Question

Once your chosen business is more established, you decide to get involved in a joint venture with a foreign firm. The contract for the joint venture gives you the right to buy the project in three years. You worry that the foreign firm has been bribing government officials to obtain an economic advantage over other companies. Do you have any reason to be concerned about the possible bribery if you purchase the venture in three years? Why or why not?

Provide an overview of the country’s (your choice) business practices and the consequences of engaging in questionable business practices.

Answer 1

Bribing is ounishable offense and any subsidiary unit or joint venture involved in doing so can be penalised and jailed under Foreign Corrupt Practice Act which barrs unethical bribery and related activities which are illegal or misappropriated.

In countries like US, firms need to comply to Sarbanes Oxley Act and ethical audit plus stro g risk management frameworks and thus violation of these laws is felony and is subject to punishment. It leads to cancellation of licenses to operate and seizure of business under Company Law Tribunal benches and leads to loss of brand image as intangible externality.

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