International Law Update, May 2012: A Compliance Defense for the FCPA; The Revenue Rule & Recognition of Tax Claims in Cross-border Cases; and A New Weapon in the War Against Foreign Trade Secret Misappropriation

International Law Update, May 2012

Good Faith Efforts: A Compliance Defense for the Foreign Corrupt Practices Act

By: Stella M. Tsai, Esquire

In late April 2012, the New York Times broke a front-page story about Wal-mart and its potential exposure under the Foreign Corrupt Practices Act ("FCPA") in Mexico. According to the NYT, top executives at Wal-mart de Mexico shut down an internal investigation of wide-spread bribery of local Mexican officials in 2005, only to revive it and disclose it to the US Department of Justice in 2011 after learning about the NYT's own investigation of the same bribery allegations. Putting aside difficult news cycles, what other challenges lie ahead for Wal-mart under the FCPA?

The Revenue Rule and the Recognition of Tax Claims in Cross-border Cases

Examining various approaches to administering cross-border insolvencies, reasons for non-recognition of foreign tax claims, and potential solution.

By: Stephen M. Packman & Douglas G. Leney

In the nearly seven years since the United States Bankruptcy Code was amended to include a new Chapter 15 to address cross-border insolvencies, a number of previously unsettled insolvency issues has been put to the test, with some measure of clarity coming from the courts while still other guidance is provided by Chapter 15 itself. To be sure, Chapter 15, like its predecessor transnational legal texts, seeks to provide a general framework for recognition of foreign proceedings, relief which may be granted to a foreign representative, and cooperation among foreign courts in which concurrent proceedings are pending.

However, Chapter 15 does not explicitly provide instruction with respect to claims procedures, either within or outside the United States. Courts have thus been left to fashion their own means of ensuring fair adjudication of claims while simultaneously seeking to protect the interests of local constituencies. The issue is further compounded when the claims at issue are foreign tax claims, which are generally not recognized outside the country in which they arise.

Section 337 of the Tariff Act: A New Weapon in the War Against Foreign Trade Secret Misappropriation

By: Joseph A. Martin

It has become a fact of economic life for U.S. businesses that products are simply less expensive to manufacture abroad and import back into the United States for sale. This fact has compelled many U.S. companies to outsource their manufacturing and other processes to companies operating in countries with less regulation, lower wages and cheaper raw materials.

But with these lower costs come significant competitive risks. U.S. companies are disclosing their trade secrets - the processes, practices or formulas that give these companies a competitive advantage - to foreign companies that can manufacture the U.S. companies' products more inexpensively. This disclosure, together with the inherent difficulties in overseeing a foreign operation, provides a fertile field for misappropriation of U.S. companies' trade secrets. Such misappropriation is happening every day in places like China, India and the Philippines.

So what is a U.S. company to do when its trade secrets are misappropriated in a foreign country?

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Practice Area:

International Law

Archer & Greiner's International Law Group handles a wide range of legal matters for companies and individuals with regard to overseas transactions and disputes. The Group routinely advises Fortune 500 corporations, as well as, start-ups and smaller companies, on all aspects of business transaction structuring. Specialized services include: international corporate transactional and tax service, cross-border restructuring and insolvency, international intellectual property and immigration.

International Law Attorneys:

Kenneth E. Ahl

Jill M. Bellak

Charles J. Brown, III

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