Here are a few recent legal updates from US and UK of relevance to Indian clients:
Tariffs Cancelled By Courts—Or Are They?
Two courts this week invalidated the tariffs issued by the President under the International Emergency Economic Powers Act (IEEPA). First, late Wednesday night (May 28), the US Court of International Trade (CIT) in V.O.S. v. United States issued an order gutting seventeen executive orders that imposed tariffs under IEEPA.[1] Before the ink could dry on the order, the government appealed and requested a stay from the CIT. Before the CIT ruled on that request, the Court of Appeals for the Federal Circuit (CAFC) stayed the CIT’s order — at least until the government’s motion to stay is briefed and decided.
Then, on May 29, the District Court for the District of Columbia preliminarily enjoined the government from enforcing IEEPA tariffs levied against the plaintiffs in Learning Resources v. Trump. The government likewise immediately appealed. While the order applies only to the two plaintiffs in the action, it suggests a path for similar challenges in federal district courts to the President’s power to issue tariffs under IEEPA.
Despite these victories, the tariffs currently are in full force and effect and likely will remain so until appeals in these cases, including a likely further appeal to the Supreme Court, are resolved. Moreover, given the Supreme Court’s recent hearing in Trump v. CASA Inc.,[2] it is unclear if the victory in V.O.S. is affirmed whether the ruling will apply beyond the parties in the cases. And the administration already has stated that it will attempt to impose similar tariffs under other statutes. As a result, companies should continue to evaluate how the tariffs may affect their business relationships and what recourse they may have and consider their own challenges to the tariffs.
IEEPA Tariffs Subject to the Court’s Order
Since taking office in January 2025, President Trump has imposed extensive tariffs under IEEPA, purportedly to address two national emergencies. First, the President claimed that tariffs were necessary to address the fentanyl crisis and issued Executive Order 14193 against goods from Canada (Imposing Duties to Address the Flow of Illicit Drugs Across Our Northern Border), 14194 against Mexico (Imposing Duties to Address the Flow of Illicit Drugs Across Our Southern Border), and 14195 against China (Imposing Duties to Address the Synthetic Opioid Supply Chain in the People’s Republic of China).
Second, the President stated that “reciprocal” tariffs against all global imports were necessary to address the economic crisis caused by the United States’ trade imbalance and issued Executive Order 14157 (Regulating Imports with A Reciprocal Tariff to Rectify Trade Practices that Contribute to Large and Persistent Annual United States Goods Trade Deficits), as well as a number of retaliatory tariffs specifically targeting China. These tariffs include the 10% world-wide “baseline tariff” imposed on April 5, and also country-specific additional “reciprocal” rates, currently scheduled to go into effect on July 9. The CIT’s injunction invalidates all of these tariffs.
Notably, however, neither case involves recent tariffs imposed under Section 232 on steel, aluminum, and automobiles and parts, or ongoing Section 232 investigations into timber, pharmaceuticals, and semiconductors. The Court’s decision also does not affect the Section 301 tariffs imposed during the previous Trump administration on goods from China.
The Courts’ Decisions
The CIT issued a single order covering two separate appeals in V.O.S. Selections, Inc. v. United States and State of Oregon v. Department of Homeland Security.[3] In that order, the CIT ordered the US government to stop levying IEEPA-based tariffs against any importer or small business, and to refund tariffs that have been paid already. The three-judge panel from the CIT, which issued a per curiam order, concluded that the administration’s broad interpretation of IEEPA exceeds both statutory authorization and constitutional limits. While it did not declare that tariffs could never be imposed under IEEPA, it held that the current tariffs exceeded the executive’s authority under the statute.
