Bill Overview
Title: Countering Corporate Corruption in China Act of 2022
Description: This bill expands the activity prohibited under the Foreign Corrupt Practices Act (FCPA) applicable to issuers of securities, domestic concerns, and others. (The FCPA generally prohibits bribes to foreign officials.) For example, the bill includes as prohibited corrupt practices certain activity supporting human rights abuses by China against Uyghurs, Kazakhs, and members of other predominately Muslim ethnic groups; certain activity supporting censorship or human rights abuses by China with respect to individuals in Hong Kong; supporting certain territorial claims by China; political advocacy in favor of the Chinese Communist Party; and investing in specified Chinese entities.
Sponsors: Sen. Rubio, Marco [R-FL]
Target Audience
Population: Individuals working for companies involved in or preventing corrupt practices in China
Estimated Size: 1000000
- The bill impacts any issuer of securities that is subject to the Foreign Corrupt Practices Act, which includes a large number of global corporations.
- The bill specifically targets activities in China that involve human rights abuses, meaning it affects companies involved in these practices or complicit through their businesses in China.
- Global businesses with subsidiaries or investments in China that could be interpreted as supporting the Chinese government's territorial claims or human rights abuses are also affected.
- It includes restrictions on political advocacy in favor of the Chinese Communist Party, impacting entities that engage in such activities.
- The legislation targets investments in specified Chinese entities, impacting investors and financial institutions worldwide who hold these investments.
Reasoning
- The policy is targeted towards businesses and individuals in the US with significant economic ties to China. This includes multinational corporations, financial institutions, and even individual investors who might indirectly support entities in China through their investments.
- The policy effectively expands the existing legal framework, addressing ethical concerns regarding human rights abuses, thus potentially influencing organizations' operations in China or their partnerships with Chinese entities.
- Given the potential legal implications, companies may need to restructure their businesses to ensure compliance, which could have significant economic and employment impacts.
- With a budget of $20 million in the first year, the policy likely focuses on monitoring and enforcing new regulatory requirements, initially impacting larger corporations with dedicate compliance teams.
- A broader implication is that smaller investors or those involved tangentially may not feel the impact immediately as the policy's enforcement remains within budget constraints.
- The policy's impact is spread globally but has significant repercussions domestically due to the large volume of trade and investment between the US and China. This affects a wide range of stakeholders, including employees, managers, and investors in numerous sectors.
Simulated Interviews
CEO of a tech company (San Francisco, CA)
Age: 45 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 2/20
Statement of Opinion:
- I'm concerned about the potential operational disruptions this policy could cause.
- While I'm supportive of human rights initiatives, the new regulations might force us to reconsider our business strategy in China.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 5 | 6 |
| Year 3 | 4 | 5 |
| Year 5 | 4 | 5 |
| Year 10 | 5 | 6 |
| Year 20 | 6 | 7 |
Investment Manager (New York, NY)
Age: 30 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 3/20
Statement of Opinion:
- This policy could significantly impact the portfolios I manage.
- Potential prohibitions could cause market instability temporarily.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 7 | 8 |
| Year 5 | 7 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 10 |
Compliance Officer in a multinational corporation (Dallas, TX)
Age: 39 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- This places more burden on our compliance teams.
- It aligns with ethical business practices but increases our work.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 4 | 5 |
| Year 3 | 5 | 6 |
| Year 5 | 5 | 6 |
| Year 10 | 6 | 7 |
| Year 20 | 7 | 8 |
Political Analyst (Chicago, IL)
Age: 51 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 2.0 years
Commonness: 6/20
Statement of Opinion:
- This is a strategic move to address broader geopolitical issues.
- However, the effectiveness of this policy needs consistent enforcement.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 9 |
Graduate Student in International Law (Boston, MA)
Age: 27 | Gender: other
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 7/20
Statement of Opinion:
- The policy represents a significant milestone in international human rights advocacy.
- I'm curious to see its real-world impact on business ethics.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 9 |
Small Business Owner (Seattle, WA)
Age: 34 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 2.0 years
Commonness: 4/20
Statement of Opinion:
- I support ethical business practices, but I fear this policy could increase costs.
- It might push me to seek alternative suppliers.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 5 | 6 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 7 |
| Year 10 | 7 | 8 |
| Year 20 | 8 | 9 |
Human Rights Activist (Los Angeles, CA)
Age: 48 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 5/20
Statement of Opinion:
- This policy is a positive step, though it requires thorough global cooperation.
- I'm hopeful it will pressure companies to reassess their international operations.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 9 |
| Year 5 | 8 | 9 |
| Year 10 | 9 | 10 |
| Year 20 | 9 | 10 |
Energy Sector Executive (Houston, TX)
Age: 55 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 8.0 years
Commonness: 3/20
Statement of Opinion:
- This could endanger our partnerships and projects in China.
- We need to evaluate our business practices to align with new regulations.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 4 | 5 |
| Year 3 | 5 | 6 |
| Year 5 | 5 | 6 |
| Year 10 | 6 | 7 |
| Year 20 | 7 | 8 |
Financial Analyst (Miami, FL)
Age: 41 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 5/20
Statement of Opinion:
- The policy could disrupt investment plans, making my role more challenging.
- I'm apprehensive about the effects on the stock market.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 5 | 6 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 7 |
| Year 10 | 7 | 8 |
| Year 20 | 8 | 9 |
Government Official (Washington, DC)
Age: 63 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- It's vital to uphold ethical trade practices while balancing international relations.
- The policy is a step in the right direction, though enforcement is key.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 9 |
Cost Estimates
Year 1: $20000000 (Low: $15000000, High: $30000000)
Year 2: $22000000 (Low: $16000000, High: $34000000)
Year 3: $24000000 (Low: $17000000, High: $36000000)
Year 5: $26000000 (Low: $18000000, High: $40000000)
Year 10: $30000000 (Low: $20000000, High: $50000000)
Year 100: $500000000 (Low: $300000000, High: $600000000)
Key Considerations
- The policy's success relies heavily on international cooperation.
- Enforcement complexity varies based on cross-border legal jurisdictions.
- Potential diplomatic tensions with China over perceived political motivations.