President Trump Issues Executive Order Pausing All FCPA Enforcement Actions
On February 10, 2025, President Donald J. Trump issued an Executive Order (the “EO”)[1] directing a 180-day pause on all investigations and enforcement actions under the Foreign Corrupt Practices Act ("FCPA")[2]. The President directed the Attorney General to conduct a review of enforcement guidelines under FCPA, to avoid initiating any new enforcement actions, and to review all existing FCPA investigations and enforcement actions. The Attorney General is also directed to determine whether “remedial actions” should be taken with respect to prior enforcement actions under the statute.
The FCPA was adopted in 1977 in response to a series of corruption scandals including payments made to foreign governments by Lockheed Corporation to promote the sales of military aircraft to US allies.[3] In the decades since, FCPA has become the primary basis for and the lead example of a global anti-corruption effort. At its most basic, FCPA outlaws the payments by a US-based company or their foreign affiliates to any person who is deemed a governmental official to obtain or retain business. The scope of officials is broad, covering not only those who serve in public office, but also candidates for office and the leaders of political parties, among others. Making such payments violates FCPA even if such conduct is perfectly legal in the country in which the payments are made. Violators can face both civil and criminal penalties. The law is enforced primarily by the US Department of Justice (“DOJ”), though substantial enforcement authority also vests with the US Securities and Exchange Commission (“SEC”).
Critically, the FCPA – as interpreted by DOJ, SEC and the US courts – can be applied in an extraterritorial fashion. In other words, US law enforcement authorities are able to bring actions not only for illegal (under US law) payments that occur entirely outside the United States, but also for actions that are taken by persons who are themselves outside the United States, so long as those actions impact the books and records of a US entity or a company that otherwise has a presence in the United States. For example, the SEC entered into a $62 million settlement agreement (without an admission of guilt) with a Netherlands-based company, Koninklijke Philips N.V., to resolve allegations that it violated FCPA for payments made to officials for the sale of medical diagnostic equipment in China.[4] How did the SEC have jurisdiction? As a foreign private company, Philips’ common stock was registered with the Commission under Exchange Act Section 12(b) and publicly traded through a secondary listing on the New York Stock Exchange.
Because of this expansive authority, American companies and others subject to US jurisdiction have long complained that FCPA puts them and their foreign affiliates at a competitive disadvantage, particularly in parts of the world where the payment of “convenience fees” or “facilitation payments” are the norm. Until now, both Democratic and Republican administrations have responded by seeking to “level the playing field” – working through international organizations such as the Organization for Economic Cooperation and Development (“OECD”) and the Group of Twenty (“G-20”), the association of the twenty largest economies. These efforts have been matched by other larger economic powers, perhaps most notably by the UK Bribery Act of 2010, and by bringing international pressure to bear on countries that still permit or at least tolerate these activities. Part of these efforts include bringing broad extraterritorial enforcement actions against violators not only in the United States, but also in the UK and other countries.
President Trump’s Executive Order represents a reversal of these efforts. It explicitly states that the greatest accomplishment of these anti-corruption efforts has been to put American businesses at a disadvantage, hurting the US economy and costing US jobs. Whatever one thinks of the merits of this policy, it is now the “law of the land” albeit for the United States alone. As will be noted below, other countries and international bodies appear unlikely to follow the Trump Administration’s lead. Therefore, some caution is advisable before interpreting the EO as indicating that the days of enforcing anti-corruption laws are over. We recommend that companies and individuals remain mindful of the following considerations as they plan how to proceed.
1. FCPA Remains the Law of the Land
The EO does not – and cannot – repeal the FCPA. That requires an Act of Congress with the President’s assent. Unless this occurs, all business entities that conduct business in the United States, which expressly includes foreign affiliates of US-based entities, remain subject to its requirements and to judicial decisions which have interpreted FCPA and its scope. For so long as the EO remains in effect, however, it does mean that DOJ will not be taking any further action either to investigate or enforce FCPA.
2. For Now, It’s Only 180 Days.
By its express terms, the President’s Executive Order applies only for 180 days starting on February 10, 2025, but allows for a 180-day extension of review as the Attorney General deems appropriate. Until further action, therefore, one cannot assume that the suspension of enforcement and investigative actions will remain in effect indefinitely. It should be noted, however, that the Executive Order grants the Attorney General the power to extend the moratorium indefinitely.
