The original version of the Foreign Corrupt Practices Act (FCPA), enacted in 1977, contained an exception for payments made to non-US officials who performed duties that were “essentially ministerial or clerical”. In 1988 Congress responded by amending the FCPA under the Omnibus Trade and Competitiveness Act to clarify the scope of the FCPA’s prohibitions on bribery, including the scope of permitted facilitation payments. An expanded definition of “routine governmental action” was included in the final version of the bill, reflecting the intent of Congress that the exceptions apply only to the performance of duties listed in the subcategories of the statute and actions of a similar nature. Congress also meant to make clear that “ordinarily and commonly performed actions”, with respect to permits or licenses, would not include those governmental approvals involving an exercise of discretion by a government official where the actions are the functional equivalent of “obtaining or retaining business for, or with, or directing business to, any person.”
Three key takeaways:
- Many companies still struggle with facilitation payments.
- What are the five listed purposes for facilitation payments?
- The facilitation payment exception is narrowly construed by both the courts and the Justice Department.
For more information, check out The Compliance Handbook, 4th edition, here.
