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Comment by mrweasel | Hacker News Reader

Many years ago (15+ years ago), I worked for a company that wanted to sell some software product to China. Now, you can't legally use bribes where I am, "the EU says NO". What you can do is hire a Chinese consulting company, they will invoice you a surprisringly high amount for their services and take some of that money and use it to grease the wheels of the Chinese bureaucracy. At least at that point in time, it was basically required to win any sort of contract on that level in China.

Microsoft using bribes in Africa, the Middle East or parts of Asia isn't a Microsoft problem, it a problem that those specific countries need to deal with. Microsoft would most likely have made their sales anyway, if bribes hadn't been a thing, it would just be slightly cheaper to do so, so I don't think management at Microsoft cares one way or the other.

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> Now, you can't legally use bribes where I am, "the EU says NO". What you can do is hire a Chinese consulting company, they will invoice you a surprisringly high amount for their services and take some of that money and use it to grease the wheels of the Chinese bureaucracy.

Just so y'all know, people have been convicted for international bribery in the US using "arms-length" consultants. This has been called out in every ethics training I've had to take since like 2004.

Every year I’m forced to watch training videos saying that it’s against US laws to be involved in bribery abroad. As I understand it, there’s severe federal penalties for briberies committed abroad. It may not be a Microsoft problem exclusively, but I can’t imagine “hey everyone else is breaking the law” is going to work as a defense.

It's the same in the EU, hence the "consulting" companies. Don't get to hung up on the fact that you know the money is going towards a bribe, because legally you didn't do it, nor did you technically ask anyone else to do it. All you did was hire a company that understand the local business culture and they helped facilitate the contract.

We even had a visiting member of the EU parliament and the CEO directly asked about this scenario. The PM argued that it wasn't ideal, but that it was part of doing business with, in this case, China. Technically, yeah you know, legally, just don't have the word bribe in the contract with the consultants.

The "arms-length consulting" is absolutely illegal in the US, I'm surprised that it doesn't seem to be that way for the EU.

Based on those trainings I also have to take yearly, the US has a weird carve out for "facilitation payments" that are basically just bribes to cut through red tape and delays that probably exist just to extract bribes in the first place. But I do remember the training calling out using a third party intermediary to launder your bribes isn't a defense and you're suppose to be responsible for how your money is used. I suspect the later isn't well enforced though but I couldn't say.

It’s stupid complicated, but essentially right. The legality of facilitation depends on the laws of all the jurisdictions involved. So where it’s legal and customary, say, in Egypt or whatever, I think, you can get away with it. Because how else would you get anything done?

It is.

I guess people just don't know that that it's just as illegal, or feel it's less objectionable than paying bribes directly. Or they speculate that it's harder to prove.

I think they know, or at least see that it's an issue, but what are they suppose to do? Either they stay out of a large number of countries, which seriously hamper their options for expansion or they speculate in it being hard to prove.

It also create an uneven playing field. Western countries can't do business in large part of the world, while companies from those same countries are free to sell anywhere.

You don't have a god-given right to run your business in every country in the world, especially when the manner in which you are doing so breaks the law of the countries you are headquartered in.

If you did, sanctioned countries wouldn't be a thing.

'I want to make money' isn't some kind of first, last, or sole moral consideration, overriding all others.

Should western countries be able to use slave labor outside the west?

These training programs are there so the company can check a box, have plausible deniability, and so low ranking employees don’t do something stupid that exposes the company.

Yes, I had to watch the same videos when I worked for BigCo.

It's obvious though that the problem is getting caught. If bribery is endemic, then you pay both the corporate bribe costs and the "not-getting-caught" bribe costs

No, this isn't Microsoft simply "paying the cost of business", this is Microsoft tolerating its own employees stealing millions for themselves on the excuse that their other corrupt practices brings in business.

Yes, this is Microsoft (or its employees) siphoning public funds from corrupt governments that those societies sorely need.

Those funds are lost regardless. There's no action that Microsoft or any other Western company can take that would do anything but leave them with a slightly cleaner conscience. As long as corruption is accepted those funds will never be directed towards schools, hospitals or infrastructure anyway.

It's a shitty argument, I'll grant you that, but it's not a problem that Microsoft can fix. They should take the moral high ground, but the money was always going to be siphoned of.

So the money should go to a local construction company to “build affordable houses” that will never get built or buy cheap computers with a 300% markup? Without systematically changing the culture in these countries corruption is never going to go away and no one has proved the FCPA has moved the needle anywhere.

It doesn't matter if the country has corruption problems on it's own, we shouldn't be party to that, and we shouldn't facilitate or encourage it by doing business with them. That's the whole point of these laws.

