31 Days to a More Effective Compliance Program - Franchisor liability

Thomas Fox
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There remains a question about franchisor liability under the FCPA.

While some believe that a franchisor may not have direct involvement in conduct prohibited by the FCPA, as there may not be the requisite corrupt intent required under the statute. However, unless a franchisor has an adequate compliance program in place, a franchisor may well find itself in the shoes of Frederic Bourke and sustain a finding of conscious See more +

There remains a question about franchisor liability under the FCPA.

While some believe that a franchisor may not have direct involvement in conduct prohibited by the FCPA, as there may not be the requisite corrupt intent required under the statute. However, unless a franchisor has an adequate compliance program in place, a franchisor may well find itself in the shoes of Frederic Bourke and sustain a finding of conscious indifference.

Three key takeaways:

1. Consider the different types of international franchise agreements to help assess your compliance risk.

2. There are no reported FCPA enforcement actions involving international franchisors, yet.

3. Franchisors must conduct thorough research in both the foreign market they hope to enter and on their potential franchisees. See less -

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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