A New York federal district court judge has dismissed a Foreign Corrupt Practices Act (“FCPA”) claim against a former executive of Siemens, S.A. Argentina and Siemens Transportation Systems for lack of personal jurisdiction. The U.S. Securities and Exchange Commission (“SEC”) brought the civil FCPA enforcement action against Herbert Steffen for his role in an alleged scheme by which Siemens paid bribes to top government officials in Argentina to secure a project to create national identity cards.Continue Reading...
One of the goals of the Foreign Corrupt Practices Act (“FCPA”) is to prevent US companies and individuals from paying bribes to foreign officials in exchange for business. To this end, the FCPA prohibits any domestic individual or business entity from making payments to a “foreign official” for the purpose of obtaining or retaining business. 15 U.S.C. § 78dd-2(a)(1). However, who, precisely, qualifies as a “foreign official” is the subject of much uncertainty. In particular, whether employees of a state-owned company qualify as foreign officials for purposes of FCPA is an area of great concern—and potential liability—particularly for US companies doing business in Latin America where governments often have at least some level of involvement in various business sectors from education to utilities to health care.Continue Reading...
Increased Opportunities for Foreign Investment in Brazil Also Bring Increased Risk for FCPA Violations
By Curt Dombek and Karin Johnson
With the award to Rio de Janeiro of two of the highest profile sports events in the world—the 2014 World Cup and the 2016 Summer Olympics—many U.S. and multinational corporations will be looking for investment opportunities in Brazil. If the 2008 Olympics in China are to be any kind of guide, foreign investment in Brazil will dramatically increase over the next several years and Brazil will become an increasingly attractive market. Companies looking to do business or invest in Brazil, however, should also be aware of the risks they face under the Foreign Corrupt Practices Act (“FCPA”) and should ensure that they have a strong compliance program in place.
By Rebecca Roberts
According to Forbes, the government has initiated more proceedings under the Foreign Corrupt Practices Act in the last five years than it did in the previous twenty. Given the huge expense and political and economic implications of an enforcement action, many companies choose to settle rather than litigate. As a result, there is not much case law on the constitutional implications of the FCPA’s long reach, which may, in some cases, exceed due process requirements.