15 U.S.C. 78dd-1
78dd-1. Prohibited foreign trade practices by issuers
(a) Prohibition. It shall be unlawful for any issuer which has a class of securities registered
pursuant to section 12 of this title or which is required to file reports under section 15(d) of
this title, or for any officer, director, employee, or agent of such issuer or any stockholder
thereof acting on behalf of such issuer, to make use of the mails or any means or
instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise
to pay, or authorization of the payment of any money, or offer, gift, promise to give, or
authorization of the giving of anything of value to--
(1) any foreign official for purposes of--
(A) (i) influencing any act or decision of such foreign official in his official capacity, or
(ii) inducing such foreign official to do or omit to do any act in violation of the lawful duty
of such official, or
(B) inducing such foreign official to use his influence with a foreign government or
instrumentality thereof to affect or influence any act or decision of such government or
instrumentality,
in order to assist such issuer in obtaining or retaining business for or with, or directing
business to, any person;
(2) any foreign political party or official thereof or any candidate for foreign political office
for purposes of--
(A) (i) influencing any act or decision of such party, official, or candidate in its or his official
capacity, or (ii) inducing such party, official, or candidate to do or omit to do an act in
violation of the lawful duty of such party, official, or candidate,
(B) inducing such party, official, or candidate to use its or his influence with a foreign
government or instrumentality thereof to affect or influence any act or decision of such
government or instrumentality,
in order to assist such issuer in obtaining or retaining business for or with, or directing
business to, any person; or
(3) any person, while knowing that all or a portion of such money or thing of value will be
offered, given, or promised, directly or indirectly, to any foreign official, to any foreign
political party or official thereof, or to any candidate for foreign political office, for purposes
of--
(A) (i) influencing any act or decision of such foreign official, political party, party official,
or candidate in his or its official capacity, or (ii) inducing such foreign official, political party,
party official, or candidate to do or omit to do any act in violation of the lawful duty of such
foreign official, political party, party official, or candidate, or
(B) inducing such foreign official, political party, party official, or candidate to use his or its
influence with a foreign government or instrumentality thereof to affect or influence any act or
decision of such government or instrumentality,
in order to assist such issuer in obtaining or retaining business for or with, or directing
business to, any person.
(b) Exception for routine governmental action. Subsection (a) shall not apply to any
facilitating or expediting payment to a foreign official, political party, or party official the
purpose of which is to expedite or to secure the performance of a routine governmental action
by a foreign official, political party, or party official.
(c) Affirmative defenses. It shall be an affirmative defense to actions under subsection (a)
that--
(1) the payment, gift, offer, or promise of anything of value that was made, was lawful under
the written laws and regulations of the foreign official's, political party's, party official's, or
candidate's country; or
(2) the payment, gift, offer, or promise of anything of value that was made, was a reasonable
and bona fide expenditure, such as travel and lodging expenses, incurred by or on behalf of a
foreign official, party, party official, or candidate and was directly related to--
(A) the promotion, demonstration, or explanation of products or services; or
(B) the execution or performance of a contract with a foreign government or agency thereof.
(d) Guidelines by the Attorney General. Not later than one year after the date of the
enactment of the Foreign Corrupt Practices Act Amendments of 1988, the Attorney General,
after consultation with the Commission, the Secretary of Commerce, the United States Trade
Representative, the Secretary of State, and the Secretary of the Treasury, and after obtaining
the views of all interested persons through public notice and comment procedures, shall
determine to what extent compliance with this section would be enhanced and the business
community would be assisted by further clarification of the preceding provisions of this section
and may, based on such determination and to the extent necessary and appropriate, issue--
(1) guidelines describing specific types of conduct, associated with common types of export
sales arrangements and business contracts, which for purposes of the Department of Justice's
present enforcement policy, the Attorney General determines would be in conformance with
the preceding provisions of this section; and
(2) general precautionary procedures which issuers may use on a voluntary basis to conform their conduct to the Department of Justice's present enforcement policy regarding the preceding provisions of this section.
The Attorney General shall issue the guidelines and procedures referred to in the preceding
sentence in accordance with the provisions of subchapter II of chapter 5 of title 5, United
States Code, and those guidelines and procedures shall be subject to the provisions of chapter 7
of that title.
