The Department of Justice announced June 9 updated guidelines on its enforcement of the Foreign Corrupt Practices Act.
Under the FCPA it is unlawful to make payments to foreign government officials to assist in obtaining or retaining business. Since 1977 the anti-bribery provisions of the FCPA have applied to all U.S. persons and certain foreign issuers of securities, and in 1998 those provisions were extended to foreign firms and persons who cause an act in furtherance of a corrupt payment to take place within U.S. territory.
The DOJ has actively enforced the FCPA, but an executive order issued earlier this year asserted that this law “has been systematically, and to a steadily increasing degree, stretched beyond proper bounds and abused in a manner that harms the interests of the United States.” The EO explained that “overexpansive and unpredictable FCPA enforcement against American citizens and businesses — by our own Government — for routine business practices in other nations not only wastes limited prosecutorial resources that could be dedicated to preserving American freedoms, but actively harms American economic competitiveness and, therefore, national security.”
The DOJ has therefore revised its guidelines and policies governing FCPA investigations and enforcement actions, which will apply to all current and future proceedings.
Specifically, effective June 9 prosecutors will (1) focus on cases in which individuals have engaged in criminal misconduct and not attribute non-specific malfeasance to corporate structures, (2) proceed as expeditiously as possible in their investigations, and (3) consider collateral consequences, such as the potential disruption to lawful business and the impact on a company’s employees, throughout such investigations and not only at the resolution phase.
Prosecutors will also consider certain factors in determining whether to pursue FCPA investigations and enforcement actions, including whether the alleged misconduct (1) is associated with the criminal operations of a cartel or transnational criminal organization or (2) deprived specific and identifiable U.S. entities of fair access to compete and/or resulted in economic injury to specific and identifiable U.S. companies or individuals. Enforcement will also focus on (1) the most urgent threats to U.S. national security resulting from the bribery of foreign officials involving key infrastructure or assets and (2) alleged misconduct that bears strong indicia of corrupt intent tied to particular individuals, rather than alleged misconduct involving routine business practices or the type of corporate conduct that involves de minimis or low-dollar, generally accepted business courtesies.
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