[House Report 105-802]
[From the U.S. Government Publishing Office]



105th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 2d Session                                                     105-802
_______________________________________________________________________


 
      INTERNATIONAL ANTI-BRIBERY AND FAIR COMPETITION ACT OF 1998

_______________________________________________________________________


October 8, 1998.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

  Mr. Bliley, from the Committee on Commerce, submitted the following

                              R E P O R T

                        [To accompany H.R. 4353]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Commerce, to whom was referred the bill 
(H.R. 4353) to amend the Securities Exchange Act of 1934 and 
the Foreign Corrupt Practices Act of 1977 to improve the 
competitiveness of American business and promote foreign 
commerce, and for other purposes, having considered the same, 
report favorably thereon with an amendment and recommend that 
the bill as amended do pass.


                                CONTENTS
                                                                   Page
Amendment........................................................     2
Purpose and Summary..............................................     9
Background and Need for Legislation..............................     9
Hearings.........................................................    16
Committee Consideration..........................................    16
Roll Call Votes..................................................    17
Committee Oversight Findings.....................................    17
Committee on Government Reform and Oversight.....................    17
New Budget Authority, Entitlement Authority, and Tax Expenditures    17
Committee Cost Estimate..........................................    17
Congressional Budget Office Estimate.............................    17
Federal Mandates Statement.......................................    19
Advisory Committee Statement.....................................    19
Constitutional Authority Statement...............................    19
Applicability to Legislative Branch..............................    19
Section-by-Section Analysis of the Legislation...................    19
Changes in Existing Law Made by the Bill, as Reported............    27

                               Amendment

  The amendment is as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``International Anti-Bribery and Fair 
Competition Act of 1998''.

SEC. 2. AMENDMENTS TO THE FOREIGN CORRUPT PRACTICES ACT GOVERNING 
                    ISSUERS.

  (a) Prohibited Conduct.--Section 30A(a) of the Securities Exchange 
Act of 1934 (15 U.S.C. 78dd-1(a)) is amended--
          (1) by amending subparagraph (A) of paragraph (1) to read as 
        follows:
                  ``(A)(i) influencing any act or decision of such 
                foreign official in his official capacity, (ii) 
                inducing such foreign official to do or omit to do any 
                act in violation of the lawful duty of such official, 
                or (iii) securing any improper advantage; or'';
          (2) by amending subparagraph (A) of paragraph (2) to read as 
        follows:
                  ``(A)(i) influencing any act or decision of such 
                party, official, or candidate in its or his official 
                capacity, (ii) inducing such party, official, or 
                candidate to do or omit to do an act in violation of 
                the lawful duty of such party, official, or candidate, 
                or (iii) securing any improper advantage; or''; and
          (3) by amending subparagraph (A) of paragraph (3) to read as 
        follows:
                  ``(A)(i) influencing any act or decision of such 
                foreign official, political party, party official, or 
                candidate in his or its official capacity, (ii) 
                inducing such foreign official, political party, party 
                official, or candidate to do or omit to do any act in 
                violation of the lawful duty of such foreign official, 
                political party, party official, or candidate, or (iii) 
                securing any improper advantage; or''.
  (b) Officials of International Organizations.--Paragraph (1) of 
section 30A(f) of the Securities Exchange Act of 1934 (15 U.S.C. 78dd-
1(f)(1)) is amended to read as follows:
          ``(1)(A) The term `foreign official' means any 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.
          ``(B) For purposes of subparagraph (A), the term `public 
        international organization' means--
                  ``(i) an organization that is designated by Executive 
                order pursuant to section 1 of the International 
                Organizations Immunities Act (22 U.S.C. 288); or
                  ``(ii) any other international organization that is 
                designated by the President by Executive order for the 
                purposes of this section, effective as of the date of 
                publication of such order in the Federal Register.''.
  (c) Alternative Jurisdiction Over Acts Outside the United States.--
Section 30A of the Securities Exchange Act of 1934 (15 U.S.C. 78dd-1) 
is amended--
          (1) by adding at the end the following:
  ``(g) Alternative Jurisdiction.--
          ``(1) It shall also be unlawful for any issuer organized 
        under the laws of the United States, or a State, territory, 
        possession, or commonwealth of the United States or a political 
        subdivision thereof and which has a class of securities 
        registered pursuant to section 12 of this title or which is 
        required to file reports under section 15(d) of this title, or 
        for any United States person that is an officer, director, 
        employee, or agent of such issuer or a stockholder thereof 
        acting on behalf of such issuer, to corruptly do any act 
        outside the United States in furtherance of an offer, payment, 
        promise to pay, or authorization of the payment of any money, 
        or offer, gift, promise to give, or authorization of the giving 
        of anything of value to any of the persons or entities set 
        forth in paragraphs (1), (2), and (3) of subsection (a) of this 
        section for the purposes set forth therein, irrespective of 
        whether such issuer or such officer, director, employee, agent, 
        or stockholder makes use of the mails or any means or 
        instrumentality of interstate commerce in furtherance of such 
        offer, gift, payment, promise, or authorization.
          ``(2) As used in this subsection, the term `United States 
        person' means a national of the United States (as defined in 
        section 101 of the Immigration and Nationality Act (8 U.S.C. 
        1101)) or any corporation, partnership, association, joint-
        stock company, business trust, unincorporated organization, or 
        sole proprietorship organized under the laws of the United 
        States or any State, territory, possession, or commonwealth of 
        the United States, or any political subdivision thereof.'';
          (2) in subsection (b), by striking ``Subsection (a)'' and 
        inserting ``Subsections (a) and (g)''; and
          (3) in subsection (c), by striking ``subsection (a)'' and 
        inserting ``subsection (a) or (g)''.
  (d) Penalties.--Section 32(c) of the Securities Exchange Act of 1934 
(15 U.S.C. 78ff(c)) is amended--
          (1) in paragraph (1)(A), by striking ``section 30A(a)'' and 
        inserting ``subsection (a) or (g) of section 30A'';
          (2) in paragraph (1)(B), by striking ``section 30A(a)'' and 
        inserting ``subsection (a) or (g) of section 30A''; and
          (3) by amending paragraph (2) to read as follows:
  ``(2)(A) Any officer, director, employee, or agent of an issuer, or 
stockholder acting on behalf of such issuer, who willfully violates 
subsection (a) or (g) of section 30A of this title shall be fined not 
more than $100,000, or imprisoned not more than 5 years, or both.
  ``(B) Any officer, director, employee, or agent of an issuer, or 
stockholder acting on behalf of such issuer, who violates subsection 
(a) or (g) of section 30A of this title shall be subject to a civil 
penalty of not more than $10,000 imposed in an action brought by the 
Commission.''.

SEC. 3. AMENDMENTS TO THE FOREIGN CORRUPT PRACTICES ACT GOVERNING 
                    DOMESTIC CONCERNS.

  (a) Prohibited Conduct.--Section 104(a) of the Foreign Corrupt 
Practices Act of 1977 (15 U.S.C. 78dd-2(a)) is amended--
          (1) by amending subparagraph (A) of paragraph (1) to read as 
        follows:
                  ``(A)(i) influencing any act or decision of such 
                foreign official in his official capacity, (ii) 
                inducing such foreign official to do or omit to do any 
                act in violation of the lawful duty of such official, 
                or (iii) securing any improper advantage; or'';
          (2) by amending subparagraph (A) of paragraph (2) to read as 
        follows:
                  ``(A)(i) influencing any act or decision of such 
                party, official, or candidate in its or his official 
                capacity, (ii) inducing such party, official, or 
                candidate to do or omit to do an act in violation of 
                the lawful duty of such party, official, or candidate, 
                or (iii) securing any improper advantage; or''; and
          (3) by amending subparagraph (A) of paragraph (3) to read as 
        follows:
                  ``(A)(i) influencing any act or decision of such 
                foreign official, political party, party official, or 
                candidate in his or its official capacity, (ii) 
                inducing such foreign official, political party, party 
                official, or candidate to do or omit to do any act in 
                violation of the lawful duty of such foreign official, 
                political party, party official, or candidate, or (iii) 
                securing any improper advantage; or''.
  (b) Penalties.--Section 104(g) of the Foreign Corrupt Practices Act 
of 1977 (15 U.S.C. 78dd-2(g)) is amended--
          (1) by amending subsection (g)(1) to read as follows:
  ``(g)(1)(A) Penalties.--Any domestic concern that is not a natural 
person and that violates subsection (a) or (i) of this section shall be 
fined not more than $2,000,000.
  ``(B) Any domestic concern that is not a natural person and that 
violates subsection (a) or (i) of this section shall be subject to a 
civil penalty of not more than $10,000 imposed in an action brought by 
the Attorney General.''; and
          (2) by amending paragraph (2) to read as follows:
  ``(2)(A) Any natural person that is an officer, director, employee, 
or agent of a domestic concern, or stockholder acting on behalf of such 
domestic concern, who willfully violates subsection (a) or (i) of this 
section shall be fined not more than $100,000 or imprisoned not more 
than 5 years, or both.
  ``(B) Any natural person that is an officer, director, employee, or 
agent of a domestic concern, or stockholder acting on behalf of such 
domestic concern, who violates subsection (a) or (i) of this section 
shall be subject to a civil penalty of not more than $10,000 imposed in 
an action brought by the Attorney General.''.
  (c) Officials of International Organizations.--Paragraph (2) of 
section 104(h) of the Foreign Corrupt Practices Act of 1977 (15 U.S.C. 
78dd-2(h)) is amended to read as follows:
          ``(2)(A) The term `foreign official' means any 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.
          ``(B) For purposes of subparagraph (A), the term `public 
        international organization' means--
                  ``(i) an organization that is designated by Executive 
                order pursuant to section 1 of the International 
                Organizations Immunities Act (22 U.S.C. 288); or
                  ``(ii) any other international organization that is 
                designated by the President by Executive order for the 
                purposes of this section, effective as of the date of 
                publication of such order in the Federal Register.''.
  (d) Alternative Jurisdiction Over Acts Outside the United States.--
Section 104 of the Foreign Corrupt Practices Act of 1977 (15 U.S.C. 
78dd-2) is further amended--
          (1) by adding at the end the following:
  ``(i) Alternative Jurisdiction.--
          ``(1) It shall also be unlawful for any United States person 
        to corruptly do any act outside the United States in 
        furtherance of an offer, payment, promise to pay, or 
        authorization of the payment of any money, or offer, gift, 
        promise to give, or authorization of the giving of anything of 
        value to any of the persons or entities set forth in paragraphs 
        (1), (2), and (3) of subsection (a), for the purposes set forth 
        therein, irrespective of whether such United States person 
        makes use of the mails or any means or instrumentality of 
        interstate commerce in furtherance of such offer, gift, 
        payment, promise, or authorization.
          ``(2) As used in this subsection, the term `United States 
        person' means a national of the United States (as defined in 
        section 101 of the Immigration and Nationality Act (8 U.S.C. 
        1101)) or any corporation, partnership, association, joint-
        stock company, business trust, unincorporated organization, or 
        sole proprietorship organized under the laws of the United 
        States or any State, territory, possession, or commonwealth of 
        the United States, or any political subdivision thereof.'';
          (2) in subsection (b), by striking ``Subsection (a)'' and 
        inserting ``Subsections (a) and (i)'';
          (3) in subsection (c), by striking ``subsection (a)'' and 
        inserting ``subsection (a) or (i)''; and
          (4) in subsection (d)(1), by striking ``subsection (a)'' and 
        inserting ``subsection (a) or (i)''.
  (e) Technical Amendment.--Section 104(h)(4)(A) of the Foreign Corrupt 
Practices Act of 1977 (15 U.S.C. 78dd-2(h)(4)(A)) is amended by 
striking ``For purposes of paragraph (1), the'' and inserting ``The''.

SEC. 4. AMENDMENTS TO THE FOREIGN CORRUPT PRACTICES ACT GOVERNING OTHER 
                    PERSONS.

  Title I of the Foreign Corrupt Practices Act of 1977 is amended by 
inserting after section 104 (15 U.S.C. 78dd-2) the following new 
section:

``SEC. 104A. PROHIBITED FOREIGN TRADE PRACTICES BY PERSONS OTHER THAN 
                    ISSUERS OR DOMESTIC CONCERNS.

