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U.S. Code as of:
01/19/04
Section 78dd-1. Prohibited foreign trade practices by issuers
(a) Prohibition
It shall be unlawful for any issuer which has a class of
securities registered pursuant to section 78l of this title or
which is required to file reports under section 78o(d) of this
title, or for any officer, director, employee, or agent of such
issuer or any stockholder thereof acting on behalf of such issuer,
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 issuer 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 issuer 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 issuer in obtaining or retaining business
for or with, or directing business to, any person.
(b) Exception for routine governmental action
Subsections (a) and (g) 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 (g) 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) Guidelines by Attorney General
Not later than one year after August 23, 1988, the Attorney
General, after consultation with the 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 issuers 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.
(e) 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 issuers 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 an issuer 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 an issuer 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 issuer, be
made publicly available, regardless of whether the Attorney General
responds to such a request or the issuer withdraws such request
before receiving a response.
(3) Any issuer 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.
(f) Definitions
For purposes of this section:
(1)(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.
(2)(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.
(3)(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
decisionmaking process to encourage a decision to award new
business to or continue business with a particular party.
(g) Alternative jurisdiction
(1) It shall also be unlawful for any issuer organized under the
laws of the United States, or a State, territory, possession, or
commonwealth of the United States or a political subdivision
thereof and which has a class of securities registered pursuant to
section 78l of this title or which is required to file reports
under section 78o(d) of this title, or for any United States person
that is an officer, director, employee, or agent of such issuer or
a stockholder thereof acting on behalf of such issuer, 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 issuer or such officer, director, employee, agent, or
stockholder 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.
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