to apply to payments that even indirectly assist in obtaining business or maintaining existing business operations in a foreign country.” Id., at 756.

[4]Id., at 755.


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