In reaching its holding, the CIT panel performed an in-depth interpretation of IEEPA, including its text, legislative history, and related statutes, noting that IEEPA was enacted to restrict executive authority. The Court then examined numerous challenges to the tariffs, including the doctrines of nondelegation and political question deference. The CIT concluded that “simply with separation of powers in mind, any interpretation of IEEPA that delegates unlimited tariff authority is unconstitutional.”[4] The CIT distinguished this case from its prior precedent which permitted certain tariffs under IEEPA’s predecessor statute, explaining that the Court held that the statute did not authorize limitless authority.[5]
The Court rejected the administration’s attempt to use IEEPA for tariffs on different grounds depending on the type of tariff. It held that as to fentanyl-related tariffs (or what the Court calls “trafficking tariffs”), the tariffs are not authorized by IEEPA because the statute requires that emergency authority only be “exercised to deal with an unusual and extraordinary threat with respect to which a national emergency has been declared… [and] not be exercised for any other purpose.”[6] It held that imposing tariffs to create “leverage” to encourage countries to take measures to counter fentanyl production and trafficking did not “deal with” the crisis as required by the statute.[7] The “unusual and extraordinary threat” requirement is not what the court called a “symbolic festoon” — instead, it is a meaningful constraint that must be satisfied.[8]
As to reciprocal and retaliatory tariffs, the Court held that the tariffs that aimed to address “a type of balance-of-payments deficit,” even if those deficits were “large and serious,” could not be addressed under IEEPA because another statute specifically dealt with balance-of-payment deficits, the Trade Act of 1974.[9] IEEPA does not allow the administration to circumvent the procedural requirements and congressional oversight mechanisms that Section 122 imposes on an executive trying to balance foreign and domestic payments of tariffs.[10]
The CIT characterized its central holding as one of constitutional avoidance. It held that regardless of whether it applied the nondelegation doctrine (which requires Congress to provide guidance when delegating power so that executive authority is not without limits), major questions doctrine (which likewise requires statutory clarity when Congress delegates “powers of vast economic and political significance”), or separation of powers principles, any interpretation of IEEPA that delegates unlimited authority to impose tariffs for any reason is unconstitutional.[11] Specifically, the nondelegation doctrine limits how much authority Congress can delegate to the President to impose tariffs under IEEPA, and the major questions doctrine requires that IEEPA’s language be exceptionally clear in authorizing tariffs of such significance—which was lacking, given that IEEPA does not even mention tariffs. The CIT held that permitting unfettered executive branch tariff authority under IEEPA would effectively transfer congressional power to the President, violating principles that prevent excessive concentration of governmental authority.[12]
Because the tariffs were not authorized under IEEPA, the CIT invalidated them and issued a permanent injunction that required the government, within ten days, to effectuate cancellation of all tariffs imposed under claimed IEEPA authority. The CIT further ordered the immediate cessation of tariff collection under the enjoined executive orders; refund of tariffs collected during the pendency of litigation; notification to Customs and Border Protection; and coordination with trading partners and international customs authorities.
Almost immediately after the CIT issued its order, the government appealed to the CAFC and simultaneously requested that the CIT and the CAFC stay the order pending a decision on its appeal. While the CIT issued an expedited schedule for briefing on the motion to stay, the CAFC stepped in and issued a temporary administrative stay while the broader stay issue is briefed and decided before it—thus pausing implementation of the injunction. For now, that leaves the tariffs in place.
The District Court in Learning Resources similarly held that IEEPA does not authorize tariffs, and that if it did, its delegation of power would likewise be far too broad.[13] The government already has appealed this decision as well. Notably, the District Court limited its holding to the plaintiffs in that case and pointed out that the nationwide injunction against tariffs in V.O.S. meant that its order would have “virtually no effect on the government.”[14]
What These Rulings Mean for Companies Affected by IEEPA Tariffs
Given the current stay of the CIT’s order, IEEPA tariffs remain in effect for now. Companies subject to the tariffs are in the same situation as they were before the CIT’s ruling. This may well be the case until the CAFC decides the appeal, given that it already stayed the injunction before the CIT even ruled on the motion to stay before it. And this matter is very likely headed to the Supreme Court, given the significance of the issues at stake.
Moreover, even if the appellate courts ultimately uphold these rulings that IEEPA tariffs at issue are void, the administration already has stated that it is planning other means to try to impose reciprocal and retaliatory tariffs, including using a provision of the Trade Act of 1974 that allows for tariffs of up to 15% for 150 days to address trade imbalances, followed by individualized tariffs against each major trading partner to counter unfair foreign trade practices.
That said, while the V.O.S. case is working its way up through the appellate process, companies should take this time to check their supplier and purchaser contracts to determine where tariff liability lies, re-negotiate terms where possible, and set prospective tariff allocations.
Footnotes
[1] The Executive Orders in these two categories that are based in IEEPA authority or modify previous IEEPA EOs are 14193, 14194, 14195, 14197, 14198, 14200, 14226, 14227, 14228, 14231, 14232, 14256, 14257, 14259, 14266, 14289, and 14298.
