The FCPA Executive Order

 The Foreign Corrupt Practices Act (“FCPA”) Executive Order (“EO”) directs the Attorney General to undertake a 180-day comprehensive review of FCPA enforcement guidelines and policies, and provides for a possible extension for an additional 180 days. It temporarily suspends the initiation of new FCPA investigations and enforcement proceedings during the review period, and directs the Attorney General to conduct a thorough review of existing FCPA investigations and enforcement actions, and develop updated enforcement guidelines that align with presidential foreign policy prerogatives. Following the review, the Attorney General will decide whether to implement additional actions, such as remedial measures regarding past FCPA investigations and enforcement actions.

The FCPA EO invokes Article II of the Constitution, asserting presidential authority over foreign affairs and American interests. It claims FCPA enforcement has exceeded statutory boundaries, and may be disadvantageous to U.S. commercial interests in strategic sectors and compromise national security. It posits that overenforcement of the FCPA may conflict with presidential foreign policy authority and impede the ability of American enterprises to secure competitive advantages in critical sectors like strategic minerals, deep-water ports, and key infrastructure assets, thereby damaging national security

FCPA Remains a Valid Statute

The FCPA EO cannot be interpreted as a green light to bribe foreign public officials or to neglect the implementation of effective compliance programs. While it temporarily suspends new Department of Justice FCPA investigations and enforcement actions, it neither questions the statute’s validity nor curtails the Securities and Exchange Commission’s (SEC) independent authority to investigate and prosecute civil violations under 15 U.S.C. §§78dd-1. The Executive Order does not suspend the SEC’s civil actions under the FCPA. Moreover, the DOJ FCPA Unit, a unit within the Criminal Division’s Fraud Section, retains its fundamental criminal jurisdiction under all three anti-bribery provisions and civil enforcement capacity under 15 U.S.C. §§78dd-2 and 78dd-3, notwithstanding the temporary review period.^[1]

Significantly, the FCPA EO does not create a “safe harbor” for FCPA violations or a viable defense for misconduct occurring during the review period. The dual enforcement framework remains operative through continued SEC oversight, and any violations during this period remain subject to future DOJ prosecution. This enforcement reality, coupled with the FCPA’s undiminished statutory authority, necessitates that businesses maintain robust compliance programs and internal controls. The temporary pause in DOJ enforcement activities should not be misconstrued as a change in compliance obligations or a diminution of legal risks associated with foreign corrupt practices. Opting to make corrupt payments to foreign officials and to cease investing resources in effective compliance programs will increase legal risk.

Temporary Enforcement Pause with Exceptions

The Executive Order’s enforcement pause is temporary (180 days, subject to an additional period of 180 days) suggesting that FCPA enforcement will resume soon under new guidelines. Meanwhile, the Attorney General is authorized to grant exceptions for new investigations, though no criteria for determining when these exceptions  were provided. Setting forth guidelines for when exceptions will be granted would serve two primary purposes as outlined in the Executive Order and its fact sheet: (1) to reestablish appropriate boundaries for FCPA enforcement and (2) to maintain the President’s foreign policy authority

Two possible approaches appear to be under consideration for implementing these exceptions:

• Comprehensive Guidelines on Exceptions

The Attorney General´s memorandum, issued five days before the FCPA EO, shifted the DOJ FCPA Unit’s investigation and enforcement priorities towards transnational criminal organizations and cartels, and may serve as a general guideline for determining exceptions to the enforcement pause. In addition, the Attorney General issued a comprehensive memorandum outlining specific criteria and categories of cases eligible for exception from the enforcement pause. This approach would provide clear guidance to the DOJ FCPA Unit about which types of investigations may proceed despite the general pause. One of the challenges the Attorney General must address to ensure objective and justified exceptions is the issuance of appropriate guidelines to the DOJ FCPA Unit. These guidelines will clarify the extent to which new investigations or ongoing FCPA enforcement cases may be excluded from the suspension period mandated by the Executive Order.