(e) Opinions of the Attorney General.
(1) The Attorney General, after consultation with appropriate departments and agencies of
the United States and after obtaining the views of all interested persons through public notice
and comment procedures, shall establish a procedure to provide responses to specific inquiries
by issuers concerning conformance of their conduct with the Department of Justice's present
enforcement policy regarding the preceding provisions of this section. The Attorney General
shall, within 30 days after receiving such a request, issue an opinion in response to that
request. The opinion shall state whether or not certain specified prospective conduct would,
for purposes of the Department of Justice's present enforcement policy, violate the preceding
provisions of this section. Additional requests for opinions may be filed with the Attorney
General regarding other specified prospective conduct that is beyond the scope of conduct
specified in previous requests. In any action brought under the applicable provisions of this
section, there shall be a rebuttable presumption that conduct, which is specified in a request by
an issuer and for which the Attorney General has issued an opinion that such conduct is in
conformity with the Department of Justice's present enforcement policy, is in compliance with
the preceding provisions of this section. Such a presumption may be rebutted by a
preponderance of the evidence. In considering the presumption for purposes of this paragraph,
a court shall weigh all relevant factors, including but not limited to whether the information
submitted to the Attorney General was accurate and complete and whether it was within the
scope of the conduct specified in any request received by the Attorney General. The Attorney
General shall establish the procedure required by this paragraph in accordance with the
provisions of subchapter II of chapter 5 of title 5, United States Code, and that procedure shall
be subject to the provisions of chapter 7 of that title.
(2) Any document or other material which is provided to, received by, or prepared in the
Department of Justice or any other department or agency of the United States in connection
with a request by an issuer under the procedure established under paragraph (1), shall be
exempt from disclosure under section 552 of title 5, United States Code, and shall not, except
with the consent of the issuer, be made publicly available, regardless of whether the Attorney
General responds to such a request or the issuer withdraws such request before receiving a
response.
(3) Any issuer who has made a request to the Attorney General under paragraph (1) may
withdraw such request prior to the time the Attorney General issues an opinion in response to
such request. Any request so withdrawn shall have no force or effect.
(4) The Attorney General shall, to the maximum extent practicable, provide timely guidance
concerning the Department of Justice's present enforcement policy with respect to the
preceding provisions of this section to potential exporters and small businesses that are unable
to obtain specialized counsel on issues pertaining to such provisions. Such guidance shall be
limited to responses to requests under paragraph (1) concerning conformity of specified
prospective conduct with the Department of Justice's present enforcement policy regarding the
preceding provisions of this section and general explanations of compliance responsibilities
and of potential liabilities under the preceding provisions of this section.
(f) Definitions. For purposes of this section:
(1) The term "foreign official" means any officer or employee of a foreign government or
any department, agency, or instrumentality thereof, or any person acting in an official capacity
for or on behalf of any such government or department, agency, or instrumentality.
(2) (A) A person's state of mind is "knowing" with respect to conduct, a circumstance, or a result if--
(i) such person is aware that such person is engaging in such conduct, that such circumstance
exists, or that such result is substantially certain to occur; or
(ii) such person has a firm belief that such circumstance exists or that such result is
substantially certain to occur.
(B) When knowledge of the existence of a particular circumstance is required for an offense,
such knowledge is established if a person is aware of a high probability of the existence of
such circumstance, unless the person actually believes that such circumstance does not exist.
(3) (A) The term "routine governmental action" means only an action which is ordinarily
and commonly performed by a foreign official in--
(i) obtaining permits, licenses, or other official documents to qualify a person to do business
in a foreign country;
(ii) processing governmental papers, such as visas and work orders;
(iii) providing police protection, mail pick-up and delivery, or scheduling inspections
associated with contract performance or inspections related to transit of goods across country;
(iv) providing phone service, power and water supply, loading and unloading cargo, or
protecting perishable products or commodities from deterioration; or
(v) actions of a similar nature.
