Today the U.S.
Chamber of Commerce and a number of other leading business and professional
groups sent a letter (see below for full text) to senior officials at the Justice Department (DOJ) and Securities Exchange Commission (SEC) containing their "wish list" of items that they would like to see in the FCPA guidance that is supposed to be issued
later this year.
letter requests DOJ and SEC to address the following issues in any future FCPA-related
1. Definitions of “Foreign Official” and
“Instrumentality” of a Foreign Government – Requests further clarification of
those terms in the FCPA context, including the percentage ownership or level of
control by a foreign government that ordinarily will qualify a corporation as
an “instrumentality” of a foreign government.
2. Consideration of Compliance Programs in
Enforcement Decisions – Guidance is requested on what types of things should be included in an effective FCPA compliance program that would receive favorable consideration
in enforcement decisions. The letter also requests guidance on the impact that voluntary disclosures have on enforcement
3. Clarification on parent-subsidiary
liability in FCPA enforcement actions – The letter notes that the FCPA is not clear on whether a
parent company can be held liable for a foreign subsidiary’s FCPA violation and
the SEC and DOJ have taken different positions on this. Thus, the guidance
requests DOJ and SEC to clarify and confirm that they consider parent
company liability under the FCPA’s anti-bribery provisions to extend only to
circumstances in which the parent actually authorized, directed or controlled
the improper activity of its subsidiary.
4. Successor Liability – FCPA guidance should
outline reasonable standards for conducting FCPA acquisition due diligence and
identify factors that will be considered in determining whether such due
diligence was adequate.
5. De Minimis Gifts and Hospitality – The
guidance should identify a clear standard for gifts and hospitality that
ordinarily will not be subject to enforcement action and to address common
scenarios that arise in the course of business interactions with foreign
officials. U.S. companies spend a great deal of time and effort on
these types of issues and specific guidance would be extremely helpful. However, some senior DOJ officials have indicated that they do not think that bright lines or specific values will be useful as it could be misused or misinterpreted and they would prefer the status quo.
6. Knowledge Standard for Corporate Criminal
Liability – Because the FCPA does not explicitly address the “willful
knowledge” standard required for corporate criminal liability, the letter requests DOJ to clarify its position on that standard and state its views on whether a company
may be criminally sanctioned for FCPA bribery violations of which the company
had no direct knowledge.
7. Declination Decisions – The letter
requests DOJ to reconsider its practice of not providing information about its
decisions to close FCPA-related investigations with no enforcement action. However, senior DOJ officials have expressed reservations about making declination decisions public.
8. Other Common FCPA Issues – The letter
requests DOJ and SEC to issue guidance on the following FCPA issues:
guidance should outline recommended “best practices” and examples of
prophylactic measures that would be expected by DOJ and SEC with regard to
business relationships with relatives of foreign officials.
standards should govern corporate donations to charities that have connections
with foreign governments?
The letter closes by requesting the
guidance to apply to civil and criminal enforcement cases and should carry
sufficient precedential weight to be reliable and meaningful for businesses
seeking to comply with the FCPA.
Neither the DOJ nor SEC have indicated when
their FCPA guidance will be issued.
FCPA Guidance Request Letter 02-21-2012