“Bribing foreign officials is wrong, but not everything governments do to prevent it is wise or proportional,” begins a new piece in The Economist comparing the U.K. Bribery Act (which went into force this summer) and the U.S. Foreign Corrupt Practices Act (which was born in 1977, the same year the world’s first personal computer, the Commodore PET, went to market.)
This Pepsi Challenge ends poorly for the American anti-bribery law, which the magazine says is written “confusingly” and applied “vigorously.”
The law’s muddled language and broad reach — bosses can be held accountable for bribes paid by their subordinates in far-flung subsidiaries, even if they didn’t know about them — coupled with aggressive enforcement by the Justice Department and the SEC, has deterred foreign investment, the piece argues.
The central complaint is that the FCPA, unlike the U.K. Bribery Act, has no compliance defense, a shield for companies that show they have tough procedures and processes in place to prevent corrupt practices. This feature of the Bribery Act will minimize crippling investigations “into an otherwise blameless company,” the magazine says.
(The FCPA Professor has a great post on reform bills in the 1980s that sought to create a compliance defense for the FCPA — this in light of a forthcoming bill Rep. Jim Sensenbrenner that will likely include such a defense.)
Anti-corruption groups have argued that a compliance defense would engender fig-leaf compliance programs, and Assistant Attorney General Lanny Breuer, head of the Justice Department’s Criminal Division, has flatly rejected the notion of one.
via Economist: UK Bribery Act Is ‘Smarter’ Than FCPA – Corruption Currents – WSJ.
