On the evening of September 25, with the cordial care and firm support of the party and the people, Meng Wanzhou arrived at Shenzhen Bao'an International Airport on a Chinese government chartered flight and returned smoothly after ending her nearly three years of illegal detention by Canada. motherland.
Although Meng Wanzhou has returned to the embrace of her motherland, Meng Wanzhou’s case is not over. The final outcome depends on whether the deferred prosecution agreement (DPA) she signed can be complied with, and this is also consistent with the long-arm jurisdiction of the United States. is directly related.
On the other side, according to the British " Financial Times " report on September 24, the US government recently arrested a Russian executive on suspicion of tax evasion.
On the evening of September 25, 2021, Meng Wanzhou arrived at Shenzhen Bao’an International Airport on a Chinese government charter flight. Picture | Let Uncle Ku tell you.
author | Ali Raidi
editor | Xie Fang Outlook Think Tank
This article is an excerpt from the Outlook Think Tank book, excerpted from "The Hidden War", published by CITIC Publishing Group in August 2019. The original text has been deleted and does not represent the views of the Outlook Think Tank.
In August 1974, the resignation of Nixon after the "Watergate incident" confirmed the existence of power-for-money transactions both in the United States and among overseas companies and political parties.
From 1975 to 1977, members of the House of Representatives representing voters witnessed members of the Senate constantly being involved in hearing scandals due to "multi-national overseas payment issues." In order to deal with this situation, the "Foreign Corrupt Practices Act" came into being on December 19, 1977. . The law is primarily intended to prohibit U.S. public servants from accepting bribes abroad.
The " long-arm jurisdiction " in the United States starts from the "Foreign Corrupt Practices Act".
In order to clarify the origin of this bill, we will first introduce two major cases with extremely bad influence in the 1970s- Lockheed Corporation Bribery Case and Banana Gate Case.
1 Transnational bribery
In the late 1950s, the aviation manufacturing giant Lockheed became famous for its shameless bribery of intermediaries in many countries. Everyone from high-ranking politicians to gang leaders were "favored" by it. ”, its corruption network is extremely large, but what it does is seen by the company’s top management as necessary to “buy” the market.
Lockheed's important sales executive John Kenneth Hull was sent to Japan, shouldering the important task of selling F-104 fighter jets to the Japanese Air Force.
In order to complete the task more quickly, Hull took over with World War II war criminal and Japanese underworld leader Yushio Kodama. Kodama Yushio has an extremely large network of connections. He is very familiar with the vice chairman of the ruling Liberal Democratic Party and is also on good terms with the then Japanese Prime Minister Kishi Nobusuke.
[Note: The Liberal Democratic Party of Japan was formed by the merger of the Liberal Party and the Radical Party, and the Radical Party was created and generously funded by the US Central Intelligence Agency . 】
With such a unique network of contacts, Lockheed sold 200 fighter jets to the Japanese Air Force without any effort. Its competitor, Northrop Grumman Company , also an American company, failed miserably.
Lockheed found that the approach of linking politics, speculation and crime was very effective, and it followed the same method in the civil aviation market. The prosperous Lockheed Company happened to have a good relationship with the well-connected Kodama Yushio and the new Japanese Prime Minister Tanaka Kakuei. Tanaka Kakuei himself is from the Liberal Democratic Party , so it only needs to guide this powerful person. The Prime Minister put a few strokes on the order for Lockheed and it was done. All Nippon Airways purchased many Lockheed L-1011 Samsung passenger aircraft, and in exchange and reward, Kodama received millions of dollars.
Tanaka Kakuei.
In 1976, the American media exposed the scandal. Tanaka Kakuei, who had resigned in 1974, was arrested. Lockheed's tactics and the role played by the CIA in it became the headlines of major newspapers.This incident caused a huge sensation in the United States. Secretary of State Henry Kissinger was very worried: The exposure of the CIA's secrets and its internal network would be extremely detrimental to the international image of the United States. He sent a letter to the U.S. federal prosecutor asking him to curb the spread of sensitive information contained in the Senate report, and then personally facilitated secret negotiations between the House of Representatives, prosecutors and Lockheed's legal counsel to resolve the case.