  ``(a) Prohibition.--It shall be unlawful for any person other than an 
issuer that is subject to section 30A of the Securities Exchange Act of 
1934 or a domestic concern (as defined in section 104 of this Act), or 
for any officer, director, employee, or agent of such person or any 
stockholder thereof acting on behalf of such person, while in the 
territory of the United States, corruptly to make use of the mails or 
any means or instrumentality of interstate commerce or to do any other 
act in furtherance of an offer, payment, promise to pay, or 
authorization of the payment of any money, or offer, gift, promise to 
give, or authorization of the giving of anything of value to--
          ``(1) any foreign official for purposes of--
                  ``(A)(i) influencing any act or decision of such 
                foreign official in his official capacity, (ii) 
                inducing such foreign official to do or omit to do any 
                act in violation of the lawful duty of such official, 
                or (iii) securing any improper advantage; or
                  ``(B) inducing such foreign official to use his 
                influence with a foreign government or instrumentality 
                thereof to affect or influence any act or decision of 
                such government or instrumentality,
        in order to assist such person in obtaining or retaining 
        business for or with, or directing business to, any person;
          ``(2) any foreign political party or official thereof or any 
        candidate for foreign political office for purposes of--
                  ``(A)(i) influencing any act or decision of such 
                party, official, or candidate in its or his official 
                capacity, (ii) inducing such party, official, or 
                candidate to do or omit to do an act in violation of 
                the lawful duty of such party, official, or candidate, 
                or (iii) securing any improper advantage; or
                  ``(B) inducing such party, official, or candidate to 
                use its or his influence with a foreign government or 
                instrumentality thereof to affect or influence any act 
                or decision of such government or instrumentality,
        in order to assist such person in obtaining or retaining 
        business for or with, or directing business to, any person; or
          ``(3) any person, while knowing that all or a portion of such 
        money or thing of value will be offered, given, or promised, 
        directly or indirectly, to any foreign official, to any foreign 
        political party or official thereof, or to any candidate for 
        foreign political office, for purposes of--
                  ``(A)(i) influencing any act or decision of such 
                foreign official, political party, party official, or 
                candidate in his or its official capacity, (ii) 
                inducing such foreign official, political party, party 
                official, or candidate to do or omit to do any act in 
                violation of the lawful duty of such foreign official, 
                political party, party official, or candidate, or (iii) 
                securing any improper advantage; or
                  ``(B) inducing such foreign official, political 
                party, party official, or candidate to use his or its 
                influence with a foreign government or instrumentality 
                thereof to affect or influence any act or decision of 
                such government or instrumentality,
        in order to assist such person in obtaining or retaining 
        business for or with, or directing business to, any person.
  ``(b) Exception for Routine Governmental Action.--Subsection (a) of 
this section shall not apply to any facilitating or expediting payment 
to a foreign official, political party, or party official the purpose 
of which is to expedite or to secure the performance of a routine 
governmental action by a foreign official, political party, or party 
official.
  ``(c) Affirmative Defenses.--It shall be an affirmative defense to 
actions under subsection (a) of this section that--
          ``(1) the payment, gift, offer, or promise of anything of 
        value that was made, was lawful under the written laws and 
        regulations of the foreign official's, political party's, party 
        official's, or candidate's country; or
          ``(2) the payment, gift, offer, or promise of anything of 
        value that was made, was a reasonable and bona fide 
        expenditure, such as travel and lodging expenses, incurred by 
        or on behalf of a foreign official, party, party official, or 
        candidate and was directly related to--
                  ``(A) the promotion, demonstration, or explanation of 
                products or services; or
                  ``(B) the execution or performance of a contract with 
                a foreign government or agency thereof.
  ``(d) Injunctive Relief.--
          ``(1) When it appears to the Attorney General that any person 
        to which this section applies, or officer, director, employee, 
        agent, or stockholder thereof, is engaged, or about to engage, 
        in any act or practice constituting a violation of subsection 
        (a) of this section, the Attorney General may, in his 
        discretion, bring a civil action in an appropriate district 
        court of the United States to enjoin such act or practice, and 
        upon a proper showing, a permanent injunction or a temporary 
        restraining order shall be granted without bond.
          ``(2) For the purpose of any civil investigation which, in 
        the opinion of the Attorney General, is necessary and proper to 
        enforce this section, the Attorney General or his designee are 
        empowered to administer oaths and affirmations, subpoena 
        witnesses, take evidence, and require the production of any 
        books, papers, or other documents which the Attorney General 
        deems relevant or material to such investigation. The 
        attendance of witnesses and the production of documentary 
        evidence may be required from any place in the United States, 
        or any territory, possession, or commonwealth of the United 
        States, at any designated place of hearing.
          ``(3) In case of contumacy by, or refusal to obey a subpoena 
        issued to, any person, the Attorney General may invoke the aid 
        of any court of the United States within the jurisdiction of 
        which such investigation or proceeding is carried on, or where 
        such person resides or carries on business, in requiring the 
        attendance and testimony of witnesses and the production of 
        books, papers, or other documents. Any such court may issue an 
        order requiring such person to appear before the Attorney 
        General or his designee, there to produce records, if so 
        ordered, or to give testimony touching the matter under 
        investigation. Any failure to obey such order of the court may 
        be punished by such court as a contempt thereof.
          ``(4) All process in any such case may be served in the 
        judicial district in which such person resides or may be found. 
        The Attorney General may make such rules relating to civil 
        investigations as may be necessary or appropriate to implement 
        the provisions of this subsection.
  ``(e) Penalties.--
          ``(1)(A) Any juridical person that violates subsection (a) of 
        this section shall be fined not more than $2,000,000.
          ``(B) Any juridical person that violates subsection (a) of 
        this section shall be subject to a civil penalty of not more 
        than $10,000 imposed in an action brought by the Attorney 
        General.
          ``(2)(A) Any natural person who willfully violates subsection 
        (a) of this section shall be fined not more than $100,000 or 
        imprisoned not more than 5 years, or both.
          ``(B) Any natural person who violates subsection (a) of this 
        section shall be subject to a civil penalty of not more than 
        $10,000 imposed in an action brought by the Attorney General.
          ``(3) Whenever a fine is imposed under paragraph (2) upon any 
        officer, director, employee, agent, or stockholder of a person, 
        such fine may not be paid, directly or indirectly, by such 
        person.
  ``(f) Definitions.--For purposes of this section:
          ``(1) The term `person', when referring to an offender, means 
        any natural person other than a national of the United States 
        (as defined in section 101 of the Immigration and Nationality 
        Act (8 U.S.C. 1101) or any corporation, partnership, 
        association, joint-stock company, business trust, 
        unincorporated organization, or sole proprietorship organized 
        under the law of a foreign nation or a political subdivision 
        thereof.
          ``(2)(A) The term `foreign official' means any 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.
          ``(B) For purposes of subparagraph (A), the term `public 
        international organization' means--
                  ``(i) an organization that is designated by Executive 
                order pursuant to section 1 of the International 
                Organizations Immunities Act (22 U.S.C. 288); or
                  ``(ii) any other international organization that is 
                designated by the President by Executive order for the 
                purposes of this section, effective as of the date of 
                publication of such order in the Federal Register.
          ``(3)(A) A person's state of mind is knowing, with respect to 
        conduct, a circumstance or a result if--
                  ``(i) such person is aware that such person is 
                engaging in such conduct, that such circumstance 
                exists, or that such result is substantially certain to 
                occur; or
                  ``(ii) such person has a firm belief that such 
                circumstance exists or that such result is 
                substantially certain to occur.
          ``(B) When knowledge of the existence of a particular 
        circumstance is required for an offense, such knowledge is 
        established if a person is aware of a high probability of the 
        existence of such circumstance, unless the person actually 
        believes that such circumstance does not exist.
          ``(4)(A) The term `routine governmental action' means only an 
        action which is ordinarily and commonly performed by a foreign 
        official in--
                  ``(i) obtaining permits, licenses, or other official 
                documents to qualify a person to do business in a 
                foreign country;
                  ``(ii) processing governmental papers, such as visas 
                and work orders;
                  ``(iii) providing police protection, mail pick-up and 
                delivery, or scheduling inspections associated with 
                contract performance or inspections related to transit 
                of goods across country;
                  ``(iv) providing phone service, power and water 
                supply, loading and unloading cargo, or protecting 
                perishable products or commodities from deterioration; 
                or
                  ``(v) actions of a similar nature.
          ``(B) The term `routine governmental action' does not include 
        any decision by a foreign official whether, or on what terms, 
        to award new business to or to continue business with a 
        particular party, or any action taken by a foreign official 
        involved in the decision-making process to encourage a decision 
        to award new business to or continue business with a particular 
        party.
          ``(5) The term `interstate commerce' means trade, commerce, 
        transportation, or communication among the several States, or 
        between any foreign country and any State or between any State 
        and any place or ship outside thereof, and such term includes 
        the intrastate use of--
                  ``(A) a telephone or other interstate means of 
                communication, or
                  ``(B) any other interstate instrumentality.''.

SEC. 5. TREATMENT OF INTERNATIONAL ORGANIZATIONS PROVIDING COMMERCIAL 
                    COMMUNICATIONS SERVICES.

  (a) Definition.--For purposes of this section:
          (1) International organization providing commercial 
        communications services.--The term ``international organization 
        providing commercial communications services'' means--
                  (A) the International Telecommunications Satellite 
                Organization established pursuant to the Agreement 
                Relating to the International Telecommunications 
                Satellite Organization; and
                  (B) the International Mobile Satellite Organization 
                established pursuant to the Convention on the 
                International Maritime Satellite Organization.
          (2) Pro-Competitive privatization.--The term ``pro-
        competitive privatization'' means a privatization that the 
        President determines to be consistent with the United States 
        policy of obtaining full and open competition to such 
        organizations (or their successors), and nondiscriminatory 
        market access, in the provision of satellite services.
  (b) Treatment as Public International Organizations.--
          (1) Treatment.--An international organization providing 
        commercial communications services shall be treated as a public 
        international organization for purposes of section 30A of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78dd-1) and sections 
        104 and 104A of the Foreign Corrupt Practices Act of 1977 (15 
        U.S.C. 78dd-2) until such time as the President certifies to 
        the Committee on Commerce of the House of Representatives and 
        the Committees on Banking, Housing and Urban Affairs and 
        Commerce, Science, and Transportation that such international 
        organization providing commercial communications services has 
        achieved a pro-competitive privatization.
          (2) Limitation on effect of treatment.--The requirement for a 
        certification under paragraph (1), and any certification made 
        under such paragraph, shall not be construed to affect the 
        administration by the Federal Communications Commission of the 
        Communications Act of 1934 in authorizing the provision of 
        services to, from, or within the United States over space 
        segment of the international satellite organizations, or the 
        privatized affiliates or successors thereof.
  (c) Extension of Legal Process.--
          (1) In general.--Except as specifically and expressly 
        required by mandatory obligations in international agreements 
        to which the United States is a party, an international 
        organization providing commercial communications services, its 
        officials and employees, and its records shall not be accorded 
        immunity from suit or legal process for any act or omission 
        taken in connection with such organization's capacity as a 
        provider, directly or indirectly, of commercial 
        telecommunications services to, from, or within the United 
        States.
          (2) No effect on personal liability.--Paragraph (1) shall not 
        affect any immunity from personal liability of any individual 
        who is an official or employee of an international organization 
        providing commercial communications services.
  (d) Elimination or Limitation of Exceptions.--The President and the 
Federal Communications Commission shall, in a manner that is consistent 
with specific and express requirements in mandatory obligations in 
international agreements to which the United States is a party--
          (1) expeditiously take all actions necessary to eliminate or 
        to limit substantially any privileges or immunities accorded to 
        an international organization providing commercial 
        communications services, its officials, its employees, or its 
        records from suit or legal process for any act or omission 
        taken in connection with such organization's capacity as a 
        provider, directly or indirectly, of commercial 
        telecommunications services to, from, or within the United 
        States, that are not eliminated by subsection (c);
          (2) expeditiously take all appropriate actions necessary to 
        eliminate or to reduce substantially all privileges and 
        immunities not eliminated pursuant to paragraph (1); and
          (3) report to the Committee on Commerce of the House of 
        Representatives and the Committee on Commerce, Science, and 
        Transportation of the Senate on any remaining privileges and 
        immunities of an international organization providing 
        commercial communications services within 90 days of the 
        effective date of this act and semiannually thereafter.
  (e) Preservation of Law Enforcement and Intelligence Functions.--
Nothing in subsection (c) or (d) of this section shall affect any 
immunity from suit or legal process of an international organization 
providing commercial communications services, or the privatized 
affiliates or successors thereof, for acts or omissions--
          (1) under chapters 119, 121, 206, or 601 of title 18, United 
        States Code, the Foreign Intelligence Surveillance Act of 1978 
        (50 U.S.C. 1801 et seq.), section 514 of the Comprehensive Drug 
        Abuse Prevention and Control Act of 1970 (21 U.S.C. 884), or 
        Rules 104, 501, or 608 of the Federal Rules of Evidence;
          (2) under similar State laws providing protection to service 
        providers cooperating with law enforcement agencies pursuant to 
        State electronic surveillance or evidence laws, rules, 
        regulations, or procedures; or
          (3) pursuant to a court order.
  (f) Rules of Construction.--
          (1) Negotiations.--Nothing in this section shall affect the 
        President's existing constitutional authority regarding the 
        time, scope, and objectives of international negotiations.
          (2) Privatization.--Nothing in this section shall be 
        construed as legislative authorization for the privatization of 
        INTELSAT or Inmarsat, nor to increase the President's authority 
        with respect to negotiations concerning such privatization.

