Rep. John D. Dingell (D-Mich.) has moved to block legislation he claims would weaken a 1977 law designed to deter bribery of foreign officials by U.S. firms.
Dingell, who is chairman of the House Energy and Commerce Committee, asked House Speaker Thomas P. (Tip) O'Neill Jr. to send the legislative proposal to his committee, which has jurisdiction over the Foreign Corrupt Practices Act of 1977.
The proposal is now an amendment to a widely supported trade bill approved late yesterday by the House Foreign Affairs Committee.
Dingell told O'Neill, in a series of letters released yesterday, that the amendments are "in fundamental conflict with the Foreign Corrupt Practices Act of 1977," would "alter jurisdiction, rights, duties and obligations of the Securities and Exchange Commission," and would shift FCPA civil enforcement from the SEC to the Commerce Department.
"Easing the prohibitions against bribery . . . is a highly charged issue that should be handled separately," Dingell wrote.
Among other things, the amendments would protect corporate executives from criminal prosecution if they did not know of bribes paid by subordinates to foreign officials, and exempt "grease," or "facilitating" payments, from the definition of punishable bribery. Such payments are made to remove routine governmental obstacles such as the issuance of permits to do business or to get products through customs.
The jurisdictional dispute is not expected to be resolved until the trade bill reaches the House Rules Committee.
The amendments, originally sponsored by Rep. Daniel A. Mica (D-Fla.) as a separate bill, have the backing of the Chamber of Commerce of the United States, the National Association of Manufacturers, the Business Roundtable, and a business coalition called the Emergency Committee for American Trade. The business groups argue the Mica proposals would boost exports and offset record trade deficits.
They also contend the act penalizes U.S. companies by holding over them the threat of prosecution for engaging in overseas business practices that pose no such risk for competitors based in Asian and European countries where no such laws are on the books.
Opponents of the amendments disagree. They argue the corrupt practices law protects legitimate U.S. foreign policy interests without putting unfair obstacles in the path of U.S. corporations.
In his letters to O'Neill, Dingell cited "the recent reports that former Philippines president Ferdinand Marcos and his associates benefited from enormous bribes and kickbacks from U.S. companies seeking to obtain contracts and business from the Philippines government."
Rep. Howard Wolpe (D-Mich.) told a recent hearing that "the terrible consequences of corruption" in the Philippines "illustrate the vital role that can be played by the FCPA."
"We have never heard a compelling rationale for the proposed changes," Wolpe said. "What is it exactly that companies want to do which necessitates these changes that they cannot do now under current law?"