The picture shows the arrested Kakuei Tanaka on his way from the prosecutor's office to the detention center. Source: China Communist Party News Network
Frank Church, the U.S. Democratic Senator and chairman of the Subcommittee on Transnational Corporations, did not follow Kissinger's arrangements. In 1976, he exposed Lockheed's use of 3 billion yen as funds for secret activities in order to monopolize the market. This action was named "Peanut" within the company.
[Note: "Peanut" in English can refer to a trivial amount of money. 】
This is obviously not worthy of the name: corrupt people are greedy for more than just peanuts. pocketed millions of dollars, part of which, about 600 million yen (equivalent to about 2 million U.S. dollars), was used to bribe Japanese government officials.
Lockheed is not the only company that engages in the same business, but because its practices have become a negative example, it must pay a heavy price for it. In an investigation led by Senator Frank Church and conducted by Jack Blum, the president of Northrop Grumman, an aerospace company that competes with Lockheed, claimed that he was also subject to The impact of Lockheed's practices has bribed civil servants in many countries, including those in some European countries.
On August 15, 1975, six months before the Lockheed scandal was revealed, Senator Frank Church had consulted his colleagues in the Senate responsible for the bank case for some relevant information. There are doubts about what Sid Company is doing in the European market. Immediately, the Senate discovered that Lockheed had sold multiple F-104 fighter jets to the Federal Republic of Germany by bribing German political party leaders. Coincidentally, in Italy and and the Netherlands , Lockheed also followed the same pattern. The negative impact of this case has exceeded social moral standards, public opinion has been in an uproar, and Lockheed's reputation has been severely impacted. The U.S. Congress, under pressure, decided to take action to turn the tide.
However, one wave after another, another scandal has occupied the headlines of major newspapers, namely the banana scandal. The company involved paid a bribe to the president of a South American country in order to ask him to charge the company as little as possible. banana export tax.
2 The President Gets Rich
Latin America is the world's largest banana producing region, and the United States is its most important buyer. In other words, any fluctuation in banana export prices will have a huge impact on U.S. importers.
In 1974, the Alliance of Banana Exporting Countries decided to charge a tariff of US$1 per 40-pound box of bananas. This aroused resentment from American multinational companies, who threatened to withdraw from the market. However, the producer countries, which hold the power of life and death, ignored their protests. But in the same year, Honduras passed a law setting a banana tariff of 50 cents per box, and soon lowered it to 25 cents per box without warning.
Guatemala City , a man is carrying bananas.
The U.S. authorities expressed extreme surprise, and the Securities and Exchange Commission immediately launched an investigation. A suicide dramatically buys the investigation a lot of time. In 1975, Eli M. Black, the president of United Trademark Company, one of the three largest import companies in the United States, committed suicide.
By investigating his actions during his lifetime, the Securities and Exchange Commission quickly found out the reason for the sudden drop in Honduras tariffs - United Trademark Corporation bribed Osvaldo López A., then President of Honduras, with $2.5 million. Legliano. The $2.5 million was a lot of money for the company, but it was well worth the return, with the tariff reduction saving it $7.5 million. The SEC investigation also revealed that the company paid a $750,000 bribe to a senior Italian official to prevent Italy from lowering import prices.
The picture shows the logo of the U.S. Securities and Exchange Commission
In fact, the Securities and Exchange Commission could have turned a blind eye to this bribery, but what bothered it was that the money was not included in the company's accounts. At the time, U.S. law did not criminalize corruption. On the contrary, it is common to withhold all kinds of information from shareholders, even important information such as bribing intermediaries.