SEC. 6. ENFORCEMENT AND MONITORING.

  (a) Reports Required.--Not later than July 1 of 1999 and each of the 
5 succeeding years, the Secretary of Commerce shall submit to the 
Committee on Commerce of the House of Representatives and the Committee 
on Banking, Housing, and Urban Affairs of the Senate a report that 
contains the following information with respect to implementation of 
the Convention:
          (1) Ratification.--A list of the countries that have ratified 
        the Convention, the dates of ratification by such countries, 
        and the entry into force for each such country.
          (2) Domestic legislation.--A description of domestic laws 
        enacted by each party to the Convention that implement 
        commitments under the Convention, and assessment of the 
        compatibility of such laws with the Convention.
          (3) Enforcement.--As assessment of the measures taken by each 
        party to the Convention during the previous year to fulfill its 
        obligations under the Convention and achieve its object and 
        purpose including--
                  (A) an assessment of the enforcement of the domestic 
                laws described in paragraph (2);
                  (B) an assessment of the efforts by each such party 
                to promote public awareness of such domestic laws and 
                the achievement of such object and purpose; and
                  (C) an assessment of the effectiveness, transparency, 
                and viability of the monitoring process for the 
                Convention, including its inclusion of input from the 
                private sector and non-governmental organizations.
          (4) Laws prohibiting tax deduction of bribes.--An explanation 
        of the domestic laws enacted by each party to the Convention 
        that would prohibit the deduction of bribes in the computation 
        of domestic taxes.
          (5) New signatories.--A description of efforts to expand 
        international participation in the Convention by adding new 
        signatories to the Convention and by assuring that all 
        countries which are or become members of the Organization for 
        Economic Cooperation and Development are also parties to the 
        Convention.
          (6) Subsequent efforts.--An assessment of the status of 
        efforts to strengthen the Convention by extending the 
        prohibitions contained in the Convention to cover bribes to 
        political parties, party officials, and candidates for 
        political office.
          (7) Advantages.--Advantages, in terms of immunities, market 
        access, or otherwise, in the countries or regions served by the 
        organizations described in section 5(a), the reason for such 
        advantages, and an assessment of progress toward fulfilling the 
        policy described in that section.
          (8) Bribery and transparency.--An assessment of anti-bribery 
        programs and transparency with respect to each of the 
        international organizations covered by this Act.
  (b) Definition.--For purposes of this section, the term 
``Convention'' means the Convention on Combating Bribery of Foreign 
Public Officials in International Business Transactions adopted on 
November 21, 1997, and signed on December 17, 1997, by the United 
States and 32 other nations.

                          Purpose and Summary

    H.R. 4353, the International Anti-Bribery and Fair 
Competition Act of 1998, amends the Securities Exchange Act of 
1934 and the Foreign Corrupt Practices Act of 1977 to improve 
the competitiveness of American business and promote foreign 
commerce. The bill includes implementing language for the 
Organization for Economic Cooperation and Development (OECD) 
Convention on Combating Bribery of Foreign Public Officials in 
International Business Transactions (the OECD Convention). The 
bill also includes reporting requirements to monitor the 
implementation and enforcement of other nations' commitments 
under the OECD Convention and a section to promote the 
reduction of privileges and immunities for international 
organizations providing commercial communications services 
(e.g., INTELSAT and Inmarsat).

                  Background and Need for Legislation

    This legislation is designed to level the playing field for 
business worldwide by seeking to reduce foreign bribery 
generally as well as special privileges and immunities from law 
in the satellite industry.
    Investigations by the Securities and Exchange Commission 
(SEC) in the mid-1970s revealed that over 400 U.S. companies 
admitted making questionable or illegal payments in excess of 
$300 million to foreign government officials, politicians, and 
political parties. Many public companies maintained cash 
``slush funds'' from which illegal campaign contributions were 
being made in the United States and illegal bribes were being 
paid to foreign officials. Scandals involving payments by U.S. 
companies to public officials in Japan, Italy, and Mexico led 
to political repercussions within those countries and damaged 
the reputation of American companies throughout the world.
    In the wake of these disclosures, Congress enacted the 
Foreign Corrupt Practices Act of 1977 (the FCPA). The Foreign 
Corrupt Practices Act of 1977, Pub. L. No. 95-213, 91 Stat. 
1494, 15 U.S.C. Sec. Sec. 78m, 78dd-1, 78dd-2, 78ff (1998), as 
amended by the Omnibus Trade and Competitiveness Act of 1988 
Sec. Sec. 5001-5003, Pub. L. No. 100-418, (H.R. 4848). The FCPA 
amended the Securities Exchange Act of 1934, 15 U.S.C. Sec. 78 
et seq., to require issuers of publicly traded securities to 
institute adequate accounting controls and to maintain accurate 
books and records. Civil and criminal penalties were enacted 
for the failure to do so. In addition, the FCPA required both 
issuers and all other U.S. nationals or residents, as well as 
U.S. business entities and foreign entities with their primary 
place of business in the United States (defined as ``domestic 
concerns'') to refrain from making any unlawful payments to 
public officials, political parties, party officials, or 
candidates for public office, directly or through others, for 
the purpose of causing that person to make a decision or take 
an action, or refrain from taking an action, for the purpose of 
obtaining or retaining business.
    Since the passage of the FCPA, American businesses have 
operated at a disadvantage relative to foreign competitors who 
have continued to pay bribes without fear of penalty. See, 
Trade Promotion Coordinating Committee Sixth Annual Report to 
the United States Congress, The National Export Strategy (Sept. 
1998). Such bribery is estimated to affect international 
contracts valued in the billions of dollars each year. Some of 
our trading partners have explicitly encouraged and subsidized 
such bribes by permitting businesses to claim them as tax-
deductible business expenses. Id.
    Beginning in 1989, the U.S. government began an effort to 
convince our trading partners at the OECD to criminalize the 
bribery of foreign public officials. Achieving comparable 
prohibitions in other developed countries and combating 
corruption generally has been a major priority of the U.S. 
business community, the U.S. Congress, and successive 
Administrations since the late 1970s.
    International bribery and corruption continue to be 
problems worldwide. They undermine the goals of fostering 
economic development, trade liberalization, and achieving a 
level playing field throughout the world for businesses. It is 
impossible to calculate with certainty the losses suffered by 
U.S. businesses due to bribery by foreign competitors. The 
Commerce Department has stated that it has learned of 
significant allegations of bribery by foreign firms in 
approximately 240 international commercial contracts since mid-
1994 valued at nearly $108 billion. Id. This legislation, 
coupled with implementation of the OECD Convention by our major 
trading partners, is designed to result in a substantial 
leveling of the playing field for U.S. businesses.
    The goal of the United States is the promotion of stronger, 
more reliable, and transparent foreign legal regimes that, in 
turn, make for more reliable and attractive investment 
climates. Rather than competing directly on the price and 
quality of products and services, companies competing against 
firms paying bribes may lose to someone offering an inferior 
deal. Competition without bribery gives the buyer the best 
value for the money. Moreover, countries that have the most 
corruption have trouble attracting foreign investment because 
the need to bribe acts as a substantial added tax on the 
investor.
    Fortunately, in the 1990s the international community has 
made a concerted effort in the fight against corruption. 
Gradually, as awareness of the effects of transnational bribery 
became more apparent, progress was made in efforts to combat 
bribery overseas. After almost four years of substantial work 
in the OECD's Working Group on Bribery, on May 27, 1994, the 
OECD Council approved a Recommendation on Bribery in 
International Business Transactions (the Recommendations). The 
29 OECD member states agreed that bribery distorts 
international competitive conditions; that all countries share 
a responsibility to combat bribery in international business 
transactions, however their nationals may be involved; and that 
further action is needed on the national and international 
level. Id. Member states agreed to ``take concrete and 
meaningful steps'' to meet the goal of deterring, preventing, 
and combating bribery of foreign officials. However, the 
Recommendation did not require each member state to criminalize 
the bribery of officials of another country.
    These efforts ultimately culminated in the signing of the 
Organization for Economic Cooperation and Development 
Convention on Combating Bribery of Foreign Public Officials in 
International Business Transactions (the OECD Convention). 
Thirty-three countries, composed of most of the world's largest 
trading nations, signed the OECD Convention on December 17, 
1997. For twenty years after the passage of the Foreign Corrupt 
Practices Act, the United States was virtually alone in 
criminalizing foreign bribery. Now, thirty-four other countries 
have taken a step in this direction. Twenty-eight of the 
twenty-nine OECD member countries along with five other 
countries, Argentina, Bulgaria, Brazil, Chile, and the Slovak 
Republic, signed the OECD Convention. Australia, the only OECD 
member which did not sign, participated in the negotiations and 
adoption of the OECD Convention. Because of new internal treaty 
processes of the Australian parliament, Australia cannot sign 
the OECD Convention until it has completed its necessary 
national procedures. However, the Commerce Department expects 
Australia to sign and ratify the OECD Convention by the 
December 31, 1998 deadline.
    Under the OECD Convention:
          The U.S. and its trading partners agreed to 
        criminalize bribery of foreign public officials, 
        including officials in all branches of government, and 
        to criminalize payments to officials of public agencies 
        and public international organizations;
          The OECD Convention also calls for criminal penalties 
        for those who bribe foreign public officials. If a 
        nation's legal system lacks the concept of corporate 
        criminal liability, the nation must provide for 
        equivalent non-criminal sanctions, such as fines;
          Parties to the agreement pledged to work to provide 
        legal assistance in investigations and proceedings 
        within the scope of the OECD Convention and to make 
        bribery of foreign public officials an extraditable 
        offense; and
          The OECD Convention requires the Parties to cooperate 
        in an OECD follow-up program to monitor and promote 
        full implementation.
    This legislation amends the FCPA to conform it to the 
requirements of and to implement the OECD Convention.

               Intergovernmental Satellite Organizations

    The International Telecommunications Satellite Organization 
(INTELSAT) is a global communications satellite cooperative 
with 143 member countries which provides space segment for 
international telecommunications and is the world's primary 
provider of international ``fixed'' satellite services (e.g., 
transoceanic telephone calls, video feeds). The International 
Mobile Satellite Organization (Inmarsat) developed out of the 
perceived need for a global maritime communications satellite 
system that would provide distress, safety, and communications 
services to seafaring nations in a cooperative, cost-sharing 
entity. Inmarsat began providing commercial service in 1982. 
Today, Inmarsat has 82 member countries.
    INTELSAT and Inmarsat are controlled by ``Parties'' and 
``signatories.'' The Parties, which are the national government 
members of the INTELSAT and Inmarsat agreements, have ultimate 
control. The signatories hold ownership interests and assist 
with the operation and management of the systems and are 
distributors of INTELSAT and Inmarsat services in their own 
country. Many signatories are government-owned or controlled 
telecommunications monopolies or dominant service providers. 
There are many ways to ``control'' access to markets. Legal 
control is one means. Control through facilities ownership or 
influence with authorities are others. For example, France 
Telecom, which is the dominant provider of telecommunications 
services in France, is the signatory to INTELSAT and Inmarsat. 
In some markets, the signatory is the actual licensing body for 
that country.
    The ownership structure of the intergovernmental satellite 
organizations (IGOs) provides them with advantages in terms of 
market access and regulatory processes over their competitors 
and potential competitors. Changing this structure by ending or 
reducing ownership by government owned or controlled entities 
would greatly facilitate opening markets to competitive 
suppliers of telecommunications services and would help lower 
the costs of international communications for the benefit of 
consumers in the United States and worldwide.
    The U.S. is the largest user in both systems and, since 
ownership is based on usage, currently holds an approximately 
18 percent ownership share in INTELSAT and 23 percentownership 
share in Inmarsat. The U.S. signatory to INTELSAT and Inmarsat is 
COMSAT, which Congress determined was subject to the antitrust laws and 
which was created in order to facilitate our policy goal of having an 
independent entity, organized to maintain and strengthen competition, 
as our signatory. This pro-competitive policy is described in section 
102(c) of the Communications Satellite Act of 1962, as amended (the 
Satellite Act or 1962 Act); 47 U.S.C. 701(c):

          In order to facilitate this development and to 
        provide for the widest possible participation by 
        private enterprise, United States participation in the 
        global market shall be in the form of a private 
        corporation, subject to appropriate governmental 
        regulation. It is the intent of Congress that all 
        authorized users have nondiscriminatory access to the 
        system; that maximum competition be maintained in the 
        provision of equipment and services utilized by the 
        system; that the corporation created under this Act be 
        so organized and operated as to maintain and strengthen 
        competition in the provision of communications services 
        to the public; and that the activities of the 
        corporation created under this Act and of the persons 
        or companies participating in the ownership of the 
        corporation shall be consistent with the Federal 
        antitrust laws.

