On February 10, 2025, President Donald Trump issued an Executive Order titled "Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security" (the "E.O."). The E.O was issued five days after Attorney General Pamela Bondi issued a memorandum (the "Memorandum") redirecting enforcement of the Foreign Corrupt Practices Act (FCPA) away from U.S. businesses. The E.O. imposes additional obligations and restrictions on the Attorney General with regard to FCPA enforcement.

The FCPA prohibits paying or offering to pay money or anything of value to a foreign official for the purpose of obtaining or retaining business. The FCPA applies to U.S. persons, domestic concerns, and issuers of securities listed on a U.S. exchange or that are required to file S.E.C. reports, as well as to foreign persons and entities that engage in foreign corrupt activity that occurs, at least in part, in or through the United States (such as by using U.S. currency). The FCPA also prohibits issuers from falsifying books and records, and from circumventing or knowingly failing to implement internal controls. 

The E.O. declares that the FCPA has been "stretched beyond proper bounds and abused in a manner that harms the interests of the United States" and that current FCPA enforcement "impedes the United States' foreign policy objectives[.]" The E.O. continues that "[t]he President's foreign policy authority is inextricably linked with the global economic competitiveness of American companies," and that "American national security depends in substantial part on the United States and its companies gaining strategic business advantages whether in critical minerals, deep-water ports, or other key infrastructure or assets."

The E.O. goes on to say that "overexpansive and unpredictable FCPA enforcement against American citizens and businesses — by our own Government — for routine business practices in other nations not only wastes limited prosecutorial resources that could be dedicated to preserving American freedoms, but actively harms American economic competitiveness and, therefore, national security. It is therefore the policy of my Administration to preserve the Presidential authority to conduct foreign affairs and advance American economic and national security by eliminating excessive barriers to American commerce abroad."

The E.O. institutes a 180-day review period, during which the Attorney General will:

• Review all pending FCPA investigations and enforcement actions and take measures "to restore proper bounds on FCPA enforcement and preserve Presidential foreign policy prerogatives";
• Cease initiation of any new FCPA investigations or enforcement actions, unless the Attorney General determines that an individual exception should be made;
• Review guidelines and policies governing FCPA investigations and enforcement actions;
• Issue updated guidelines or policies that will govern the conduct of FCPA investigations and enforcement actions, which may only be initiated or continued with the specific authorization of the Attorney General.

The Attorney General may extend the 180-day review period by an additional 180 days. In addition, after the revised guidelines or policies have been issued, the Attorney General will determine whether additional actions are warranted, including "remedial measures with respect to inappropriate past FCPA investigations and enforcement actions." The Attorney General will take such additional actions, and if Presidential action is required, the Attorney General will recommend such actions to the President.

The February 5, 2025 Memorandum redirects FCPA enforcement away from businesses, and toward Cartels and Transnational Criminal Organizations ("TCOs"). The February 10, 2025 E.O. makes no mention of Cartels or TCOs, but goes considerably further than the Memorandum with regard to shielding businesses, by imposing a moratorium on FCPA enforcement, and by requiring a review of past enforcement and consideration of possible remediation.

The E.O. does not apply to the S.E.C., which is not part of the Department of Justice and which has civil enforcement authority over issuers. It remains to be seen when and how the administration intends to restrict that authority in furtherance of its stated policy goals.

The E.O. can be revoked by a future president. While enforcement of the FCPA is now in suspense mode, and while that could remain the case for the duration of President Trump's term, absent legislation that repeals or modifies it, the FCPA will remain in effect, and will be available to the next administration should it choose to enforce it, even on a retroactive basis, provided the statute of limitations (either five years or six, depending on the offense) for a particular violation has not expired.

The FCPA can raise complex and challenging issues for U.S. companies that do business in foreign countries, and for foreign companies that do business in or through the United States. Katten is well-equipped to help clients navigate those challenges.