U.S. Code > Title 15 > Chapter 2B > § 78dd-1 - Prohibited foreign trade practices by issuers
Current as of: February 2010 (a) Prohibition
It shall be unlawful for any domestic concern, other than an
issuer which is subject to section 78dd-1 of this title, or for any
officer, director, employee, or agent of such domestic concern or
any stockholder thereof acting on behalf of such domestic concern,
to make use of the mails or any means or instrumentality of
interstate commerce corruptly in furtherance of an offer, payment,
promise to pay, or authorization of the payment of any money, or
offer, gift, promise to give, or authorization of the giving of
anything of value to -
(1) any foreign official for purposes of -
(A)(i) influencing any act or decision of such foreign
official in his official capacity, (ii) inducing such foreign
official to do or omit to do any act in violation of the lawful
duty of such official, or (iii) securing any improper
advantage; or
(B) inducing such foreign official to use his influence with
a foreign government or instrumentality thereof to affect or
influence any act or decision of such government or
instrumentality,
in order to assist such domestic concern in obtaining or
retaining business for or with, or directing business to, any
person;
(2) any foreign political party or official thereof or any
candidate for foreign political office for purposes of -
(A)(i) influencing any act or decision of such party,
official, or candidate in its or his official capacity, (ii)
inducing such party, official, or candidate to do or omit to do
an act in violation of the lawful duty of such party, official,
or candidate, or (iii) securing any improper advantage; or
(B) inducing such party, official, or candidate to use its or
his influence with a foreign government or instrumentality
thereof to affect or influence any act or decision of such
government or instrumentality,
in order to assist such domestic concern in obtaining or
retaining business for or with, or directing business to, any
person; or
(3) any person, while knowing that all or a portion of such
money or thing of value will be offered, given, or promised,
directly or indirectly, to any foreign official, to any foreign
political party or official thereof, or to any candidate for
foreign political office, for purposes of -
(A)(i) influencing any act or decision of such foreign
official, political party, party official, or candidate in his
or its official capacity, (ii) inducing such foreign official,
political party, party official, or candidate to do or omit to
do any act in violation of the lawful duty of such foreign
official, political party, party official, or candidate, or
(iii) securing any improper advantage; or
(B) inducing such foreign official, political party, party
official, or candidate to use his or its influence with a
foreign government or instrumentality thereof to affect or
influence any act or decision of such government or
instrumentality,
in order to assist such domestic concern in obtaining or
retaining business for or with, or directing business to, any
person.
(b) Exception for routine governmental action
Subsections (a) and (i) of this section shall not apply to any
facilitating or expediting payment to a foreign official, political
party, or party official the purpose of which is to expedite or to
secure the performance of a routine governmental action by a
foreign official, political party, or party official.
(c) Affirmative defenses
It shall be an affirmative defense to actions under subsection
(a) or (i) of this section that -
(1) the payment, gift, offer, or promise of anything of value
that was made, was lawful under the written laws and regulations
of the foreign official's, political party's, party official's,
or candidate's country; or
(2) the payment, gift, offer, or promise of anything of value
that was made, was a reasonable and bona fide expenditure, such
as travel and lodging expenses, incurred by or on behalf of a
foreign official, party, party official, or candidate and was
directly related to -
(A) the promotion, demonstration, or explanation of products
or services; or
(B) the execution or performance of a contract with a foreign
government or agency thereof.
(d) Injunctive relief
(1) When it appears to the Attorney General that any domestic
concern to which this section applies, or officer, director,
employee, agent, or stockholder thereof, is engaged, or about to
engage, in any act or practice constituting a violation of
subsection (a) or (i) of this section, the Attorney General may, in
his discretion, bring a civil action in an appropriate district
court of the United States to enjoin such act or practice, and upon
a proper showing, a permanent injunction or a temporary restraining
order shall be granted without bond.
(2) For the purpose of any civil investigation which, in the
opinion of the Attorney General, is necessary and proper to enforce
this section, the Attorney General or his designee are empowered to
administer oaths and affirmations, subpoena witnesses, take
evidence, and require the production of any books, papers, or other
documents which the Attorney General deems relevant or material to
such investigation. The attendance of witnesses and the production
of documentary evidence may be required from any place in the
United States, or any territory, possession, or commonwealth of the
United States, at any designated place of hearing.