    The Satellite Act also empowers the Federal Communications 
Commission (the FCC or the Commission) in its administration of 
the Communications Act of 1934, as amended, to assure 
nondiscriminatory use of and equitable access to the satellite 
system. See Section 201(c)(2) of the Satellite Act; 47 U.S.C. 
721(c)(2). The Satellite Act also gives the Commission 
discretion in implementing this provision by regulating the 
manner in which facilities of the system and stations are 
allocated among users. Id. Thus Congress sought to promote 
competition in this market by permitting broad availability of 
the systems to carriers and users.
    The Committee included language to address the special 
advantages of the intergovernmental satellite organizations and 
to ensure that they do not improperly escape coverage by the 
FCPA. Thus the legislation makes it clear that bribery of 
intergovernmental satellite organizations does not escape the 
coverage of the FCPA through a privatization which is not 
deemed pro-competitive. It also seeks to remove the special 
advantages of such organizations, in particular privileges and 
immunities. The Committee intends that American companies 
should not suffer competitive disadvantages due to either 
foreign bribery, or due to privileges and immunities resulting 
from the fact that the intergovernmental satellite 
organizations have not yet achieved the U.S. policy of 
obtaining a pro-competitive privatization.

                       Privileges and Immunities

    INTELSAT and Inmarsat enjoy a range of privileges and 
immunities, such as tax exemptions, immunity from lawsuits, 
potential antitrust immunity, and preferential access to 
orbital locations. These privileges and immunities may make it 
difficult for private competitors to obtain legal redress for 
anti-competitive activities that INTELSAT and Inmarsat may 
engage in. These privileges and immunities could distort 
competition which would be detrimental to the interests of 
consumers and American workers.
    The legal status of INTELSAT's and Inmarsat's immunity from 
suit and legal process is unclear. Under U.S. law, 
international organizations such as INTELSAT and Inmarsat 
generally have the same immunity as foreign governments, and 
the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. 
Sec. Sec. 1602 et seq., provides that foreign governments are 
not immune for actions taken in connection with their 
commercial activities. However, there is a lack of case law on 
this issue. It is particularly important to resolve this issue 
in the context of INTELSAT and Inmarsat, whose primary mission 
(unlike the primary missions of other international 
organizations) is to provide commercial services.
    These privileges and immunities make it more difficult for 
private companies to compete against these intergovernmental 
organizations. Such privileges and immunities give INTELSAT and 
Inmarsat a commercial advantage which their competitors cannot 
match and which make it more difficult for the competitors to 
have nondiscriminatory access to satellite telecommunications 
markets in countries that are members of INTELSAT and Inmarsat. 
Just as implementing the OECD Convention is designed to help 
level the playing field for American business overseas through 
reduction of bribery, reduction of immunities from law will 
help level the playing field for business by applying the same 
laws to the intergovernmental satellite organizations that 
apply to their would-be private sector competitors.
    Thus this legislation addresses the issue of privileges and 
immunities and clarifies the law on this issue. It provides 
that INTELSAT and Inmarsat are not immune from suit or legal 
process in connection with their commercial activities, which 
include provision of commercial communications services. 
Further, this legislation directs the President and the 
Commission to substantially limit or eliminate other privileges 
and immunities that INTELSAT and Inmarsat presently enjoy.

                             Legal Analysis

    There may be an open question as to the extent to which 
INTELSAT and Inmarsat are currently subject to suit and legal 
process in connection with their commercial activities. The 
lack of clear standards is apparent from a review of INTELSAT's 
and Inmarsat's organizational documents, the International 
Organizations Immunities Act (IOIA), 22 U.S.C. Sec. 288 et 
seq., the Foreign Sovereign Immunities Act, and relevant court 
decisions.
    In the case of INTELSAT, neither the Agreement Relating to 
the International Telecommunications Satellite Organization 
(the INTELSAT Agreement), TIAS 7532, nor its implementing 
agreement, the INTELSAT Headquarters Agreement (the INTELSAT HQ 
Agreement), TIAS 8542, provides clear guidance on the issue of 
immunity. Article XV(c) of the INTELSAT Agreement states that 
the Party in whose territory INTELSAT's headquarters is located 
(i.e., the United States) shall grant privileges, exemptions, 
and immunities ``inaccordance with the Headquarters 
Agreement,'' and that the other Parties shall make a grant ``in 
accordance with the [privileges, exemptions, and immunities] 
Protocol.''
    Article XV(c) does not, however, specify what the 
privileges, exemptions, and immunities should be, other than to 
state that they should be ``appropriate,'' and that, as to 
``immunity from legal process in respect of acts done or words 
written or spoken in the exercise of . . . [officers' and 
employees'] duties,'' the privileges, exemptions, and 
immunities should be ``to the extent and in the cases to be 
provided for in the Headquarters Agreement and Protocol.''
    The INTELSAT Headquarters Agreement also leaves largely 
unanswered the question of to what extent INTELSAT and its 
officials are immune from suit or legal process. Section 16 of 
the INTELSAT Headquarters Agreement affords immunity ``from 
suit and legal process'' to ``[t]he officers and employees of 
INTELSAT, the representatives of the Parties and of the 
Signatories and persons participating in arbitration 
proceedings pursuant to the INTELSAT Agreement.'' This 
immunity, however, is limited to ``acts performed by them in 
their official capacity and falling within their functions,'' 
and section 16 does not elaborate upon the intended meaning of 
those terms.
    The INTELSAT Protocol suggests that the parties to the 
INTELSAT Agreement never intended for INTELSAT to be immune for 
its commercial activities. See Protocol on INTELSAT Privileges, 
Exemptions, and Immunities, May 19, 1978. The Protocol 
implements the same immunity language in Article XV(c) of the 
INTELSAT Agreement as the INTELSAT Headquarters Agreement 
implements, and governs INTELSAT's privileges, immunities, and 
exemptions in all INTELSAT member nations other than the United 
States. Article III, Section 1 of the Protocol states that 
INTELSAT's ``immunity from jurisdiction and immunity from 
execution'' does not apply ``in respect of its commercial 
activities.'' Thus, apparently the other parties to INTELSAT 
have taken the position that Article XV(c) confers no immunity 
for commercial activities to INTELSAT, its parties, or its 
signatories, but the status of commercial activities in the 
United States has not been as explicitly addressed.
    The International Organizations Immunities Act (IOIA), 
which applies to INTELSAT through an implementing Executive 
Order, limits immunity for international organizations to the 
immunities granted to ``foreign governments.'' The IOIA also 
provides that the President may restrict the immunity of any 
particular organization. The reason for this reservation of 
right was to ``permit the adjustment or limitation of the 
privileges in the event that any international organization 
should engage, for example, in activities of a commercial 
nature.'' S. Rep. No. 861, 79th Cong., 1st Sess. 4 (1945).
    In 1976, Congress passed the Foreign Sovereign Immunities 
Act (FSIA). The FSIA provides that foreign governments are not 
immune for any ``action [that] is based upon a commercial 
activity carried on in the United States by the foreign state; 
or upon an act performed in the United States in connection 
with a commercial activity of the foreign state elsewhere; or 
upon an act outside the territory of the United States in 
connection with a commercial activity of the foreign state 
elsewhere and that the act causes a direct effect in the United 
States.'' 28 U.S.C. Sec. 1605(a)(2). Although the IOIA affords 
international organizations the same immunity as foreign 
governments, the FSIA did not explicitly mention the IOIA. See 
Broadbent v. Organization of American States, 628 F.2d 27 (D.C. 
Cir. 1980).
    The Inmarsat agreements, like those regarding INTELSAT, do 
not speak meaningfully to the issue of the scope of immunity. 
This legislation helps define the scope of that immunity. The 
extent to which immunity applies to commercial activities has 
been unclear not only with respect to INTELSAT and Inmarsat, 
but also in the case of their U.S. signatory, Comsat. Comsat is 
neither an international organization nor a foreign government. 
As a result, Comsat itself has no antitrust immunity, and the 
Satellite Act expressly subjects Comsat to the antitrust laws.
    One court, however, has held Comsat to be immune from 
antitrust liability for actions Comsat took in connection with 
INTELSAT's commercial role of providing communications 
satellite services. In Alpha Lyracom v. Communications 
Satellite Corporation, 946 F.2d 168, 174 (2d Cir. 1991), cert. 
denied, 502 U.S. 1096 (1992), the court concluded that section 
16 of the INTELSAT Headquarters Agreement, when read in 
conjunction with Article XV of the INTELSAT Agreement, granted 
immunity to Comsat when it is engaged in signatory activities, 
without regard to whether the signatory activities concerned 
INTELSAT's commercial functions. Further, on remand, the 
Federal District Court for the Southern District of New York 
concluded that Comsat's signatory immunity extended to its 
participation in an INTELSAT resolution calling for a boycott 
of private satellite systems. Alpha Lyracom Space 
Communications, Inc. v. Comsat Corporation, 968 F. Supp. 876 
(S.D.N.Y. 1996). The Second Circuit affirmed, finding that 
``Comsat's activities in connection with a so-called ``boycott 
resolution,'' adopted and reaffirmed at meetings of INTELSAT, 
were immune from discovery and could not be considered as 
evidence to support . . . [a separate system's] antitrust 
claims.'' 113 F.3d 372 (2d Cir. 1997).
    The FCC has found that the immunity from antitrust that the 
court in Alpha Lyracom found to be conferred on Comsat provides 
Comsat with a ``competitive advantage'' that ``allows 
commercial decisions and activities to be conducted under a 
cloak of immunity unavailable to Comsat's competitors.'' 
Amendment of the Commission's Regulatory Policies to Allow Non-
U.S. Licensed Space Stations to Provide Domestic and 
International Satellite Service in the United States, FCC 97-
399 (Nov. 26, 1997) at para. 125.

                   Federal Communications Commission

    The Commission has in the past worked to eliminate 
immunities associated with the intergovernmental satellite 
organizations.
    In The Merger of MCI Communications Corporation and British 
Telecommunication plc, FCC 97-302 (Sept. 24, 1997), the FCC 
conditioned its approval of the proposed merger between British 
Telecommunications plc (BT) and MCI Communications Corporation 
on BT making ``awaiver of any claim to immunity from U.S. 
antitrust laws acting in its capacity as signatory to INTELSAT * * * as 
such immunity may apply to BT's provision of services in the United 
States.'' Id. para. 328 (Note that this merger addressed in this 
decision did not ultimately occur).
    In its ``DISCO II'' decision, the FCC held that it would 
``require Comsat to make an appropriate waiver of immunity from 
any suit as part of its application to provide domestic 
services via INTELSAT or Inmarsat.'' Amendment of the 
Commission's Regulatory Policies to Allow Non-U.S. Licensed 
Space Stations to Provide Domestic and International Satellite 
Service in the United States, 12 FCC Rcd 24094 (1997) at para. 
126 (emphasis in original).
    The FCC also determined that it should continue to regulate 
Comsat as a dominant carrier in the provision of switched 
voice, private line, and occasional-use video service in non-
competitive markets because, among other reasons, Comsat had 
not made ``an appropriate waiver * * * of its immunity, in form 
and substance satisfactory to the [Federal Communications] 
Commission.'' Comsat Corporation, FCC 98-78 (Apr. 28, 1998) at 
para. 162.

                                Hearings

    The Subcommittee on Finance and Hazardous Materials held a 
hearing on H.R. 4353, the International Anti-Bribery and Fair 
Competition Act of 1998, on September 10, 1998. Appearing 
before the Subcommittee were Mr. Andrew Pincus, General 
Counsel, Office of General Counsel, U.S. Department of 
Commerce, on behalf of the Administration, and Mr. Paul V. 
Gerlach, Associate Director, Division of Enforcement, 
Securities and Exchange Commission.

                        Committee Consideration

    On September 16, 1998, the Subcommittee on Finance and 
Hazardous Materials met in open markup session and approved 
H.R. 4353, the International Anti-Bribery and Fair Competition 
Act of 1998, for Full Committee consideration, amended, by a 
voice vote. On September 24, 1998, the Full Committee met in 
open markup session and ordered H.R. 4353 reported to the 
House, amended, by a voice vote, a quorum being present.

