International Law

FCPA And China. Important Ruling Coming Soon.

By Dan

The FCPA Professor Blog is out with a blog post entitled "'Foreign Official'" First" on what constitutes a foreign official for purposes of the United States' Foreign Corrupt Practices Act (FCPA). According to the FCPA Professor Blog, "for the first time in FCPA history, a [United States] federal court judge, with the benefit of a detailed and complete overview of the FCPA's extensive legislative history on the 'foreign official' element, is being asked to rule on the DOJ's interpretation that employees of alleged state-owned or state-controlled enterprises are 'foreign officials' under the FCPA. 

This is a big deal.

To grossly pversimplify what this means, this means that if the court says employees of Chinese state owned entities (SOEs) are foreign officials then "gifts" given to those employees could subject you to criminal prosecution under the FCPA. And if the court holds the other way, then the opposite will be true. Of course this is but one Federal Court in California and an issue this big is going to need to be decided by multiple Federal Courts, including courts of appeal and maybe even the Supreme Court, before U.S. law on this becomes clear. But this is certainly a start.

The FCPA Professor blog links over to the defendant's motion to dismiss the government's case (U.S. v. Stuart Carson, et al.) and that motion can be found here. The FCPA Professor (Michael Koehler) did a declaration supporting defendants" motion and that declaration and that declaration can be found here.

Full post as published by China Law Blog on February 23, 2011 (boomark / email).