United Trademark Corporation is more worried about the impact of this incident on the company's reputation than the sanctions and penalties imposed by the Securities and Exchange Commission. For this reason, the lawyers responsible for the company's case deliberately approached the mediators of the U.S. State Department and asked them to put pressure on the Securities and Exchange Commission to calm the situation. Their main argument is that this incident will not only damage the companies involved, but also make the United States lose face in the diplomatic arena. But this approach did not work, and in the spring of 1975, the media exposed the United Trademark Company scandal.
Aviation manufacturing and agriculture are not two special industries plagued by corruption. In September 1977, a report by the U.S. Congress showed that more than 400 U.S. companies had had suspicious or illegal transfer transactions. “Many companies have confessed to bribing foreign government leaders, politicians or political parties, with the total amount exceeding US$300 million. ". History is full of ironies. Investigations show that most of the corruption behavior of the companies involved is not to compete with foreign companies, but their targets are often domestic competitors. In short, the report believes that these economic tricks have tarnished the international image of the United States.
3 Law is introduced
Senator Frank Church also holds a similar view, but he is more worried about where the United States' foreign policy will go than the moral sense and conscience of American bosses. "We are not interested in issues of public conscience or private moral sense. What worries us is U.S. foreign policy." Therefore, the U.S. Congress decided to put order in order. But how to prohibit these illegal activities? At that time, there was no law prohibiting these bribery behaviors. Even if the bribed foreign civil servants violated the laws of their country, the U.S. judiciary had no right to interfere.
The picture shows Senator Frank Church
What's more, countries involved in scandals often do not have the financial and material resources to conduct investigations or organize evidence. "For these countries, it is really difficult to conduct investigations because they cannot master the evidence. We have these evidence, but an investigation cannot be launched because the laws of our country do not prohibit this behavior."
So, is it enough to just appeal to the conscience and moral sense of the majority of entrepreneurs? Senators are negative, fearing that such behavior will become more rampant if they sit idly by.
Why do many companies pay bribes even if they are frugal? In the final analysis, small risks can bring huge profits, and the gains more than compensate for the losses. Democratic Senator William Proxmire noted that no national leader had been jailed and only three business executives had been fired for bribery. Even worse, companies like Lockheed continue to rake in profits even as scandals abound. The conclusion is to change the law and ban bribery of foreign public officials.
In 1976, a legislative working group headed by U.S. President Gerald Ford and directly led by Economic Secretary Elliott Richardson was formally established. The group's task was to introduce a less restrictive law. . Ford hopes that the law will only require companies to publicly declare the amount of bribes they pay, and violators will be held civil and criminal responsible. The law forces companies to inform shareholders, but the law's authority is strictly limited and enforceable only in the United States.
Ford's main opponent was the Democratic Party Jimmy Carter . Carter strongly opposes this law, saying that the president's response is too weak and too lenient on companies and their top leaders. In the 1976 election, Carter fiercely criticized Ford's policies as a candidate, even refuting that Ford's legislation permitted corruption and bribery in a sense. After Carter was elected, he immediately abandoned Ford's plan and criminalized and sentenced corruption.MPs believe that “criminalizing corruption and bribery is the most effective way to counter its spread and the least restrictive approach to business”.
In December 1977, federal Bill 305, the "Foreign Corrupt Practices Act", was passed by vote. Only then did the senators breathe a sigh of relief, and the United States' leadership position in the world was consolidated. This law has also become a competitive advantage for American companies to a certain extent. From then on, companies can win contracts as long as they demonstrate their sense of ethics and focus on improving product quality.
However, how to ensure that this golden rule remains valid in the face of competitors who do not obey US laws? There is only one way, and that is to make them comply with the same laws.
The then President Carter was well aware of this. He called on the international community to work together and pushed many other countries to pass similar laws in their own countries. The United States even wants to help these countries learn from its own path, especially to promote this system of combating corruption in the conclusion and negotiation of international trade contracts.
