A grease payment is a small sum of money given with the sole intention of facilitating a transaction or business deal. The Foreign Corrupt Practice Act (FCPA
Foreign Corrupt Practices Act
The Foreign Corrupt Practices Act of 1977 is a United States federal law known primarily for two of its main provisions: one that addresses accounting transparency requirements under the Securities Exchange Act of 1934 and another concerning bribery of foreign officials. The Act was amended in 1988 and in 1998, and has been subject to continued congressional concerns, namely whether its enforcement …
What is grease money?
Grease money is money that is paid to an official to facilitate the rapid processing of bureaucratic paperwork. Such a payment is known as a grease or facilitating payment, and the legality of such payments varies, depending on the laws that govern the activities of the official and the person or company offering the payment.
What is grease payment under FCPA?
Grease Payment Defined A grease payment, on the other hand, is paid in order to expedite a deal or transaction. A grease payment is not intended to make a business deal happen, it merely makes it happen faster. Under the FCPA, grease payments don’t change the outcome of the foreign official’s decision.
Is a grease payment a bribe?
The payment could take the form of money, business contracts, gifts, or services. If it has value and facilitates obtaining or retaining business, the FCPA considers it a bribe. A grease payment, on the other hand, is paid in order to expedite a deal or transaction.
Are grease payments legal in the US?
A grease payment is not intended to make a business deal happen, it merely makes it happen faster. Under the FCPA, grease payments don’t change the outcome of the foreign official’s decision. If they did, the payment would instead be considered a bribe, and therefore illegal.
What is an example of a grease payment?
A sum of money, typically a bribe, paid to a government official or business person so as to facilitate or expedite some decision or transaction. Just offer the governor's aide a grease payment to move our building application to the forefront of the governor's agenda.
What is the difference between bribes and grease payments?
How do bribes and grease payments differ? Bribes are intended to influence a foreign official's decision. If money changes the outcome of a decision, it's a bribe. Grease payments don't change the outcome of a decision, they just make the outcome happen faster.
What are grease payments and are they legal?
A facilitating payment, facilitation payment, or grease payment is an unlawful, or at least questionable, payment to foreign officials which is not considered to be bribery according to the legislation of some states as well as in international anti-bribery conventions.
Are grease payments allowed under FCPA?
Grease Payment Defined A grease payment is not intended to make a business deal happen, it merely makes it happen faster. Under the FCPA, grease payments don't change the outcome of the foreign official's decision. If they did, the payment would instead be considered a bribe, and therefore illegal.
Are facilitation payments illegal?
Facilitation payments were illegal before the Bribery Act came into force and they are illegal under the Bribery Act, regardless of their size or frequency.
What is a kickback payment?
A kickback is a payment from a corrupt contractor to a public or private sector employee as compensation for biased representation or preferential treatment in a decision-making process. This preferential treatment can include things like: Choosing to award a contract to one supplier or contractor instead of another.
Are facilitation payments legal in USA?
Facilitation payments are allowed as an exception in the bribery laws of only four countries: Australia, New Zealand, South Korea and the USA. These laws apply only when they are made abroad and paradoxically, remain illegal in their own domestic laws.
What types of payments are permitted to foreign officials?
There are two circumstances under which a payment, gift, offer, or promise of anything of value to a foreign official may qualify as an “affirmative defense” under the FCPA: (1) the payment, gift, offer, or promise of anything of value is lawful under the written laws and regulations of the foreign official's, ...
What are grease payments and are they acceptable by the US law and the OECD Convention?
Commonly known as "grease payments," these small bribes are permitted for "routine governmental actions," a concept that is difficult to reconcile both in the law and in corporate codes of conduct.
What is bribery defined as?
5.1 Defining Bribery TI defines bribery as: the offering, promising, giving, accepting or soliciting of an advantage as an inducement for an action which is illegal, unethical or a breach of trust.
What is an example of bribery?
Some examples of bribes might include: A construction guaranteeing an elected official ten percent in kickback money in exchange for a large public infrastructure contract. A manufacturing firm paying foreign officials money for preferential treatment or to smuggle unregistered goods across a border.
Are grease payments allowed under the FCPA quizlet?
The Foreign Corrupt Practices Act (FCPA) prohibits grease payments. Such payments are legal only if they are also legal under the laws of the country where the grease payments take place..
What are grease payments and are they acceptable by the US law and the OECD Convention?
Commonly known as "grease payments," these small bribes are permitted for "routine governmental actions," a concept that is difficult to reconcile both in the law and in corporate codes of conduct.
What is grease payment?
A sum of money, typically a bribe, paid to a government official or business person so as to facilitate or expedite some decision or transaction. Just offer the governor's aide a grease payment to move our building application to the forefront of the governor's agenda.
Is paying additional charges a grease payment?
Paying the additional charge is considered a grease payment and is permitted under the law.
Foreign Bribery Defined
The FCPA makes it illegal for a US person or business to pay a foreign official in order to obtain or retain business. A foreign official is generally anyone with an official connection to a foreign government or international agency.
Grease Payment Defined
A grease payment, on the other hand, is paid in order to expedite a deal or transaction. A grease payment is not intended to make a business deal happen, it merely makes it happen faster.
Report Foreign Bribery to the SEC
If you’ve witnessed a foreign bribe, or if you aren’t sure that a purported grease payment wasn’t something more, you might have information regarding a violation of the FCPA. By reporting it to the SEC with the help of Meissner Associates, you might become eligible to claim a financial whistleblower bounty.
