Its no secret that local agents and intermediaries are essential for most companies that want to break into foreign markets. They are invaluable in navigating bureaucratic and logistical mazes, understanding regional customs, and securing introductions to important decision-makers. These agents are not only able to translate the local language, but also the local business dialect, which can be starkly different from that with which the company is familiar. These ambassadors of commercial affairs also pose corruption risks though, which are widely reported in the compliance community.
Whether vetting third parties themselves or using an external vendor, companies seeking to protect themselves from liability under the U.S. Foreign Corrupt Practices Act (FCPA) should ensure that they get answers to five basic questions when conducting routine due diligence:
