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Why US didn't prosecute Walmart for flouting norms in India
Last month, the US issued a guide to the Foreign Corrupt Practices Act or FCPA. The resource guide, published by the Justice Department and the US Securities and Exchange Commission, explains how they enforce the Foreign Corrupt Practices Act, which bars US-linked firms from bribing officials of foreign governments.
It said, for instance, US officials did not prosecute companies accused of bribing officials in foreign countries when companies disclosed the conduct to authorities, fired responsible employees and took steps to improve compliance with the law.
The 120-page guide also provided hypothetical examples to address questions about who the law covers, how it considers gifts or travel expenses and issues involving a foreign company later acquired by another one subject to the FCPA.
Some lawyers involved in such cases said the document was not detailed enough.
"To the extent to which many of us were expecting that this was going to be guidance, as opposed to a resource guide, it doesn't necessarily live up to expectations," said Christopher Garcia, a former federal prosecutor who is now a partner at Weil, Gotshal & Manges.
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Why US didn't prosecute Walmart for flouting norms in India
A few takeaways from the guide:
Examples of actions taken to obtain or retain businesses
- Winning a contract
- Influencing the procurement process
- Circumventing the rules for importation of products
- Gaining access to non-public bid tender information
- Evading taxes or penalties
- Influencing the adjudication of lawsuits or enforcement actions
- Obtaining exceptions to regulations
- Avoiding contract termination
Examples of improper travel and entertainment
- A $12,000 birthday trip for a government decision maker from Mexico that included visits to wineries and dinners
- $10,000 spent on dinners, drinks, and entertainment for a government official
- A trip to Italy for eight Iraqi government officials that consisted primarily of sightseeing and included $1,000 in "pocket money" for each official
- a trip to Paris for a government official and his wife that consisted primarily of touring activities via a chauffeur-driven vehicle
Source: FCPA resource guide, Reuters
