Compliance Man Takes a Euro Trip

Welcome to Episode 4 of Compliance Man Chooses the Target with Tim Khasanov-Batirov. My goal is to highlight matters that should be on agenda of practitioners that deploy compliance programs in industries or countries of active FCPA enforcement. I target three specific matters that you might like to address in the course of implementation of your compliance program. Today we will focus on Industrial & Consumer Goods industry.

Target #1: Politically Exposed Persons

The interpretation of the term politically exposed person is a tricky thing. For instance, you want to engage a law firm, which is owned by a sibling of a governmental official, let say, in Kazakhstan.  If you do business in the country where culturally strong family ties extends beyond immediate family members it could be a challenge to define whether a person among many siblings of a particular PEP de-factocould act as a shadow representative so to say of that PEP.  How to decrease compliance risks in this situation? The best way would be to the following:

To find out if your company really needs offered legal services;To conduct fair market value estimation of fees to be paid;Talk to business people and folks in the professional community (or even better to do detailed background check in addition to due diligence) to find out if your potential business partner enjoys preferential regime before local state bodies being sibling of the governmental official. Target #2: Construction of Plants

If your company decides to expand, its business by constructing a plant overseas we would recommend accessing the following three areas, which might encompass corruptions risks:

Approvals of design of your plant by respective foreign regulators;Permissions on land allocation and construction permits to be obtained overseas;Taxation, which might vary subject to interpretation of the vague tax rules regarding construction works by overseas tax authority.       Target #3: Local Team

Bribes are paid by people. Thus, the most important assurance you want to get is adherence to ethical culture by your team in the fields. How to access whether your FCPA/Ethics program really works even on distance of thousands miles from the HQ? You may want to do self evaluation of your FCPA program using guidance called Evaluation of Corporate Compliance Programsby DOJ: https://www.justice.gov/criminal-fraud/page/file/937501/download I will give you some practical insights regarding this tip in the next episode of the show.

Join us for the next episode of Compliance Man Chooses the Target with Tim Khasanov-Batirov.

Learn more compliance tips from Tim Khasanov-Batirov at:

http://complianceinpostussr.com/& http://complianceinpostussr.com/blog/

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In this episode of Compliance Man Chooses the Target, we’re talking about oil and gas.

Target 1: Joint ventures. As a standard practice in emerging nations, a joint venture could be formed between a foreign investor and a local state company. What are the risks involved in this?

Target 2: Request for donations. It is common to get various requests for donations from authorities in the region. You might want to check out local laws on the legality of making such donations. If it isn’t clear, you can use this argument to deny such requests. 

Target 3: Consultants. If business people want to hire consultants in a high-risk country, it is more than a red flag. It doesn’t matter whether the company intends to enter the market or expand its local presence, your scrutiny over such engagements should be extremely high. Be ready to justify the amount of money to be paid to consultants as remuneration.

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In this episode of Compliance Man Chooses the Target, we’re exploring communications services. 

Target 1: Permissions and permits. Should a telecom company decide to operate in a higher risk market, it will need to obtain various permissions. Tentatively, look at all processes and related issues regarding governmental permits in these jurisdictions.

Target 2: Underdeveloped judicial systems. Investors are becoming hostages, and you will likely spend a lot of money for a low chance to win a court case. So what can you do instead?

Target 3: Participation in business associations. You may want to find out which association or Chamber of Commerce has a reputation for developing compliance practices. In many countries, the ethics movement is needed by companies from the communications services industry. 

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In this episode of Compliance Man Chooses the Target, we’re talking about the healthcare industry.

Target 1: Interactions with healthcare professionals. Is it acceptable to give souvenirs or flowers to doctors? What is the best way to find out? 

Target 2: Clinical trials and research. Clinical trials are an integral part of the official approval process required for the marketing of medicines. Consequently, scenarios might be linked to government officials responsible for the issuance of these licenses.

Target 3: In many nations, your sales to state-owned hospitals are conducted through local distributors, and the participation of these distributors might pose an FCP risk. What can you do to ensure transparency? 

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Welcome to Compliance Man Chooses the Target, hosted by Tim Khasanov-Batirov. Tim has been working in the former Soviet Union for the last 20 years as a lawyer and compliance person, and the challenges in that region differ from the issues compliance practitioners face in the US.  Compliance Man Chooses the Target is a podcast series aimed at sharing insights from the region to a global audience, highlighting practical matters you will need to look at if you work in a risky country or industry.

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