Question

The proponents for the Foreign Corrupt Practices Act (FCPA) maintain that the law helps to clean up corruption worldwide. However, the critics argue that the law hurts American companies’ competitiveness abroad. Moreover, some skeptics believe that the FCPA also harms developing countries, in which bribes are commonly sought, by deterring American companies from investing in them, and thereby letting the companies from corrupt countries move in to fill the void.

Based on the arguments for and against the FCPA, explain whether you think the law should be abolished or not

Answer 1

Foreign Corrupt Practices Act or FCPA was drafted in the year 1977 with the objective to stop organizations from bribing government employees, in return of special favors and assistance to facilitate their respective business and thus conducting fraud.

In my views, FCPA must not be abolished. The incorporation of FCPA has been quite critical for doing business in USA. Due to the enactment of this act, the companies get a fair chance to bid for the government and private deals and crack it based on their fair proposal as well as performance. Some of the other important attributes of this act, which are benefitting businesses, are:

• The act maintains competitive environment in USA. So the companies try to enhance their performances to maintain their competitive advantage
• The act facilitates fair business
• The companies have benefitted from the internal controls levied to facilitate FCPA
• Corruption and bureaucracy is kept at bay with the help of FCPA