Now that the feds have gotten tough over foreign bribes, a move is afoot to loosen the law. Why? The US Chamber of Commerce and attorneys for corporations claim to have anecdotal evidence that legal confusion has created a chilling effect, which has dampened overseas business interests and even prompted some to walk away from deals that can trigger probes, The Wall Street Journal writes.

The effort has implications, of course, for the pharmaceutical industry and its global activities, since drugmakers are among those that have been ensnared by the Foreign Corrupt Practices Act. Pfizer has reached an agreement in principle with the US Department of Justice and the US Securities and Exchange Commission to pay at least $60 million resolve a bribery probe (read here).

In April, Johnson & Johnson was fined $70 million for bribing public doctors in several European countries - and paying kickbacks to Iraq - to illegally obtain business (see this). And over the past year, at least five other drugmakers, including Merck and Eli Lilly, received letters as the feds seeks to uncover any FCPA violations. Violations can result in criminal charges, by the way.

Since the 2002 Sarbanes-Oxley Act was passed, the Journal notes that more companies are finding records of potential bribes and disclosing them to the feds, since corporate officers must certify their financial statements are accurate. And more money is being spent on compliance programs. Now, though, money is also being spent to change the law.

Through the first nine months of the year, the US Chamber of Commerce paid lobbyists more than $700,000 to change the FCPA, according to the paper, citing House lobbying records. The chamber wants the law to clarify whether employees of state-owned companies qualify. The feds tell the Journal that every employee in a state-run health-care system could be considered a foreign official.

The Justice Department says changing the law would send the wrong message to foreign governments that recently passed or updated bans on foreign bribes. “This is precisely the wrong moment in history to weaken the FCPA,” Lanny Breuer, head of the Justice Department’s Criminal Division, which oversees FCPA cases, said at a recent conference, according to the Journal. “There is no argument for becoming more permissive when it comes to corruption.”

Earlier this year, AstraZeneca received a criminal indictment in Belgrade, Serbia, over allegations that local employees offered alleged bribes to physicians at the Institute of Oncology and Radiology. Last year, several reps from AstraZeneca and Roche, among other drugmakers, were arrested on suspicion of accepting and giving bribes (read here).

What changes does the chamber want? Allowing companies to avoid liability if they can prove programs are in place to prevent bribes, reduced penalties - of up to 40 percent - for voluntarily disclosing an infraction, and discounts for ratting on other companies. Will the feds comply? This remains unclear, but the Journal writes that the Justice Department plans to introduce new guidance next year. What do you think?

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bribe pic thx to donhankins on flickr