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Friday Roundup

A “foreign official” headed to prison, more on monitors, the language of bribery, more pre-enforcement action news, and perspectives from the field.

It’s all here in the Friday roundup.

Haitian “Foreign Official” Headed to U.S. Prison

Numerous prior posts (see here, here, and here) have covered the FCPA and FCPA-related enforcement action involving Telecommunications D’Haiti (“Haiti Teleco”).

The action was noteworthy because it involved “foreign officials.” Because the Foreign Corrupt Practices Act only applies to bribe givers and not bribe recipients, the charges were not FCPA charges, but rather a money laundering conspiracy charge.

Earlier this week, Robert Antoine (a former Director of International Relations of Haiti Teleco responsible for negotiating contracts with international telecommunications companies on behalf of Haiti Teleco), was sentenced to four years in prison. In addition, Antoine was ordered to serve three years of supervised release following his prison term, ordered to pay $1,852,209 in restitution, and ordered to forfeit $1,580,771. (See here for the DOJ release).

Certain of the indicted defendants, including “foreign official” Jean Rene Duperval, have not pleaded and the DOJ release notes that “trial for these remaining defendants is scheduled to begin July 19, 2010, in U.S. District Court in Miami.”

Additional Guidance on the Use of Monitors in Deferred Prosecution Agreements and Non-Prosecution Agreements

Most corporate FCPA enforcement actions involve deferred prosecution or non-prosecution agreements. Many of these agreements require the appointment of a compliance monitor.

Thus, most FCPA aficionados are familiar with the “Morford Memo” – the March 2008 DOJ guidance “relating to the use of independent corporate monitors in connection with deferred prosecution agreements and non-prosecution agreements with corporations.” The Morford Memo (see here) sets forth nine basic principles for
drafting monitor-related provisions in such agreements.

Recently Acting Deputy Attorney General Gary Grindler issued a memo (see here) “to supplement the guidance in the Morford Memorandum by adding a tenth basic principle to guide prosecutors in drafting agreements: namely, that an agreement should explain what role the Department could play in resolving any disputes between the monitor and the corporation, given the facts and circumstances of the case.”

The Language of Bribery

The FCPA is a serious topic.

But that doesn’t mean an FCPA article can’t be informative and entertaining at the same time.

Case in point, “A Bribe By Any Other Name” by James Tillen and Sonia Delman (Miller & Chevalier) (see here).

Don’t understand the significance of “moon cakes,” “rice cake expenses” or “black mist?”

You probably should.

As the authors note, “[w]hen an expatriate manager does not recognize that a subordinate is seeking reimbursement for a bribe disguised by a code word or when auditors miss a suspect transaction concealed behind a local idiom, the employees themselves and the company as a whole are at serious risk of running afoul of anti-bribery laws.”

The article concludes with a “few simple steps” companies can take to incorporate the language of bribery into compliance training and policies.

The Flood of Pre-Enforcement Action News Continues

One of these days, the FCPA dam is going to burst because the surge of pre-enforcement action news continues.

Among others in the “stay-tuned” category are: Alcatel-Lucent, Technip, Panalpina, Pfizer and Johnson & Johnson.

Add to the list Universal Corporation, “the world’s leading leaf tobacco merchant and processor.” (see here).

The company’s recent 10-K (see here) notes as follows:

“As a result of a posting to our Ethics Complaint hotline alleging improper activities that involved or related to certain of our tobacco subsidiaries, the Audit Committee of our Board of Directors engaged an outside law firm to conduct an investigation of the alleged activities. That investigation revealed that there have been payments that may have violated the U.S. Foreign Corrupt Practices Act. The payments approximated $2 million over a seven-year period. In addition, the investigation revealed activities in foreign jurisdictions that may have violated the competition laws of such jurisdictions, but we believe those activities did not violate U.S. antitrust laws. We voluntarily reported these activities to the Department of Justice (“DOJ”) and the SEC in March 2006. On June 6, 2006, the SEC notified us that a formal order of investigation had been issued.