4 Promotion is difficult
Jimmy Carter knew that promoting the Foreign Corrupt Practices Act would not be easy. This issue has been discussed several times within the US government as a top priority, but without any substantive results.
The picture shows Jimmy Carter, the 39th President of the United States. Source: People's Daily Online
In 1975, the United Nations passed Resolution 3514, which was intended to crack down on all corruption that violated the laws and regulations of relevant countries. The United States strongly invited United Nations member states to sign the relevant resolution international convention . The United Nations Economic and Social Council organized the relevant conventions into Resolution 2041, which was adopted on August 5, 1976.
The resolution proposed the establishment of an intergovernmental working group on anti-corruption in world trade. Three years after its formation, the group was transformed into the Special Committee on Illegal Trading. The Special Committee on Illicit Trade drafted a plan aimed at treating companies as legal persons and pursuing criminal liability. The United States vigorously advocated signing the plan, but to no avail. In 1979, the Special Committee on Illegal Trading ceased due to differences of opinion. "Despite the many efforts made by everyone, especially the US representatives, all parties have not reached a consensus..."
Why did such a reversal happen??
The differences mainly originate from the Western camp. Legal and political issues are the two main factors that hinder the agreement. Developed countries value national sovereignty more than anything else. Which party's judicial power can more effectively investigate, track cases and combat crime? The dispute over extraterritorial jurisdiction is still the focus of everyone's attention. No one is willing to succumb to a foreign law and let it monitor their own country's enterprises. "As for judicial issues, representatives from many countries said that even if there is a strong extraterritorial jurisdiction mechanism, it is not compatible with domestic laws." Everyone has begun to fear that the United States will dominate the world market.
The Americans did not give in. They continued to advocate this idea through the mediation of the International Chamber of Commerce . Initially, the International Chamber of Commerce organized an international survey to take stock of countries' anti-corruption legislation. It then contacts countries and companies to get them to agree to the regulations. Many multinational companies were inspired by this and developed their own internal strategic guidelines, but that was all.
As attempts by the United Nations and the International Chamber of Commerce have failed one after another, the U.S. government has begun to reflect: Should it relax restrictions on companies, or continue to increase the influence of the Foreign Corrupt Practices Act around the world? Federal prosecutor Philip Hyman wonders whether it is possible to prevent U.S. companies from engaging in corrupt practices for the purpose of seizing markets and defeating domestic competitors, while allowing them to do the same in the face of foreign competitors. Where exactly are the jurisdictional limits of the Foreign Corrupt Practices Act?
In 1988, amendments to the Foreign Corrupt Practices Act allowed gifts and benefits to public officials of a country as permitted by the laws of that country. Major multinational companies in the United States believe that this is still a whitewash of the law and is far from sufficient to defend rights and interests. They call for unified regulations. American lobbyists picked up their "magic wands" again and went out again, preparing to build momentum to achieve this goal. This path of the United Nations did not work, so they decided to start with Organization for Economic Cooperation and Development and sell their plan to them.
5 Killing two birds with one stone
A protracted tug-of-war between lobbying and judicial diplomacy has begun.
The Organization for Economic Cooperation and Development finally adopted the Convention against Bribery of Foreign Public Officials in International Business Transactions (referred to as the Anti-Bribery Convention) on December 17, 1997. The provisions of this convention almost copied the United States' "Anti-Bribery Convention". Foreign Corrupt Practices Act. “The OECD Convention clearly borrows from the Foreign Corrupt Practices Act in at least four points: allowing foreign public officials to receive compensation within certain limits; restricting active bribery (tracking the bribe giver rather than the bribe recipient); Maintain market fairness and impose certain penalties for illegal behavior (bribes are not allowed for private purposes, and falsification or concealment of accounts and balance sheets for bribes is sanctioned); transnational law enforcement is allowed. Article 5 of the
Convention clearly stipulates that signatory countries must actively participate in case investigations, even if doing so will have a certain impact on their foreign-related policies. "Investigations and interrogations of bribery of foreign public officials will be conducted under rules and guidelines acceptable to all parties, and will not be affected by national economic interests, relations with other countries, or the identity of the natural persons involved."
