One of the many challenges companies face when assessing their Foreign Corrupt Practices Act (“FCPA”) liability is determining whether a potential business partner constitutes a “foreign government official” under the FCPA. From a definitional perspective, the FCPA is far from a model of clarity on this point. See 15 U.S.C. § 78dd-2(h)(2)(A).
By way of example, consider the compliance sandbars companies must circumnavigate to determine whether (and when) providing something of value to “traditional authorities” (including First Nations, Métis and Inuit peoples) could impose FCPA liability. This question often arises when U.S.-based companies are asked to make donations to American Indian tribes with whom they interact, or to do favors for individual members of a tribe. For instance, a tribal elder may ask that a company doing business with the tribe employ a certain tribal member, or provide an internship to the chief’s son, etc. Under such circumstances, companies might find themselves evaluating the contemplated transaction through the amorphic lens of the FCPA.
Understanding the Definitional Challenge
Going back to basics, the FCPA’s anti-bribery provisions define a “foreign official” as:
[A]ny 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. 15 U.S.C. § 78dd-2(h)(2)(A).
Do American Indian tribes fit under this definition? While there is little guidance on this analysis outside the United States (see this helpful article by my colleagues on that issue), there is even less in the context of American Indian tribes, even though they possess much-discussed “sovereign status” in the United States. This is both surprising and concerning.