In a move that sent shockwaves through the world of white collar corporate defense, President Trump has issued an Executive Order instructing the Attorney General to pause new FCPA enforcement subject to review existing FCPA investigations and enforcement actions over the next 180 days. Specifically, the Executive Order prohibits DOJ from initiating any new FCPA investigations or enforcement actions over the next 180 days “unless the Attorney General determines that an individual exception should be made.” In addition, the Attorney General is instructed to review all open FCPA investigations and enforcement matters during the next 180 days “and take appropriate action with respect to such matters to restore proper bounds on FCPA enforcement and preserve Presidential foreign policy prerogatives.” Finally, the Attorney General is instructed to issue updated guidelines or policies with respect to FCPA enforcement.
Critics of the FCPA have long argued that aggressive FCPA enforcement puts American companies at a competitive disadvantage relative to their foreign peers, and President Trump appears to agree. President Trump explained the decision to take these actions saying that the FCPA “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 . . . . [O]verexpansive 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 Executive Order does not provide any detail as to the mechanism by which the Attorney General will conduct reviews of open FCPA investigations and enforcement actions and also fails to provide any criteria that will be applied in determining whether to take any action — such as closing out investigations — with respect to such matters. As such, FCPA practitioners and companies currently under investigation by DOJ will be watching closely for further guidance from the Attorney General’s office.