DOJ And SEC Issue Long-Awaited Resource Guide To The Foreign Corrupt Practices Act

On November 14, 2012, the Department of Justice and the Securities and Exchange Commission published their much anticipated Resource Guide to the U.S. Foreign Corrupt Practices Act.1 There is little new in the Guide to clarify the circumstances under which the government will charge companies or individuals with FCPA violations. Instead, the Guide reiterates previous government pronouncements that the FCPA should be construed broadly, and cites its own charging decisions as "authority" for what the statute proscribes. Basically, the Guide is a comprehensive compilation of "authority" formerly found only in various Government press releases, settlement agreements and guilty pleas. Thus, the guidance is somewhat of a disappointment for the experienced FCPA practitioner and for companies that already have robust compliance programs. In a few areas – notably in its discussion of gifts, travel and entertainment – the Guide does offer a few practical compliance tips for companies still trying to find their compliance footing in the challenging business conditions that prevail in many foreign countries. Some key points made in the Guide are highlighted below.

The FCPA outlaws bribes for purposes beyond winning or retaining government contracts.

The Guide advances the Government's view that the FCPA is not limited merely to bribes paid to obtain or retain government contracts, but also covers payments made to foreign officials for any business purpose. For instance, the Guide states that payments to foreign officials to reduce or eliminate customs duties, to enable the release of goods or equipment from customs, to lower tax assessments, to obtain government action to prevent competitors from entering a market, or to circumvent a licensing or permit requirement would all be unlawful. See Guide at 12-13. The bulk of the "authority" cited by the Guide in support of this unduly broad interpretation are civil complaints and criminal informations filed by the government in connection with negotiated settlements, and even a handful of SEC and DOJ press releases. See id. at 107, nn. 66 & 68. The only caselaw cited by the government for this expansive view of the FCPA is the decision of the Fifth Circuit in United States v. Kay, 359 F.3d 738 (5th Cir. 2004). Yet, despite the suggestion in the Guide to the contrary, Kay held that to support an FCPA charge the government must prove the defendant made an offer or payment with the intent to bring about a specific result "that would assist (or is meant to assist) in obtaining or retaining...