3. Don’t Forget the SEC!
The SEC is not a part of the Justice Department and it, as noted above, has its own broad enforcement powers for violations of FCPA. Under US administrative law, the SEC is considered an “independent agency,” which is intended to insulate it from direct Presidential oversight and control. (While the President nominates commissioners, this normally happens only as an individual commissioner’s term expires rather than allowing for wholesale replacement of the commissioners upon the start of a new president’s term.) That said, the Trump Administration’s Department of Government Efficiency (“DOGE”) initiative seems not to be affected by that structure, apparently in reliance upon the “unitary executive” legal theory. Under this approach, the distinction between independent agencies and executive departments such as Treasury or Interior becomes one of nomenclature not of substance. Whether that view will ultimately be upheld by the federal courts remains to be seen. Still, the SEC staff has reportedly been feeling the pressure.[5] It has been reported that the SEC has curtailed “affinity group” organizations as has been done at other federal departments, agencies and institutions, and that SEC staff are concerned that they may be subject to layoffs along with other federal employees. One cannot, therefore, assuredly say that the SEC will continue to take enforcement or investigative actions pertaining to FCPA violations. Nor can one conclude that the SEC will follow the President and the Attorney General’s lead indefinitely. Only time will tell.
4. Don’t Forget Other Countries!
Any business or individual that conducts business operations in multiple countries needs to remain acutely aware of the requirements of anti-corruption laws in each country in which you do business, or which are impacted by one’s business. In this regard, it is important to remember that countries like the United Kingdom have also asserted extraterritorial enforcement powers under their anti-corruption laws. Of note, the UK’s Serious Fraud Office (“SFO”), the primary enforcement authority of the Bribery Act, has continued to undertake enforcement actions and updated their guidance under the Bribery Act as recently as January 22, 2025, just a few weeks before President Trump’s Executive Order.[6] The current Labour government in the UK is unlikely to follow the Trump Administration’s lead on this issue, so one ought to expect continued activity by SFO.
In addition, the European Council, a part of the executive of the European Union (“EU”), issued a proposal for an EU directive on combatting corruption in June 2024. This replaces an earlier European Commission proposal and reflects discussion and debate within the European Parliament, much of which moved to expand the scope of the draft directive beyond what the Commission proposed. Whether this will result in the adoption of an EU directive remains to be seen. If adopted, however, it would likely become a significant new international standard, much like the EU’s General Data Protection Regulation (“GDPR”) has become a leading standard in the absence of comparable US law or regulation.
Needless to say, the UK and EU are not the only national and trans-national bodies with anti-corruption initiatives and/or laws. Most major economic powers have adopted some version of FCPA/Bribery Act, although the enforcement activity can vary significantly from country to country and from trade bloc to trade bloc. If you have not done so recently, this may be a good time to conduct a survey of all the countries in which you conduct business, in this case using the broadest possible definition of that term, to ascertain the non-US laws and regulations to which you may be subject.
5. Don’t Stop Thinking About Tomorrow!
The likelihood remains that the Trump Administration will leave office on January 20, 2028, less than four (4) years from now, as the President cannot seek another term under the 22nd Amendment to the US Constitution. The statute of limitations under FCPA is five (5) years, meaning that the next administration could bring enforcement actions for violations that occur during this period regardless of President Trump’s EO, even if the Attorney General extends the moratorium on enforcement and investigative activities until the end of the President’s term. (Executive orders, by their nature, apply only during the term of the president who issues them.) It bears mentioning that the 5-year statute can be extended still further under various international agreements, so one cannot assume that today’s non-enforcement of FCPA will protect current activity against future enforcement.
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The President’s February 10 Executive Order represents a significant departure from pre-existing US policy, which itself will send a signal to other countries of what the world’s largest economy and the world’s largest financial system will deem to be acceptable conduct, at least for now. Companies and individuals deciding how to proceed in light of the EO should nevertheless proceed with caution. This is the case partly because foreign and multinational anti-corruption efforts seem likely to remain in place and partly because a future US administration may reverse course and authorize investigations and enforcement actions with respect to conduct that occurs during the current moratorium.
This notice is intended to provide a general overview of the President’s Executive Order with respect to FCPA enforcement. It is not intended to provide legal advice to any individual or company. We would be happy to discuss your particular circumstances with you, so please do not hesitate to contact us at your convenience.
Ari D. Levine is a Corporate Partner at Pierson Ferdinand and Co-Chair of the Firm’s International Practice Group. Contact Ari at ari.levine@pierferd.com.
Nicole Hughes Waid is a Litigation Partner at Pierson Ferdinand and Chair of the Firm’s White Collar Defense & Investigations Practice Group. Contact Nicole at nicole.waid@pierferd.com.
This publication and/or any linked publications herein do not constitute legal, accounting, or other professional advice or opinions on specific facts or matters and, accordingly, the author(s) and PierFerd assume no liability whatsoever in connection with its use. Pursuant to applicable rules of professional conduct, this publication may constitute Attorney Advertising. © 2025 Pierson Ferdinand LLP.
[2] 15 U.S.C. §§ 78dd-1, et seq..
[3] https://en.wikipedia.org/wiki/Lockheed_bribery_scandals
[4] https://www.sec.gov/newsroom/press-releases/2023-92.
[6] https://www.gov.uk/government/publications/bribery-act-2010-guidance.