• Case-by-Case Exception Requests:  A second approach would involve DOJ FCPA Unit attorneys preparing individual memos requesting exceptions for specific cases, detailing the justification for why each particular investigation should proceed during the pause period.

The comprehensive guidelines on exceptions approach should be pursued as the superior implementation strategy because it offers multiple systemic advantages over the case-by-case method. By establishing clear, consistent guidelines for both the DOJ FCPA Unit and businesses, a comprehensive memorandum would enhance legal certainty, promote efficient resource allocation, ensure equitable application of exceptions, enable more focused corporate compliance efforts, and maintain clearer signals to international enforcement partners about U.S. anti-corruption priorities. While individual exception requests might provide greater flexibility, they would likely generate unnecessary procedural burdens, potential inconsistencies in application, and continued market uncertainty—outcomes that would undermine both governmental enforcement objectives and private-sector compliance planning during this critical transition period.

Therefore, it is advisable for companies to maintain robust compliance programs to prevent the corruption of foreign public officials. The scope of cases that may fall under the exceptions remains unclear. Additionally, it will be necessary to await the updated enforcement guidelines, which will align with presidential foreign policy prerogatives. 

FCPA and the OECD Convention´s Enduring Framework

The states of the Organization for Economic Cooperation and Development (OECD)´s Convention on Combating Bribery of Foreign Public Officials in International Business Transactions has significantly contributed to an expansion of anti-corruption enforcement. The OECD Anti-Bribery Convention remains the fundamental international legal framework governing anti-corruption efforts globally.

The FCPA, enacted in 1977 following Watergate revelations about offshore corporate slush funds, pioneered global foreign anti-corruption regulation and enforcement. The early minimal enforcement has evolved over the years into extensive enforcement, and has resulted in important corporate criminal cases with interpretation largely controlled by the DOJ and SEC.^[2]

The FCPA implemented an “international-competition neutral” strategy, allowing the prosecution of both American corporations and their foreign competitors to ensure a level playing field.^[3] In response to the Convention’s requirements, other ratifying countries have substantially strengthened their legislation against bribery of public officials. Foreign acceptance of anti-bribery norms and cooperation in U.S. prosecutions contributed to the FCPA from a corporate statute into a pillar of American market regulation.^[4]

The “hard law” anti-corruption principle empowered U.S. officials to enforce the FCPA Statute broadly—an approach politically unfeasible before. With the OECD Convention enabling competition-neutral enforcement, the DOJ and SEC intensified efforts, publicly declaring their intention to target foreign corporations alongside domestic ones.^[5]

 FCPA enforcement by DOJ and SEC

Since the FCPA’s enactment in 1977, cumulative sanctions have reached an extraordinary $31 billion, with an average sanction of $58 million per enforcement action. This staggering sum represents thousands of individual enforcement decisions, investigations, and prosecutions that have collectively transformed corporate attitudes toward foreign bribery. The 2024 statistics alone—with $1.56 billion in total sanctions with an average penalty of $141.67 million—demonstrate the continued vigor of enforcement even as the statute approaches its fiftieth anniversary.^[6]

FCPA enforcement has expanded globally over the years, evolving from a U.S.-focused initiative into an international enforcement mechanism. The geographic distribution of FCPA enforcement—with significant concentrations in China (75 cases), Brazil (34 cases), and Mexico and India (26 cases each)—demonstrates the strategic focus of U.S. anti-corruption authorities on major emerging markets where American companies face substantial competitive pressures and heightened corruption risks.^[7]

Record-breaking penalties against Odebrecht ($3.56 billion, 2016), Goldman Sachs ($2.9 billion, 2020), and Airbus ($2.09 billion, 2020) sent unmistakable signals to boardrooms globally. These enforcement actions, conducted by the U.S. and other countries,  targeted companies across multiple continents and industries regardless of national origin or sector.^[8]  The $11.84 billion in documented bribery payments uncovered by FCPA investigations  illustrates the scale of corruption addressed. This likely understates the true impact in deterring corrupt practices.^[9]

These data  shows the evolution of global anti-corruption enforcement, which reshaped corporate compliance practices worldwide, and established binding international commercial standards. This empirical record provides essential context for assessing both the FCPA historical significance and the potential implications of the FCPA EO. The enforcement trajectory represents prima facie evidence that any substantial modifications to established protocols will significantly impact longstanding international anti-corruption frameworks.