(B) The term "routine governmental action" does not include any decision by a foreign
official whether, or on what terms, to award new business to or to continue business with a
particular party, or any action taken by a foreign official involved in the decision-making
process to encourage a decision to award new business to or continue business with a
particular party.
78ff. Penalties
(a) Willful violations; false and misleading statements. Any person who willfully violates
any provision of this title (other than section 30A, or any rule or regulation thereunder the
violation of which is made unlawful or the observance of which is required under the terms of
this title, or any person who willfully and knowingly makes, or causes to be made, any
statement in any application, report, or document required to be filed under this title or any
rule or regulation thereunder or any undertaking contained in a registration statement as
provided in subsection (d) of section 15 of this title or by any self-regulatory organization in
connection with an application for membership or participation therein or to become
associated with a member thereof, which statement was false or misleading with respect to any
material fact, shall upon conviction be fined not more than $ 1,000,000, or imprisoned not
more than 10 years, or both, except that when such person is a person other than a natural
person, a fine not exceeding $ 2,500,000 may be imposed; but no person shall be subject to
imprisonment under this section for the violation of any rule or regulation if he proves that he
had no knowledge of such rule or regulation.
(b) Failure to file information, documents, or reports. Any issuer which fails to file
information, documents, or reports required to be filed under subsection (d) of section 15 of
this title or any rule or regulation thereunder shall forfeit to the United States the sum of $ 100
for each and every day such failure to file shall continue. Such forfeiture, which shall be in
lieu of any criminal penalty for such failure to file which might be deemed to arise under
subsection (a) of this section, shall be payable to the Treasury of the United States and shall be
recoverable in a civil suit in the name of the United States.
(c)(1) (A) Any issuer that violates section 30A(a) shall be fined not more than $ 2,000,000.
(B) Any issuer that violates section 30A(a) shall be subject to a civil penalty of not more
than $ 10,000 imposed in an action brought by the Commission.
(2) (A) Any officer or director of an issuer, or stockholder acting on behalf of such issuer,
who willfully violates section 30A(a) shall be fined not more than $ 100,000, or imprisoned
not more than 5 years, or both.
(B) Any employee or agent of an issuer who is a United States citizen, national, or resident
or is otherwise subject to the jurisdiction of the United States (other than an officer, director, or
stockholder acting on behalf of such issuer), and who willfully violates section 30A(a), shall
be fined not more than $ 100,000, or imprisoned not more than 5 years, or both.
(C) Any officer, director, employee, or agent of an issuer, or stockholder acting on behalf of
such issuer, who violates section 30A(a) shall be subject to a civil penalty of not more than $
10,000 imposed in an action brought by the Commission.
(3) Whenever a fine is imposed under paragraph (2) upon any officer, director, employee,
agent, or stockholder of an issuer, such fine may not be paid, directly or indirectly, by such
issuer.
15 U.S.C. 78dd-2
78dd-2. Prohibited foreign trade practices by domestic concerns
(a) Prohibition. It shall be unlawful for any domestic concern, other than an issuer which is
subject to section 30A of the Securities Exchange Act of 1934, or for any officer, director,
employee, or agent of such domestic concern or any stockholder thereof acting on behalf of
such domestic concern, to make use of the mails or any means or instrumentality of interstate
commerce corruptly in furtherance of an offer, payment, promise to pay, or authorization of
the payment of any money, or offer, gift, promise to give, or authorization of the giving of
anything of value to--
(1) any foreign official for purposes of--
(A) (i) influencing any act or decision of such foreign official in his official capacity, or (ii)
inducing such foreign official to do or omit to do any act in violation of the lawful duty of such
official, or
(B) inducing such foreign official to use his influence with a foreign government or
instrumentality thereof to affect or influence any act or decision of such government or
instrumentality,
in order to assist such domestic concern in obtaining or retaining business for or with, or
directing business to, any person;
(2) any foreign political party or official thereof or any candidate for foreign political office
for purposes of--
(A) (i) influencing any act or decision of such party, official, or candidate in its or his official
capacity, or (ii) inducing such party, official, or candidate to do or omit to do an act in
violation of the lawful duty of such party, official, or candidate,
(B) inducing such party, official, or candidate to use its or his influence with a foreign
government or instrumentality thereof to affect or influence any act or decision of such
government or instrumentality,
in order to assist such domestic concern in obtaining or retaining business for or with, or
directing business to, any person; or
(3) any person, while knowing that all or a portion of such money or thing of value will be
offered, given, or promised, directly or indirectly, to any foreign official, to any foreign
political party or official thereof, or to any candidate for foreign political office, for purposes
of--
(A) (i) influencing any act or decision of such foreign official, political party, party official,
or candidate in his or its official capacity, or (ii) inducing such foreign official, political party,
party official, or candidate to do or omit to do any act in violation of the lawful duty of such
foreign official, political party, party official, or candidate, or
(B) inducing such foreign official, political party, party official, or candidate to use his or its
influence with a foreign government or instrumentality thereof to affect or influence any act or
decision of such government or instrumentality,
in order to assist such domestic concern in obtaining or retaining business for or with, or
directing business to, any person.
