The Foreign Corrupt Practices Act (FCPA) is a federal law in the United States that concerns foreign business activities. The act seeks to deter foreign corrupt practices by punishing instances of bribery. The act also specifies how companies with securities must maintain accurate and transparent records in accordance with the Securities Exchange Act of 1934.
The Foreign Corrupt Practices Act (FCPA) is primarily a concern for large, multinational firms. Due to their interactions with foreign officials, such companies are prone to violate FCPA’s anti-bribery provisions. Multinational firms that issue stock should also be careful to comply with FCPA requirements concerning foreign issuers of securities.
Can a Small Business Violate the FCPA?
Although the FCPA generally applies to large companies, the provisions of the act are also applicable to small or mid-sized businesses that engage in business activities with a foreign official. Even the activities of individuals may violate the FCPA.
As commerce in the global economy becomes increasingly viable, small businesses that deal with foreign partners abroad need to become vigilant with the provisions of the FCPA.
How Can My Business Comply with the FCPA?
In order to comply with the anti-bibery provisions in the FCPA, you or your business should not facilitate bribes or any form of corrupt payments. You are not allowed to pay a foreign official in order to further a business activity.
Small businesses are more likely to become unwitting targets of corrupt solicitations because many of their business activities may be done under the radar. Also, since a small business may lack a sophisticated management team, it may become a perfect target for unscrupulous local officials.
Seeking Legal Advice
If you suspect that a foreign official, an agent, or a business entity is soliciting a corrupt payment, you should notify the US Department of Justice (DOJ). You should also seek an attorney’s help when handling business activities in foreign countries. Furthermore, if you suspect that you have been involved in making a corrupt payment, a criminal defense attorney should evaluate your situations.