Page 9 - U.S. FOREIGN CORRUPT PRACTICES ACT

A Resource Guide to the U.S. Foreign Corrupt Practices Act. Second Edition.

Chapter 1
Introduction

INTRODUCTION

Congress enacted the U.S. Foreign Corrupt Practices Act (FCPA or the Act) in 1977 in response

to revelations of widespread bribery of foreign officials by U.S. companies. The Act was

intended to halt those corrupt practices, create a level playing field for honest businesses,
and restore public confidence in the integrity of the marketplace. 3

The FCPA contains both anti-bribery and The Department of Justice (DOJ) and the
accounting provisions. The anti-bribery provisions Securities and Exchange Commission (SEC) share
prohibit U.S. persons and businesses (domestic FCPA enforcement authority and are committed to

concerns), U.S. and foreign public companies listed fighting foreign bribery through robust enforcement.
on stock exchanges in the United States or that are An important component of this effort is education,
required to file periodic reports with the Securities and this resource guide, prepared by DOJ and SEC
and Exchange Commission (issuers), and certain staff, aims to provide businesses and individuals
foreign persons and businesses acting while in the with information to help them abide by the law,

territory of the United States (territorial jurisdiction) detect and prevent FCPA violations, and implement
from making corrupt payments to foreign officials to effective compliance programs.
obtain or retain business. The accounting provisions
require issuers to make and keep accurate books The Costs of Corruption
and records and to devise and maintain an Corruption is a global problem. In the four
adequate system of internal accounting controls. decades since Congress enacted the FCPA, the

The accounting provisions also prohibit individuals extent of corporate bribery has become clearer and
and businesses from knowingly falsifying books and its ramifications in a transnational economy starker.
records or knowingly circumventing or failing to Corruption impedes economic growth by diverting
implement a system of internal controls. public resources from important priorities such as

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