[2] No. 24A884, oral argument held May 15, 2025.
[3] Opinion, V.O.S. Selections et al v. United States et al, Case No. 1:25-cv-00066, Doc. 55, Slip Op. 25-66 (Ct. Intl. Trade, May 28, 2025).
[4] Id. at 28.
[5] Id. at 28-29 (discussing United States v. Yoshida Int’l. Inc., 526 F.2d 560, 584 (C.C.P.A. 1975)).
[6] Id. at 41. (quoting 50 U.S.C. § 1701(b))
[7] Id. at 45-47.
[8] Id. at 41.
[9] Id. at 33-34.
[10] Id. at 34.
[11] Id. at 27-28 (quoting Ala. Ass’n of Realtors v. HHS, 594 U.S. 758, 764 (2021) (quotation marks omitted).
[12] Id. at 26-28.
[13] Memorandum Opinion, Learning Resources. Inc. et al v. Trump et al, 1:25-cv-01248-RC, Doc. 37, 17-18 (D.D.C., May 29, 2025).
[14] Id. at 32.
English High Court Confirms That India’s Ratification of the New York Convention Was Not a Waiver of Its Sovereign Immunity
The threshold for challenging awards and their enforcement in the UK remains high, a key reason why London remains one of the busiest arbitration venues in the world and a key jurisdiction for the enforcement of arbitral awards, including those against state entities. As such, there are several prominent enforcement cases pending in England which are testing the scope of the State Immunity Act 1978 (the “SIA”). In the latest decision,1 Sir William Blair, sitting as a Judge of the High Court, has confirmed that India did not waive its right to claim state immunity by reason of having ratified the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “NY Convention”).
Case background
The case arises out of a contractual arrangement between Devas Multimedia Private Limited and Antrix Corporation Limited. Antrix is an Indian company wholly owned by the Government of India which contracted with Devas for the lease of a proportion of India’s S-Band spectrum on two Indian satellites to be operated by the Indian Space Research Organization. India eventually terminated the contract, which led to an arbitration under the contract, with Devas eventually being awarded $652 million (US) in damages, and to enforcement and annulment proceedings in the Indian and Dutch courts.
Investors in Devas also brought an investment treaty arbitration against India under the India/Mauritius Bilateral Investment Treaty (the “BIT”), under the UNCITRAL Rules seated in The Hague. The Devas investors eventually obtained an award now said to be worth €195 million. The recent English High Court decision arises from an application to enforce this BIT award.
The BIT award is currently also the subject of proceedings in the Netherlands, where India seeks to have the award annulled on the basis that there was no binding arbitration agreement. India argues that the investment which is the subject of the claim did not meet the legality requirements of the BIT, so that India’s offer to arbitrate in Article 8 of the BIT did not apply and the Tribunal did not have jurisdiction to arbitrate the Claimants’ claims (the “BIT jurisdiction argument”).
India’s claim to sovereign immunity in the UK
India also raises the BIT jurisdiction argument in the English courts where they are challenging the enforcement of the BIT award. In the UK, pursuant to section 9 of the SIA, states are immune from the jurisdiction of the courts save where the state has agreed to arbitration, in which case the state has no immunity with respect to court proceedings related to the arbitration. This is known as the arbitration exception to immunity. India therefore relies on its BIT jurisdiction argument to claim immunity from enforcement of the BIT award in the English courts. However, given that the BIT jurisdiction argument is pending in the Netherlands already, India has applied for a stay of the English proceedings until the issue is resolved in the Netherlands. The question of whether the Devas investors can rely on the arbitration exception to India’s sovereign immunity in the UK is therefore likely to be delayed for some time.2
To avoid this delay, the Devas investors raised a novel argument based on section 2 of the SIA and the NY Convention. Section 2 provides a further exception to immunity where the state has submitted to the jurisdiction of the UK courts by prior written agreement. The Devas investors argue that India’s ratification of the NY Convention (which provides in article III that “Each Contracting State shall recognize arbitral awards as binding and enforce them in accordance with the rules of procedure of the territory where the award is relied upon”) amounts to such a prior written agreement to submit to the jurisdiction of the UK courts, being “the territory where the award is relied upon.”
