What are the restrictions imposed by the Foreign Corrupt Practices Act?

The Foreign Corrupt Practices Act (FCPA) is a federal law that restricts corporations and other entities from engaging in bribery and other forms of corruption in the international business arena. The FCPA is enforced by the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ). The FCPA has two primary elements. The first element prohibits companies from offering, promising, or giving anything of value to foreign officials, political candidates, or political parties in order to gain any business advantage. Additionally, companies may not offer anything of value to any person or entity, public or private, in order to induce them to use their influence to help the company obtain or retain business. The second element of the FCPA requires companies to maintain accurate records of all financial transactions and internal controls. Companies must create and maintain a system of internal accounting and financial controls that are designed to provide reasonable assurances that transactions are executed in compliance with the law and that all financial records are kept accurately. The FCPA also prohibits companies from off-the-book or secret payments. Companies are not allowed to make payments that are not properly disclosed in corporate records. The FCPA provides both civil and criminal penalties for violating the law. Companies and individuals may face hefty fines, as well as jail time if convicted. Fines may range up to $2 million per violation and unlimited imprisonment. In addition, companies may also face debarment from government contracts for a period of up to three years.

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What are the restrictions imposed by the Foreign Corrupt Practices Act?

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