CCEP Anti-Corruption Practices 3 — Questions and Answers
Question 1: A sales executive claims that a $5,000 dinner for a government minister was 'promotional expenditure.' What compliance concern does this raise?
- The expenditure may not be tax-deductible under local law
- The expenditure may constitute an improper benefit to a foreign official under anti-bribery laws (Correct answer)
- Promotional expenditures are always permissible if business purpose is documented
- The amount exceeds typical marketing budget allocations
Correct answer: The expenditure may constitute an improper benefit to a foreign official under anti-bribery laws
Lavish hospitality for government officials can constitute a corrupt payment under the FCPA and UK Bribery Act even when labeled as promotional expenditure.
Question 2: Which type of anti-corruption due diligence is typically most critical when acquiring a company operating in a high-risk jurisdiction?
- Pre-acquisition due diligence to identify successor liability risks (Correct answer)
- Post-acquisition integration audits only
- Annual compliance certifications from target management
- Quarterly transaction testing after closing
Correct answer: Pre-acquisition due diligence to identify successor liability risks
Pre-acquisition due diligence is critical because acquirers can inherit FCPA liability for pre-acquisition conduct, making early identification of risks essential to deal structuring.
Question 3: Under the FCPA, what affirmative defense is available to a company that made payments that are lawful under the written laws of the foreign country?
- The 'local law' defense (Correct answer)
- The 'foreign sovereign immunity' defense
- The 'de minimis payment' defense
- The 'business necessity' defense
Correct answer: The 'local law' defense
The FCPA provides a 'local law' affirmative defense when a payment was lawful under the written laws and regulations of the foreign official's country.
Question 4: A company's subsidiary in a foreign country engages in bribery without the knowledge of the parent company's executives. Which factor would most likely still expose the parent to FCPA liability?
- The subsidiary is wholly owned by the parent
- The parent failed to implement adequate internal controls over the subsidiary (Correct answer)
- The parent and subsidiary share the same auditor
- The subsidiary's revenues are consolidated into the parent's financials
Correct answer: The parent failed to implement adequate internal controls over the subsidiary
Failure to implement adequate anti-corruption internal controls over subsidiaries can expose a parent company to FCPA accounting provisions liability, even without direct knowledge of bribery.
Question 5: What is 'politically exposed person' (PEP) screening primarily used to identify in an anti-corruption compliance program?
- Individuals who have made political campaign contributions
- Individuals who hold or have held prominent public positions and their close associates (Correct answer)
- Individuals who have been convicted of political crimes
- Individuals who are active members of foreign political parties
Correct answer: Individuals who hold or have held prominent public positions and their close associates
PEP screening identifies individuals in prominent public roles and their close associates who present elevated corruption risk due to their influence over government decisions.
Question 6: Which element is required to establish a violation of the FCPA's anti-bribery provisions?
- Proof that the payment actually influenced the foreign official's decision
- Corrupt intent to obtain or retain business or a business advantage (Correct answer)
- A written agreement to make the payment
- Proof that the company benefited financially from the payment
Correct answer: Corrupt intent to obtain or retain business or a business advantage
The FCPA requires proof of corrupt intent — that the payment was made to obtain or retain business or gain a business advantage — but does not require proof that the official was actually influenced.
Question 7: When designing anti-corruption training, which approach is considered most effective for high-risk roles?
- Annual online training modules covering all employees equally
- Role-specific scenario-based training tailored to the actual risks faced by those employees (Correct answer)
- In-person seminars conducted by external legal counsel only
- Self-certification that employees have read the anti-corruption policy
Correct answer: Role-specific scenario-based training tailored to the actual risks faced by those employees
Role-specific scenario-based training is most effective because it addresses the specific corruption risks that employees in high-risk positions actually encounter.
CCEP Anti-Corruption Practices 3
A sales executive claims that a $5,000 dinner for a government minister was 'promotional expenditure.' What compliance concern does this raise?