This argument under section 2 of the SIA has never been raised in the UK before. However, the Devas investors have pointed to the recent decision of the English Court of Appeal in the joint appeal of the Infrastructure Services v. Spain and Border Timbers v. Zimbabwe cases.3 In that joint appeal, the Claimants successfully argued that, by ratifying the ICSID Convention, states had by prior written agreement submitted to the jurisdiction of the UK courts and therefore, pursuant to section 2 of the SIA, could not oppose the enforcement of ICSID awards against them on the grounds of state immunity. This case therefore provided useful precedent supporting the Devas Claimants’ argument that the ratification of the NY Convention also amounted to submission to the UK courts.4
The court’s decision
The English High Court disagreed. Although he did not wish to “in any way contradict the enforcement friendly aspect of the NY [Convention], which is its purpose, and the reason for its success, and which has been consistently upheld in English law,” Sir William Blair found that the drafters of the NY Convention had never intended to preclude immunity-based arguments. Article III of the NY Convention required contracting states to “recognize arbitral awards as binding and enforce them in accordance with the rules of procedure of the territory where the award is relied upon.” This reference to the “procedure of the territory” where enforcement is sought preserved the right of state parties to rely on the procedural defense of state immunity where it was available in the state of enforcement. Accordingly, as a matter of English law, it could not be said that India had waived its immunity by simply having ratified the NY Convention.
It is important to recognize that this decision was on a very narrow question of sovereign immunity law concerning the interplay of the NY Convention and the SIA. It says nothing about the approach of the English courts to enforcing either ICSID or NY Convention awards, nor does it in any way broaden the scope for challenging enforcement of arbitral awards under those conventions. The UK remains an arbitration friendly, non-interventionist jurisdiction and the threshold for challenging awards and their enforcement remains high.
In any event, the Devas investors have already indicated their intention to appeal this decision, so it is expected that the Court of Appeal will have more to say on the issue.
Footnotes
[1] CC/Devas (Mauritius) Ltd and others v. The Republic of India [2025] EWHC 964 (Comm)
[2] The situation is not dissimilar to that faced by the English Court of Appeal, considering an application to enforce the $63 billion (US) Yukos awards, which we recently reported on. (Hulley Enterprises Limited; Yukos Universal Limited; and Veteran Petroleum Limited v. the Russian Federation, [2025] EWCA Civ 108). In that case, the English Court of Appeal not only stayed proceedings in England pending the resolution of jurisdiction arguments in annulment proceedings in the Dutch courts, but went on to find that the decision of the Dutch courts gave rise to an issue estoppel which bound the English courts.
[3] Infrastructure Services Luxembourg S.A.R.L. and Energia Termosolar B.V. v. the Kingdom of Spain; and Border Timbers Limited and Hangani Development Co. (Private) Limited v. the Republic of Zimbabwe [2024] EWCA Civ 1257.
[4] For those not familiar with the distinction, investor/state arbitration awards rendered under the ICSID Convention are subject to enforcement pursuant to the ICSID Convention. They are not subject to enforcement pursuant to the NY Convention. As the Devas investor/state arbitration was conducted under the UNCITRAL rules and seated in the Netherlands, it was subject to the NY Convention regime.
Evaluating the Impact of Tariffs on Customer and Supplier Relationships
As tariffs are imposed and additional tariffs are threatened, companies concerned about the impacts of tariffs on agreements with customers and suppliers should review their contracts and the parameters of the tariff to determine how they may impact ongoing relationships. The following are some general guidelines for evaluating your customer and supply relationships.
First, examine existing contracts to identify provisions that may address tariffs:
- Check the applicable delivery terms. Many contracts use the International Chamber of Commerce (“ICC”) Incoterms to determine whether the buyer or seller is liable for shipping costs and import or export duties. Those provisions may already allocate payment of tariffs to the buyer or the seller. For example, the Incoterm Delivery Duty Paid (“DDP”) usually requires the seller to pay any export and import duties. Conversely, delivery terms such as Free on Board (“FOB”) from the origin point and Ex Works (“EXW”) typically make the buyer responsible for importing the goods and paying resulting duties. The ICC publishes a guide detailing specific requirements of various Incoterms.
- Check contract provisions that allocate payment of taxes, and whether the definition of taxes can be read to encompass tariffs or other trade duties.
- Check whether your contracts permit price adjustments, and whether adjustments are permitted for tariffs. Contracts may have a wide array of price adjustment mechanisms. Some agreements permit periodic price adjustments based on actual costs or published price indices that may or may not capture the impact of tariffs. Other contracts may require the parties to renegotiate pricing in the event of material changes to the costs or changes to the law, which might include the costs of tariffs.
