In its ongoing efforts to encourage voluntary disclosure of corporate misconduct, the U.S. Department of Justice (DOJ) recently announced a new policy specifically targeting mergers and acquisitions. In a statement released by Deputy Attorney General Lisa Monaco, the new corporate self-disclosure policy, dubbed the Mergers and Acquisition Safe Harbor Policy, was unveiled for the legal community. McGuireWoods LLP provides an area of coverage on this recently announced plan.
This policy is an endeavor by the DOJ to create a safe harbor for acquiring companies that take immediate action to disclose any criminal conduct found within the company they intend to acquire. The emphasis here is on prompt, voluntary disclosures about such infractions. The companies that adhere to this condition may then be shielded from criminal charges. This initiative ensures that the buyers are not penalized for the illicit behavior of a company they are procuring, provided they make a comprehensive and proactive disclosure.
The Mergers and Acquisition Safe Harbor Policy’s goal is to encourage responsible corporate behaviour and integrity in transactions, which generally results in a more transparent and ethical commercial world. This can be considered a step forward in terms of corporate accountability, which is increasingly becoming a major focus for corporate legal teams worldwide.
The full implications of this for legal professionals especially those working within the corporate world and globally-renowned law firms, are yet to be seen. Notwithstanding, this is a policy that is bound to generate extensive discussion. Legal experts and corporates will need to stay abreast of developments to effectively navigate the new landscape created by this policy.