(b) Exception for routine governmental action. Subsection (a) shall not apply to any
facilitating or expediting payment to a foreign official, political party, or party official the
purpose of which is to expedite or to secure the performance of a routine governmental action
by a foreign official, political party, or party official.
(c) Affirmative defenses. It shall be an affirmative defense to actions under subsection (a)
that--
(1) the payment, gift, offer, or promise of anything of value that was made, was lawful under
the written laws and regulations of the foreign official's, political party's, party official's, or
candidate's country; or
(2) the payment, gift, offer, or promise of anything of value that was made, was a reasonable
and bona fide expenditure, such as travel and lodging expenses, incurred by or on behalf of a
foreign official shall not apply to any official, party, party official, or
candidate and was directly related to--
(A) the promotion, demonstration, or explanation of products or services; or
(B) the execution or performance of a contract with a foreign government or agency thereof.
(d) Injunctive relief.
(1) When it appears to the Attorney General that any domestic concern to which this section
applies, or officer, director, employee, agent, or stockholder thereof, is engaged, or about to
engage, in any act or practice constituting a violation of subsection (a) of this section, the
Attorney General may, in his discretion, bring a civil action in an appropriate district court of
the United States to enjoin such act or practice, and upon a proper showing, a permanent
injunction or a temporary restraining order shall be granted without bond.
(2) For the purpose of any civil investigation which, in the opinion of the Attorney General,
is necessary and proper to enforce this section, the Attorney General or his designee are
empowered to administer oaths and affirmations, subpoena witnesses, take evidence, and
require the production of any books, papers, or other documents which the Attorney General
deems relevant or material to such investigation. The attendance of witnesses and the
production of documentary evidence may be required from any place in the United States, or
territory, possession, or commonwealth of the United States, at any designated place of
hearing.
(3) In case of contumacy by, or refusal to obey a subpoena issued to, any person, the
Attorney General may invoke the aid of any court of the United States within the jurisdiction
of which such investigation or proceeding is carried on, or where such person resides or carries
on business, in requiring the attendance and testimony of witnesses and the production of
books, papers, or other documents. Any such court may issue an order requiring such person
to appear before the Attorney General or his designee, there to produce records, if so ordered,
or to give testimony touching the matter under investigation. Any failure to obey such order of
the court may be punished by such court as a contempt thereof. All process in any such case
may be served in the judicial district in which such person resides or may be found. The
Attorney General may make such rules relating to civil investigations as may be necessary or
appropriate to implement the provisions of this subsection.
(e) Guidelines by the Attorney General. Not later than 6 months after the date of the
enactment of the Foreign Corrupt Practices Act Amendments of 1988, the Attorney General,
after consultation with the Securities and Exchange Commission, the Secretary of Commerce,
the United States Trade Representative, the Secretary of State, and the Secretary of the
Treasury, and after obtaining the views of all interested persons through public notice and
comment procedures, shall determine to what extent compliance with this section would be
enhanced and the business community would be assisted by further clarification of the
preceding provisions of this section and may, based on such determination and to the extent
necessary and appropriate, issue--
(1) guidelines describing specific types of conduct, associated with common types of export
sales arrangements and business contracts, which for purposes of the Department of Justice's
present enforcement policy, the Attorney General determines would be in conformance with
the preceding provisions of this section; and
(2) general precautionary procedures which domestic concerns may use on a voluntary basis
to conform their conduct to the Department of Justice's present enforcement policy regarding
the preceding provisions of this section.
