Flashback To The Mid-1970’s Regarding The Demand Side
Previous posts here and here discussed the recently introduced Foreign Extortion Prevention Act which seeks to “prohibit a foreign official from demanding a bribe” by amending – not the FCPA – but rather 18 USC 201 (the so-called domestic bribery statute).
In introducing the bill, Representative John Curtis (R-UT), one of the co-sponsors, stated. “Currently, a business being extorted for a bribe can only say ‘I can’t pay you a bribe because it is illegal and I might get arrested.’ This long-overdue bill would enable them to add, ‘and so will you.”
This remark caused a mid-1970’s flashback because, as highlighted below, it largely mirrors the policy rationale of those who supported addressing the so-called foreign corporate payments through a disclosure approach and not the criminalization approach that ultimately became the Foreign Corrupt Practices Act.
The Foreign Extortion Prevention Act: A Response to Professor Koehler
Today’s post is from Baker & McKenzie attorneys Tom Firestone and Maria Piontkovska.
As the authors of one of the articles that contributed to the Foreign Extortion Prevention Act (“FEPA” or the “Act”), we would like to address some of the points made in Professor Koehler’s post on the FCPA Professor of August 5 entitled “Bill Seeks To Capture The Demand Side of Foreign Bribery Through Amendment to 18 USC 201.” (See here)
As an initial matter, we applaud Professor Koehler’s longstanding attention to this issue and understand that despite his criticisms of the text of the bill, Professor Koehler supports the concept of criminalizing the demand side of bribery. He just believes that this should be accomplished through an amendment to the FCPA, rather than to 18 USC §201, as the Act would do and as we suggested in our original article. In support of this argument, he raises several questions about FEPA.
Bill Seeks To Capture The Demand Side Of Foreign Bribery Through Amendment To 18 USC 201
The Foreign Corrupt Practices Act only captures one participant in a bribery scheme (the so-called supply side) in what is nearly always a two participant scheme. For more on this dynamic, see this recent FCPA Flash podcast episode with Tom Firestone (Baker & McKenzie) for how the demand side of bribery can be best addressed from a legal and policy perspective.
This bill titled “Foreign Extortion Prevention Act” recently introduced in the House by Representatives Sheila Jackson Lee (D- TX), John Curtis (R-UT), Tom Malinowski (D- NJ), and Richard Hudson (R-NC) seeks to “prohibit a foreign official from demanding a bribe.”
FCPA Flash Podcast – A Conversation With Tom Firestone Regarding The Demand Side Of Bribery
The FCPA Flash podcast provides in an audio format the same fresh, candid, and informed commentary about the Foreign Corrupt Practices Act and related topics as readers have come to expect from written posts on FCPA Professor.
This FCPA Flash episode is a conversation with Tom Firestone (Baker & McKenzie). During the podcast, Firestone talks about his recent article titled “Two to Tango Attacking the Demand Side of Bribery” and how the demand side of bribery can be best addressed from a legal and policy perspective.
Friday Roundup
Interesting, from the DOJ’s perspective, pay them more, sanctioned, scrutiny update, exit, and for the reading stack. It’s all here in the Friday roundup.
Interesting
As highlighted here, in December 2016 Odebrecht S.A. (a Brazilian holding company) and Braskem S.A. (a Brazil-based petrochemical company in which Odebrecht owns a majority of voting shares) resolved a large FCPA and related enforcement action largely concerning conduct in Brazil including the companies relationships with Petrobras as well as allegations of improper payments in Angola, Argentina, Brazil, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Mozambique, Panama, Peru, and Venezuela.