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March 14, 2025
Cadwalader partner Martin Weinstein spoke with IFLR about how lawyers are advising their clients on matters related to the Foreign Corrupt Practices Act in the wake of an executive order freezing any new enforcement of it for six months.The article, "''The Law is Far From Dead,' Warn Lawyers Over FCPA Freeze," was published on March 14.
Law firms are advising their clients to maintain strong anti-bribery and corruption compliance programs following the executive order, which was issued on February 10. While new investigations are temporarily halted, the FCPA is still law and enforcement could begin again.
“While new enforcement is temporarily paused as priorities are reassessed, companies are not changing their compliance policies or engaging in previously prohibited conduct,” said Martin. “The law is still in place and the pause has had no practical impact on corporate behaviour, given the long-term enforcement risks.”
Martin added that even if US enforcement slows down for a “brief” period, international bribery efforts will continue.
“The trend is inexorable that, internationally, with the OECD Anti-Bribery Convention and foreign laws, whenever there is a void in activity, somebody else will fill that void,” he argued.
Assessing the FCPA enforcement freeze, lawyers have argued that while its application has been deemed aggressive and expansive, it has had multiple benefits for the US economy.
“I would say that the FCPA’s jurisdiction has broadened since I was a prosecutor,” Martin said.
He explained that the Department of Justice and the Security Exchange Commissions have been investigating cases with minimal US ties, such as transactions passing through a US bank or emails coming through a US server.
However, he noted that FCPA “has probably been one of the best economic investments the US has ever made in the legal world”.
“It's brought in billions of dollars of fines and penalties. Much of that money has come from companies that are not US-based and don't have the same compliance standards as US companies,” he added. “It has also enhanced the competitiveness of US companies, making them preferred partners in international business for their integrity and quality.”
Martin also commented on the need for clarity about how the law will be treated in the future.
“There is confusion and concern about the future of FCPA enforcement, both inside and outside the government,” he said.
“US companies want the law enforced to protect employees from bribery risks overseas and to prevent foreign competitors from taking advantage of a potential enforcement pause.”
Martin also discussed the fact that there is uncertainty about the future of whistleblower programmes, established by the DOJ and the SEC, which he notes have generated revenue for the government as they rely on FCPA-related tips.
He concluded, however, that despite these concerns, “the law remains in effect and does not appear to be disappearing”.
Read the full article here (subscription required).