The purpose of the United States Reached : Most economic entities in the world have joined the US anti-corruption standard system. The promoters of the "Foreign Corrupt Practices Act" are overjoyed. This law not only directly affects international conventions and national legislation to combat transnational corruption, but has also successfully given the United States the power to restrain many foreign companies. It can be said to be a perfect killing two birds with one stone: U.S. law has spread around the world and has placed foreign companies on the bench of U.S. justice.
44 countries have ratified and adopted the Anti-Bribery Convention of the Organization for Economic Cooperation and Development, of which 8 countries are not members of the organization. The convention has officially come into effect on February 15, 1999. Theoretically, this means that it is completely legal for the United States to conduct investigations. However, at the beginning, the United States deliberately restrained itself. Two years later, the "9·11" terrorist attacks in 2001 opened up a new front. US leaders focused their energy on combating terrorism, but they did not stop moving into the economic field.
How did the United States do it? Cut off the financial resources of terrorist organizations and crack down on corruption and other dirty transactions suspected of funding bin Laden and other extremist organizations. The CIA, National Security Agency, and Treasury Department staff turned into commercial "agents". Their targets were not just businesses, foundations, or non-governmental organizations in the Near East, and the Middle East. Their mission was to scan the economies of the planet. Big and small things happening in the field.
6 Law support
During this period, the United States introduced several major bills under the pretext of anti-terrorism to supplement and strengthen the "long-arm jurisdiction" granted to itself.
In 1996, the U.S. Congress voted to pass the "Cuba Freedom and Democratic Solidarity Act". This bill also has a more familiar name - " Helms-Burton Act " . The name comes from two submitters: Jesse Helms, a Republican U.S. senator from North Carolina, a conservative figure and a staunch white supremacist, and Danny Lee Burton, a Republican representative from Indiana.
The "Helms-Burton Act" is divided into four parts. The first part is aimed at "strengthening the Castro government's international sanctions "; the second part is only about supporting a new government that surrenders to the United States; The third and fourth parts are the specific content of sanctions. It can be said that this law makes a mockery of and violates the basic rules of state relations of "non-interference in other countries' internal affairs." The United States is well aware of this, but completely ignores it.
The picture shows Fidel Castro, known as the "Father of the Founding of Cuba". Source: China Youth Network
The "Helms-Burton Act" is specially used when talking about business dealings with Cuba The word "trafficking" is used in English, which usually refers to illegal transactions. The U.S. Congress clearly intends to use this to cast a dark and unclear color on all economies that have economic dealings with Cuba, and to discourage all those who want to trade with Cuba. enterprise. Bob Livingston, Republican Representative of Louisiana, USA, believes: The logic behind this is that many multinational companies must make a basic choice, either to maintain relations with Castro, or to stay away from the world's largest market ( U.S).
Following the "Helms-Burton Act", on August 5, 1996, the U.S. Congress passed the "Iran and Libya Sanctions Act", its household name is "D'Amato-Kennedy Act" , also from two committers. This time it is the turn of Iran and Libya to accept the US economic isolation policy.
According to the "D'Amato Law", any enterprise or individual whose annual investment in Iran or Libya exceeds US$40 million (one time or in installments), and the investment will directly or indirectly support the oil and natural gas industries of the two countries, shall be punished.
Anyone who violates the Helms-Burton Act and the D'Amato Act will face the risk of being included in the United States' list of Specially Designated Nationals, which is a powerful "economic death penalty" list. Established by the Office of Foreign Assets Control of the U.S. Department of the Treasury. The Office of Foreign Assets Control of the U.S. Department of the Treasury is a powerful tool affiliated with the U.S. Department of the Treasury. It is responsible for enforcing sanctions against embargoed countries and prohibits companies from any country from having dealings with individuals and companies on the Specially Designated Nationals List.