Since voluntarily reporting, we have cooperated with and assisted the DOJ and SEC in their investigations, and for the past year we have engaged in settlement discussions with both authorities to resolve the matter. Those negotiations have resulted in agreements in principle being reached with representatives of the DOJ and the staff of the SEC. The final resolution of this matter remains subject to the completion of definitive agreements and the approval and execution of those agreements by the DOJ and the SEC. In addition, each settlement is subject to the approval of a federal district court with jurisdiction over the matter. We have been given no assurance that the settlements will be approved by the DOJ, SEC, or federal district courts. Based on the agreements in principle that have been reached to date, the resolution of this matter with the DOJ and the SEC is expected to include injunctive relief, disgorgement and prejudgment interest, fines, penalties, and the retention of an independent compliance monitor. Based in part on the progress of the matter and consultation with outside counsel, we have recorded accruals from time to time since the matter arose that are adequate to satisfy the estimated financial settlement we expect with the resolution of the matter. The financial settlement is not expected to have a material effect on our financial condition or results of operations.”

Incidentally, on the same day, Universal issued a press release announcing record annual earnings (see here).

U.K. Bribery Bill – Perspectives from the Conference Circuit

Michael Osajda (see here) is an attorney and business ethics consultant. He frequently writes and speaks on FCPA issues, including for World-Check (see here).

In the below guest post, Osajda offers perspectives from recent presentations in Singapore and Hong Kong attended by over 120 business professionals and attorneys.


“My presentation compared and contrasted the FCPA and the U.K. Bribery Act. I spoke of the different bases for the two statutes, the FCPA being a product of a unique post Watergate cloture and a significant Cold War foreign policy element and the Bribery Act, a product of legislative efficiency and the need for the UK to comply with the OECD convention. The new offenses of foreign private bribery and failure to prevent bribery were stressed.

Like many commentators, the attendees were nervous about the SFO’s stated use of prosecutorial discretion to address issues such as facilitation payments and the appropriateness of business expenses. Attendees were concerned that SFO statements that it does not intend to shut down business and that it will look reasonably at facilitation payments, especially in circumstances that appear to be coercion that can be given to the field. These issues may be a mine filed until some pattern of prosecution or abstention is established. Another concern of attendees was the new strict liability offense of failure to prevent bribery. The attendees were interested as to the elements of “adequate procedures.” While the Sentencing Guidelines, the Woolf Report and OECD guidance are good starts, we will all wait for the guidance to come from the UK Secretary of State on the components of “adequate procedures”.

All in all this Asia trip underscores the world-wide interest of multinationals, whatever their home jurisdictions, to the issue of corruption. All understand that the landscape is changing and are interested in doing the right thing.”


Also, Trace recently conducted a symposium in London “attended by over 60 company representatives and featuring speakers from government, the private bar and in-house legal and compliance departments.” For insight into what was on the minds of program participants see here.

James Giffen Update

The FCPA enforcement action against James Giffen goes back a long way.

April 2003 to be precise (see here).

The case concerns allegations that Giffen made approximately $80 million in payments to senior Kazakhstan officials in connection with numerous deals in which American companies acquired oil and gas rights in Kazakhstan. In defense, Giffen has implicated the CIA and much of the delay in prosecuting this case revolves around access to classified documents.

The case is still active as documented in this recent Main Justice piece by Lisa Brennan.

Few have been following the Giffen case closer than Steve LeVine (see here). LeVine is author of The Oil and the Glory (see here).

A key figure in LeVine’s book is James Giffen.

In this guest post, LeVine profiles next Monday’s hearing in the Giffen case.


