WEBVTT - U.S. Authorities Probe Sinopec Over Nigeria Payments (Audio)

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<v Speaker 1>The Securities and Exchange Commission and the Justice Department are

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<v Speaker 1>investigating China Petroleum and Chemical over allegations at the state

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<v Speaker 1>controlled oil producer paid Nigerian officials about a one million

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<v Speaker 1>dollars in bribes to resolve a business dispute. According to

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<v Speaker 1>people familiar with the probe, the alleged payments by outside

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<v Speaker 1>lawyers acting as middlemen for the company known as sine Peck,

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<v Speaker 1>were intended to resolve a four billion dollar dispute between

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<v Speaker 1>the Chinese Oil Companies petroleum unit in Geneva and the

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<v Speaker 1>Nigerian government. Here to help us explain this probe are

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<v Speaker 1>Peter Henning, professor at Wayne State University Law School, and

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<v Speaker 1>Robert Hockett, professor at Cornell University Law School. Bob tell

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<v Speaker 1>us more about the allegations. All right, So the allegation

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<v Speaker 1>is that China Peck, through its ads, got into a

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<v Speaker 1>dispute with the Nigerian government over a financial deal that

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<v Speaker 1>was meant to be consummated over in Niger area. Um.

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<v Speaker 1>Ultimately this became more and more complicated. The litigation got

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<v Speaker 1>kind of harry or I should not litigation, but the

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<v Speaker 1>negotiation around possibilitation got sufficiently Harry UH that SINO picked

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<v Speaker 1>through a X decided sort of resolve the dispute with

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<v Speaker 1>the sort of side payment to the Nigerian government officials involved.

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<v Speaker 1>UM this particular, these payments were said are said to

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<v Speaker 1>have end are alleged to have been funneled through US

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<v Speaker 1>banks UH. And that's of course with the U S

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<v Speaker 1>juristiction sort of comes into into the story. Um. So

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<v Speaker 1>what we have now is the possibility of charges being

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<v Speaker 1>brought by the SEC, perhaps by the d J against

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<v Speaker 1>UM SINOPEC for essentially misusing UH its American bank accounts

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<v Speaker 1>in conducting these payments. That would have been violation or

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<v Speaker 1>Practices Act and violations of other nations statutes as well. Peter,

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<v Speaker 1>is it unusual for U S officials to be interested

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<v Speaker 1>in a transaction like this? So, so Bob did mention

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<v Speaker 1>the American banks and so that's a legal jurisdictional element there.

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<v Speaker 1>But you know, we're talking about stuff in Europe, were

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<v Speaker 1>talking about stuff in in Asia, We're talking about stuff

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<v Speaker 1>in Africa. It seems like most of the activity is

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<v Speaker 1>going on in places other than the US. Well, welcome

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<v Speaker 1>to the Foreign Corrupt Practices Act. It is, Uh, the

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<v Speaker 1>law is so broad that if there have been cases

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<v Speaker 1>in which emails were sent through Yahoo accounts, UH and

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<v Speaker 1>servers in Silicon Valley, and that was the basis for

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<v Speaker 1>the US to get involved. So it's not a surprise,

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<v Speaker 1>um in a sense the Justice Department in sec have

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<v Speaker 1>become something of the top cop for overseas bribery payments.

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<v Speaker 1>And of course, when you overlay this the fact that

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<v Speaker 1>Sinopeck is um a Chinese controlled oil company and the

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<v Speaker 1>US is raising issues about Chinese trade practices, you can

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<v Speaker 1>certainly see this says part of an effort to use

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<v Speaker 1>American laws to police Chinese company and potentially embarrass the

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<v Speaker 1>Chinese government. Bob, the Swiss had looked into this matter

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<v Speaker 1>and closed the book on it after a short inquiry.

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<v Speaker 1>They required sign a pack to pay thirty two million

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<v Speaker 1>dollars in damages after admitting to organizational deficiencies. So is

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<v Speaker 1>it is it? Should that have been the end of it?

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<v Speaker 1>Is the US going a little too far in pursuing

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<v Speaker 1>it further? Well, it sort of depends. I mean, Peter

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<v Speaker 1>is exactly right that the Foreign Practices Act, which I

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<v Speaker 1>also mentioned before, you know, affords a great abroad sort

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<v Speaker 1>of jurisdiction, Right, to US authorities. Um, Basically, they can

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<v Speaker 1>exercise jurisdiction anytime some American institution or firm has been

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<v Speaker 1>used in the perpetration of some active corruption. Um. The

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<v Speaker 1>reasons I mean, the fact that we're able to do that,

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<v Speaker 1>of course, is one thing. Whether we would want to

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<v Speaker 1>do that or want to act on that jurisdiction is another,

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<v Speaker 1>And that raises the questionable why would we want to?

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<v Speaker 1>Peter identified one reason? Right, we are engaged in the

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<v Speaker 1>kind of across the board sort of trade a competition

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<v Speaker 1>with China, and there is some concern about Chinese business

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<v Speaker 1>practices more broadly. The other thing may be worth noting

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<v Speaker 1>in this connection, though, is that US companies are routinely

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<v Speaker 1>prosecuted under the Foreign corupt Practices acting are held to

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<v Speaker 1>a pretty high standard by American law enforcement agencies, and

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<v Speaker 1>so if they didn't do likewise with respect to foreign companies,

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<v Speaker 1>that might in effect give foreign companies and advantage over

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<v Speaker 1>American companies, right, they would be an effect subject to

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<v Speaker 1>less to more lacks regulation. So my guess is that

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<v Speaker 1>that might be playing a role here as well, that

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<v Speaker 1>basically we don't want to be sort of treating our

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<v Speaker 1>own firms more harshly than we treat foreign firms if

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<v Speaker 1>they're violating the same laws.