Why is that a given? It ultimately results in our adversaries like China or Prigozhin who are willing to pay bribes getting the resources. Or even other European countries who barely enforce these laws. So American companies are forced to be at a disadvantage and no actual bribery is prevented.

You realize that both parties in bribing are corrupt? This is not only people in middle east breaking the law, it also requires that people in the US are willing to commit fraud.

Saying it is fine when Americans bribe in foreign countries is saying it is fine if Americans are corrupt.

It's gonna be tough for the West to try and use their sway over multinationals to stop this kind of behavior overseas when they can't even stop it at home. Not that they shouldn't try to do both, but there are limits to what can be achieved in this area.

It's absolutely a Microsoft problem that they don't take a moral stand on bribing.

They don't take a moral stand on a lot of things. Most of the large companies in the world are deeply immoral, but we draw the line at bribing, in a culture that encourages it?

I'd argue that it's a WTO problem, let's just cut of all ties to countries where bribing in any form is acceptable, leaving us with what? The Nordic countries and New Zealand?

I'm not arguing that it's not an issue, but what would you have them do exactly? The bribing isn't going to disappear because Microsoft says no. Africa will just be running on Red Star OS and Tecent Cloud.

Microsoft is an American company, so the US can just forbid Microsoft from paying bribes.

Just like the US is using their clout to force people around the world to eg force French companies not to do business with Iran.

> I'd argue that it's a WTO problem, let's just cut of all ties to countries where bribing in any form is acceptable, leaving us with what?

As a compromise, you could target countries in which bribing is de jure _legal_, and worry about de facto later.

>>US can just forbid Microsoft from paying bribes.

That's already the case. It's already illegal for an American company to pay bribes abroad, even if it's "legal" there. The problem is that like many other people said - you just hire a local "consulting" business that handles that for you and your hands are clean.

> The problem is that like many other people said - you just hire a local "consulting" business that handles that for you and your hands are clean.

Just make that illegal, too? And make sure that ignorance is not an excuse before the law. (Something like gross negligence, if you don't check on your subcontractors well enough.)

I wonder how much the citizens of a country rife with low-level corruption would appreciate the US taking the high road and refusing to allow their companies to do business with them.

That's what's already happening with a few countries around the world.

Morale in a for-profit company is a virtual concept, it simply does not exist in reality. Claiming it does is likely delusionary or an attempt to hide the truth.

You are implying that running a for-profit company is immoral. Of course you can run a for-profit company in moral and ethical way!

Then it's a for-profit-and-some-other-things. And when there is more than one owner those other things better be defined in a legally binding way or else.

No, yoou can't. Claiming otherwise is pretty naive.

Teach me, please... What is immoral if you open your Limited company and sell your programming services to some customers and make profit doing it?

Make it economically bad times, and the customer a shady actor. Will the company deliberately close and stop offering its services, despite needing to put food on the table? Or will the company just go along and do the coding for shady customer?

Now, put a lot of air in that thought-baloon and you will see how basically every for-profit will end up doing immoral things.

You are wrong! Not every for-profit will end up doing immoral things in this case! Some will move on to do other stuff...

Most people in the developed world are all immoral according this argument.

https://www.youtube.com/watch?v=cTsfzLTBuo0

"no ethical consumption under capitalism" is a saying for a reason

"Morals" in any organization large enough for responsibility to be sufficiently diffuse is a virtue statement. Every large organization will sociopathically and amorally advance its KPIs. It just so happens that some organizations are in or adjacent to morals as part of their core business hence why the church comes out looking a little better than Monsanto.

Your argument works just as well for any other company or organisation.

The worst morale failures in history have been perpetrated by governments.

All this recent talk of "banning AI work for the sake of the economy" (perhaps when they're fully competitive with human-equivalent workers across all multidisciplinary domains) has had me thinking the money will just go to international consulting firms or independent contractors that can then use the AI tools as they wish.

That's why people need to start thinking of these issues globally, not in terms of what "their country" can do

I had to take some training at work on not doing exactly that. I guess the regulators are on to the little scam.

So hold the company liable for its subcontractors' violations. This isn't rocket surgery.

> use it to grease the wheels of the Chinese bureaucracy.

"Facilitating payments" aka "grease payments" are explicitly allowed in the Foreign Corrupt Practices Act.

This article is about actual, real bribery, which is illegal under the FCPA.

Company "fasttracked" worker visas to china, are basically olympic sport visas etc. reassigned for a bribe.

The article isn’t so much about Microsoft paying bribes to grease the wheels as it is about Microsoft employees skimming money from the contract.

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