                             Rollcall Votes

    Clause 2(l)(2)(B) of rule XI of the Rules of the House 
requires the Committee to list the recorded votes on the motion 
to report legislation and amendments thereto. There were no 
recorded votes taken in connection with ordering H.R. 4353 
reported. An Amendment in the Nature of Substitute offered by 
Mr. Oxley was adopted by a voice vote. A motion by Mr. Bliley 
to order H.R. 4353 reported to the House, amended, was agreed 
to by a voice vote, a quorum being present.

                      Committee Oversight Findings

    Pursuant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House of Representatives, the Committee held a legislative 
hearing and made findings that are reflected in this report.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the Committee by the Committee on Government 
Reform and Oversight.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 2(l)(3)(B) of rule XI of the 
Rules of the House of Representatives, the Committee finds that 
H.R. 4353, the International Anti-Bribery and Fair Competition 
Act of 1998, would result in no new or increased budget 
authority, entitlement authority, or tax expenditures or 
revenues.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of 
the House of Representatives, the following is the cost 
estimate provided by the Congressional Budget Office pursuant 
to section 402 of the Congressional Budget Act of 1974:
                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 30, 1998.
Hon. Tom Bliley,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 4353, the 
International Anti-Bribery and Fair competition Act of 1998.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Mark 
Grabowicz and Mark Hadley.
            Sincerely,
                                         June E. O'Neill, Director.
    Enclosure.

H.R. 4353--International Anti-Bribery and Fair Competition Act of 1998

    CBO estimates that implementing H.R. 4353 would not result 
in any significant cost to the federal government. Because 
enactment of the bill could affect direct spending and 
receipts, pay-as-you-go procedures would apply. However, CBO 
estimates that any impact on direct spending and receipts would 
not be significant.
    CBO has determined that this legislation is excluded from 
the application of the Unfunded Mandates Reform Act (UMRA) 
because it would amend the Foreign Corrupt Practices Act (FCPA) 
and other laws in ways that are necessary to implement the 
Organization for Economic Cooperation and Development 
Convention on Combating Bribery of Foreign Public Officials in 
International Business Transactions. Section 4 of UMRA excludes 
from the application of that act any legislative provisions 
that are necessary for the ratification or implementation of 
international treaty obligations.
    H.R. 4353 would expand the FCPA to cover additional 
offenses relating to corporate bribery of foreign officials. As 
a result, the federal government would be able to pursue cases 
that it otherwise would not be able to prosecute. CBO expects 
that the government probably would not pursue many such cases, 
however, so we estimate that any increase in federal costs for 
law enforcement, court proceedings, or prison operations would 
not be significant. Any such additional costs would be subject 
to the availability of appropriated funds.
    Because those prosecuted and convicted under the bill could 
be subject to civil and criminal fines, the federal government 
might collect additional fines (which are categorized as 
governmental receipts) if the bill is enacted. However, CBO 
expects that any additional fines would be negligible because 
of the small number of cases involved. Collections of criminal 
fines are deposited in the Crime Victims Fund and spent in the 
following year. Because any increase in direct spending would 
equal the fines collected with a one-year lag, the additional 
direct spending from the Crime Victims Fund also would be 
negligible.
    H.R. 4353 would require the Department of Commerce to 
submit reports each year during the 1999-2004 period detailing 
the enforcement and monitoring efforts of foreign countries 
that ratified the convention. Based on information from the 
department, CBO estimates that such efforts would cost less 
than $500,000 a year and would be subject to the availability 
of appropriated funds.
    The CBO staff contacts for this estimate are Mark Grabowicz 
and Mark Hadley. This estimate was approved by Paul N. Van de 
Water, Assistant Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for this legislation is provided in 
Article I, section 8, clause 3, which grants Congress the power 
to regulate commerce with foreign nations, among the several 
States, and with the Indian tribes.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation

Section 1.--Short title

    Section 1 establishes the short title of the legislation as 
the ``International Anti-Bribery and Fair Competition Act of 
1998.''

Section 2.--Amendments to the Foreign Corrupt Practices Act governing 
        issuers

    Subsection (a) implements the OECD Convention by amending 
Sec. 30A of the Securities Exchange Act of 1934 (the Securities 
Exchange Act) to prohibit any payments made to foreign 
officials for the purpose of securing ``any improper 
advantage.'' See OECD Convention, Art. 1, para. 1.
    Subsection (b) implements the OECD Convention by amending 
Sec. 30A(f)(1) of the Securities Exchange Act to expand the 
definition of ``foreign official'' to include an official of a 
public international organization. See OECD Convention, Art. 1, 
para. 4(a). Public international organizations are then 
defined, first, by reference to those organizations designated 
by Executive Order pursuant to the International Organizations 
Immunities Act (IOIA) (22 U.S.C. Sec. 288), and second, by 
reference to any other international organization that is 
designated by the President for the purposes of this section. 
The Committee intends that citizens will be given adequate 
notice of such designations.
    Subsection (c) implements the OECD Convention by creating 
an additional basis for jurisdiction over foreign bribery by 
U.S. issuers and U.S. persons that are officers, directors, 
employees, or agents, or stockholders of such issuers. See OECD 
Convention, Art. 4, para. 2. This section extends coverage for 
acts outside the United States to U.S. issuers that are 
organized under the laws of the United States or of a State, 
territory, or commonwealth, or a political subdivision thereof 
and U.S. persons acting on such issuers' behalf. Under the new 
Sec. 30A(g) of the Securities Exchange Act, U.S. issuers or 
U.S. persons acting on a U.S. issuer's behalf violate the FCPA 
if they make any of the payments prohibited under the existing 
statute outside of the United States, irrespective of whether 
in doing so they make any use of the mails or means or 
instrumentality of interstate commerce. Although this section 
limits liability to U.S. issuers and U.S. persons acting on 
U.S. issuers' behalf, it is expected that the established 
principles of liability, including principles of vicarious 
liability, that apply under the current version of the FCPA 
shall apply to the liability of U.S. issuers for acts taken on 
their behalf by their officers, directors, employees, agents, 
or stockholders outside the territory of the United States, 
regardless of the nationality of the officer, director, 
employee, agent, or stockholder. The subsection also inserts 
references to the new offense in the provisions of the existing 
statute governing exceptions and affirmative defenses.
    Subsection (d) implements the OECD Convention by amending 
Sec. 32(c) of the Securities Exchange Act (15 U.S.C. 78 ff (c)) 
to eliminate the current disparity in treatment between U.S. 
nationals that are employees or agents of issuers and foreign 
nationals that are employees or agents of issuers. Presently, 
foreign nationals who are employees or agents (as opposed to 
officers or directors) are subject only to civil sanctions. 
Eliminating this preferential treatment implements the OECD 
Convention's requirement that ``[e]ach Party shall take such 
measures as may be necessary to establish that it is a criminal 
offense under its law for any person to [make unlawful 
payments].'' OECD Convention, Article 1. In addition, 
subsection (d) provides that the same penalties shall apply to 
issuers for violation of the new provisions for acts outside 
the United States as apply to violations of the existing 
statute.

Section 3.--Amendments to the Foreign Corrupt Practices Act governing 
        domestic concerns

    Subsection (a) implements the OECD Convention by amending 
Sec. 104(a) of the FCPA to prohibit any payments made to 
foreign officials for the purpose of securing ``any improper 
advantage,'' Art. 1, para. 1.
    Subsection (b) implements the OECD Convention by 
eliminating the current disparity in treatment between U.S. 
nationals that are employees or agents of domestic concerns and 
foreign nationals that are employees or agents of domestic 
concerns. Presently, foreign nationals who are employees or 
agents (as opposed to officers or directors) are subject only 
to civil sanctions. Eliminating this preferential treatment 
implements the OECD Convention's requirement that``[e]ach Party 
shall take such measures as may be necessary to establish that it is a 
criminal offense under its law for any person to [make unlawful 
payments].'' OECD Convention, Article 1. In addition, section 3(b) 
provides that the same penalties shall apply to U.S. persons for 
violation of the new Sec. 104(i) for acts outside the United States as 
apply to violations of the existing FCPA.
    Subsection (c) implements the OECD Convention by amending 
Sec. 104(h)(2) of the FCPA, 15 U.S.C. 78dd-2(h)(2), to expand 
the definition of ``foreign official'' to include an official 
of a public international organization. See OECD Convention, 
Art. 1, para. 4(a). Public international organizations are then 
defined, first, by reference to those organizations designated 
by Executive order pursuant to the International Organizations 
Immunities Act (22 U.S.C. Sec. 288), and second, by reference 
to any other international organization that is designated by 
the President for the purposes of this section. The Committee 
intends that citizens will be given adequate notice of such 
designations.
    Subsection (d) implements the OECD Convention by creating 
an additional basis for jurisdiction over foreign bribery by 
U.S. persons. See OECD Convention, Art. 4, para. 2. This 
section limits coverage to businesses organized under the laws 
of the United States, a State, territory, possession, or 
commonwealth, or a political subdivision thereof, or U.S. 
nationals. U.S. nationals are defined by reference to the 
Immigration and Nationality Act, 8 U.S.C. Sec. 1101(22), which 
defines a ``national of the United States'' as ``(A) a citizen 
of the United States, or (B) a person, who though not a 
citizen, owes permanent allegiance to the United States.'' 
Under the new Sec. 104(i), a U.S. person violates the FCPA if 
it makes any of the payments prohibited under the existing 
statute outside of the United States, irrespective of whether 
in doing so it makes any use of the mails or means or 
instrumentality of interstate commerce. Although this section 
imposes liability only on U.S. persons, it is expected that the 
established principles of liability, including principles of 
vicarious liability, that apply under the current version of 
the FCPA shall apply to the liability of U.S. businesses for 
acts taken on their behalf by their officers, directors, 
employees, agents or stockholders outside the United States, 
regardless of the nationality of the officer, director, 
employee, agent, or stockholder. Subsection (d) also inserts 
references to the new offense in the provisions of the existing 
statute governing exceptions, affirmative defenses, and 
injunctive relief.

Section 4.--Amendments to the Foreign Corrupt Practices Act governing 
        other persons

    Section 4 creates a new section in the FCPA, Sec. 104A, 
providing for criminal and civil penalties over persons not 
covered under the existing FCPA provisions regarding issuers 
and domestic concerns. This section closes the gap left in the 
original FCPA and implements the OECD Convention's requirement 
that Parties criminalize bribery by ``any person.'' OECD 
Convention, Art. 1, para. 1. The prohibited acts are the same 
as those covered by Sec. 30A(a) of the Securities Exchange Act, 
15 U.S.C. 78dd-1(a), and Sec. 104(a) of the FCPA, 15 U.S.C. 
78dd-2(a), with two qualifications.
    First, the offense created under this section requires that 
an act in furtherance of the bribe be taken within the 
territory of the United States. The OECD Convention requires 
each Party to ``take such measures as may be necessary to 
establish its jurisdiction over the bribery of a foreign public 
official when the offense is committed in whole or in party in 
its territory.'' OECD Convention, Art. 4, para. 1. The new 
offense complies with this section by providing for criminal 
jurisdiction in this country over bribery by foreign nationals 
of foreign officials when the foreign national takes some act 
in furtherance of the bribery within the territory of the 
United States. It is expected that the established principles 
of liability, including principles of vicarious liability, that 
apply under the current version of the FCPA shall apply to the 
liability of foreign businesses for acts taken on their behalf 
by their officers, directors, employees, agents or stockholders 
in the territory of the United States, regardless of the 
nationality of the officer, director, employee, agent, or 
stockholder.
    As envisioned in the OECD the territorial basis for 
jurisdiction should be interpreted broadly so that an extensive 
physical connection to the bribery act is not required. See 
Commentaries on the Convention on Combating Bribery of Foreign 
Public Officials in International Business Transactions (OECD 
Commentary) at para. 24. Further, ``territory of the United 
States'' should be understood to encompass all areas over which 
the United States asserts territorial jurisdiction. See 18 
U.S.C. Sec. 5 (``The term `United States', as used in this 
title in a territorial sense, includes all places and waters, 
continental or insular, subject to the jurisdiction of the 
United States, except the Canal Zone.''); 18 U.S.C. Sec. 7 
(special maritime and territorial jurisdiction of the United 
States, 49 U.S.C. Sec. 46501(2) (special aircraft jurisdiction 
of the United States)).
    Although this section limits jurisdiction over foreign 
nationals and companies to instances in which the foreign 
national or company takes some action while physically present 
within the territory of the United States, Congress does not 
thereby intend to place a similar limit on the exercise of U.S. 
criminal jurisdiction over foreign nationals and companies 
under any other statute or regulation.
    The second difference from the existing FCPA provisions is 
that this section expands the commerce nexus to include not 
only the use of the mails or any means or instrumentality of 
interstate commerce but ``any other act'' within the United 
States.