Next week, James Giffen — the former chief oil adviser to Kazakhstan President Nursultan Nazarbayev — returns to court in New York for the longest-running U.S. foreign bribery case in history. His strategy — to gum up the works in the hope of getting all or most of the charges dropped — has thus far appeared ingenious: Seven years after being led away in handcuffs from JFK Airport, Giffen appears none-too-close to trial. But will it ultimately pay off?

If the strategy does prevail, the Giffen case could send an important signal to bribers with financial wherewithal — you can wait out the Department of Justice.

A key question at the moment is whether Giffen’s lawyers — in the vein of their already-bold, go-for-broke approach — can plausibly, and as early as next Monday, successfully motion for dismissal of the charges on the basis of his Sixth Amendment right to a speedy trial.

William Schwartz, Giffen’s chief lawyer and a former assistant U.S. Attorney in the Southern District where Giffen’s case is being heard, declined to comment on the question of a Sixth Amendment motion when I emailed him. But I rang up lawyers specializing in the Foreign Corrrupt Practices Act — the law applied to foreign bribery cases — and they made the across-the-board observation that Giffen’s strategy may not be strong enough to achieve such a straight-forward victory.

In his defense, Giffen asserts that the Central Intelligence Agency either knew or should have known all along that he was diverting millions of dollars from U.S. oil companies — a total of some $80 million — to Nazarbayev and other powerful Kazakhs. When he advanced the strategy, it was exquisitely timed — in among the strongest periods of the George W. Bush Administration, with its hyper-sensitivity about the release of even unclassified documents — under the premise that the CIA was unlikely to disgorge cables and what-not that would validate Giffen’s claims. And if the CIA did refuse to so cooperate, Giffen could claim compellingly that he couldn’t receive a fair trial.

Up to this point, Giffen has proven correct — the CIA has been as slow as molassas, and has consequently tested the patience of federal Judge William Pauley. Yet, that doesn’t necessarily add up to a successful Sixth Amendment motion, experts tell me. To win, Giffen would have to show an outside reason why the long delay has occurred, and that he is being harmed by it. But as a former U.S. prosecutor who didn’t want to be identified told me, “When much of the litigation is instigated by the defendant, the defense would be hard-pressed to claim that it’s been denied a speedy trial.” As for hardship or harm, Giffen hasn’t been sitting in jail, but rather whiling away his time at home in Westchester County near the Winged Foot Golf Club.

Even so, said Richard N. Dean, a Washington-based FCPA lawyer with long experience in the former Soviet Union, that doesn’t mean that Giffen won’t prevail. He sees a more fundamental issue at stake — “I just don’t know if [the prosecution] has a case or not,” says Dean, who is a partner at Baker & McKenzie.

That is, it’s true that the CIA has dragged its heels, but so has the prosecution itself — it hasn’t seemed at all in a rush to bring the case to trial. That makes Dean wonder “how strong they think their case is, whether they believe they can overcome the defense’s assertion” of the CIA defense.

Schwartz, in other words, probably can’t abbreviate the current snail’s-pace pre-trial process: Judge Pauley is unlikely to grant a Sixth Amendment motion.

There’s always the chance that government prosecutors will demonstrate renewed spine in Monday’s hearing, and make it plain that they intend to go to trial soon — the Justice Department certainly doesn’t wish to give bribe-givers or their lawyers the idea that they can use delaying tactics to wiggle out of an FCPA case. In that event, Schwartz would need to prepare for a knock-down, drag-out jury trial that would reveal embarrassing details about his client’s luxurious, heavy-partying life abroad.

Yet, given the case thus far, one gets the impression that one or both sides wish the case would simply go away. If this is in Schwartz’s thinking, he must patiently hope that the prosecution elects to save face by dropping at least some of the more onerous charges, and perhaps then persuade Giffen to plead to lesser violations of the law.

Q & A With Martin Weinstein

Martin Weinstein (here) is a “dean” of the FCPA bar. Much of my early understanding of the FCPA came as a direct result of working with Martin on FCPA investigations and enforcement actions. I also have Martin to thank for several of the stamps in my passport.

