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What is the FCPA regulation and what is its importance for companies?

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The Foreign Corrupt Practices Act (FCPA) is one of the most well-known and important anti-corruption laws in international trade. In today's business environment, this law transcends the category of a simple regulation, as over the years it has become an essential standard to govern and ensure proper business conduct. At Simor Global Services, we deeply understand the importance of implementing an FCPA compliance strategy, and therefore, we provide specialized advice to promote the integrity and success of your business on a global scale. 


Enacted in 1977 in the wake of the Watergate scandal, the FCPA establishes clear principles to eradicate corporate corruption and bribery in international business transactions. The law expressly prohibits making payments to public officials, political parties, party officials, or candidates for public office with the intention of influencing their decisions or gaining an advantage in contract awards. 


The scope of the FCPA goes beyond U.S. borders, affecting any company that operates or conducts business with U.S. entities. In a globalized world where international operations are common, the FCPA has established itself as an indispensable code of conduct. 


The consequences of non-compliance with this regulation can be devastating for the company and its employees at all levels of the organization. Violations can result in civil litigation and severe penalties, including the disgorgement of profits obtained through corrupt practices, with fines that can amount to $1 billion. 


Adhering to the FCPA goes far beyond avoiding these sanctions; it is a tangible demonstration of your company's commitment to ethical principles in business. Non-compliance, as outlined earlier, can not only result in substantial fines and damage to reputation but also in a loss of trust from investors and customers. Conversely, effective compliance with this regulation can provide significant competitive advantages, such as strengthening government relations and a privileged position in international tenders. 


How do we develop an effective FCPA compliance strategy for our clients? 


  1. Education and Training: Effectiveness in compliance starts with education. We ensure that all members of your team understand the provisions of the FCPA and the consequences of non-compliance. 

  2. Internal Policies and Procedures: We establish clear policies and internal procedures that reflect the requirements of the FCPA, including rigorous approval processes for payments and donations in foreign markets. 

  3. Internal Control System: We develop robust internal controls to monitor transactions and prevent acts of corruption, including regular audits and reporting systems for suspicious activities. 

  4. Due Diligence: We conduct thorough due diligence on your company, as well as on third parties and business partners. It is well-known that many FCPA violations stem from the actions of external agents or consultants acting on behalf of a company. 


Compliance with the FCPA should not be seen as a burden but as an opportunity to continuously improve your operations. It can be the catalyst for optimizing internal control systems and promoting a culture of transparency throughout the organization. Companies that adopt this approach not only comply with the law but also establish a reputation for reliability and accountability. 


At Simor Global Services, we are dedicated to assisting companies in understanding and complying with the FCPA and all local and international regulations. We provide guidance from a multidisciplinary team of experts, compliance tools, and customized training programs designed to keep your company safe and ethically sound. With our support, you can make FCPA compliance an integral part of your global business strategy. 


Contact us to discover how our personalized approach and global expertise can strengthen your position in the international market and guide your company towards a future of success and integrity. 

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