Moore Electronics sells automated lighting for airport runways. The government of an Eastern European country has offered Moore a contract to provide equipment for the 15 major airports in the country. The official in charge of awarding the contract, however, is demanding a 5 percent kickback. He told Moore to build this into the contract price so that there would be no cost to Moore. Without the kickback, Moore loses the contract. Such kickbacks are considered a normal way of doing business in this country.
Questions
1. What should Moore do?
2. Review the Foreign Corrupt Practices Act online at www.usdoj.gov/ criminal/ fraud/fcpa/. Write a brief paragraph on what this statute contains that relates to Moore's dilemma. Some American executives think this law causes American corporations to suffer a competitive disadvantage. Do you agree? Why or why not?