ABA Conference Discussion on FCPA: Building the FCPA Plane While Flying It

The yearly panel on the Foreign Corrupt Practices Act (FCPA) is usually the most packed discussion at the ABA White Collar Crime Conference. But without the participation of U.S. Department of Justice (DOJ) officials to give us additional guidance, the discussion this year merely expanded on speculation that many FCPA practitioners have been deliberating over the past few weeks. In the wake of the executive order hitting the “pause” button on almost all FCPA enforcement activity, what is the future for FCPA enforcement? Do companies still have to comply with the mandates of the FCPA? See our previous Blog post for more on the executive order and its implications.

The discussion at the panel by and large was in line with our analysis. A theme of the discussion was that the recent administrative actions put the FCPA in a period of pendency — that the statute is paused for review while the administration works on developing guidelines. Whether or not we receive guidance, the panelists expected to achieve better understanding of FCPA enforcement under Trump through its implementation — to see in practice how, for example, the administration defines “American competitiveness,” or whether there will be a focus on particular countries (for example, China, Venezuela, and Mexico).

The overall conclusion: companies still need to comply with the FCPA. The panelists urged moderation — neither should companies refrain from disclosing under the new guidance more than usual, nor should they rush to disclose (in the expectation that they would receive declinations and be done with the investigation), since there is no promise that future administrations will similarly decline to investigate. Panelists noted that many companies still rightly believe in the merits of corporate compliance programs, other countries will continue to enforce their own anti-corruption laws, auditors will still be reviewing for books and records violations, and due diligence during M&A activity will still look for corruption issues. Panelists further cautioned that the statute can be extended up to eight years, while the administration only has a four-year term. As one panelist aptly phrased it: “The arc of the statute is long, and so is the arc of history.”

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