FCPA Policy

FCPA Policy

Foreign Corrupt Practices Act Policy

LiteCure, LLC
January 2019

 

Background and Objective

LiteCure, LLC (the “Company”) conducts its business in certain international locations. This can present the unique challenge of trying to observe local business customs while still complying with applicable U.S. and other laws prohibiting corruption. The U.S. Foreign Corrupt Practices Act (“FCPA”) and other anti-corruption laws prohibit any payment or offer of payment to a “foreign official” for the purpose of influencing that official to assist in obtaining or retaining business for a company. The Company has established this policy in order to ensure that all employees of the Company, its agents, and its affiliates are aware of the FCPA and engage in ethical and legal practices. This policy is focused on the FCPA because of its broad application; however, it is the Company’s policy to comply with all applicable anti-corruption laws.

 

Policy Statement

No Company employee, agent, or affiliate has authority to give or to offer anything of value to a “foreign official” or government employee, or to 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 or government employee for the purpose of inducing that person to affect any government act or decision in a manner that will assist the Company in obtaining or retaining business. Furthermore, every employee, agent, and affiliate is obligated by this policy and federal law to keep books, records, and accounts that accurately and fairly reflect all transactions in and dispositions of Company assets.

 

Bribery Prohibited

The FCPA generally applies to all U.S. corporations, partnerships, and other business entities, as well as all persons acting on behalf of those entities. Regardless of the applicability of the FCPA or its jurisdictional reach, this policy applies to the Company, as well as its employees, agents, and affiliates. In accordance with the FCPA, this policy prohibits any payment or offer of payment to a “foreign official” for the purpose of influencing that official to assist in obtaining or retaining business for a company.

The FCPA and this policy apply to any act or event that is “in furtherance of” a payment to a foreign official. Further, the “payment” clause of the FCPA is broadly construed. It covers not only the actual payment of money but also an offer, promise, or authorization of the payment of money and an offer, gift, promise, or authorization of the giving of “anything of value.” The FCPA and this policy also apply to payments to foreign political parties, officials of foreign political parties, and candidates for foreign political office.

The Company, as well as its employees, agents, and affiliates must also be aware of, and comply with, applicable anti-bribery laws of the foreign countries with which they carry out international activities.  Such foreign laws may include, but are not limited to, the U.K. Bribery Act, The Prevention of Bribery Ordinance of Hong Kong, and India’s Prevention of Corruption Act.  Since some of these foreign laws are in certain instances stricter than their FCPA counterpart, Company employees, agents, and affiliates should consult with legal counsel regarding the specific requirements of these foreign anti-bribery laws as needed.

 

Key Definitions

“Bribery” means the direct or indirect (i.e., through a third party) (a) offering, giving, directing or promising to another person (including a Foreign Official’s family member) anything of value with the intention to induce or reward a Foreign Official to (i) undertake an official act or decision, (ii) violate his or her official duties, (iii) use his or her influence to affect an act or decision of the government or (iv) give an improper advantage; or (b) engaging in (a) without the aforementioned intention to induce or reward, but which nonetheless could reasonably be interpreted as such an inducement or reward.

Foreign Official” means any (a) employee, officer or agent of a foreign government, (b) political candidate of a foreign party, or (c) employee of a (i) foreign government owned or controlled commercial enterprise, university, research institution, health care facility, or instrumentality, (ii) public international organization (e.g., United Nations, World Bank, World Health Organization), or (iii) foreign political party.

“Company Employee” means any individual directly employed by the Company, whether full-time or part-time.

“Company Agents or Affiliates” means any individual or organization doing business with, or on behalf of, the Company, including but not limited to a distributor, retaining agent, consultant, vendor, or volunteer

 

Fundamental Responsibilities

The consequences of failing to comply with the FCPA are very serious. Violation of the FCPA and related laws by a Company employee, agent, or affiliate can result in millions of dollars in fines against the Company and can subject the individual to prosecution, criminal fines, and imprisonment, as well as disciplinary action by the Company, including dismissal. Note that the FCPA states that fines and penalties imposed upon individuals may not be paid directly or indirectly by any corporation for which they may have acted.

It is the responsibility of all members of senior management to supervise, monitor, and train the employees under their supervision to ensure that the purposes of this policy are fulfilled.

It is the responsibility of each employee, agent, and affiliate to comply with this policy and with procedures and guidelines established in furtherance of this policy. Failure to comply with the policy is grounds for disciplinary action, up to and including termination.

The following guidance is provided to employees and anyone acting on behalf of the Company to clarify how this policy applies:

  • Except as expressly provided elsewhere in this statement of policy, no payment or gift of any kind may be promised, offered, or made to any of the following people:

a “foreign official,” which is defined as 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;

any foreign political party or official thereof or any candidate for foreign political office;

  • or any person acting on behalf of a foreign official, a foreign political party or official thereof, or a candidate for foreign political office.
  • If you have any doubt about whether a person is a foreign official, raise the question with the member of senior management responsible for your function in the Company. The senior managers will be responsible for obtaining advice from a legal consultant.
  • Complete and accurate records sufficient to show compliance with the above rules, the FCPA generally, and any other Company policies must be maintained at all times. This means, among other things, that when a payment is intended to go to a particular party or entity for a particular purpose, the records with respect to that payment must accurately reflect the true recipient and the true purpose of the payment.

 

Other Considerations

Facilitating Payments. In certain parts of the world, it is common for companies to pay low level government employees to expedite or secure the performance of a routine governmental action, such as to obtain a visa or a permit. Though permitted under the FCPA and customary in certain parts of the world, these payments may violate U.S. law or local anti-bribery laws of the foreign jurisdiction (e.g., the U.K. Bribery Act). Therefore, facilitating payments are not permitted under this Policy unless (i) the payment is necessary to prevent risk of injury or harm to oneself or another person or (ii) a legal consultant has determined the specific payment is permissible under the FCPA and the applicable laws of the local jurisdiction.