(3) In case of contumacy by, or refusal to obey a subpoena issued
to, any person, the Attorney General may invoke the aid of any
court of the United States within the jurisdiction of which such
investigation or proceeding is carried on, or where such person
resides or carries on business, in requiring the attendance and
testimony of witnesses and the production of books, papers, or
other documents. Any such court may issue an order requiring such
person to appear before the Attorney General or his designee, there
to produce records, if so ordered, or to give testimony touching
the matter under investigation. Any failure to obey such order of
the court may be punished by such court as a contempt thereof. All
process in any such case may be served in the judicial district in
which such person resides or may be found. The Attorney General may
make such rules relating to civil investigations as may be
necessary or appropriate to implement the provisions of this
subsection.
(e) Guidelines by Attorney General
Not later than 6 months after August 23, 1988, the Attorney
General, after consultation with the Securities and Exchange
Commission, the Secretary of Commerce, the United States Trade
Representative, the Secretary of State, and the Secretary of the
Treasury, and after obtaining the views of all interested persons
through public notice and comment procedures, shall determine to
what extent compliance with this section would be enhanced and the
business community would be assisted by further clarification of
the preceding provisions of this section and may, based on such
determination and to the extent necessary and appropriate, issue -
(1) guidelines describing specific types of conduct, associated
with common types of export sales arrangements and business
contracts, which for purposes of the Department of Justice's
present enforcement policy, the Attorney General determines would
be in conformance with the preceding provisions of this section;
and
(2) general precautionary procedures which domestic concerns
may use on a voluntary basis to conform their conduct to the
Department of Justice's present enforcement policy regarding the
preceding provisions of this section.
The Attorney General shall issue the guidelines and procedures
referred to in the preceding sentence in accordance with the
provisions of subchapter II of chapter 5 of title 5 and those
guidelines and procedures shall be subject to the provisions of
chapter 7 of that title.
(f) Opinions of Attorney General
(1) The Attorney General, after consultation with appropriate
departments and agencies of the United States and after obtaining
the views of all interested persons through public notice and
comment procedures, shall establish a procedure to provide
responses to specific inquiries by domestic concerns concerning
conformance of their conduct with the Department of Justice's
present enforcement policy regarding the preceding provisions of
this section. The Attorney General shall, within 30 days after
receiving such a request, issue an opinion in response to that
request. The opinion shall state whether or not certain specified
prospective conduct would, for purposes of the Department of
Justice's present enforcement policy, violate the preceding
provisions of this section. Additional requests for opinions may be
filed with the Attorney General regarding other specified
prospective conduct that is beyond the scope of conduct specified
in previous requests. In any action brought under the applicable
provisions of this section, there shall be a rebuttable presumption
that conduct, which is specified in a request by a domestic concern
and for which the Attorney General has issued an opinion that such
conduct is in conformity with the Department of Justice's present
enforcement policy, is in compliance with the preceding provisions
of this section. Such a presumption may be rebutted by a
preponderance of the evidence. In considering the presumption for
purposes of this paragraph, a court shall weigh all relevant
factors, including but not limited to whether the information
submitted to the Attorney General was accurate and complete and
whether it was within the scope of the conduct specified in any
request received by the Attorney General. The Attorney General
shall establish the procedure required by this paragraph in
accordance with the provisions of subchapter II of chapter 5 of
title 5 and that procedure shall be subject to the provisions of
chapter 7 of that title.
(2) Any document or other material which is provided to, received
by, or prepared in the Department of Justice or any other
department or agency of the United States in connection with a
request by a domestic concern under the procedure established under
paragraph (1), shall be exempt from disclosure under section 552 of
title 5 and shall not, except with the consent of the domestic
concern, be made publicly available, regardless of whether the
Attorney General responds to such a request or the domestic concern
withdraws such request before receiving a response.
(3) Any domestic concern who has made a request to the Attorney
General under paragraph (1) may withdraw such request prior to the
time the Attorney General issues an opinion in response to such
request. Any request so withdrawn shall have no force or effect.
(4) The Attorney General shall, to the maximum extent
practicable, provide timely guidance concerning the Department of
Justice's present enforcement policy with respect to the preceding
provisions of this section to potential exporters and small
businesses that are unable to obtain specialized counsel on issues
pertaining to such provisions. Such guidance shall be limited to
responses to requests under paragraph (1) concerning conformity of
specified prospective conduct with the Department of Justice's
present enforcement policy regarding the preceding provisions of
this section and general explanations of compliance
responsibilities and of potential liabilities under the preceding
provisions of this section.
(g) Penalties
(1)(A) Any domestic concern that is not a natural person and that
violates subsection (a) or (i) of this section shall be fined not
more than $2,000,000.
