FMF and Commissions

Started by Patrick Mathern · Oct 31, 2017 · 2 replies

  1. P

    Patrick Mathern

    Oct 31, 2017 · 8y ago

    Original post

    I have a client that is hiring a sales agent in a foreign country.  This agent's territory will likely include contracts subject to FMF rules, sales will be direct commercial.  This particular client compensates all of their sales agents with a commission plan.  I've never worked with FMF before - it appears that commissions are allowed, but they have to be disclosed, they cannot be in violation of Anti-Kickback regulations, and it appears that commissions may need to be split out and paid by the Purchaser's national funds.

    My questions:

    1. I'd like to wrap my head around this better.  What is the purpose of the FMF rules on commissions/contingent fees?

    2. What does the last provision (paid by Purchaser's national funds) mean?

    3. Where can I find the source document that discusses FMF commission requirements from a contractor's perspective?

    Thanks in advance!

    Patrick

  2. j

    ji20874

    Nov 1, 2017 · 8y ago

    For FMF, do you mean Foreign Military Financing?  If so, see http://www.dsca.mil/sites/default/files/dsca_guidelines_for_foreign_military_financing_of_direct_commercial_contracts.pdf -- page 5, item 11.

  3. h

    here_2_help

    Nov 1, 2017 · 8y ago

    I have nothing on point to add, except that if the contractor isn't very knowledgeable about commissions and fees associated with international sales --whether or not government-financed or funded--then I would consider that situation to be very very high risk, from a FCPA compliance perspective.

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