In 1996, Hervey Descharette, then French Foreign Minister, declared: These two bills have crossed the red line and reflected the unilateralist stance of the United States... This is a serious violation of international trade principles, and the two bills The bill has nothing to do with counter-terrorism.
Enron office building in Houston, USA, on March 21, 2002.
In 2001, after the Enron scandal, the United States passed the " Sarbanes-Oxley Act" (also known as the "Public Company Accounting Reform and Investor Protection Act"). This is the most significant reform implemented by the U.S. government in the field of financial security since the financial crisis in the 1930s.
After the promulgation of the Sarbanes-Oxley Act, companies must clearly identify themselves: accounts must be verified, signed and dated by the CEO and CFO; and must be audited by the U.S. Securities and Exchange Commission at least once every three years. ; Publish off-balance sheet financial information; change external auditors in real time... All companies listed in the United States, whether they are domestic companies or foreign companies, or overseas subsidiaries of U.S. companies, must comply with its requirements. The bill provides companies with a high degree of transparency and allows review and oversight agencies to access all information. This means that when doing business in the United States, you must accept that all trade secrets are subject to the control of the U.S. government.
On October 26, 2001, US President George Bush signed the " Patriot Act " , some of which strengthened the strength of the "Foreign Corrupt Practices Act". Its essence is to expand security, surveillance and intelligence. departmental powers.
The picture shows George Bush. Source: Russian Satellite News Agency
With the "blessing" of public laws, major banks and entrepreneurs have entered their radar areas. Around 2004, the first batch of cases were closed and sent for trial, and the U.S. treasury was filled. Fines rose from $100 million per year to more than $1.8 billion for all of 2010 and never fell back to $200 million until 2016.
7 The long arm is open
The full text of the Foreign Corrupt Practices Act has more than twenty pages.Its enforcement scope includes corruption by foreign public officials, registered securities issuers, persons authorized to submit various types of statements, various leaders, senior executives, representatives of securities issuers or shareholders, or persons working for them. And the above-mentioned people abuse power for personal gain, dereliction of duty and discipline, accept various forms of bribes, including various oral or written commitments, etc., in order to manipulate international trade or use their power to exercise their powers on public agents to cause adverse influence or instigate them to accept benefits or violate other laws and regulations. Legal obligations, or acts to assist a securities issuer to deliberately occupy or retain the market for a certain party or to assist a certain party to occupy the market.
No matter where the case occurs, as long as the company involved or any of its branches (or only one trade office) has some connection with the United States, such as conducting transactions in U.S. dollars, the U.S. judicial department can prosecute it. Launch an investigation or impose sanctions.
Even if the connection is very small, such as a simple email. In 2011, the U.S. securities regulatory authority - the Securities and Exchange Commission - and the U.S. Department of Justice jointly issued a multi-million dollar fine to the Hungarian Telecom Company for corruption involving the company's Macedonia and Montenegro markets. . Hungarian Telecom's parent company, and Deutsche Telekom , were also fined for poor supervision.
SEC Building.
At the same time, the Securities and Exchange Commission also launched an investigation into three former executives of Hungarian Telecom, including the company’s former president Elek Straub. This case has no connection with the United States, but the U.S. Department of Justice can investigate these three executives. why? Because one of them sent an email admitting corruption using an email address with a server in the United States! In December 2013, a New York court ruled that the Securities and Exchange Commission's use of the Foreign Corrupt Practices Act to investigate these three individuals was legal. In other words, as long as an email address has a server in the United States, the U.S. Department of Justice can destroy a company and sanction its top managers and employees.
