Last week, the Department of Justice and the Securities and Exchange Commission jointly released a highly anticipated guide about the Foreign Corrupt Practices Act (“FCPA”). The publication, officially titled A Resource Guide to the U.S. Foreign Corrupt Practices Act and available here, is an informative resource to the extent it describes the analytical framework used by the government in reviewing issues arising under the FCPA and the government’s interpretation of some of the statute’s key provisions.
In particular, the guide’s discussion about various fact patterns provides insight into what the government views as both problematic and permissible conduct. Hypothetical situations involving gifts and travel and entertainment expenses, for example, reflect the government’s view of reasonable, bona fide payments that will not give rise to FCPA liability. And for the first time, the government discloses examples of situations in which it has declined to prosecute. Among the other topics that receive extended treatment are the FCPA’s accounting provisions, the potential remedies for FCPA violations, and the different ways that FCPA cases are resolved.
At the same time, the guide is certain to disappoint many practitioners to the extent it does not provide definitive guidance on some of the most difficult questions that arise under the FCPA, including exactly who qualifies as a foreign official under the statute, how much diligence should be done in connection with hiring agents and conducting M&A transactions, when a parent company may be held liable for the acts of its subsidiaries, and how much credit is actually given by the government for self-reporting and other forms of cooperation. Instead of addressing these questions with clear-cut answers, the guide states that these issues must be left to a case-by-case analysis based on the specific facts and circumstances at issue.
Nonetheless, by combining a discussion of legal principles, policy considerations, and hypothetical fact patterns into one official annotated compendium, the guide is an important development in an area that continues to lack extensive judicial precedent or other authoritative practice resources