Daimler's Iran exit related to bribery case settlement case in US?

German automaker Daimler's sudden announcement yesterday to quit all its operations in Iran smacks more of being a part of its recent settlement of its bribery case with the US government than with its new-found moral ethics to curb the Islamic Republic's nuclear programme.

Dieter Zetsche, the chief executive of the Stuttgart-based Daimler told shareholders at company's annual general meeting yesterday that it will divest its 30 per cent stake in Iranian Diesel Engine Manufacturing and also withdraw its pending applications to export three-axle commercial vehicles for civilian use to Iran.

"The policies of the current Iranian leadership have compelled us to put our business relationship with that country on a new footing," said Zetsche.
"In general, our business activities with Iran will now be limited to meeting our existing contractual obligations and continuing our cooperation with established customers."

But this review of its business in Iran comes too close to the $185 million settlement it signed on 3 April 2010 with the US government for bribing foreign officials to secure business in 22 countries. (See: Daimler agrees to pay $185 million to settle bribery case) 

According to a critic, Daimler exiting Iran has more to do with US arm-twisting in exchange for a deal with its bribery case bought on by the US Securities and Exchange Commission (SEC) and the US Department of Justice (DOJ).

Although Daimler had not committed the offence in the US, the SEC and the DOJ had bought on the bribery case against Daimler since US-listed companies and its employees are barred from bribing foreign officials in order to secure business under the US Foreign Corrupt Practices Act.
As part of the guilty plea bargain, the US deferred prosecution that will allow Daimler to avoid criminal prosecution as long as it cooperates with regulators.