(B) Any domestic concern that is not a natural person and that
violates subsection (a) or (i) of this section shall be subject to
a civil penalty of not more than $10,000 imposed in an action
brought by the Attorney General.
(2)(A) Any natural person that is an officer, director, employee,
or agent of a domestic concern, or stockholder acting on behalf of
such domestic concern, who willfully violates subsection (a) or (i)
of this section shall be fined not more than $100,000 or imprisoned
not more than 5 years, or both.
(B) Any natural person that is an officer, director, employee, or
agent of a domestic concern, or stockholder acting on behalf of
such domestic concern, who violates subsection (a) or (i) of this
section shall be subject to a civil penalty of not more than
$10,000 imposed in an action brought by the Attorney General.
(3) Whenever a fine is imposed under paragraph (2) upon any
officer, director, employee, agent, or stockholder of a domestic
concern, such fine may not be paid, directly or indirectly, by such
domestic concern.
(h) Definitions
For purposes of this section:
(1) The term "domestic concern" means -
(A) any individual who is a citizen, national, or resident of
the United States; and
(B) any corporation, partnership, association, joint-stock
company, business trust, unincorporated organization, or sole
proprietorship which has its principal place of business in the
United States, or which is organized under the laws of a State
of the United States or a territory, possession, or
commonwealth of the United States.
(2)(A) The term "foreign official" means any officer or
employee of a foreign government or any department, agency, or
instrumentality thereof, or of a public international
organization, or any person acting in an official capacity for or
on behalf of any such government or department, agency, or
instrumentality, or for or on behalf of any such public
international organization.
(B) For purposes of subparagraph (A), the term "public
international organization" means -
(i) an organization that is designated by Executive order
pursuant to section 288 of title 22; or
(ii) any other international organization that is designated
by the President by Executive order for the purposes of this
section, effective as of the date of publication of such order
in the Federal Register.
(3)(A) A person's state of mind is "knowing" with respect to
conduct, a circumstance, or a result if -
(i) such person is aware that such person is engaging in such
conduct, that such circumstance exists, or that such result is
substantially certain to occur; or
(ii) such person has a firm belief that such circumstance
exists or that such result is substantially certain to occur.
(B) When knowledge of the existence of a particular
circumstance is required for an offense, such knowledge is
established if a person is aware of a high probability of the
existence of such circumstance, unless the person actually
believes that such circumstance does not exist.
(4)(A) The term "routine governmental action" means only an
action which is ordinarily and commonly performed by a foreign
official in -
(i) obtaining permits, licenses, or other official documents
to qualify a person to do business in a foreign country;
(ii) processing governmental papers, such as visas and work
orders;
(iii) providing police protection, mail pick-up and delivery,
or scheduling inspections associated with contract performance
or inspections related to transit of goods across country;
(iv) providing phone service, power and water supply, loading
and unloading cargo, or protecting perishable products or
commodities from deterioration; or
(v) actions of a similar nature.
(B) The term "routine governmental action" does not include any
decision by a foreign official whether, or on what terms, to
award new business to or to continue business with a particular
party, or any action taken by a foreign official involved in the
decision-making process to encourage a decision to award new
business to or continue business with a particular party.
(5) The term "interstate commerce" means trade, commerce,
transportation, or communication among the several States, or
between any foreign country and any State or between any State
and any place or ship outside thereof, and such term includes the
intrastate use of -
(A) a telephone or other interstate means of communication,
or
(B) any other interstate instrumentality.
(i) Alternative jurisdiction
(1) It shall also be unlawful for any United States person to
corruptly do any act outside the United States in furtherance of an
offer, payment, promise to pay, or authorization of the payment of
any money, or offer, gift, promise to give, or authorization of the
giving of anything of value to any of the persons or entities set
forth in paragraphs (1), (2), and (3) of subsection (a) of this
section, for the purposes set forth therein, irrespective of
whether such United States person makes use of the mails or any
means or instrumentality of interstate commerce in furtherance of
such offer, gift, payment, promise, or authorization.
(2) As used in this subsection, the term "United States person"
means a national of the United States (as defined in section 1101
of title 8) or any corporation, partnership, association, joint-
stock company, business trust, unincorporated organization, or
sole proprietorship organized under the laws of the United States
or any State, territory, possession, or commonwealth of the United
States, or any political subdivision thereof.Legislative History ________________________________________________________________________
U.S. Code Provisions: SecuritiesState Laws: Securities
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