Below is a Q & A exchange with Martin in which he talks about the FCPA’s early years, the current state of enforcement, and suggestions for change.


Q: As a 1984 law school graduate did you have any exposure to the FCPA? Describe your first exposure to the FCPA?

A: When I was in law school, I never heard of the Foreign Corrupt Practices Act and didn’t even know that it existed until around 1991. I was an Assistant U.S. Attorney, and a witness I was interviewing mentioned to me that she thought that some payments had been made to an Egyptian government official. I remember turning to the investigating agent who was with me and saying, “isn’t there a statute somewhere that prohibits this?” That was my first exposure to the Foreign Corrupt Practices Act.

Q: You were lead DOJ counsel in the Lockheed case in the mid-1990’s. Generally describe this matter, how it was resolved, and whether resolution of this case, if brought in 2010, would look any different?

A: I was the lead counsel in the Lockheed case that was resolved in the mid-1990’s, specifically January 1995. It was, by all accounts, the first really serious corporate case brought in the then 20 year history of the Foreign Corrupt Practices Act. In that case, the company actually was indicted, and the allegations involved payments to a member of the Egyptian Parliament to obtain a contract through which the Egyptian Air Force would buy three C130 aircraft from Lockheed. There were two individuals also charged. The cases against all three defendants (the company and the two individuals) were resolved before trial, in the company’s case, literally days before the jury was to be selected.

The company agreed to plead guilty to a conspiracy to violate the Foreign Corrupt Practices Act. It agreed to pay a combination of civil and criminal damages in the amount of $24.8 million, which was twice the profit of the contract they had with the Egyptian military to sell the C130 aircraft.

One of the individuals pled guilty to a lesser charge, and the other individual, a marketing manager named Suleiman Nassar, actually fled to Syria. That was one of the most interesting parts of the case for me because I visited Damascus on several occasions and negotiated directly with the government. Nassar was imprisoned in Syria on these charges, but was ultimately released and returned to the U.S. to plead guilty to violating the FCPA and became, I believe, the first person to go to jail under the FCPA.

Q: Did FCPA enforcement, during the last decade, morph into something other than what Congress intended the FCPA to address when passed in 1977?

A: The last decade of FCPA enforcement has seen extraordinary evolution, and I think you have to say that when Congress passed the law in 1977, they did not envision the wide reach of enforcement today and the types of things that the government gets involved in, such as transactions, joint ventures, and successor liability. I do think that the DOJ and the SEC have stayed generally true to the vision of the FCPA, which focuses on things of value, primarily money, going to foreign government officials in exchange for business.

Q: What is your biggest challenge as an FCPA practitioner? How has your FCPA practice changed over the past decade?

A: The challenges as an FCPA practitioner have mainly involved keeping up with the pace of the enforcement agencies in recent years. Whereas cases used to involve U.S. companies and their businesses in a few countries, the typical case now involves enforcement actions by multiple sovereigns involving the same company at the same time, and that makes the practice more challenging and more fascinating.

Q: What are your clients’ biggest challenges / frustrations with the FCPA or FCPA enforcement? Have these challenges / frustrations changed over the past decade?

A: I think that companies’ main frustration is that even with an outstanding compliance program and 99% of the employees maintaining strict adherence to the laws, you can still have violations which expose the entire company to extraordinarily serious penalties. I think the government has, at times, lost track of the main motivations for this statute and has become focused on the amounts of penalties, the imposition of compliance monitors, and exercising government control over what are basically private businesses. The vast majority of companies are absolutely committed to following the spirit and the letter of the FCPA, but when a company gets into trouble, the whole enterprise can be put at risk because of the conduct of a few people, and that doesn’t seem right. I worry that the government has come to see private industry through “dirty” glasses: the punishments don’t seem to fit the crimes.

