“FCPA Diligence in Infrastructure Transactions”
Companies that make, authorize, or even promise bribes to foreign officials face the risk of criminal prosecution under U.S. law. The United States Foreign Corrupt Practices Act of 1977 (FCPA) makes it illegal for issuers, domestic concerns and, under certain circumstances, foreign persons, to bribe foreign officials in order to obtain or retain business. The FCPA also covers the officers, directors, employees and agents of such companies. Companies that acquire businesses that have engaged in bribery can acquire significant liability.
FCPA compliance presents special challenges for U.S. companies and investors engaged in infrastructure and energy transactions worldwide. Infrastructure and energy projects are particularly susceptible to FCPA violations. Companies can reduce this risk by performing in-depth FCPA diligence when acquiring an at-risk target.
This Stroock Special Bulletin highlights some of the procedures that should be employed when conducting FCPA diligence in infrastructure or energy transactions outside of the U.S.