Here's a tip about how U.S. corporate executives can avoid violating America's anti-foreign bribery law: Buying a foreign official a latte won't likely draw scrutiny, but skip the trip for two to Paris.
Ending months of speculation among corporate officials and white-collar defense attorneys, the U.S. Justice Department and U.S. Securities and Exchange Commission last week published a much anticipated guide that attempts to clarify key provisions of the Foreign Corrupt Practices Act. The 120-page memo is the product of a year of work for senior DOJ lawyers and SEC officials who set out to craft a comprehensive catalogue of court rulings, hypothetical scenarios and enforcement practices in the criminal and civil arena.
"Some will say maybe it goes too far. Others will say we hit the sweet spot," Robert Khuzami, the SEC director of enforcement, told reporters in announcing the FCPA guide at a press conference on Nov. 14. "And yet others will say it's not far enough. That's just the nature of an undertaking like this."
White-collar defense lawyers largely praised the guidance as a one-stop collection of how the government intends to enforce the FCPA.
"It is not, however, a clear road map for compliance," said Erich Schwartz, a securities enforcement partner in the Washington office of Skadden, Arps, Slate, Meagher & Flom.
The FCPA guidance, several criminal defense and securities lawyers said, doesn't break substantial new ground. Attorneys suggested enforcement agencies were, essentially, consolidating the gains made in litigation but refraining from creating any semblance of an FCPA checklist to provide a safe harbor for companies and individuals. Companies are likely to continue to face uncertainty over the benefits of voluntary disclosure of potential foreign bribery violations.
Covington & Burling partner Steven Fagell, who co-chairs the firm's anti-corruption practice, said the resource reflects "accumulated wisdom" but stops short of any "bright-line rules that some may have hoped for."
The U.S. Chamber Institute for Legal Reform and more than two dozen business and trade groups pressed DOJ to address issues that include successor liability, the definition of a foreign official and scenarios in which enforcement agencies declined to file criminal or civil charges. The Institute's president, Lisa Rickard, called the new manual an "important step forward in an ongoing process of providing much needed clarity and certainty to the business community."
DOJ's Lanny Breuer, who leads the Criminal Division, said that on the day the new guidelines were publicly issued he called and personally thanked former Attorney General Michael Mukasey, now a Debevoise & Plimpton partner in New York, for his input on the memo.
"Any fair-minded person will say that this guide addresses the issues and, I think, takes a substantial step forward in adding transparency," Breuer said.