- If the parties exchanged documents with conflicting terms and conditions, you may need to consider which party’s terms govern under the “battle of the forms.”
Second, beyond examining whether existing contracts already allocate responsibility for tariffs, parties may want to examine the extent to which the parties are bound to continue performing, including whether the contract may be terminated. This review may identify areas of leverage or challenges to a party in discussions about tariffs with their counterparty. Some considerations include:
- Whether a force majeure clause or doctrines such as commercial impracticability might excuse performance due to the impacts of tariffs. Historically efforts to avoid contractual obligations due to the cost of performance have been met with skepticism. However, the issue should be evaluated based on the terms of the specific contract, and the specific impact that a particular tariff will have on performance.
- Whether you have termination rights, including the right to terminate for convenience, and whether the costs of continued performance may be higher than the costs or damages you face if you terminate.
- Whether the contract is binding at all. In some industries, supply arrangements are established by “blanket” purchase orders that do not commit the buyer to purchase any particular quantity of goods or even specify a term. These types of purchase orders may not be binding under the statute of frauds or may constitute an illusory bargain. Contracts of indefinite duration, with no set end date, may be terminable at will by either party.
Third, regardless of your legal evaluation, buyers and sellers in long-term supply relationships may have an interest in resolving issues amicably by negotiating mutually acceptable terms. Finding ways to modify existing contracts may be particularly important where there are few or no qualified replacement suppliers, or where tariffs threaten the viability of links in the supply chain that could put all participants’ businesses at risk. Thus, the parties might modify existing provisions regarding tariffs, or add provisions where none currently exist. Where accommodation cannot be agreed, the parties will need to lay the foundation for successful dispute resolution, for example, by making demands for adequate assurance, or complying with any prerequisites to litigation or arbitration provided for in a contract.
Fourth, prospectively, companies should consider how they may want to allocate the risk of tariffs in future contracts. For example, by adding express terms allocating who pays existing or future tariffs, or permitting termination or renegotiation where tariffs exceed certain thresholds.
The Trump Administration Calls for a Pause on New FCPA Enforcement but Don’t Abandon Compliance Programs Just Yet
In an executive order issued on February 10, 2025 (Executive Order), and a memorandum issued by Attorney General Pam Bondi regarding cartels and transnational criminal organizations on February 5, 2025 (Cartel Memo), the Trump Administration has begun making its mark on enforcement of the Foreign Corrupt Practices Act (FCPA).1 The Executive Order, entitled “Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security,”2 establishes a 180-day pause on new FCPA enforcement activity, subject to exceptions made by the Attorney General. It also directs the Attorney General to develop new guidelines for future enforcement consistent with “the President’s Article II authority to conduct foreign affairs,” the “prioritiz[ation of] American interests,” “American economic competitiveness with respect to other nations,” and “efficient use of Federal law enforcement resources.”3 The Cartel Memo, in turn, orders federal prosecutors to prioritize FCPA enforcement involving cartels and Transnational Criminal Organizations (TCOs) and eliminates the Criminal Division Fraud Section’s exclusive jurisdiction over FCPA matters in those cases.
While the Executive Order and Cartel Memo may foretell a new era of FCPA enforcement, companies should resist efforts to immediately overhaul their policies on bribery and corruption or slow their FCPA compliance efforts. It is unlikely that the Executive Order and Cartel Memo are the final word on the Trump Administration’s and Department of Justice’s (DOJ) positions on FCPA enforcement. And the FCPA’s five- and six-year statutes of limitations for substantive violations and violations of the accounting provisions, respectively, as well as the Securities and Exchange Commission’s (SEC) parallel jurisdiction, should be front of mind as companies consider high-risk business activities. This client alert discusses the Executive Order and Cartel Memo in more detail and highlights important considerations for companies operating across the globe.
The FCPA
The FCPA has two primary prongs: the anti-bribery provisions and accounting provisions.4 The anti-bribery provisions generally prohibit companies and individuals from corruptly giving or offering anything of value to foreign officials to improperly influence them for the purpose of “obtaining or retaining business.” The anti-bribery provisions apply not only to American companies and individuals but also to companies whose securities are listed in the United States, as well as foreign companies and individuals whose conduct implicates the FCPA’s jurisdictional provisions. The accounting provisions—which apply only to companies whose securities are listed in the United States—require “issuers” to maintain accurate records and internal accounting controls.
