Question

What is the difference between grease payment and bribery? Is grease payment legal per FCPA and per the law of all other countries?

Answer 1

Grease Payment : A grease payment is something paid to Government agency or any other international agency in order to expedite a deal or transaction to happen faster. It merely depends on the intention behind the payment. If grease payments made do not change the decision of government official then it is fine, but if they did, the payment would considered as Bribe and therefore illegal.

Bribery : The payment in the form of Money, gifts or services etc.given to any government official with intention of obtaining some business deals is considered as bribe and it is illegal.

For Example : Imagine you went to a Car driving test for obtaining Driving license and you see huge a Queue for the test. You would pay some small amount to the official to call up your name on top of the list. It would take longer time to do so but with grease payment the official will act faster and move up your name to the top. Where as If you pay a huge amount without attempting a test drive, then it is considered as Bribe.

Countries such as India, China Russia etc. would improve their Transparency International (TI) Ranking by placing hard and strict laws which force their business attitude and this would help them more successful.