The U.S. Department of Justice has this impeccable "weapon" for extracting money . It can use it to investigate any foreign company with financial corruption problems. As long as there is an ambiguous crime, it can legitimately access all the encryption of the corporate parent company. Accounts to learn about the operating status of its subsidiaries. Investigations into financial corruption issues can lead to more serious offenses such as violations of the Foreign Corrupt Practices Act, violations of financial regulations (accounts and records), and violations of internal controls. The more charges there are, the heavier the punishment will be for the company involved, and the worse the impact on its reputation will be.
Let’s look back at the Siemens case. In 2006, the U.S. Department of Justice learned from German media that the German Ministry of Justice was investigating Siemens 's global bribery case. The U.S. Department of Justice easily gained authority to investigate the case, summoning Siemens executives and ordering them to conduct an internal investigation. Although the case has no connection with the United States, but involves Argentina, Bangladesh, Russia, Iraq and other countries, although the suspected Siemens subsidiaries are registered in Bangladesh, Argentina and Venezuela and have never been registered in New York. Stock exchange is listed, but none of that matters.
The picture shows the Siemens headquarters in Munich, Germany. Source: Xinhua News Agency | Associated Press
Why can the U.S. Department of Justice sue Siemens?
There are two reasons: first, in order to be listed on the U.S. market, Siemens submitted equity certificates (American depositary receipts) to the U.S. Securities and Exchange Commission; second, several suspected bribes were transferred through bank accounts in the United States. This established Siemens' ties to the United States, allowing the U.S. Department of Justice to bring charges against it. Siemens only needs to conduct an internal investigation and incriminate itself. It hired the New York law firm DePauw & Peck and Deloitte Touche Tohmatsu to conduct investigations in 34 countries. Millions of documents were scrutinized, and countless detailed reports were sent to the U.S. Department of Justice.
The U.S. Department of Justice was satisfied with the seamless cooperation, but it did not show mercy: Siemens suffered a double fine, not only paying $450 million to the U.S. Department of Justice and $350 million to the U.S. Securities and Exchange Commission, but It also paid a fine of 596 million euros to the German government in 2008, totaling more than 1 billion US dollars.
8 The fall of the giant
The predecessor of Alcatel is Electricite de France. It has experienced brilliance and also fallen into troughs.
In the 1980s and 1990s, Alcatel was a leader in the global power equipment industry (businesses include digital telephone switching, submarine cables, mobile networks, call centers, satellites, etc.). The company was also in the optical network market, DSL (digital It is a world leader in subscriber line) access systems and routers.
In the late 1990s, Alcatel's business spanned 130 countries, with a turnover of several billion euros. However, after that, the company's situation took a turn for the worse. In early 2000, as the economic situation became more severe, Alcatel suffered heavy operating losses (approximately 5 billion euros in 2002) and was forced to lay off 30,000 employees. The company's solution was to "marriage" with the American company Lucent in 2006. The merger received a positive response from the financial markets, and the two companies joined forces: Alcatel brought the European market, while -Lucent could bring US contracts. The new company after the merger is a global heavyweight with a value of 21 billion euros and captures 40% of the DSL access system market share. Before selling itself to its American partners, Alcatel carefully handled sensitive business units: it sold its satellite and security divisions to Thales, leaving these strategic assets in French hands.
But this "marriage" was short-lived. The management of the two companies could not reach an agreement, and the company suffered repeated setbacks. Alcatel-Lucent failed to hold on to the original market, let alone capture new markets. What followed was layoffs and downsizing of the company. The merger ultimately failed. Meanwhile, Alcatel has struggled with legal disputes since 2006.
The U.S. Department of Justice and the Securities and Exchange Commission began investigating Alcatel for bribery in Costa Rica , Honduras, Taiwan, and Malaysia from 2001 to 2006. In 2007, a former Alcatel executive who was arrested in Miami admitted bribing leaders of state-owned companies in Costa Rica and was sentenced to 30 months in prison. His guilty plea helped the U.S. Department of Justice prosecute his former employer, Alcatel, and Alcatel paid a $137 million fine in 2010 to settle the case: $92 million to the U.S. Department of Justice and $45 million to the U.S. Securities and Exchange Commission. fine.
