431 MISCELLANEOUS Parent-Subsidiary Liability Within the Scope of Foreign Corrupt Practices Act* Merve Bakırcı Introduction Traditionally, with an aim to prevent corrupt practices internationally, pursuant to the Foreign Corrupt Practices Act (“FCPA”), offering anything of value to foreign public officials while performing their duties in order to gain commercial advantages are prohibited. Having said that, the FCPA has an extremely wide jurisdiction; that is to say, the relevant provisions and sanctions of the FCPA include all companies traded on the US Stock Exchange regardless of their origin, U.S. citizens or legal entities or subsidiaries of U.S. origin, and any real person or legal entity who offers a bribe to foreign public officials within the U.S. borders. In this framework, the principles of corporate liability regarding legal entities that fall into one of the said groups shall be applied and, in certain cases, parent companies may also be held accountable for the actions of their subsidiaries. To that end and as observed from sample cases, the U.S. authorities evaluate whether the parent company has control over the subsidiary and knowledge with regard to the infringing activities in such cases. If the answers to both of these questions are in the affirmative, the parent company is usually held accountable for the actions of its subsidiary, and therefore, faces civil and criminal liabilities for violating the provisions of the FCPA, although it may have no actual knowledge regarding the violation. The Scope of Parent-Subsidiary Liability Firstly, it should be stated that the application of FCPA depends on the fulfillment of certain conditions. To that end, (i) bribery must be intended to gain a business advantage, (ii) the related payment or offer must be made to a foreign public official with corrupt purposes, and * Article of February, 2021
RkJQdWJsaXNoZXIy MjUzNjE=