The FCPA Blog recently did a post, China dominates the corporate investigations list, in which it listed out the number of ongoing FCPA (Foreign Corrupt Practices Act) investigations by country. This list appears to have been compiled using company disclosures so there are no doubt a number of investigations not reflected by it.
Nonetheless, it is a very useful list and what stands out (but is not the least bit surprising) is China’s dominance. The top five countries by number of ongoing FCPA investigations is as follows:
- China 37
- Russia 7
- Brazil 7
- Libya 6
- Poland 6
The post explains that Libya shows up so high simply because Ghaddafi’s recent overthrow allowed a review of government documents. The post calls Poland’s presence an outlier, but we disagree. Or should I say that one of my law firm’s lawyers disagrees. James Yrkoksi spent about twenty years as a lawyer in Poland and in his view Poland’s inclusion makes complete sense as so many American companies base their Central European operations there. Indeed, a growing number of American companies are basing their European operations there due to its educated and yet relatively inexpensive workforce. In other words, Poland makes the list simply because so many American companies are there.
And China makes the list for the same reason, along with the added reason that so many Chinese companies are embedded with government employees. Prevalence of corruption is obviously another factor.
If you are interested in your company not adding numbers to the above list, I urge you to read Doing Business In China Without An Anti-Corruption Compliance Program? Are You Crazy? and How To Do Business In China Without Jail Time? Kill A Chicken.