SENSITIVE TRANSACTIONS
Facilitating payments versus bribery?
Many companies operate in many countries. Sometimes local custom and practice dictate that like tipping a waiter, a company pays for (government) services to speed-up a certain process or application. Why would you wait five months for getting electricity to your factory if you can get it in three weeks? However, these kind of payments are not without risk.
Most countries are a party to non-bribery treaties (‘OECD-Convention on Combating Bribery of Foreign Public Officials in International Business Transactions’; ‘United Nations Convention against corruption’) or have enacted legislation which forbids bribery. Many companies have a code of conduct regarding ‘sensitive transactions’. Halliburton, for example, on its website describes sensitive transactions as a broad range of business dealings generally considered to be either illegal, unethical, immoral or to reflect adversely on the integrity of a company. ‘These transactions are usually in the nature of kickbacks, gifts of significant value, bribes or payoffs made to favorably influence some decision affecting a company’s business or for the personal gain of an individual. These transactions may result in violation of various laws, including the United States Foreign Corrupt Practices Act (the “FCPA”) and similar laws of other countries.‘
It is difficult to determine the (fine) line between facilitating payments (possibly legal in the relevant jurisdiction) and bribes (illegal in almost all countries). But what may be legal in the country you do business in, may be illegal in your own country. The FCPA, for example, is applicable to any US-based company, regardless where such company may be operating.
The best advice one can give is to abstain from any such payments. But we all do know that facilitating payments are not uncommon in certain places .
Karel Frielink
Attorney (Lawyer) / Partner
