The only Opinion Release of 2011 (11-01) may have left compliance practitioners initially scratching their heads. However, this collective head scratching is not because the Opinion Release is so difficult to understand and has no application to the everyday business of compliance, but for a polar opposite reason – the question posed to the Department of Justice (DOJ) is so straight-forward, and has been previously asked and answered, that it is difficult to understand how any first year compliance practitioner did not know the answer to it. Yet there is more than this facile analysis as to what may have been going on.
Background
The Requestor was a US Company which facilitated international infant adoptions and it desired to bring some foreign governmental officials over to the US to learn more about it. The foreign government selected the officials to travel, the travel was economy class and it involved no WAGs (wives and girlfriends). The trip was scheduled to be for two days and the US Company paid all the vendors, airlines, hotels, local transportation and food service providers directly. No cash was provided to the traveling officials and any gifts would be branded and of nominal value.
Requestor Representations
In addition to those statements by the Requestor, it also represented to the DOJ the following:
- It had no non-routine business (e.g., licensing or accreditation) under consideration by the relevant foreign government agencies.
- Its routine business before the relevant foreign government agencies consists primarily of seeking approval of pending adoptions. Such routine business is guided by international treaty and administrative rules with identified standards.
- The Requestor did not select the particular officials who will travel. That decision will be made solely by the foreign government agencies.
- Apart from the expenses identified above, the Requestor did not compensate the foreign government agencies or the officials for their visit, nor will it fund, organize, or host any other entertainment, side trips, or leisure activities for the officials, or provide the officials with any stipend or spending money.
- The visit will be for a two-day period (exclusive of travel time), and costs and expenses will be only those necessary and reasonable to educate the visiting officials about the operations and services of U.S. adoption service providers.
- The Requestor has invited another adoption service provider to participate in the visit.
DOJ Discussion
The DOJ cited to Opinion Releases 07-01 and 07-02 for the general rules around travel and entertainment for foreign officials. It then stated, “Based upon all of the facts and circumstances, as represented by the Requestor, and consistent with these prior opinions, the expenses contemplated are reasonable under the circumstances and directly relate to “the promotion, demonstration, or explanation of [the Requestor’s] products or services.” 15 U.S.C. § 78dd-2(c)(2)(A). Therefore, the Department does not presently intend to take any enforcement action with respect to the planned program and proposed payments described in this request.”
Discussion
In his testimony before the House Judiciary Committee, then DOJ Representative Greg Andres spoke about the Opinion Release Procedure as one of the mechanisms by which the DOJ can not only bring transparency to the area of information relating to Foreign Corrupt Practices Act (FCPA) but also can allow businesses with substantive questions to seek and receive specific answers to queries regarding factual scenarios which they may face. So what are the requirements under the Opinion Release Procedure? Initially I would note that DOJ has posted on its website, the Foreign Corrupt Procedures Opinion Procedure, (28 C.F.R. part 8).
The stated purpose is noted as follows: “These procedures enable issuers and domestic concerns to obtain an opinion of the Attorney General as to whether certain specified, prospective–not hypothetical–conduct conforms with the Department’s present enforcement policy regarding the antibribery provisions of the [FPCA]” (§80.1). The requirements of the Opinion Release Procedure are (1) the submission must be in writing; (2) an original and copies must be provided; and (3) must be sent to address provided. (§80.2) In addition to these specific requirements there are certain general requirements listed. (§80.6) They include that complete copies of all operative documents and detailed statements of all collateral or oral understandings. The request must be signed by an appropriate senior officer.
While there is additional language in the Opinion Release Procedure that it only relates to the query submitted to the DOJ, does not bind any other agency or department and can change if different facts occur or that the DOJ can ask for additional information from the party making the request, it is required under the terms of the Opinion Request Procedure “within 30 days after receiving a request that complies with the foregoing procedure, respond to the request by issuing an opinion that states whether the prospective conduct, would, for purposes of the DOJ’s present enforcement policy, [violate the FCPA].” (§80.8)
So there may be an addition lesson learned from Opinion 11-01, which is that the Opinion Release Procedure can be straightforward. The DOJ can be available to assist in interpreting the FCPA based upon the facts and circumstances a company faces in the real world. I have argued for greater transparency by the DOJ in providing information for companies and the compliance practitioner and the Opinion Release Procedure is one of the mechanisms by the DOJ does provide transparency and information.
However there might be another aspect to this specific Opinion Release. While I had discussed the above points from the perspective of an outside counsel, in-house lawyer or compliance office who specialized in FCPA compliance work; the Opinion Release Procedure is designed so that any person or company may submit a query to the DOJ and could be utilized by a company that does not have either an in-house compliance practitioner or even a General Counsel (GC). Simply put, a question can be submitted to the DOJ as straight forwardly as with a one-page document setting forth the information required under the Opinion Release Procedure.
