The first challenge when confronting corruption is how to define it. Many experts define corruption based on different categories of behavior, relying mostly on laws; others maintain that because of the lack of those formal regulations in some societies, the best approach to define corruption is based on public opinion or cultural standards.

Despite these differences, the most common definition includes the elements of "abuse of public office for private gain." While there is no general agreement on a universal definition of corruption that can be applied to all forms, types and degrees of corruption, it could be said that the identification of the three above-mentioned elements makes the definition broad enough to include most forms of corruption.

Regardless the degree or the type of corruption, it is not possible to escape its multiple impacts on businesses trying to negotiate in foreign countries. When corruption is pervasive and uncontrolled, it results in wasted resources, distrust of government, and the loss of savings and investments due to overseas flight of profit from bribes, among others.

Investigations by the Securities and Exchange Commission in the mid-1970's 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. Congress enacted the FCPA in 1977 to bring a halt to the bribery of foreign officials and to restore public confidence in the integrity of the American business system.

For more than two decades, the United States has waged a solitary war against corruption in international business transactions. Virtually all countries outlaw domestic bribery, but the U.S. Foreign Corrupt Practices Act was unique in proscribing bribery of foreign officials.

1. Anti-bribery provisions : The anti-bribery provisions prohibit domestic concerns or issuers from bribing foreign officials to obtain or retain business. Penalizing payers rather than recipients, these provisions were designed to curb the supply, or "active" side, of transnational bribery. Specifically, they criminalize any act of a covered person in U.S. interstate or foreign commerce in furtherance of a payment--or an offer, promise or authorization of a payment--of money or anything of value to a foreign official to secure that official's action, inaction or influence, in a decision relative to a business opportunity.
2. Accounting provisions: The FCPA's accounting provisions oblige issuers to adopt internal controls and to ensure that company books and records are complete, accurate and not misleading with regard to the amount, nature or destination of any payments. In addition, the FCPA also makes U.S. companies liable for actions of third parties--including agents, sales representatives, consultants and joint-venture partners--who make illicit payments to foreign officials. Such liability turns on the issuer's or domestic concern's knowledge or authorization of a pass-through to a foreign official.

Unfortunately, the FCPA's extraterritorial reach is limited. It does not apply to foreign subsidiaries of U.S. corporations, foreign entities that do not qualify as issuers or foreign nationals who are not officers, directors, stockholders, employees or agents of domestic concerns or issuers.

Regardless the FCPA’s imperfections and loopholes no other industrial country has enforced comparable regulations. On the other hand, this "uniqueness" of the U.S. with the FCPA has spurred controversy in the American business world, since this situation has been blamed as the cause for disadvantages for U.S. companies compared with foreign competitors.

As it was stated by U.S. Secretary of Commerce, William Daley, "since 1994, foreign firms have used bribery to win approximately 180 commercial contracts valued at nearly $80 billion. The U.S. estimates that over the past year American companies lost at least 50 of these contracts valued at more than $15 billion. And since many of these contracts were for groundbreaking projects – the kind that produce exports for years to come – the ultimate cost could be much higher."

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