Policy Number: 107

Policy Suffix:

I. General Policy

As part of its commitment to global ethical and legal conduct, Rice University and its employees, vendors, subcontractors, agents, and those whom Rice University has employed or engaged to speak or act on its behalf shall comply with both domestic and foreign laws and regulations that are intended to combat bribery and corruption. This policy also provides limitations and guidance on business courtesies such as gifts, meals and entertainment provided to Domestic and Foreign Officials.

This policy also sets forth Rice University’s policy against the use of human trafficking in any university activity.

II. Roles and Responsibilities

All Rice University employees (including faculty and staff), vendors, subcontractors, and agents must comply with this policy and the laws and regulations that are relevant to their specific university business activities or location, and will seek guidance prior to and during any course of action as necessary to remain compliant. Any such individual who is conducting university business (including educational, research, or any financial activities) in a foreign country- in person or virtually -- will be aware of and seek guidance from university resources relating to the laws of that country and the business risks that are inherent in that country. The policy is being promulgated to ensure the University’s compliance with the Foreign Corrupt Practices Act (“FCPA”) and other domestic and foreign anti-bribery and anti-corruption laws and regulations.

The Chief Compliance Officer will work with the Office of Research Compliance and the Office of General Counsel (OGC) to produce resources and guidance in order to facilitate compliance with this policy.

III. Definitions

“Agent” means a person or third party who has expressly been given the authority to speak or act for Rice University in connection with transactions or interactions with Domestic or Foreign Officials. Agents can include, without limitation, a research or program partner, affiliate, consultant, or advisor. Agents do not generally include vendors providing the university with commodities of a modest value or routine office services.

“Anything of Value” means any financial or non-financial benefit. This definition can include, but is not limited to: cash or cash equivalents such as gift cards; gifts; meals, entertainment, and travel; political or charitable contributions; in kind benefits to family or friends or associates; or employment opportunities.

“Bribe” means a direct or indirect (i.e., through a third party) 1) offer to pay, payment, promise to pay or authorization of a payment of; (2) Anything of Value; (3) with Corrupt Intent to influence a Foreign or Domestic official. Under the FCPA, it is illegal to offer, pay, promise to pay, or authorize a payment to a third party while knowing or being aware that there is a high probability that some or all of that payment will be used as a Bribe to a Foreign Official.

“Corrupt Intent” means acting with an intent, actual or perceived, to induce or influence a Domestic or Foreign Official to use his or her official position to assist in directing, obtaining or retaining business or a business advantage to or for Rice or a third party, or to secure any other improper advantage. The business or business advantage does not need to directly result from the improper payment. The payment for routine reasonable meals or hospitality associated with visiting foreign research collaborators would generally not be regarded as providing “Anything of Value” with “Corrupt Intent” under this definition because such payments are not usually designed to induce a Foreign Official to take action or misuse his or her position. Further, expenses related to US political activities that are made in accordance with US law and Rice Policy No. 807 Partisan Political Activities do not meet this definition.

“Domestic Official” means any officer, employee, or agent of any agency, department, or instrumentality of the US government, State of Texas or other US state, or municipal agency.

“Due Diligence” means an investigation of a depth appropriate to the risk level of the proposed transaction with a prospective Agent.

“Facilitating Payment” means a small payment made to induce or influence a Domestic or Foreign Official to perform routine governmental functions as to which the official has no discretion, such as processing a visa, providing police protection or mail service, and supplying utilities like phone service, power and water. Subject to very limited exceptions (discussed below), such payments are prohibited. A documented payment for expedited service made to a government agency or entity and based on a published fee schedule is not considered a “Facilitating Payment.”

“Foreign Official” means any officer, employee or agent of a non-U.S. government, any department, agency, or Instrumentality of a non-U.S. government, non-U.S. state-owned enterprise (e.g., public hospital or university), non-U.S. political party, or public international organization (e.g., United Nations, World Bank, World Health Organization, and International Monetary Fund); a non-U.S. political party; or a candidate for non-U.S. political office; or anyone acting on behalf of any of the above.