Section 5.--Treatment of international organizations providing 
        commercial communications services

    Subsection (a) establishes definitions and policy. 
Paragraph (1) defines ``international organization providing 
commercial communications services'' to mean INTELSAT and 
Inmarsat.
    Paragraph (2) defines the term ``pro-competitive 
privatization'' for purposes of section 5 to mean one the 
President determines to be consistent with the U.S. policy of 
obtaining full and open competition to such organizations (or 
their successors), and nondiscriminatory market access, in the 
provision of satellite services. This language makes clear that 
it is the Presidentwho is to make a determination for purposes 
of applicability of section 5(b) as to whether a privatization is 
consistent with the U.S. policy set forth in paragraph (2). That policy 
is to be one of obtaining full and open competition to such 
organizations (or their successors), and nondiscriminatory market 
access.
    Subsection (b) deals with the treatment of public 
international organizations. Paragraph (1) extends the FCPA to 
bribery of officials of public international organizations. 
Pursuant to subsection (b)(1), the classification of INTELSAT 
and Inmarsat as ``public international organizations'' for 
purposes of the FCPA remains in effect until the President 
certifies that INTELSAT or Inmarsat, as the case may be, has 
achieved a ``pro-competitive privatization.'' Prior to this 
certification, therefore, a prohibited payment made to an 
official of INTELSAT or Inmarsat will constitute a violation of 
the FCPA. The certification requirement is designed to ensure 
that neither INTELSAT nor Inmarsat falls outside the FCPA by 
engaging in activity that is a privatization that the President 
has not certified as pro-competitive pursuant to subsection 
a(2). The Committee expects that the President will not make 
this certification unless the privatization facilitates full 
and fair competition to INTELSAT, Inmarsat, and their 
successors and fosters non-discriminatory market access in the 
provision of satellite services. The Committee also intends 
that the President will seek to achieve a pro-competitive 
privatization described in this section 5.
    Paragraph (2) states that the requirement in paragraph (1) 
for a Presidential certification does not affect the authority 
of the FCC under the Communications Act of 1934, as amended 
(the Communications Act), to authorize services to, from, or 
within the United States via the satellite systems of INTELSAT 
and Inmarsat, and the satellite systems of privatized 
affiliates and successors of INTELSAT and Inmarsat.
    This paragraph clarifies that the FCC's responsibilities 
under the Communications Act are independent of any 
Presidential authority pursuant to this section. When presented 
with an application seeking authority to use one of these 
satellite systems, and regardless of whether the President has 
made a certification for the system pursuant to paragraph (1), 
the FCC must make its own determination under the 
Communications Act as to whether use of the system is 
consistent with the public convenience, interest, and 
necessity. In light of the fact that the Executive Branch's 
procedures may lack the transparency that the FCC's procedures 
possess, moreover, there is a risk that, absent an independent 
review by the FCC, the public would not have an adequate 
opportunity to comment on a privatization. The Commission may 
use any existing authority to achieve the mandates of this 
legislation, including requiring waiver of privileges and 
immunities, conditioning licenses, and conducting rulemakings.
    Subsection (c) is entitled ``Extension of Legal Process.'' 
Paragraph (1) states that neither INTELSAT and Inmarsat, nor 
their officials, employees and records, are immune from suit or 
legal process for acts or omissions taken in connection with 
INTELSAT or Inmarsat providing commercial telecommunications 
services to, from, or within the United States, except that 
immunity continues to apply to the extent ``specifically and 
expressly required by mandatory obligations in international 
agreements to which the United States is a party.'' This 
legislation is designed to put the intergovernmental satellite 
organizations on an equal legal footing with their private 
sector competitors.
    This paragraph provides, therefore, that INTELSAT and 
Inmarsat, and their officials, employees, and records, do not 
have immunity in connection with their commercial role of 
providing telecommunications services to, from, or within the 
United States. The use of ``directly or indirectly'' in 
subsection (b) reflects the fact that, although INTELSAT and 
Inmarsat services are generally provided indirectly through a 
signatory such as COMSAT, it is possible with the ongoing 
restructuring within INTELSAT and Inmarsat that either 
organization will be providing services directly. The Committee 
uses the terms ``express,'' ``specific,'' ``mandatory,'' and 
``obligations'' because it wishes to make very clear that it 
intends that obligations under international agreements be 
narrowly construed. The Committee does not anticipate that any 
commercial activities will be deemed immune under any 
agreements to which the U.S. is party. INTELSAT's and 
Inmarsat's activities are almost entirely commercial. For 
example, INTELSAT operates a network that the Congress, in the 
Satellite Act, characterized as ``a commercial communications 
satellite system,'' 47 U.S.C. Sec. 701(a).
    Paragraph (2) clarifies that paragraph (1) does not affect 
any immunity officials and employees of INTELSAT and Inmarsat 
may or may not have with respect to personal liability. 
Although paragraph (2) protects the personal funds of officials 
and employees of INTELSAT and Inmarsat to the extent that the 
officials and employees are immune, those individuals remain 
subject to legal process and injunctions, and similar matters, 
and may be required to appear as witnesses and to respond to 
discovery requests.
    Subsection (d) requires the President and the FCC, 
consistent with specific and express requirements in mandatory 
obligations in international agreements to which the United 
States is a party, each act to limit or eliminate the 
privileges and immunities enjoyed by INTELSAT and Inmarsat. The 
Committee uses the terms ``express,'' ``specific,'' 
``mandatory,'' and ``obligations'' because it wishes to make 
clear that it intends that obligations under international 
agreements be narrowly construed. The Committee does not intend 
to require the President to abrogate international agreements 
to which the U.S. is a party. The Committee does intend, 
however, that the President and the Commission will work 
expeditiously to eliminate those immunities or privileges which 
are required by international agreements to which the U.S. is a 
party.
    The FCC has a role in U.S. government oversight of COMSAT's 
participation in INTELSAT and Inmarsat which is reflected in 
subsection (d). The Committee intends that the Commission will 
use its authority under the Communications Act to take all 
measures necessary to protect competition in the U.S. markets 
and to open markets for our companies overseas through 
elimination of privileges and immunities.
    This section explicitly requires ``expeditious'' action 
because the Committee intends for the President and Commission 
to act as soon as possible, and specifically not to wait 
pending the result of discussions with respect to 
privatization.
    Pursuant to subsection (d)(1), the President and the FCC 
each expeditiously must take all actions necessary to eliminate 
or limit substantially any additional privileges or immunities 
from suit or legal process that INTELSAT or Inmarsat enjoy that 
subsection (c) does not already eliminate. On the part of the 
President, this includes seeking the revision of existing 
agreements to accomplish the purposes of this paragraph. The 
IOIA already gives the President the authority ``to withhold or 
withdraw'' from any international organization or its officers 
or employees ``any of the privileges, exemptions, and 
immunities provided for [in the IOIA],'' or to ``condition or 
limit the enjoyment by any such organization or its officers or 
employees of any such privilege, exemption, or immunity.'
    Subsection (d)(1) is also intended to require that the FCC 
may use any existing authority to achieve the mandates of this 
subsection, including requiring waiver of privileges and 
immunities, conditioning licenses, and conducting rulemakings.
    Pursuant to subsection (d)(2), the President and the FCC 
must expeditiously take all appropriate actions that are 
necessary to eliminate or reduce substantially all privileges 
and immunities not eliminated by subsection (d)(1). INTELSAT 
and Inmarsat appear to enjoy a broad range of privileges and 
immunities in addition to the immunity from suit or legal 
process. These include immunity from import duties and taxes, 
immunity from income taxes, immunity from communications and 
property taxes, and preferential treatment in international 
organizations, processes and coordinations.
    Subsection (d)(2) requires the President and the FCC to do 
whatever is necessary, including seeking the revision of 
international agreements, as appropriate, so that these 
privileges and immunities can be eliminated or reduced 
substantially.
    The IOIA already gives the President the authority ``to 
withhold or withdraw'' from any international organization or 
its officers or employees ``any of the privileges, exemptions, 
and immunities provided for [in the IOIA],'' or to ``condition 
or limit the enjoyment by any such organization or its officers 
or employees of any such privilege, exemption, or immunity.''
    Subsection (d)(3) requires the President and the FCC 
independently to report to the Committee and the relevant 
Senate Committees of jurisdiction on a semiannual basis 
concerning any privileges and immunities that INTELSAT and 
Inmarsat continue to hold. The purpose is to create a record 
for the Congress and the private sector to use to review the 
progress of the President and the Commission in eliminating 
such privileges and immunities. The Committee expects that, to 
satisfy their reporting obligations, the President and the FCC 
each will maintain a comprehensive inventory of remaining 
privileges and immunities, and will solicit information and 
comment from a wide range of sources and report with respect to 
each of INTELSAT's and Inmarsat's member countries, including 
with respect to the extent to which these organizations' 
privileges and immunities may potentially give rise to barriers 
to market entry or otherwise adversely affect competition.
    Subsection (e) clarifies that subsections (c) and (d) do 
not affect INTELSAT's and Inmarsat's immunity from suit and 
legal process for acts or omissions: (i) under specific State 
and Federal laws for the benefit of law enforcement and 
intelligence activities; and (ii) pursuant to court orders. 
Subsection (e) expresses the intent of Congress that nothing in 
the preceding sections removing or urging the removal of 
privileges and immunities from international organizations 
providing commercial communications services shall be deemed to 
affect privileges and immunities conferred by the U.S. and 
State constitutions, statutes, rules and common law that 
pertain to cooperation with law enforcement and intelligence 
agencies. This is in no way designed to narrow the elimination 
of immunities traditionally associated with such international 
organizations; it is merely designed to make it clear that this 
section does not eliminate the law enforcement or intelligence 
related immunities such organizations would have if they were 
private companies.
    Subsection (f)(1) provides that nothing in section 5 shall 
affect the President's existing constitutional authority 
regarding the time, scope, and objectives of international 
negotiations. While the Committee understands that in the 
absence of a constitutional amendment legislation cannot modify 
the Constitution's allocations of power between the Congress 
and the Executive, in order to clarify the Committee's intent 
and address concerns in this regard some have raised, this 
subsection makes clear that this section does not attempt to 
change the President's constitutional authority with respect to 
international negotiations. Similarly, this language is not 
meant to change the constitutional authority of the Congress in 
this regard.
    Subsection (f)(2) makes clear that section 5 does not 
provide legislative authority or implementing legislation for a 
privatization plan for INTELSAT or Inmarsat. Moreover, the 
Committee expects the President will faithfully execute the 
U.S. law with respect to Inmarsat and its privatization plan.

Section 6.--Enforcement and monitoring

    Subsection (a) requires the Secretary of Commerce to 
submit, not later than July 1, 1999, and for each of the five 
succeeding years, a report to the House of Representatives and 
Senate. The Committee intends the report to be thoroughly 
researched and to contain considerable detail. The Committee 
expects Commerce Department officials to consult with the 
Congress prior to filing the report.
    First, the report is to contain a list of the countries 
that have ratified the OECD Convention, the dates of 
ratification, and the date on which the OECD Convention has 
entered into force for those countries. With respect to those 
countries that have not ratified, the report is to contain a 
description of efforts made to encourage them to join and an 
assessment of why they have not.
    Second, the Secretary is to include a description of the 
laws enacted by Parties to the OECD Convention to implement the 
OECD Convention, as well as an assessment of such lawsand of 
their compatibility with the OECD Convention, including an assessment 
of how they may differ from the requirements of the OECD Convention.
    Third, the report is to assess the enforcement measures 
taken by each Party to the OECD Convention during the previous 
year, including enforcement of domestic laws, promotion of 
public awareness of such laws, and the effectiveness, 
transparency, and viability of the OECD Convention's monitoring 
process. In particular, the Secretary is to assess the 
inclusion of input from the private sector and non-governmental 
organizations.
    Fourth, the report should explain the domestic laws enacted 
by each Party to the OECD Convention that would prohibit the 
deduction of bribes in the computation of domestic taxes. The 
report should include a list of all nations which in any way 
permit the deduction of bribes and a description of any efforts 
in such nations to change such laws.
    Fifth, the report will describe efforts to expand 
international participation in the OECD Convention through the 
addition of new signatories and by assuring that all countries 
that are or become members of the Organization for Economic 
Cooperation and Development are also Parties to the OECD 
Convention.
    Sixth, the Secretary should assess the status of efforts to 
strengthen the OECD Convention by extending its prohibitions to 
cover bribery of political parties, party officials, and 
candidates for political office.
    Seventh, the report is to in detail address advantages, in 
terms of market access, government ownership, government 
contacts or connections, privileges and immunities, favorable 
treatment by national regulatory authorities or tax treatment, 
or otherwise, in the countries or regions served by the 
organizations described in section 5, and the reasons for such 
advantages. The report should include individual reports for 
all nations unless substantially identical information can be 
applied to all nations within a region, in which case the 
report can include such region. The regional exception is 
designed to avoid creating an overly burdensome process with 
respect to nations which make little or no use of the system 
but is not a reason for failing to report on nations with 
significant or potentially significant traffic or potential or 
actual advantages such as those described above. The Committee 
intends that the Secretary of Commerce consult with the Federal 
Communications Commission in preparing this report. The 
Committee also intends that the Secretary of Commerce seek and 
incorporate comments from the private sector, including 
competing satellite companies and users of satellite services, 
in preparing this section of the report. The report should also 
include a detailed assessment of the progress toward fulfilling 
the policy described in section 5 of this Act, including an 
assessment of efforts made to achieve this policy.
    Eighth, the report should assess the anti-bribery programs 
and transparency with respect to international public 
organizations covered by this legislation.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

