Summary:

Ringo Weinhardt, who is a U.S. citizens but works in South Korea, is the general manager of
Lenhage AG, which is a European manufacturer for the construction industry. The nuclear power
generation plant is a great opportunity for his company. So that Lenhage AG has a well-growing
market in South Korea. Ringo Weinhardt strongly believes their goods safety and quality. He is
confident to win the contract, which offered by Chulsoo Lee, the key of purchasing part of ChunHa Construction. Chun-Ha Construction is a large company in South Korea, and it also is the
largest customer of Lenhage AG. This case is about a conflict situation in ethical dilemma. Ringo
Weinhardt was asked for bribery (one percent extra expense of every order) by Chulsoo Lee
himself to win the contract, offered by Chun-Ha. He had to take the legal exposure and ethical
issue if he completes the special payment. Otherwise, the competitor of Lenhage AG will win
the contract by promised-bribery. He would lose this order and discourage his employees.
Foreign Corrupt Practices Act (FCPA) is an anti-bribery provision by the U.S, which prohibit
the willful use of the mails or any means of instrumentality of interstate commerce corruptly in
furtherance of any offer, payment, promise to pay, or a portion of such money or thing of value
will be offered, given or promised to the foreign official to do or omit to do an act in violation of
his lawful duty, or secure any improper advantage in order to assist in obtaining for or with, or
directing business to, If the expatriate manager decides to pay the money, he will secure an order
that will lift his company to a new level of success for years to come. If he decides not to pay, the
order and all the company has worked for over the last year will be lost. The expatriate manager
must decide whether or not the payment would violate laws internationally, locally and in his
home country. What are the real risks? Who can help him answer the many questions he has
regarding this local practice?
Problem statement:
What are the pros and cons of going with MR LEE offer versus not taking the offer, what could
Ringo do in future in order to avoid these cash payments, while keeping his company and MR
lee happy.
Issues:
Kickbacks to agents and decision makers were common in industry
Spend more money on lavish entertainment and payments to purchase.
Personal relationships were common.