“Hospitality” means gifts above a nominal value (e.g. small Rice-branded items are permitted); meals costing over usual and customary amounts based on the location; travel; and entertainment.

“Instrumentality” means a legal entity owned or controlled by a non-U.S. government or through which a non-U.S. government operates (whether it controls the entity or not).

“Human Trafficking” is the recruitment, harboring, transportation, provision or obtaining of a person for labor or services through the use of force, fraud, or coercion for the purpose of subjection to involuntary servitude, peonage, debt bondage or slavery, and sex trafficking including any commercial sex act.

“Willfully” means with intent or willful blindness and without regard for laws or expectations.

IV. Elaboration of Policy

A. Interactions with Domestic and Foreign Officials

Individuals who act on behalf of Rice University, including employees and Agents:

  • May not give a Bribe to a Domestic or Foreign Official, or permit/authorize an Agent to do the same, or solicit or accept the same.
  • May not give a Bribe to an employee or agent of any entity related to or doing business with Rice, or permit/authorize an Agent to do the same, or solicit or accept the same.
  • May not promise, offer or make “Facilitation” payments, or permit/authorize an Agent to do the same without prior written consent from the Office of Sponsored Projects and Research Compliance.
  • Must comply with other university policies on gifts and on record keeping requirements and financial controls for cash and non-cash transactions.
  • Must conduct an appropriate level of Due Diligence on Agents (e.g., individuals or third parties with actual or apparent authority to act on behalf of Rice such as program or research partners, affiliates, consultants or advisors) before entering into an agreement or providing any type of payment to the Agent.
  • Must seek approval from the Office of Sponsored Projects and Research Compliance before providing any Hospitality (e.g., gifts above a nominal value such as small Rice-branded items; meals costing over usual and customary amounts based on the location; travel; and entertainment) for a Domestic or Foreign Official (or that official’s family members) unless such Hospitality is done in accordance with Rice Policy No. 807 Partisan Political Activities.
  • May not provide travel or entertainment for the family members or friends of a Domestic or Foreign Official without an independent, legitimate business purpose, and prior written approval from the Office of Sponsored Contracts and Research Compliance.

B. Business courtesies, such as gifts, meals, and entertainment for Domestic or Foreign Officials

Individuals who act on behalf of Rice University, including employees and Agents:

  1. All business courtesies

    Business courtesies, such as gifts, meals, and entertainment, are an established practice which, when used appropriately, can help strengthen relationships and convey respect and appreciation for our partners. However, when Domestic or Foreign Officials who have official duties that involve Rice may be involved then appropriate caution must be taken to ensure compliance with the law and to avoid even the appearance of impropriety. All such expenditures should be kept to a minimum, and must at all times be reasonable and appropriately documented in accordance with IRS regulations and Rice policies.
  2. Meals and Entertainment

    Meal and entertainment expenditures must be modest and reasonable. As a guideline, reasonable expenditures would generally not exceed three times the published U.S. Government Services Administration rates for domestic meals or two times the published U.S. State Department rate for international meals. To find the GSA and State Department rates for meals, use the links below to first find the appropriate M&IE rate (Meals and Incidental Expenses) and then the breakout of the M&IE rate by meal:
    Type M&IE Rate and Per meal allocation
    Domestic (GSA) https://www.gsa.gov/travel/plan-book/per-diem-rates
    (the allocation per meal will also be displayed)
    International (State Dept.) https://aoprals.state.gov/web920/per_diem.asp, and the per diem shall be allocated 15% for breakfast, 25% for lunch, and 40% for dinner)
    ​​​​​​
    You must obtain prior written approval from the Office of Sponsored Projects and Research Compliance before providing meals or entertainment in excess of this guideline, or occurring more than four (4) times per year to the same Official. Further, you must ensure that all meals and entertainment are properly recorded, in accordance with Policy 806. Travel, Business Meeting and Entertainment.
  3. Giving Gifts

    Gifts are an acceptable business courtesy, provided that any such expenditure (whether made from Rice funds or personal funds) must be reasonable, properly documented, and clearly unrelated to any action that the official has taken or may take on behalf of the university. Further, such expenses must be in accordance with Policy 826, Gift Made from University Funds, and Policy 807, Partisan Political Activities.

