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Joint venture risks under the FCPA

Tom Fox | August 15, 2018

Just as the FCPA enforcement field is covered with actions centering around mergers and acquisitions, there are multiple actions involving joint ventures (JVs), which continue to plague many U.S. companies. In many ways, JVs present more difficult issues for the compliance practitioner than mergers and acquisitions because of the control issues present in JVs with foreign governments or state-owned enterprises ownership. 

As early as 2002, in the Securities and Exchange Commission FCPA enforcement action involving BellSouth, the SEC alleged that BellSouth “held less than 50 percent of the voting power of Telefonia, but through its operational control, had the ability to cause Telefonia to comply with the FCPA’s books and records and internal controls provisions.” There can be direct liability as well, such as in the case of Halliburton...

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