THe gm of a software company is in the process of constructing a new facility in a country. THe gm has a manager of native origin acting as liaison between the company and government officials. THe new facility requires some permits and licenses. Government officials have indicated to the liaison that the company will have to sanction an unoffical payment. the gm gets the okay from the head officed and authorizes the payment. if prosecuted under the FCPA what defense cna the gm exercise?
a. reasonable expenditure
b. statute of reason to know
c. the stature of routine government action
d. The Eckhard Amendment.
I think it is c.
I agree.
You are correct. The defense that the GM can exercise, if prosecuted under the Foreign Corrupt Practices Act (FCPA), is "the statute of routine government action" (c).
To understand this answer, let's break it down:
The FCPA is a U.S. law that prohibits bribery of foreign officials for business purposes. It applies to companies and individuals, including foreign companies with securities listed in the U.S. or engaging in U.S. business practices.
In this scenario, the government officials have indicated that an unofficial payment is required to obtain the necessary permits and licenses for the new facility. While this may seem like a bribery request, the FCPA includes an exception for "routine government actions" that are commonly and legitimately performed by government officials.
The defense of "the statute of routine government action" provides protection if the payment made is deemed to fall into this exception. Routine government actions generally refer to non-discretionary, administrative tasks that involve obtaining licenses, permits, visas, or other similar actions.
Since the payment required in this situation involves obtaining permits and licenses, the GM can argue that it falls under the category of routine government action. Therefore, they may be able to use this defense if prosecuted under the FCPA.
To further support this defense, the GM should ensure that the payment is accurately recorded in the company's books and records, and that there is no evidence of bribery or corrupt intent. It is crucial to consult legal counsel to navigate the complexities of the FCPA and determine the best course of action.