SECURITIES EXCHANGE ACT OF 1934

           *       *       *       *       *       *       *


TITLE I--REGULATION OF SECURITIES EXCHANGES

           *       *       *       *       *       *       *


             prohibited foreign trade practices by issuers

      Sec. 30A. (a) Prohibition.--It shall be unlawful for any 
issuer which has a class of securities registered pursuant to 
section 12 of this title or which is required to file reports 
under section 15(d) of this title, or for any officer, 
director, employee, or agent of such issuer or any stockholder 
thereof acting on behalf of such issuer, to make use of the 
mails or any means or instrumentality of interstate commerce 
corruptly in furtherance of an offer, payment, promise to pay, 
or authorization of the payment of any money, or offer, gift, 
promise to give, or authorization of the giving of anything of 
value to--
          (1) any foreign official for purposes of--
                  [(A)(i) influencing any act or decision of 
                such foreign official in his official capacity, 
                or (ii) inducing such foreign official to do or 
                omit to do any act in violation of the lawful 
                duty of such official, or]
                  (A)(i) influencing any act or decision of 
                such foreign official in his official capacity, 
                (ii) inducing such foreign official to do or 
                omit to do any act in violation of the lawful 
                duty of such official, or (iii) securing any 
                improper advantage; or

           *       *       *       *       *       *       *

          (2) any foreign political party or official thereof 
        or any candidate for foreign political office for 
        purposes of--
                  [(A)(i) influencing any act or decision of 
                such party, official, or candidate in its or 
                his official capacity, or (ii) inducing such 
                party, official, or candidate to do or omit to 
                do an act in violation of the lawful duty of 
                such party, official, or candidate,]
                  (A)(i) influencing any act or decision of 
                such party, official, or candidate in its or 
                his official capacity, (ii) inducing such 
                party, official, or candidate to do or omit to 
                do an act in violation of the lawful duty of 
                such party, official, or candidate, or (iii) 
                securing any improper advantage; or

           *       *       *       *       *       *       *

          (3) any person, while knowing that all or a portion 
        of such money or thing of value will be offered, given, 
        or promised, directly or indirectly, to any foreign 
        official, to any foreign political party or official 
        thereof, or to any candidate for foreign political 
        office, for purposes of--
                  [(A)(i) influencing any act or decision of 
                such foreign official, political party, party 
                official, or candidate in his or its official 
                capacity, or (ii) inducing such foreign 
                official, political party, party official, or 
                candidate to do or omit to do any act in 
                violation of the lawful duty of such foreign 
                official, political party, party official, or 
                candidate, or]
                  (A)(i) influencing any act or decision of 
                such foreign official, political party, party 
                official, or candidate in his or its official 
                capacity, (ii) inducing such foreign official, 
                political party, party official, or candidate 
                to do or omit to do any act in violation of the 
                lawful duty of such foreign official, political 
                party, party official, or candidate, or (iii) 
                securing any improper advantage; or

           *       *       *       *       *       *       *

      (b) Exception for Routine Governmental Action.--
[Subsection (a)] Subsections (a) and (g) shall not apply to any 
facilitating or expediting payment to a foreign official, 
political party, or party official the purpose of which is to 
expedite or to secure the performance of a routine governmental 
action by a foreign official, political party, or party 
official.
      (c) Affirmative Defenses.--It shall be an affirmative 
defense to actions under [subsection (a)] subsection (a) or (g) 
that--
          (1) * * *

           *       *       *       *       *       *       *

      (f) Definitions.--For purposes of this section:
          [(1) The term ``foreign official'' means any officer 
        or employee of a foreign government or any department, 
        agency, or instrumentality thereof, or any person 
        acting in an official capacity for or on behalf of any 
        such government or department, agency, or 
        instrumentality.]
          (1)(A) The term ``foreign official'' means any 
        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.
          (B) For purposes of subparagraph (A), the term 
        ``public international organization'' means--
                  (i) an organization that is designated by 
                Executive order pursuant to section 1 of the 
                International Organizations Immunities Act (22 
                U.S.C. 288); or
                  (ii) any other international organization 
                that is designated by the President by 
                Executive order for the purposes of this 
                section, effective as of the date of 
                publication of such order in the Federal 
                Register.
  (g) Alternative Jurisdiction.--
          (1) It shall also be unlawful for any issuer 
        organized under the laws of the United States, or a 
        State, territory, possession, or commonwealth of the 
        United States or a political subdivision thereof and 
        which has a class of securities registered pursuant to 
        section 12 of this title or which is required to file 
        reports under section 15(d) of this title, or for any 
        United States person that is an officer, director, 
        employee, or agent of such issuer or a stockholder 
        thereof acting on behalf of such issuer, to corruptly 
        do any act outside the United States in furtherance of 
        an offer, payment, promise to pay, or authorization of 
        the payment of any money, or offer, gift, promise to 
        give, or authorization of the giving of anything of 
        value to any of the persons or entities set forth in 
        paragraphs (1), (2), and (3) of subsection (a) of this 
        section for the purposes set forth therein, 
        irrespective of whether such issuer or such officer, 
        director, employee, agent, or stockholder makes use of 
        the mails or any means or instrumentality of interstate 
        commerce in furtherance of such offer, gift, payment, 
        promise, or authorization.
          (2) As used in this subsection, the term ``United 
        States person'' means a national of the United States 
        (as defined in section 101 of the Immigration and 
        Nationality Act (8 U.S.C. 1101)) or any corporation, 
        partnership, association, joint-stock company, business 
        trust, unincorporated organization, or sole 
        proprietorship organized under the laws of the United 
        States or any State, territory, possession, or 
        commonwealth of the United States, or any political 
        subdivision thereof.

           *       *       *       *       *       *       *


                               penalties 

  Sec. 32. (a) * * *

           *       *       *       *       *       *       *

  (c)(1)(A) Any issuer that violates [section 30A(a)] 
subsection (a) or (g) of section 30A shall be fined not more 
than $2,000,000.
      (B) Any issuer that violates [section 30A(a)] subsection 
(a) or (g) of section 30A shall be subject to a civil penalty 
of not more than $10,000 imposed in an action brought by the 
Commission.
  [(2)(A) Any officer or director of an issuer, or stockholder 
acting on behalf of such issuer, who willfully violates section 
30A(a) shall be fined not more than $100,000, or imprisoned not 
more than five years, or both.
    [(B) Any employee or agent of an issuer who is a United 
States citizen, national, or resident or is otherwise subject 
to the jurisdiction of the United States (other than an 
officer, director, or stockholder acting on behalf of such 
issuer), and who willfully violates section 30A(a), shall be 
fined not more than $100,000, or imprisoned not more than 5 
years, or both.
    [(C) Any officer, director, employee, or agent, of an 
issuer, or stockholder acting on behalf of such issuer, who 
violates section 30A(a) shall be subject to a civil penalty of 
not more than $10,000 imposed in an action brought by the 
Commission.]
  (2)(A) Any officer, director, employee, or agent of an 
issuer, or stockholder acting on behalf of such issuer, who 
willfully violates subsection (a) or (g) of section 30A of this 
title shall be fined not more than $100,000, or imprisoned not 
more than 5 years, or both.
  (B) Any officer, director, employee, or agent of an issuer, 
or stockholder acting on behalf of such issuer, who violates 
subsection (a) or (g) of section 30A of this title shall be 
subject to a civil penalty of not more than $10,000 imposed in 
an action brought by the Commission.

           *       *       *       *       *       *       *

                              ----------                              


        SECTION 104 OF THE FOREIGN CORRUPT PRACTICES ACT OF 1977

        prohibited foreign trade practices by domestic concerns

  Sec. 104. (a) Prohibition.--It shall be unlawful for any 
domestic concern, other than an issuer which is subject to 
section 30A of the Securities Exchange Act of 1934, or for any 
officer, director, employee, or agent of such domestic concern 
or any stockholder thereof acting on behalf of such domestic 
concern, to make use of the mails or any means or 
instrumentality of interstate commerce corruptly in furtherance 
of an offer, payment, promise to pay, or authorization of the 
payment of any money, or offer, gift, promise to give, or 
authorization of the giving of anything of value to--
          (1) any foreign official for purposes of--
                  [(A)(i) influencing any act or decision of 
                such foreign official in his official capacity, 
                or (ii) inducing such foreign official to do or 
                omit to do any act in violation of the lawful 
                duty of such official, or]
                  (A)(i) influencing any act or decision of 
                such foreign official in his official capacity, 
                (ii) inducing such foreign official to do or 
                omit to do any act in violation of the lawful 
                duty of such official, or (iii) securing any 
                improper advantage; or

           *       *       *       *       *       *       *

          (2) any foreign political party or official thereof 
        or any candidate for foreign political office for 
        purposes of--
                  [(A)(i) influencing any act or decision of 
                such party, official, or candidate in its or 
                his official capacity, or (ii) inducing such 
                party, official, or candidate to do or omit to 
                do an act in violation of the lawful duty of 
                such party, official, or candidate,]
                  (A)(i) influencing any act or decision of 
                such party, official, or candidate in its or 
                his official capacity, (ii) inducing such 
                party, official, or candidate to do or omit to 
                do an act in violation of the lawful duty of 
                such party, official, or candidate, or (iii) 
                securing any improper advantage; or

           *       *       *       *       *       *       *

          (3) any person, while knowing that all or a portion 
        of such money or thing of value will be offered, given, 
        or promised, directly or indirectly, to any foreign 
        official, to any foreign politicalparty or official 
thereof, or to any candidate for foreign political office, for purposes 
of--
                  [(A)(i) influencing any act or decision of 
                such foreign official, political party, party 
                official, or candidate in his or its official 
                capacity, or (ii) inducing such foreign 
                official, political party, party official, or 
                candidate to do or omit to do any act in 
                violation of the lawful duty of such foreign 
                official, political party, party official, or 
                candidate, or]
                  (A)(i) influencing any act or decision of 
                such foreign official, political party, party 
                official, or candidate in his or its official 
                capacity, (ii) inducing such foreign official, 
                political party, party official, or candidate 
                to do or omit to do any act in violation of the 
                lawful duty of such foreign official, political 
                party, party official, or candidate, or (iii) 
                securing any improper advantage; or

           *       *       *       *       *       *       *

  (b) Exception for Routine Governmental Action.--[Subsection 
(a)] Subsections (a) and (i) shall not apply to any 
facilitating or expediting payment to a foreign official, 
political party, or party official the purpose of which is to 
expedite or to secure the performance of a routine governmental 
action by a foreign official, political party, or party 
official.
  (c) Affirmative Defenses.--It shall be an affirmative defense 
to actions under [subsection (a)] subsection (a) or (i) that--
          (1) * * *

           *       *       *       *       *       *       *

  (d) Injunctive Relief.--(1) When it appears to the Attorney 
General that any domestic concern to which this section 
applies, or officer, director, employee, agent, or stockholder 
thereof, is engaged, or about to engage, in any act or practice 
constituting a violation of [subsection (a)] subsection (a) or 
(i) of this section, the Attorney General may, in his 
discretion, bring a civil action in an appropriate district 
court of the United States to enjoin such act or practice, and 
upon a proper showing, a permanent injunction or a temporary 
restraining order shall be granted without bond.