Q: The FCPA was passed in 1977, amended in 1988 and also amended in 1998. Given this approximate ten year cycle, is the FCPA in need of further amendment? If so, what would the “Weinstein” amendment look like?

A: I think the Weinstein amendment would focus on the very significant issue of who is a foreign official and what constitutes a state-controlled instrumentality. There is so little guidance in this area that an amendment to the law providing clarity to companies wishing to comply is really essential. For example, after the U.K. government takeovers of certain British banks and U.S. intervention in the auto industry, did all these private businesses become state-controlled instrumentalities rendering all their employees government officials? Companies should not have to guess who is and who is not a government official.

Q: Arguably the two most egregious bribery schemes in recent years involved Siemens and BAE. In both instances, the companies were not charged with FCPA antibribery violations. What message does this send?

A: Siemens and BAE were not charged with antibribery violations largely for two different reasons. In the Siemens case and a number of other cases, charging a company with antibribery violations renders it susceptible to significant suspension and debarment risks. If the government can find suitable alternatives to antibribery charges and still tell the full story of the conduct to the public, it is really a much more just solution not to expose the company to extreme suspension and debarment risks. In BAE, I think the issue was much more one of jurisdiction, and I think the government is going to find this issue repeatedly if it continues to seek to prosecute foreign companies that have relatively little contact with U.S. interstate commerce.

Q: How can law and business schools best expose future lawyers and business leaders to the FCPA? What advice do you have for law students interesting in a future FCPA practice?

A: The FCPA has been a fantastic area in which to practice and to watch evolve. For students who are interested in the field, I think the most important thing is to learn as much as you can about U.S. criminal law and U.S. securities law and their interplay with various anticorruption laws around the world. It has become a very complicated field and I think it is safe to say the stakes for companies and individuals have never been higher.

Point – Counterpoint With Billy Jacobson

A few weeks ago, I took issue with Mark Mendelsohn’s (DOJ Deputy Chief, Fraud Section and the DOJ’s FCPA “top cop”) recent defense of the 2008 Siemens enforcement action. (see here).

In response, I heard from William Jacobson.

I am always grateful for reader feedback, especially when its comes from someone the caliber of Jacobson – the former Assistant Chief for FCPA Enforcement at the Fraud Section, Criminal Division, U.S. Department of Justice. While at DOJ, Jacobson worked closely with Mendelsohn, including on the Siemens matter. For more on Jacobson’s role at DOJ see this recent profile in Main Justice. Jacobson is currently the Vice President, Co-General Counsel, and Chief Compliance Officer at Weatherford International, Ltd. (see here).

With Jacobson’s permission, I set forth our e-mail exchange below.


WJ – I have to take issue with your recent post regarding the Siemens settlement. As a recent émigré to the world of in-house counsel, I can assure you that the staggering monetary settlement made a tremendous impact in boardrooms across the U.S. and the world. One can certainly argue that the government should have kept investigating Siemens until it uncovered every scrap of evidence against the company. One can also argue that the fine and disgorgement amounts could have been greater. However, the government’s goal was not to destroy the company and thereby cause untold damage to its shareholders. In fact, I think it is fair to say that the government’s goal was to sufficiently punish the company without destroying the company. An investigation lasting several more years and a fine of several billion dollars could well have done that – not to mention debarment, the lack of which you have also criticized.

Since at least 2001, the Fraud Section has been trying to bring “real-time” prosecutions as often as possible. This often means focusing on the one or two most egregious transactions at issue in a case, bringing a case based upon those transactions and moving on. An important component of this strategy in FCPA cases has been ensuring that companies improve their compliance departments to mitigate the chances of bad conduct recurring. This is precisely what the Fraud Section (as well as the SEC and the Munich Prosecutor) did with Siemens and, in my opinion, it was the correct approach.