    The following chart provides a general guideline for giving gifts:
    Individual giving the gift Limit to a Domestic Official Limit to a Foreign Official
    Faculty and Staff $20 per gift/$50 total per year What is reasonable and customary in that country. Seek Office of Research Compliance guidance for amounts over $20
    Vice Presidents - Deans and Directors $20 per gift/$50 total per year What is reasonable and customary in that country. Seek Office of Research Compliance guidance for amounts over $100
    President and Provost $20 per gift/$50 total per year What is reasonable and customary in that country. Seek Office of Research Compliance guidance for amounts over $200

    You must obtain prior written approval from the Office of Research Compliance before providing a gift to a domestic or foreign official in excess of these guidelines.
  4. Receiving Gifts

    When receiving a gift from a domestic or foreign official it is important to determine whether the gift is a gift to Rice University (in which case it becomes the property or Rice University), or a gift to the individual receiving it (in which case the individual may generally retain it, however it must be disclosed to Rice University and may be considered taxable income by the IRS). In all cases, the gift must be reasonable under the circumstances, and must avoid even the appearance of impropriety.

C. Combatting Human Trafficking

In accordance with our institutional values and US Government policy, individuals who act on behalf of Rice University, including employees and Agents are strictly prohibited from engaging in, supporting, or using Rice University resources to support any type of Human Trafficking, within the United States or in any foreign country.

D. Other laws related to Anti-Terrorism, and Anti-Boycott

Any individual conducting business on behalf of Rice University must take adequate steps to remain in compliance with all applicable laws or regulations relating to complying with current sanctions on countries or individuals, as well as relevant statutes on Anti-Terrorism or Anti-Boycott. The Office of Research Compliance or Office of General Counsel should be contacted for guidance prior to initiating new foreign activities.

E. Reporting Concerns and Accountability

All Rice University employees and Agents must promptly report any known or suspected violations of this policy or any Anti-Corruption Law to either the Office of Research Compliance, Office of General Counsel, Chief Compliance Officer, or to the EthicsPoint anonymous reporting hotline (www.rice.edu/ethics). Rice will investigate all suspected violations of this Policy which come to its attention.

Retaliation, in any form, is strictly prohibited against anyone who makes a good faith report of a suspected violation of an Anti-Corruption Law or this Policy.

Failure to comply with this Policy may result in disciplinary action, up to and including termination of employment or termination of a contract for services.

V. Roles and Responsibilities

Policy 806. Travel, Business Meeting and Entertainment
Policy 807. Partisan Political Activities
Policy 826. Gifts made from University Funds
Policy 838. Conflict of Interest
Rice University Standards of Ethical Conduct

VI. Responsible Official and Key Offices

Responsible Official: Chief Compliance Officer

Other Key Offices: Office of Research Compliance; VP International Operations; General Counsel ; VP Public Affairs; Controller’s Office

VII. Responsible Official and Key Offices

See Appendix 1. Foreign Anti-Corruption Frequently Asked Question and Resource links

Signatures

David W. Leebron, President

Policy History

Issued

April 1, 2021

Appendix 1. Foreign Anti-Corruption FAQs

This Appendix may be updated by the Office of General Counsel as necessary. Note, this FAQ is related to Foreign Officials. For guidance on interactions with Domestic Officials, contact Public Affairs Government Relations.

Q. Which Foreign Anti-Corruption Laws are applicable?

A. The two laws most relevant to Rice activity are the U.S. Foreign Corrupt Practices Act (“FCPA”) and the United Kingdom Bribery Act (“UKBA”). In addition, many countries and jurisdictions have also instituted their own Anti-Corruption Laws. You should become knowledgeable about any local Anti-Corruption Laws before engaging in activity with individuals or entities outside the United States (even if you remain in the United States).