Retaining Agents. Because the actions of a third party acting as an agent, distributor, or representative of a company can expose that company to liability under the FCPA, great care should be taken in the retention of such agents and representatives. A sufficient investigation should be undertaken to ensure that any such representative does not intend to engage in any improper practices. In determining whether to engage a particular representative, factors such as the representative’s reputation and qualifications, the manner and reasonableness of compensation, the relationship, if any, between the owners and employees of the representative and a foreign official, the presence or absence of any secret partners, the willingness of the representative to fully disclose its relationship with us, and the legality of the relationship under local law must be considered.

Government-Owned Businesses. In many countries, it is a common practice for government officials to own or operate business enterprises. While the FCPA and related laws do not prohibit legitimate business relationships with business enterprises owned or controlled by foreign officials, great care must be taken to avoid any association with any such enterprise in circumstances that might constitute an evasion of the FCPA. If you intend to engage in business with a company that is owned by one or more government official or entities, you must contact the legal department for approval.

Retention of Professionals. No person acting on behalf of the Company may enter into any transaction with agents, contractors, consultants, lawyers, or other persons that is intended or designed to permit such persons to circumvent currency, tax, or other laws of a foreign country. Any transaction that has the appearance of permitting any person to circumvent such laws must be avoided. Particular care must be taken in respect to “split payments” (i.e., payments for services that are made outside the country in which the services are performed, other than payments in the country in which the provider of the services is incorporated and has an established presence, or payments inside the country in other than the local currency).

 

Due Diligence of Agents, Vendors and other Third Parties

When entering into a relationship with a third party that may interact with a Foreign Official on behalf of the Company, employees, agents, or affiliates should complete sufficient due diligence to confirm that the retained individual or organization does not have a history of corrupt payments, and understands and agrees that they are not authorized to engage in bribery on the Company’s behalf.  The level of due diligence required will vary depending on the level of risk involved in the underlying arrangement or transaction (e.g., whether the third party will be interacting directly with Foreign Officials on behalf of the company or whether the services will occur in a country that involves a high risk of corruption).

Agents, distributors, or affiliates should ensure that the third parties described above do not have a history of violations of anti-bribery laws, provide them with a copy of this Policy, and regularly audit their activities to ensure ongoing compliance. Any agreements with these types of third parties should include provisions that they will comply with the FCPA and all other applicable local anti-bribery laws. A sample agreement provision is included here as Exhibit A.

 

Reporting Requirements

Any transaction, no matter how seemingly insignificant, that might give rise to a violation of the FCPA or this policy must promptly be reported to senior management. All such reports will be treated as confidential and will be shared with authorized individuals only on a need-to-know basis. As long as a report is made honestly and in good faith, the Company will take no adverse action against any person based on the making of such a report. Employees should note that the failure to report known or suspected wrongdoing of which an employee has knowledge may, by itself, subject that employee to disciplinary action.

Any questions concerning the FCPA and related reporting requirements may be addressed to senior management, who may choose to consult legal counsel.

 

Risk Assessment and Mitigation

Company affiliates must assess the risk of bribery in the international activities under their purview and take appropriate care to prevent and detect bribery and ensure compliance with Company policies. Certain countries have a high incidence of corruption, and particular care should be taken when undertaking activities in or involving those countries. For information regarding high risk countries, see the Transparency International Corruption Perceptions Index available at http://www.transparency.org/research/cpi/.

Depending on the individual circumstances, appropriate steps may involve (i) additional training of employees and other third parties concerning this Policy, (ii) conducting appropriate due diligence before engaging third party vendors, agents, or partners, (iii) ensuring that contracts contain anti-bribery and compliance with law provisions, and (iv) requesting guidance from a legal consultant before expanding operations into a new geographic location.

Failure to take appropriate steps to prevent and detect bribery creates legal risk for the Company and potential personal liability for the individuals involved.

 

Procurement and Record Keeping Requirements

In addition to its anti-bribery provisions, the FCPA also imposes certain accounting requirements on companies. Specifically, the FCPA requires that a company maintain books, records, and accounts that, in reasonable detail, accurately reflect the transactions and dispositions of that company. This policy incorporates these record keeping requirements. In order to comply with these requirements, it is imperative that Company employees, agents, distributors, and others acting on the Company’s behalf maintain complete and accurate records with respect to all transactions and dispositions undertaken on behalf of the Company. Company affiliates must also comply with the Company’s procurement and record keeping requirements as well as its financial controls for cash and non-cash transactions.

 

Consequences of Violations

Violations of this Policy may result in appropriate disciplinary action up to and including termination of employment or other relationships with the Company.  Conduct constituting a violation may also expose the company and its personnel to criminal or civil penalties in the United States and abroad.

 

Non-Retaliation

The Company prohibits retaliation against any person for making a report in good faith or cooperating in an investigation in connection with this Policy. Individuals who take retaliatory action will be subject to corrective action up to and including termination of employment.

 

 

Exhibit A

The Company requires all employees, agents, and affiliates to engage in ethical and legal practices. This necessitates an awareness of, and compliance with, the Foreign Corrupt Practices Act (FCPA), as well as any applicable anti-bribery laws of the foreign countries with which they carry out international activities. Distributors are required to abide by the Company’s established FCPA policy, and to cooperate in any compliance audit, including, but not limited to, providing requested documentation and assistance in the event of an investigation. Failure to comply with these terms will result in the immediate termination of this agreement.

 

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