Multinational bribery an issue in China

By Duan Yaying: 0 Comment(s)Print E-mail China.org.cn, August 6, 2012

The business corruption issue has come into full public view following the recent cosmetics giant Avon's bribery scandal. According to the Global Anti-Corruption Report 2008 published by anti-corruption watchdog Transparency International, rampant corruption, as a major global issue, is likely to incur an additional cost of US$50 billion in order to meet the development goals of a new millennium.

Avon Products Inc. said on Wednesday that it has held negotiations with the U.S. Justice Department and the Securities Exchange Commission (SEC), in the hopes of settling an investigation into the bribery of foreign officials.

As a region that hosts frequent international business activities, China has created economic miracles, but has also fallen victim to commercial corruption to varying extent. China.org.cn here presents you with an overview of several multinationals charged with bribery in China.

Company	HQ	Industry	Settling Date	Case Briefings	Self-Disclosure	Penalties
GE InVision	U.S.	Airport Bomb-Detection Machines	Feb. 14, 2005	From 2002 to 2004, InVision employees, sales agents and distributors made illegal payments to officials of government-owned airports in China, the Philippines and Thailand. The company paid US$95,000 in bribes in China.	Y	US$618,000
DPC	U.S.	Medical Equipment	May 20, 2005	DPC Tianjin paid bribes to doctors of Chinese government-owned hospitals between 1991 and 2002.	Y	US$4.8 mln
Schnitzer Steel Industries	U.S.	Steel Recycling	Oct. 16, 2006	From 1999 to 2004, the former Chairman and CEO of Schnitzer Steel Industries approved cash payments and other gifts to officials at Chinese and South Korean government-owned steel mills.	Y	US$15.2 mln
Paradim BV	Netherlands	IT	Sept. 25, 2007	Paradim BV admitted to paying bribes in China, Indonesia, Kazakhstan, Mexico and Nigeria.	Y	US$1 mln
York International	U.S.	Refrigeration Products	Oct. 1, 2007	From 2001 to 2006, York International made illicit consultancy payments to government officials in China and several other countries.	Y	US$20 mln
Lucent	U.S.	Telecom Equipment	Dec. 21, 2007	From 2000 to 2003, Lucent paid the expenses for approximately 1,000 employees of Chinese state-owned enterprises to take approximately 315 trips to the United States.	Y	US$2.5 mln
AGA	U.S.	Medical Equipment	Jun. 3, 2008	From 1997 to 2005, AGA bribed Chinese government officials.	Y	US$2 mln
Faro	U.S.	Software-based Measurement Devices	Jun. 5, 2008	From 2004 to 2005, Faro's Chinese subsidiary made illegal payments to Chinese government officials.	Y	US$2.95 mln
Siemens AG	Germany	Electronics and Electrical Engineering	Dec. 15, 2008	Among the bribes Siemens paid on widespread global transactions, Siemens' Chinese subsidiary bribed Chinese government officials via a consultancy company to secure project contracts.	N	US$1.6 bln
ITT	U.S.	High-Tech Engineering and Manufacturing	Feb. 11, 2009	ITT was charged with making illicit payments to employees of state-owned enterprises through its wholly-owned Chinese subsidiary Nanjing Goulds Pumps Ltd..	Y	US$1.67 mln
Avery Dennison	U.S.	Pressure-Sensitive Adhesive Materials	Jul. 28, 2009	Avery China bribed Chinese government officials and employees of Chinese state-owned enterprises between 2002 and 2005.	Y	US$200,000
Control Components Inc.	U.S.	Valves	Jul. 31, 2009	CCI admitted to making an estimated 236 bribery payments to employees of related companies and government officials across 36 countries. These companies included PetroChina, China Petroleum Materials and Equipment Corporation, Dongfang Electric Corporation, China National Offshore Oil Corporation, China Resources Power and many other top Chinese state-owned companies.	N/A	US$18.2 mln
UTStarcom	U.S.	Electronics and Electrical Engineering	Dec. 31, 2009	UTStarcom's wholly-owned Chinese subsidiary paid nearly $7 million between 2002 and 2007 for 225 overseas trips taken by employees of Chinese government-controlled telecommunication companies that were customers of UTStarcom, all under the banner of customer training. UTStarcom provided 10 Chinese and Thai government customers, or their family members, with work visas and purportedly hired them to work for UTStarcom in the U.S., whereas in reality they did not work for the company. UTStarcom also paid more than $4 million for Chinese government customers to attend executive training programs at several U.S. universities and other training programs unrelated to UTStarcom's business.	N/A	US$3 mln