Q. Who do I call with questions?

A. The main point of contact should be the Office of General Counsel, at (713) 348-5237

Q. Do different countries have different risks related to corruption and bribery?

A. Yes, and it is important that you know about them. Prior to doing business in any country you must familiarize yourself the risks inherent in that country. Rice has resources to assist (through International SOS), or the Risk Management department. Another commonly used tool/index for corruption is the Transparency International Corruption Perceptions Index, which may be accessed at: https://www.transparency.org/research/cpi/overview

Q. How do I report a potential violation of this policy?

A. Report actual or potential violations to your supervisor and Office of General Counsel, or if you are not comfortable with reporting there, contact the Rice EthicsLine (www.rice.edu/ethics)

Q. When do I give a third party actual or apparent authority to be an Agent for Rice?

A. Actual authority is pretty straightforward. It is given in a written document which says that a person can speak for or in the name of Rice.

Apparent authority is more complicated. In the collaborative university environment, counterparts are often advancing interests common to Rice and the counterparty. In these circumstances, the counterpart can easily say or write something that might lead a third party to believe that the counterpart is speaking or acting for Rice. At times, a Rice employee may intentionally or accidentally give the counterpart the impression that this is acceptable. In certain circumstances, Rice can be liable for the improper conduct of someone who has the apparent authority to speak or act on behalf of Rice, even if that relationship is not formal or in writing.

Q. Are there special concerns with Advisory Arrangements?

A. Advisory Arrangements, such as those under which Rice is paid for providing its educational expertise or exploring an operations partnership, are a common scenario where agency concerns should be considered more carefully. The preferred method to manage this risk, when it exists, is having a written and signed document which disclaims this authority. If the intent is to provide such authority, Due Diligence steps are required (consult with the Office of General Counsel).

Q. What are reasonable payments to Foreign Officials?

A. Examples of reasonable payments for services include, but are not limited to:

  • Payments that are required by a contract with a non-U.S. government or government entity
  • Reasonable and bona fide expenditures directly related to authorized business activities or execution or performance of a contract with a non-U.S. government or government entity. Such expenditures are always documented in accordance with Rice policy.
Q. What are common situations that might be Bribes?

A. Examples of common Bribes include:

  • Unreasonable or non-bona fide payment of travel expenses
  • Unreasonable gifts, entertainment, hospitality, administrative fees
  • Contribution to a non-U.S. political party or candidate for non-U.S. political office
  • Acceptance of cash or anything of value in excess of modest gifts and hospitality from anyone doing or seeking to do business with Rice
  • Contracting with an entity owned or recommended by a Foreign Official or owned by his or her family members.
  • Charitable contributions to organizations owned or recommended by a Foreign Official or owned by his or her family members
  • Conferring titles of honor
  • Promises of admission or acceptance to Rice
Q. Who are typical Foreign Officials?

A. Typical examples of Foreign Officials include:

  • Professors or employees of public universities
  • Employees and contracting agents at government agencies or government-controlled entities
  • Doctors in or other employees of government owned or operated medical facilities (clinics, hospitals, etc.)
  • Airport employees and local customs officials at country borders or ingress points (such as train stations and airports)
  • Public transit employees
  • Public dignitaries
  • Police officers or investigative bureau agents
Q. What are examples of third parties that are not considered Agents for the purposes of this policy?

A. Examples of third parties that are not considered Agents include:

  • U.S.-based third parties engaged to provide goods or services to Rice or to act on Rice’s behalf solely within the United States; and
  • U.S. based or non-U.S. based third parties engaged to provide routine office goods, equipment, or services (e.g., janitorial services, hotel accommodations, restaurant meals) to Rice where
    • such goods, equipment, or services are available to the public at the same market terms, conditions and prices being agreed to by Rice,
    • the Rice personnel requesting such goods, equipment, or services has no knowledge or reason to suspect that the vendor is owned by a Foreign Official, was recommended by a Foreign Official, or in which a Foreign Official has a beneficial interest, and
    • such Rice personnel has no intent to influence a Foreign Official with the procurement of the goods, equipment, or services.
Q. What are the limits for meals?