           *       *       *       *       *       *       *

  [(g) Penalties.--(1)(A) Any domestic concern that violates 
subsection (a) shall be fined not more than $2,000,000.
  [(B) Any domestic concern that violates subsection (a) shall 
be subject to a civil penalty of not more than $10,000 imposed 
in an action brought by the Attorney General.
  [(2)(A) Any officer or director of a domestic concern, or 
stockholder acting on behalf of such domestic concern, who 
willfully violates subsection (a) shall be fined not more than 
$100,000, or imprisoned not more than 5 years, or both.
  [(B) Any employee or agent of a domestic concern who is a 
United States citizen, national, or resident or is otherwise 
subject to the jurisdiction of the United States (other than an 
officer, director, or stockholder acting on behalf of such 
domestic concern), and who willfully violates subsection (a), 
shall be fined not more than $100,000, or imprisoned not more 
than 5 years, or both.
  [(C) Any officer, director, employee, or agent of a domestic 
concern, or stockholder acting on behalf of such domestic 
concern, who violates subsection (a) shall be subject to a 
civil penalty of not more than $10,000 imposed in an action 
brought by the Attorney General.]
  (g) Penalties.--(1)(A) Any domestic concern that is not a 
natural person and that violates subsection (a) or (i) of this 
section shall be fined not more than $2,000,000.
  (B) Any domestic concern that is not a natural person and 
that violates subsection (a) or (i) of this section shall be 
subject to a civil penalty of not more than $10,000 imposed in 
an action brought by the Attorney General.
  (2)(A) Any natural person that is an officer, director, 
employee, or agent of a domestic concern, or stockholder acting 
on behalf of such domestic concern, who willfully violates 
subsection (a) or (i) of this section shall be fined not more 
than $100,000 or imprisoned not more than 5 years, or both.
  (B) Any natural person that is an officer, director, 
employee, or agent of a domestic concern, or stockholder acting 
on behalf of such domestic concern, who violates subsection (a) 
or (i) of this section shall be subject to a civil penalty of 
not more than $10,000 imposed in an action brought by the 
Attorney General.

           *       *       *       *       *       *       *

  (h) Definitions.--For purposes of this section:
          (1) * * *
          [(2) The term ``foreign official'' means any officer 
        or employee of a foreign government or any department, 
        agency, or instrumentality thereof, or any person 
        acting in an official capacity for or on behalf of any 
        such government or department, agency, or 
        instrumentality.]
          (2)(A) The term ``foreign official'' means any 
        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.
          (B) For purposes of subparagraph (A), the term 
        ``public international organization'' means--
                  (i) an organization that is designated by 
                Executive order pursuant to section 1 of the 
                International Organizations Immunities Act (22 
                U.S.C. 288); or
                  (ii) any other international organization 
                that is designated by the President by 
                Executive order for the purposes of this 
                section, effective as of the date of 
                publication of such order in the Federal 
                Register.

           *       *       *       *       *       *       *

          (4)(A) [For purposes of paragraph (1), the] The term 
        ``routine governmental action'' means only an action 
        which is ordinarily and commonly performed by a foreign 
        official in--
                  (i) * * *

           *       *       *       *       *       *       *

  (i) Alternative Jurisdiction.--
          (1) It shall also be unlawful for any United States 
        person to corruptly do any act outside the United 
        States in furtherance of an offer, payment, promise to 
        pay, or authorization of the payment of any money, or 
        offer, gift, promise to give, or authorization of the 
        giving of anything of value to any of the persons or 
        entities set forth in paragraphs (1), (2), and (3) of 
        subsection (a), for the purposes set forth therein, 
        irrespective of whether such United States person makes 
        use of the mails or any means or instrumentality of 
        interstate commerce in furtherance of such offer, gift, 
        payment, promise, or authorization.
          (2) As used in this subsection, the term ``United 
        States person'' means a national of the United States 
        (as defined in section 101 of the Immigration and 
        Nationality Act (8 U.S.C. 1101)) or any corporation, 
        partnership, association, joint-stock company, business 
        trust, unincorporated organization, or sole 
        proprietorship organized under the laws of the United 
        States or any State, territory, possession, or 
        commonwealth of the United States, or any political 
        subdivision thereof.

SEC. 104A. PROHIBITED FOREIGN TRADE PRACTICES BY PERSONS OTHER THAN 
                    ISSUERS OR DOMESTIC CONCERNS.

  (a) Prohibition.--It shall be unlawful for any person other 
than an issuer that is subject to section 30A of the Securities 
Exchange Act of 1934 or a domestic concern (as defined in 
section 104 of this Act), or for any officer, director, 
employee, or agent of such person or any stockholder thereof 
acting on behalf of such person, while in the territory of the 
United States, corruptly to make use of the mails or any means 
or instrumentality of interstate commerce or to do any other 
act in furtherance of an offer, payment, promise to pay, or 
authorization of the payment of any money, or offer, gift, 
promise to give, or authorization of the giving of anything of 
value to--
          (1) any foreign official for purposes of--
                  (A)(i) influencing any act or decision of 
                such foreign official in his official capacity, 
                (ii) inducing such foreign official to do or 
                omit to do any act in violation of the lawful 
                duty of such official, or (iii) securing any 
                improper advantage; or
                  (B) inducing such foreign official to use his 
                influence with a foreign government or 
                instrumentality thereof to affect or influence 
                any act or decision of such government or 
                instrumentality,
        in order to assist such person in obtaining or 
        retaining business for or with, or directing business 
        to, any person;
          (2) any foreign political party or official thereof 
        or any candidate for foreign political office for 
        purposes of--
                  (A)(i) influencing any act or decision of 
                such party, official, or candidate in its or 
                his official capacity, (ii) inducing such 
                party, official, or candidate to do or omit to 
                do an act in violation of the lawful duty of 
                such party, official, or candidate, or (iii) 
                securing any improper advantage; or
                  (B) inducing such party, official, or 
                candidate to use its or his influence with a 
                foreign government or instrumentality thereof 
                to affect or influence any act or decision of 
                such government or instrumentality,
        in order to assist such person in obtaining or 
        retaining business for or with, or directing business 
        to, any person; or
          (3) any person, while knowing that all or a portion 
        of such money or thing of value will be offered, given, 
        or promised, directly or indirectly, to any foreign 
        official, to any foreign political party or official 
        thereof, or to any candidate for foreign political 
        office, for purposes of--
                  (A)(i) influencing any act or decision of 
                such foreign official, political party, party 
                official, or candidate in his or its official 
                capacity, (ii) inducing such foreign official, 
                political party, party official, or candidate 
                to do or omit to do any act in violation of the 
                lawful duty of such foreign official, political 
                party, party official, or candidate, or (iii) 
                securing any improper advantage; or
                  (B) inducing such foreign official, political 
                party, party official, or candidate to use his 
                or its influence with a foreign government or 
                instrumentality thereof to affect or influence 
                any act or decision of such government or 
                instrumentality,
        in order to assist such person in obtaining or 
        retaining business for or with, or directing business 
        to, any person.
  (b) Exception for Routine Governmental Action.--Subsection 
(a) of this section shall not apply to any facilitating or 
expediting payment to a foreign official, political party, or 
party official the purpose of which is to expedite or to secure 
the performance of a routine governmental action by a foreign 
official, political party, or party official.
  (c) Affirmative Defenses.--It shall be an affirmative defense 
to actions under subsection (a) of this section that--
          (1) the payment, gift, offer, or promise of anything 
        of value that was made, was lawful under the written 
        laws and regulations of the foreign official's, 
        political party's, party official's, or candidate's 
        country; or
          (2) the payment, gift, offer, or promise of anything 
        of value that was made, was a reasonable and bona fide 
        expenditure, such as travel and lodging expenses, 
        incurred by or on behalf of a foreign official, party, 
        party official, or candidate and was directly related 
        to--
                  (A) the promotion, demonstration, or 
                explanation of products or services; or
                  (B) the execution or performance of a 
                contract with a foreign government or agency 
                thereof.
  (d) Injunctive Relief.--
          (1) When it appears to the Attorney General that any 
        person to which this section applies, or officer, 
        director, employee, agent, or stockholder thereof, is 
        engaged, or about to engage, in any act or practice 
        constituting a violation of subsection (a) of this 
        section, the Attorney General may, in his discretion, 
        bring a civil action in an appropriate district court 
        of the United States to enjoin such act or practice, 
        and upon a proper showing, a permanent injunction or a 
        temporary restraining order shall be granted without 
        bond.
          (2) For the purpose of any civil investigation which, 
        in the opinion of the Attorney General, is necessary 
        and proper to enforce this section, the Attorney 
        General or his designee are empowered to administer 
        oaths and affirmations, subpoena witnesses, take 
        evidence, and require the production of any books, 
        papers, or other documents which the Attorney General 
        deems relevant or material to such investigation. The 
        attendance of witnesses and the production of 
        documentary evidence may be required from any place in 
        the United States, or any territory, possession, or 
        commonwealth of the United States, at any designated 
        place of hearing.
          (3) In case of contumacy by, or refusal to obey a 
        subpoena issued to, any person, the Attorney General 
        may invoke the aid of any court of the United States 
        within the jurisdiction of which such investigation or 
        proceeding is carried on, or where such person resides 
        or carries on business, in requiring the attendance and 
        testimony of witnesses and the production of books, 
        papers, or other documents. Any such court may issue an 
        order requiring such person to appear before the 
        Attorney General or his designee, there to produce 
        records, if so ordered, or to give testimony touching 
        the matter under investigation. Any failure to obey 
        such order of the court may be punished by such court 
        as a contempt thereof.
          (4) All process in any such case may be served in the 
        judicial district in which such person resides or may 
        be found. The Attorney General may make such rules 
        relating to civil investigations as may be necessary or 
        appropriate to implement the provisions of this 
        subsection.
  (e) Penalties.--
          (1)(A) Any juridical person that violates subsection 
        (a) of this section shall be fined not more than 
        $2,000,000.
          (B) Any juridical person that violates subsection (a) 
        of this section shall be subject to a civil penalty of 
        not more than $10,000 imposed in an action brought by 
        the Attorney General.
          (2)(A) Any natural person who willfully violates 
        subsection (a) of this section shall be fined not more 
        than $100,000 or imprisoned not more than 5 years, or 
        both.
          (B) Any natural person who violates subsection (a) of 
        this section shall be subject to a civil penalty of not 
        more than $10,000 imposed in an action brought by the 
        Attorney General.
          (3) Whenever a fine is imposed under paragraph (2) 
        upon any officer, director, employee, agent, or 
        stockholder of a person, such fine may not be paid, 
        directly or indirectly, by such person.
  (f) Definitions.--For purposes of this section:
          (1) The term ``person'', when referring to an 
        offender, means any natural person other than a 
        national of the United States (as defined in section 
        101 of the Immigration and Nationality Act (8 U.S.C. 
        1101) or any corporation, partnership, association, 
        joint-stock company, business trust, unincorporated 
        organization, or sole proprietorship organized under 
        the law of a foreign nation or a political subdivision 
        thereof.
          (2)(A) The term ``foreign official'' means any 
        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.
          (B) For purposes of subparagraph (A), the term 
        ``public international organization'' means--
                  (i) an organization that is designated by 
                Executive order pursuant to section 1 of the 
                International Organizations Immunities Act (22 
                U.S.C. 288); or
                  (ii) any other international organization 
                that is designated by the President by 
                Executive order for the purposes of this 
                section, effective as of the date of 
                publication of such order in the Federal 
                Register.
          (3)(A) A person's state of mind is knowing, with 
        respect to conduct, a circumstance or a result if--
                  (i) such person is aware that such person is 
                engaging in such conduct, that such 
                circumstance exists, or that such result is 
                substantially certain to occur; or
                  (ii) such person has a firm belief that such 
                circumstance exists or that such result is 
                substantially certain to occur.
          (B) When knowledge of the existence of a particular 
        circumstance is required for an offense, such knowledge 
        is established if a person is aware of a high 
        probability of the existence of such circumstance, 
        unless the person actually believes that such 
        circumstance does not exist.
          (4)(A) The term ``routine governmental action'' means 
        only an action which is ordinarily and commonly 
        performed by a foreign official in--
                  (i) obtaining permits, licenses, or other 
                official documents to qualify a person to do 
                business in a foreign country;
                  (ii) processing governmental papers, such as 
                visas and work orders;
                  (iii) providing police protection, mail pick-
                up and delivery, or scheduling inspections 
                associated with contract performance or 
                inspections related to transit of goods across 
                country;
                  (iv) providing phone service, power and water 
                supply, loading and unloading cargo, or 
                protecting perishable products or commodities 
                from deterioration; or
                  (v) actions of a similar nature.
          (B) The term ``routine governmental action'' does not 
        include any decision by a foreign official whether, or 
        on what terms, to award new business to or to continue 
        business with a particular party, or any action taken 
        by a foreign official involved in the decision-making 
        process to encourage a decision to award new business 
        to or continue business with a particular party.
          (5) The term ``interstate commerce'' means trade, 
        commerce, transportation, or communication among the 
        several States, or between any foreign country and any 
        State or between any State and any place or ship 
        outside thereof, and such term includes the intrastate 
        use of--
                  (A) a telephone or other interstate means of 
                communication, or
                  (B) any other interstate instrumentality.

                                
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