Over the nearly 50 years since the FCPA was enacted in the post-Watergate era, Congress and prior administrations have emphasized the value of FCPA enforcement in combatting global corruption, restoring public confidence in the integrity of the free market, and ensuring a level field for companies that follow the rules. FCPA enforcement trends have varied, but in recent years, DOJ has brought enforcement actions against large American and foreign companies alike—and, also in recent years, foreign critics have accused the United States of using the FCPA as a protectionist cudgel against foreign competitors.5
Jenner & Block has published comprehensive reviews of the FCPA and recent FCPA enforcement trends.
The Executive Order
The Executive Order directs a 180-day period following February 10, 2025 during which DOJ must cease initiation of any new FCPA investigations or enforcement actions unless the attorney general approves an exception.6 During that 180-day period—which the Attorney General is authorized to extend—the DOJ is directed to (1) reevaluate “all existing FCPA investigations or enforcement actions” and “take appropriate action with respect to such matters”; and (2) develop new policies and guidelines that prioritize American foreign policy and economic interests as described above.7
The Cartel Memo
The Cartel Memo, which was issued five days prior to the Executive Order, also directs a shift in DOJ’s FCPA enforcement priorities. Among other initiatives aimed at strengthening enforcement against drug cartels and other TCOs, the Cartel Memo enlists the Criminal Division’s FCPA Unit in those efforts.8 For the next 90 days—or longer if the Attorney General so determines—it directs the FCPA Unit to “prioritize” investigations into foreign bribery that “facilitate[] the criminal operations of Cartels and TCOs,” such as drug and gun trafficking and human smuggling, in lieu of other FCPA investigations.9 The memo also eliminates the FCPA Unit’s exclusive authority to investigate and prosecute all FCPA cases, permitting US Attorney’s Offices across the country to bring FCPA cases involving cartels and TCOs without involvement by or approval from the FCPA Unit.10
What These Changes Mean
Just weeks into the second Trump Administration, it remains too early to assess the longer-term implications of the Executive Order and the Cartel Memo for FCPA enforcement over the next four years. It is evident that the order and the memo will have some short-term implications, as DOJ and the courts grapple with whether and to what extent the directives impact ongoing FCPA cases. For example, the US district court judge supervising the FCPA prosecution of Cognizant Technology Solutions Corporation executives accused of bribing an Indian official recently ordered DOJ to articulate whether the Executive Order impacts the upcoming March 3 trial date.11
Longer-term implications, however, are less clear. Although the six-month “pause,” direction that new cases should explicitly promote American economic interests, and prioritization of cartel and TCO cases certainly provide reason for most American companies to expect less vigorous scrutiny under the FCPA, there are also plenty of reasons for companies—both American and foreign—to take a more cautious approach. Most importantly, absent an act of Congress, the FCPA remains the law, and the administration’s current enforcement approach does not immunize violative conduct or guarantee that priorities will not change or that exceptions to the pause will not be made. Both foreign and domestic companies should thus ensure that their FCPA compliance programs do not take a similar “pause”—and in some areas, they should enhance their programs in response to these recent announcements.
First, as noted above, neither the Executive Order nor the Cartel Memo extinguishes ongoing FCPA investigations. Given that many such investigations last years before resolution, companies currently under FCPA scrutiny may well remain that way for months or even years. Although the Executive Order imposes a six-month pause on new matters, it does not by its terms prevent current investigations from proceeding or prevent matters currently under investigation from being charged (or resolved in another way) beginning in August 2025; instead, it calls for a review of ongoing matters consistent with the principles behind the Executive Order. Moreover, the Executive Order also permits DOJ to initiate new investigations and enforcement actions during the six-month pause, so long as the Attorney General approves. And the Cartel Memo does not by its terms preclude any type of FCPA enforcement, directing only that the FCPA Unit prioritize certain types of matters for at least the next three months.
Given that FCPA enforcement has not historically featured much in the way of cartel and TCO matters, that focus may still leave the FCPA Unit with plenty of time to pursue other matters as well. Thus, nothing in either the Executive Order or the Cartel Memo offers any type of guarantee that DOJ will not initiate a traditional FCPA investigation or announce a traditional FCPA resolution in the near term.