A. Meal expenditures must be modest and reasonable. As a guideline, reasonable expenditures would generally not exceed three times the published U.S. Government Services Administration rates for domestic meals or two times the published U.S. State Department rate for international meals. To find the GSA and State Department rates for meals, use the links below to first find the appropriate M&IE rate (Meals and Incidental Expenses) and then the breakout of the M&IE rate by meal:

Type M&IE Rate and Per meal allocation
Domestic (GSA) https://www.gsa.gov/travel/plan-book/per-diem-rates
(the allocation per meal will also be displayed)
International (State Dept.) https://aoprals.state.gov/web920/per_diem.asp, and the per diem shall be allocated 15% for breakfast, 25% for lunch, and 40% for dinner)

You must obtain prior written approval from the Office of General Counsel before providing meals more than 4 times per year to the same Foreign Official.

Q. What does Due Diligence include?

A. At a minimum, Due Diligence should include gathering information to determine the actual and beneficial owners and key employees of an Agent which is an entity; the Agent’s relationships with Foreign Officials; whether an individual Agent or its actual or beneficial owners or key employees of an entity Agent are current or former Foreign Officials or appear on relevant government watch lists; and whether there are any compliance “red flags” that require additional investigation. In addition, Due Diligence should include checking the Agent’s references and verifying its qualifications.

Q. When conducting Due Diligence on potential Agents, what government watch lists should be checked for the names of the actual or beneficial owners of the Agent and its key personnel?

A. The Office Sponsored Programs and Research Compliance (SPARC) Export Control officer can assist with this screening. This office can be contacted to review the names of any government officials, instrumentalities, or organizations thereof. The lists reviewed generally include:

Q. When conducting Due Diligence on potential Agents, what are “red flags”?

A. “Red flags” are compliance issues that must be addressed before proceeding with a transaction. Red flags are very fact-specific, and they are not necessarily violations of the FCPA, but they do require additional investigation and analysis. “Red flags” include:

  • Agent is an employee of a public (state-owned or -controlled) hospital or university
  • Agent has a close relationship with or is related to a Foreign Official
  • Agent was recommended by a Foreign Official or a Foreign Official’s relative
  • Agent is politically active
  • High level of perceived corruption in the country where Agent would work
  • Agent has a reputation for unethical or suspicious business practices or evidence of past violations of local law or policy
  • Agent appears to lack qualifications or resources to perform
  • Agent is unwilling to enter into written agreement
  • Agent refuses to certify that it will comply with applicable Anti-Corruption Laws
  • Agent demands fees in cash
  • Agent demands discounts, rebates, or commissions higher than the typical market rate
  • Agent provides incomplete or inaccurate information
  • Agent requests payment be made to third party or in a different country
Q. What limitations exist on how Rice can pay Agents?

A. No payment to any Agent shall be made or delivered (1) in cash (other than documented petty cash disbursements); (2) with corporate checks payable to “cash,” “bearer,” or third-party designees; or (3) to an individual, entity, or account outside the recipient’s country of residency.

Q. What anti-corruption provisions should be included in contracts with Agents?

A. Rice should always execute a written contract with an Agent, approved by the appropriate Rice personnel. The contract should include anti-corruption representations and the Agent’s agreement to comply with applicable anti-corruption laws, audit rights, and the right to terminate the contract as a result of a breach applicable anti-corruption laws or Rice’s anti-corruption policy.

Q. When may Rice provide travel to Foreign Officials?

A. Rice may provide travel to Foreign Officials only if that travel is directly related to the promotion, demonstration, or explanation of Rice’s business or related to Rice’s execution or performance of a contract with a non-U.S. government or agency.

Q. What type of travel may Rice provide to Foreign Officials?

A. All travel must comply with Rice’s travel policy. Rice may not provide a class of travel to Foreign Officials other than the class of travel that would be available to Rice employees under the same circumstances.