MK – Nice to hear from you and thanks for reading the blog. I am not suggesting that in a case that apparently involved hundreds, if not thousands, of separate bribe payments, that the DOJ/SEC need to fully investigate each and every instance, perhaps focusing on six, ten (I don’t know what the magical number is or should be) is desirable. Even so, is it too much to ask that, as to those six or ten instances, that the criminal charges actually fit the facts? In other words, is it too much to ask of the DOJ to actually charge a company that clearly committed FCPA antibribery violations with FCPA antibribery charges?

Point taken that the “government’s goal was not to destroy the company and thereby cause untold damage to its shareholders.” Indeed, that is a legitimate policy issue present in any corporate criminal matter, FCPA or not. However, is agreeing to an overall penalty LESS than the amount of the alleged payments and LESS than the amount of the business allegedly obtain or retained – is that “sufficiently punishing” the company. Siemens net income between 2004-2008 (a time period that does not even cover the full range of the relevant time period) was approximately $28.3 billion. Thus, the worldwide fines and penalties accounted for approximately 5% of its net income, how does this “sufficiently punish” the company? Is not one justified, when viewing the amounts at issue, to conclude that this whole episode was a net positive for Siemens?

You raise the debarment issue, which I have discussed on my blog as well. My opinion is that the message DOJ says it wants to send in these cases, will not be sent until a company is debarred for a specific time period. If the DOJ is looking for deterrence it has the tools at its disposal.

If “real-time” prosecutions are indeed the goal of the DOJ (a dubious assertion given that many, many disclosed FCPA cases have languished for years and years) that is a good goal. However, the rush to get things settled and put a nice shiny bow around a case so that the enforcement agencies can conserve resources and focus elsewhere, and so that the company can move on, should not result in a situation, which I think is reflected in the Siemens and BAE enforcement actions, that certain companies in certain industries which sell to certain customers are essentially immune from FCPA antibribery violations.

WJ: While I agree that debarment would send an even stronger deterrent message than non-debarment, it is hard to see how a $1.6B penalty equates with immunity as you suggest. There is always more punishment that is possible, but the maximum does not have to be applied for DOJ to be effective.

Another factor that should be considered is jurisdiction. If I remember correctly, the Siemens charging papers state that its Venezuelan and Bangladeshi subsidiaries used U.S bank accounts to further their bribe schemes. The papers do not make similar US-nexus allegations for either the parent company or the Argentine subsidiary. Thus, it may be that DOJ felt it didn’t have jurisdiction over the parent company for a bribery charge. As for BAE, I can only say what press reports make clear – the case was enormously challenging for many different reasons. I think the folks at DOJ would agree that their settlement was not perfect, but I think they did an admirable job of not having perfect be the enemy of good.

MK – I am clearly not suggesting that Siemens escaped liability for its “egregious,” “staggering,” and “brazen” corrupt conduct (those are the enforcement agencies’ words – not mine). However, it sure seems that certain companies have come to be immune from FCPA antibribery charges. Any time a particular company is immune from particular aspects of a law, respect for that law and indeed the rule of law suffers.

As to Siemens and whether there was a U.S. nexus sufficient to charge an antibribery violation, the DOJ’s information clearly states that Siemens Power Generation (with offices in Florida), Siemens Power Transmission and Distribution (with offices in North Carolina) and Siemens Transportation Systems (with offices in California) were key players in the overall bribery scheme – presumably DOJ included the “with offices” in the U.S. part for a reason.

In any event, where does this leave the future of FCPA enforcement. I teach the FCPA to my students, should I now conclude my FCPA section with “FCPA enforcement – an area of law where perfect should not be the enemy of good.” If you are an individual sitting in prison today because you violated the FCPA’s antibribery provisions, how do you explain to such an individual that certain companies are immune from the same conduct for which they are sitting in prison?

WJ: Those of your students that aspire to prosecution, especially white collar prosecution, would be well served to learn that concept, yes. Prosecutorial discretion is a wonderful feature of our judicial system which often leads to imperfect solutions, but, on balance, usually – though certainly not all the time — works out just about right.