The Message for Businesses: Navigating the Current FCPA Landscape

The FCPA EO, instituting a temporary pause in FCPA enforcement activities, warrants careful consideration by businesses operating internationally. Despite this enforcement hiatus, several critical factors compel continued vigilance:

First, the FCPA remains a valid law, with the EO merely suspending certain enforcement activities rather than modifying statutory obligations. The SEC maintains full authority to pursue civil violations, creating a dual enforcement reality.

Second, the international anti-corruption framework established by the OECD Anti-Bribery Convention remains fully operational.

Third, the FCPA EO provision for exceptions introduces significant compliance uncertainty absent clear criteria for their application.

Prudent businesses should maintain comprehensive anti-corruption programs, continue rigorous due diligence, monitor DOJ developments regarding exception criteria, document compliance efforts, and prepare for enforcement resumption.

The history of FCPA enforcement demonstrates the substantial risk of non-compliance. Interpreting the temporary pause as permission to relax standards creates significant legal exposure when enforcement inevitably resumes. Companies that maintain vigilance throughout this transitional period will be better positioned to navigate the evolving regulatory environment while mitigating potential liability, as anti-corruption enforcement will remain central to the international business landscape due to the FCPA’s enforcement history and ongoing OECD Convention obligations.

References:

Books:

Daniel S. Kahn, Eugene F. Soltes & Leo R. Tsao, Corporate Criminal Investigation and Prosecution 366 (Aspen Casebook Series 2023).

Law Review Articles:

Rachel Brewster, Enforcing the FCPA: International Resonance and Domestic Strategy, 103 Va. L. Rev. (forthcoming).

Online Sources:

Stanford Law Sch., Foreign Corrupt Practices Act: Statistics & Analytics, Stanford FCPA Clearinghouse,https://fcpa.stanford.edu/statistics-analytics.html?tab=8 (last visited Mar. 2, 2025).

White House, Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security,https://www.whitehouse.gov/presidential-actions/2025/02/pausing-foreign-corrupt-practices-act-enforcement-to-further-american-economic-and-national-security/ (Feb. 2025).

U.S. Dep’t of Just., Attorney General Statement on FCPA Enforcement, https://www.justice.gov/ag/media/1388546/dl?inline (Feb. 2025).

White House, Fact Sheet: President Donald J. Trump Restores American Competitiveness and Security in FCPA Enforcement, https://www.whitehouse.gov/fact-sheets/2025/02/fact-sheet-president-donald-j-trump-restores-american-competitiveness-and-security-in-fcpa-enforcement/ (Feb. 2025).

^[1] Daniel S. Kahn, Eugene F. Soltes & Leo R. Tsao, Corporate Criminal Investigation and Prosecution 366 (Aspen Casebook Series, 2023).

^[2] Id. at 349, 350

^[3] Rachel Brewster, Enforcing the FCPA: International Resonance and Domestic Strategy, 103 Va. L. Rev. 1611, 1615 (2017).

^[4] Id. at 1618

^[5] Id. at 1620

^[6] Stanford Law Sch., Foreign Corrupt Practices Act: Statistics & Analytics, Stanford FCPA Clearinghouse,https://fcpa.stanford.edu/statistics-analytics.html?tab=8 (last visited Mar. 2, 2025).

^[7] Id.

^[8] Id.

^[9] Id.