The Attorney General shall issue the guidelines and procedures referred to in the preceding
sentence in accordance with the provisions of subchapter II of chapter 5 of title 5, United
States Code, and those guidelines and procedures shall be subject to the provisions of chapter 7
of that title.
(f) Opinions of the Attorney General.
(1) The Attorney General, after consultation with appropriate departments and agencies of
the United States and after obtaining the views of all interested persons through public notice
and comment procedures, shall establish a procedure to provide responses to specific inquiries
by domestic concerns concerning conformance of their conduct with the Department of
Justice's present enforcement policy regarding the preceding provisions of this section. The
Attorney General shall, within 30 days after receiving such a request, issue an opinion in
response to that request. The opinion shall state whether or not certain specified prospective
conduct would, for purposes of the Department of Justice's present enforcement policy, violate
the preceding provisions of this section. Additional requests for opinions may be filed with the
Attorney General regarding other specified prospective conduct that is beyond the scope of
conduct specified in previous requests. In any action brought under the applicable provisions
of this section, there shall be a rebuttable presumption that conduct, which is specified in a
request by a domestic concern and for which the Attorney General has issued an opinion that
such conduct is in conformity with the Department of Justice's present enforcement policy, is
in compliance with the preceding provisions of this section. Such a presumption may be
rebutted by a preponderance of the evidence. In considering the presumption for purposes of
this paragraph, a court shall weigh all relevant factors, including but not limited to whether the
information submitted to the Attorney General was accurate and complete and whether it was
within the scope of the conduct specified in any request received by the Attorney General. The
Attorney General shall establish the procedure required by this paragraph in accordance with
the provisions of subchapter II of chapter 5 of title 5, United States Code, and that procedure
shall be subject to the provisions of chapter 7 of that title.
(2) Any document or other material which is provided to, received by, or prepared in the
Department of Justice or any other department or agency of the United States in connection
with a request by a domestic concern under the procedure established under paragraph (1),
shall be exempt from disclosure under section 552 of title 5, United States Code, and shall not,
except with the consent of the domestic concern, be made publicly available, regardless of
whether the Attorney General responds to such a request or the domestic concern withdraws
such request before receiving a response.
(3) Any domestic concern who has made a request to the Attorney General under paragraph
(1) may withdraw such request prior to the time the Attorney General issues an opinion in
response to such request. Any request so withdrawn shall have no force or effect.
(4) The Attorney General shall, to the maximum extent practicable, provide timely guidance
concerning the Department of Justice's present enforcement policy with respect to the
preceding provisions of this section to potential exporters and small businesses that are unable
to obtain specialized counsel on issues pertaining to such provisions. Such guidance shall be
limited to responses to requests under paragraph (1) concerning conformity of specified
prospective conduct with the Department of Justice's present enforcement policy regarding the
preceding provisions of this section and general explanations of compliance responsibilities
and of potential liabilities under the preceding provisions of this section.
(g) Penalties.
(1) (A) Any domestic concern that violates subsection (a) shall be fined not more than $
2,000,000.
(B) Any domestic concern that violates subsection (a) shall be subject to a civil penalty of
not more than $ 10,000 imposed in an action brought by the Attorney General.
(2) (A) Any officer or director of a domestic concern, or stockholder acting on behalf of such
domestic concern, who willfully violates subsection (a) shall be fined not more than $
100,000, or imprisoned not more than 5 years, or both.
(B) Any employee or agent of a domestic concern who is a United States citizen, national, or
resident or is otherwise subject to the jurisdiction of the United States (other than an officer,
director, or stockholder acting on behalf of such domestic concern), and who willfully violates
subsection (a), shall be fined not more than $ 100,000, or imprisoned not more than 5 years, or
both.
(C) Any officer, director, employee, or agent of a domestic concern, or stockholder acting on
behalf of such domestic concern, who violates subsection (a) shall be subject to a civil penalty
of not more than $ 10,000 imposed in an action brought by the Attorney General.