Second, the changes announced thus far are, of course, only policy changes that are not binding on future administrations, or even on this administration should its priorities or composition change. For example, in the Biden Administration, Deputy Attorney General Lisa Monaco announced a return to previous Obama-era guidance regarding corporate enforcement, rejecting the 2018 Trump Administration directive that limited the information a corporation was required to disclose in order to obtain cooperation credit. Given that the FCPA’s statute of limitations is five or six years depending on the implicated provisions (and can be extended in certain circumstances), these policy announcements are far from a complete liability shield. Even within the next four years, it is important to bear in mind that DOJ under the prior Trump Administration actively prosecuted FCPA cases and reached some of the largest-ever FCPA settlements with US and foreign companies alike.12
Third, in some cases, the recent announcements portend greater enforcement. Most straightforwardly, the Cartel Memo directs the prioritization of matters involving certain types of criminal organizations. Those fact patterns may not be relevant to most corporations, but it should be noted that DOJ has in recent years prosecuted corporations for terrorism and narcotics offenses.13 And, of course, the Executive Order suggests that DOJ’s revised FCPA guidelines may encourage prosecutions that support American interests—which is how certain foreign critics currently describe DOJ’s motivation in prosecuting foreign companies under the FCPA. Companies that operate in high-risk environments dominated by organized criminal activity or associated with drug trafficking, or companies that may be perceived as competing with American economic or foreign policy interests, may thus be more likely than before to find themselves in DOJ’s crosshairs.
Finally, nothing in the Executive Order or the Cartel Memo purports to affect the jurisdiction or focus of the SEC, which has parallel jurisdiction over FCPA enforcement. Nor has the SEC thus far announced any changes to its own FCPA enforcement program or priorities, although the Commission’s incoming leadership may well do so. Relatedly, foreign countries such as the UK, Brazil, Switzerland, and Canada have recently brought their own anti-bribery prosecutions. Any DOJ FCPA guidelines that are perceived as targeting foreign companies to benefit American ones may draw the attention of enforcement authorities in countries where American companies do business. And recent years have also seen increased cooperation among international law enforcement agencies to combat corporate corruption and bribery that spans multiple jurisdictions as well as third-party litigation, meaning that that the current “pause” on FCPA enforcement may not ultimately impact corporate liability for conduct that would otherwise be subject to prosecution under the FCPA.
In sum, although the new announcements mark a significant shift from prior policy and practice, corporations should not let down their guard or relax their efforts to build and maintain effective anti-corruption compliance programs. Compliance programs built to comply with an array of laws and regulations, not just the FCPA, are still critical for reducing risk and promoting corporate values. Jenner & Block stands ready to assist clients in assessing and enhancing their FCPA compliance programs to navigate this shifting landscape.
This article is available in the Jenner & Block Japan Newsletter. / この記事はJenner & Blockニュースレターに掲載されています。
Footnotes
[1] For more information on the Trump Administration’s approach to national security enforcement, please see the Jenner & Block Client Alert discussing the administration’s directive to DOJ’s National Security Division.
[2] See also the White House Fact Sheet with additional details about the Executive Order.
[3] See Exec. Order, “Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security,” Sec. 2(iii) (Feb. 10, 2025).
[4] See 15 U.S.C. §§ 78dd-1, et seq.
[5] See e.g., “Jailed French executive who felt force of US bribery law” for the BBC’s summary of foreign criticism of the FCPA prosecution of Alstom S.A., a French power and transportation company, and Frédéric Pierucci, one of the company’s former executives. The French media has also widely critiqued the U.S. approach to prosecuting foreign corruption. See, e.g., Radio France’s critique in “Guerre economique.”
[6] Exec. Order, “Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security,” Sec. 2 (Feb. 10, 2025).
[7] Id.
[8] Att’y Gen., “Total Elimination of Cartels and Transnational Criminal Organizations,” Sec. II at
[9] Id. at 2-4.
[10] Id. at 4. See also DOJ Justice Manual § 9-47.000.
[11] The judge’s order requires DOJ to state its position by February 18, 2025.
[12] For more information on the prior Trump Administration’s approach to the FCPA, please see Jenner & Block’s Update to Anti-Corruption Enforcement from 2018-2019 and 2019-2020, and Anti-Corruption Enforcement 2020 Year in Review.
[13] See, e.g., DOJ Lafarge S.A. Settlement Press Release (Oct. 18, 2022); DOJ McKinsey Settlement Press Release (Dec. 13, 2024).
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