Avoiding FCPA Risks While Doing Business in China

Many companies are doing business, or contemplating doing business, in the People's Republic of China (the "PRC"). For the past ten or so years, the Chinese markets have been the top emerging markets for foreign direct investment. However, according to many international organizations, including Transparency International, a corruption watchdog worldwide, China represents a high corruption risk and, therefore, doing business in China also presents significant regulatory and legal risks, one of which is the risk of violating the Foreign Corrupt Practices Act of 1977 (the "FCPA").

The FCPA is a cornerstone of anti-bribery legislation in the United States, and increasingly around the world, as prosecutors in the U.S. try to extend the scope of the law. Generally, the FCPA prohibits U.S. citizens and permanent residents, both public and private U.S. companies, and certain non-U.S. individuals and entities from bribing foreign government officials to obtain a business