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US strong-arms competitors to its firms out of way

China Daily | Updated: 2019-05-14 07:23
The US Capitol Building is seen at sunset in Washington, Dec 19, 2018. [Photo/IC]

Editor's note: In 2014, the United States successfully dismembered Alstom, a French provider of transport systems, equipment and services, through so-called extraterritoriality. A former Alstom executive who ended up in prison in the US wrote a book exposing how the US' public power and state violence, both indirectly and directly, pave the way for its enterprises' global dominance. In a post published on his WeChat account, Qin Shuo, a financial commentator, said:

The US passed the Foreign Corrupt Practices Act in 1977, prohibiting US companies from bribing foreign officials. In 1998, the US Congress amended the Act and applied it to foreign companies, endowing it with extraterritorial force. It stipulates that as long as a foreign company signs a deal in US dollars, or its payment takes place on the US soil, or it simply sends and stores emails through servers based in the US, the US has the right to file a lawsuit against the company, which is what it did against Alstom. The US tracked Alstom's use of bank accounts in the US that were used to transfer "consulting fees" to Indonesian officials.

The US law looks "impartial", but in practice there is always an "American exception", given that the US Department of Justice rarely finds fault with the behavior of US companies. Since 2008, there have been a total of 26 foreign companies, each fined more than $100 million by the US, and all of these fines flowed to the US national treasury.

The US Department of Justice's punishment of Alstom was financial and reputational pressure on Alstom, which ultimately forced the French company to sell its energy division to General Electric.

By means of such "long-arm jurisdiction", the US has maintained its dominant position and interests in Europe, but this unequal relationship has been a source of friction and conflict with its European partners.

The "America first" principle under the current US administration disregards the interests of Europe even more, causing a greater impact on Europe on the economic, trade, security and diplomatic fronts.

Faced with this situation, Europe is seeking an autonomous road to effectively deal with the long arm jurisdiction of the US in the economic field, and it is exploring the establishment of global trade, financial transactions and settlement methods independent of the US dollar.

  
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