(3) Whenever a fine is imposed under paragraph (2) upon any officer, director, employee,
agent, or stockholder of a domestic concern, such fine may not be paid, directly or indirectly,
by such domestic concern.
(h) Definitions. For purposes of this section:
(1) The term "domestic concern" means--
(A) any individual who is a citizen, national, or resident of the United States; and
(B) any corporation, partnership, association, joint-stock company, business trust,
unincorporated organization, or sole proprietorship which has its principal place of business in
the United States, or which is organized under the laws of a State of the United States or a
territory, possession, or commonwealth of the United States.
(2) The term "foreign official" means any officer or employee of a foreign government or
any department, agency, or instrumentality thereof, or any person acting in an official capacity
for or on behalf of any such government or department, agency, or instrumentality.
(3) (A) A person's state of mind is "knowing" with respect to conduct, a circumstance, or a
result if--
(i) such person is aware that such person is engaging in such conduct, that such circumstance
exists, or that such result is substantially certain to occur; or
(ii) such person has a firm belief that such circumstance exists or that such result is
substantially certain to occur.
(B) When knowledge of the existence of a particular circumstance is required for an offense,
such knowledge is established if a person is aware of a high probability of the existence of
such circumstance, unless the person actually believes that such circumstance does not exist.
(4) (A) For purposes of paragraph (1), the term "routine governmental action" means only
an action which is ordinarily and commonly performed by a foreign official in--
(i) obtaining permits, licenses, or other official documents to qualify a person to do business
in a foreign country;
(ii) processing governmental papers, such as visas and work orders;
(iii) providing police protection, mail pick-up and delivery, or scheduling inspections
associated with contract performance or inspections related to transit of goods across country;
(iv) providing phone service, power and water supply, loading and unloading cargo, or
protecting perishable products or commodities from deterioration; or
(v) actions of a similar nature.
(B) The term "routine governmental action" does not include any decision by a foreign
official whether, or on what terms, to award new business to or to continue business with a
particular party, or any action taken by a foreign official involved in the decision-making
process to encourage a decision to award new business to or continue business with a
particular party.
(5) The term "interstate commerce" means trade, commerce, transportation, or
communication among the several States, or between any foreign country and any State or
between any State and any place or ship outside thereof, and such term includes the intrastate
use of--
(A) a telephone or other interstate means of communication, or
(B) any other interstate instrumentality.
Section 5003(d) of the Omnibus Trade and Competitiveness Act of 1988, P.L. 100-418, provides:
(d) International Agreement.--
(1) Negotiations.--It is the sense of the Congress that the President should pursue the negotiation of an international agreement, among the members of the Organization of Economic Cooperation and Development, to govern persons from those countries concerning acts prohibited with respect to issuers and domestic concerns by the amendments made by this section. Such international agreement should include a process by which problems and conflicts associated with such acts could be resolved.
(2) Report to Congress.--(A) Within 1 year after the date of the enactment of this Act,
the President shall submit to the Congress a report on--
(iii) possible actions that could be taken to promote cooperation by other
(B) The President shall include in the report submitted under subparagraph (A)--
(ii) an analysis of the potential effect on the interests of the United States,
(iii) an assessment of the current and future role of private initiatives in
IMPLEMENTATION OF OMNIBUS TRADE AND COMPETITIVENESS ACT
OF 1988 AND RELATED INTERNATIONAL TRADE MATTERS, EXECUTIVE
ORDER NO. 12661 (54 FED. REG. 53037) PART III, SEC. 3-101, FOREIGN
CORRUPT PRACTICES ACT AMENDMENTS:
The functions conferred upon the President by section 5003(d)(1) ("International Agreement") of the Omnibus Trade Act are delegated to the Secretary of State, who in performing such functions shall act in consultation with the Attorney General, the United States Trade Representative, the Chairman of the Securities and Exchange Commission, the Secretary of Commerce, the Secretary of the Treasury and the Director of the Office of Management and Budget.
This report is provided courtesy of the Business Information Service for the Newly Independent States (BISNIS)