The Foreign Corrupt Practices Act’s (FCPA) anti-bribery provisions apply to:
- “Domestic concerns,” i.e., all companies incorporated in the United States,
- Every foreign or domestic company that has its principal place of business in the United States,
- Individuals who are U.S. citizens, nationals, or residents.
The FCPA is the most widely enforced anti-corruption law. The United States passed the FCPA in 1977 to address concerns over the integrity of U.S. markets. Congress passed FCPA after hundreds of U.S. companies admitted they paid more than $300 million in bribes to foreign governments to retain or secure business.
With the enactment of certain amendments in 1998, the anti-bribery provisions of the FCPA also apply to foreign firms and individuals who cause—directly or through agents—“an act in furtherance of such a corrupt payment to take place within the territory of the United States.”
In addition to prohibiting the bribery of foreign officials, the FCPA has specific accounting provisions. The law mandates every company with securities listed on a U.S. stock exchange, or that has to file periodic reports with the U.S. Securities and Exchange Commission (SEC), maintains accurate books and records and has a system of internal controls.
The SEC and the U.S. Department of Justice are jointly responsible for FCPA enforcement. The SEC brings civil charges for FCPA violations of the anti-bribery and accounting provisions, while the Department of Justice (DOJ) brings criminal and civil charges for violations of the anti-bribery and books and records provisions.