Understanding Issuers

The FCPA (both the antibribery provisions and the books and records and internal control provisions) apply to issuers.

That was easy.

What is not so easy is figuring out just which companies are issuers. The FCPA defines an issuer as when a company “has a class of securities registered” with the SEC pursuant to the securities laws or when a company is “required to file reports” with the SEC pursuant to the securities laws.

These terms can be confusing, particularly when talking about non-U.S. based companies.

In connection with both the BAE and Technip matters, there was some mention of a potential SEC angle despite the fact that neither company currently has shares traded on a U.S. exchange.

Miller & Chevalier’s release in connection with the BAE matter (here) states:

“The U.S. pleadings detail significant issues with BAE’s compliance program and internal controls, yet the pleadings did not allege substantive violations of the FCPA’s accounting provisions, and the Securities and Exchange Commission (“SEC”) has yet to bring an action against BAE. The absence of SEC charges may reflect a lack of SEC jurisdiction because BAE was not subject to the registration and reporting requirements of the Securities and Exchange Act during the relevant time period, which is required for FCPA accounting provision jurisdiction. According to press accounts, however, the SEC may have investigated BAE in connection with the al-Yamamah arms sale. The status of this possible investigation remains unclear.”

Technip’s release (here) speaks of both the DOJ and SEC involvement in resolution of that matter.

Enter James Tillen (here), one of the co-authors of the Miller & Chevalier piece, to help explain SEC jurisdiction in these two similar, yet different matters.

Here is what he had to say.

“We specifically note in the Client Alert that the absence of an SEC resolution was likely due to the fact that the SEC did not have jurisdiction: ‘The absence of SEC charges may reflect a lack of SEC jurisdiction because BAE was not subject to the registration and reporting requirements of the Securities and Exchange Act during the relevant time period, which is required for FCPA accounting provision jurisdiction.’ Press accounts reported that the SEC was investigating at some point so it was worth raising the question of why no SEC resolution (especially since the DOJ effectively brought an internal controls case).

I looked quite closely at the issue of whether BAE was an issuer and concluded the following:

The definition of issuer includes any entity “which has a class of securities registered pursuant to” Section 12(g) of the Securities Exchange Act of 1934 or “which is required to file reports under” Section 15(d) of the Securities Exchange Act. 15 U.S.C. §§ 78dd-1(a), 78c(a)(8), 781, 78o(d). During the relevant time period, BAE Systems plc’s ADRs were sold in the United States Over The Counter (“OTC”), and not on any national securities exchanges, such as the NYSE, which require registration with the SEC. In fact, BAE has filed for an exemption from registration under Section 12(g) of the Exchange Act since at least 2002. See List of Foreign Issuers That Have Submitted Information Under the Exemption Relating to Certain Foreign Securities, SEC Release No. 34-45855 (May 1, 2002) (BAE listed as British Aerospace plc), SEC Release No. 34-49846 (June 10, 2004), and SEC Release No. 34-51893 (June 28, 2005). Pursuant to this exemption, BAE must provide information to the SEC on a yearly basis by completing Form F-6. See Rule 12g3-2. However, BAE is exempt from the annual and other periodic reports under Section 15(d) of the Act. See 17 C.F.R. § 240.15d-3. Based on these considerations, it would appear that BAE is not subject to the registration and reporting requirements of the Securities Exchange Act and therefore not an “issuer” for purposes of FCPA jurisdiction.”

In contrast, Tillen stated that Technip “had American Depository Shares listed on NYSE from at least 2001 until 2007. Thereafter, it delisted (see here and here) and now only trades on the OTC (over-the-counter) market. When it was listed, Technip was an ‘issuer’ for purposes of the FCPA.”


Thanks for the explanation James.

As my mentor was fond of saying … “at least now I am confused on a higher level.”

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