5 years later, Alcatel-Lucent was acquired by Finnish Nokia company . The next year, the company was delisted from the Paris Stock Exchange and Alcatel-Lucent ceased to exist.
9 European companies cannot escape
Stanford University Law School provided a set of case data for resorting to the US Foreign Corrupt Practices Act: 3 cases in 1999, 5 cases in 2001, 7 cases in 2006, and increased to 19 in 2007. For example... From 1977 to 2016, the U.S. government issued a total of 478 sanctions, 138 of which involved non-U.S. individuals and companies, including 13 sanctions against French individuals and companies.
In October 2006, the U.S. Department of Justice and the U.S. Securities and Exchange Commission sanctioned a foreign company for paying bribes outside the United States for the first time: Equinor violated the U.S. Foreign Corrupt Practices Act by paying an amount of bribes to an Iranian representative from 2001 to 2002. Millions of dollars (a total bribe of 15 million, paid in 11 years), in exchange for helping the company obtain future natural gas contracts, which of course are particularly profitable contracts. Statoil neither admitted nor denied the facts, but agreed to pay a $10.5 million fine. Two years later, in December 2008, the German Siemens mentioned above was fined US$800 million, 80 times higher!
When looking at the data from the U.S. Department of Justice, one sees that European companies are not only extremely corrupt but also violating the embargo imposed by the United States.They top the U.S. sanctions blacklist: “From 1977 to 2014, 30% of public investigations launched by the U.S. for violations of the Foreign Corrupt Practices Act were against foreign companies, but they paid fines. 67% of the total.” Even the American media was surprised by this.
In 2012, an article in the New York Times revealed that the U.S. Foreign Corrupt Practices Act contributed more than $3 billion to the U.S. treasury. The reporter of the newspaper pointed out at the beginning of the article that there is an anomaly in the company list compiled by the U.S. Department of Justice: " American companies rarely appear on the list. " In fact, there is only one American company (Kellogg's) - Brown & Root Co., a subsidiary of Halliburton) paid a fine of $579 million in 2009 and ranked among the top 10 companies with the most severe penalties. It was preceded by an $800 million fine from Siemens.
Facts speak louder than words: Most of those punished are European companies, and most of them are banks. From 2004 to 2014, only one US bank (JPMorgan Chase) was fined, and the amount was US$88 million! This is in conjunction with BNP Paribas (USD 9 billion), HSBC (USD 1.9 billion), Commerzbank (USD 1.5 billion), Credit Agricole (USD 787 million), etc., which have been accused of paying bribes, violating embargoes or not complying with the U.S. The amount of fines imposed for complying with the law is completely different.
In short, with the "blessing" of a series of laws, the "long-arm jurisdiction" granted to itself by the United States is like no one's territory. Most of the companies hit by this "deadly combination" are unable to regroup and make a comeback. , they have no choice but to be acquired by competitors, as happened to Alcatel, Technip and Alstom.
A former executive who has worked for several listed companies said, "Americans have eyes and ears everywhere to monitor their foreign competitors and never target domestic companies. Therefore, Americans can hide in tax havens through companies, feel free to pay bribes or violate embargoes. We are always the one being fooled in this game."
Uncle Ku’s welfare
Uncle Ku’s book donation activities are always on! CITIC Publishing Group provides Uncle Ku with 3 copies of "Hidden War" as gifts to enthusiastic readers. How did the long-arm jurisdiction of the United States become a new weapon in economic warfare? See how the U.S. judicial police use legal weapons to hunt global business opponents. A guide to avoid pitfalls for multinational companies, overseas companies, the financial industry, governments, and employees.
