On October 3, the U.S. Department of Justice (DOJ) FARA Unit published several new advisory opinions that provided additional guidance on key aspects of the Foreign Agents Registration Act (FARA). The new advisory opinions offer an invaluable reference point for understanding the DOJ’s interpretation of various FARA registration triggers and exemptions. The overall intention of these directives appears to be to streamline the registration process and provide greater clarity concerning FARA’s key provisions. A more detailed description of these developments can be found here.
The release of these advisory opinions is part of a broader trend towards increased enforcement of FARA in recent years. Legal professionals who work with foreign affiliates or offer services to overseas clients should take careful note of these opinions as they may have significant compliance implications.
Outlined below are the highlights from several of these AOs:
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An AO confirmed that U.S. subsidiaries of foreign corporations are not automatically exempt from FARA. Subsidiaries need to demonstrate that they are not, in effect, controlled by a foreign company and are not operating primarily for the advantage of a foreign principal. Organisations should therefore scrutinize their relationships with foreign partners to ensure they are not unwittingly falling under the realm of FARA enforcement.
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An adjustment was made to the exemption clause related to religious, scholastic, academic, or scientific pursuits. Institutions are only safe from FARA when their intent relates to the furthering of bona fide, as opposed to primarily political, activities. This nuance could significantly affect how institutions classify their activities in relation to FARA compliance.
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The opinions also examined the role of attorneys engaged in informal lobbying activities. Lawyers who represent foreign clients in non-legal matters may need to register as foreign agents, particularly when these activities involve attempts to influence U.S. policy. The classification of “legal” versus “non-legal” activities is clearly a determining factor in triggering FARA registration and could impact legal professionals involved in lobbying or policy advocacy.
Legal professionals and organizations are advised to closely examine their operations in light of these advisory opinions to ensure their compliance with FARA. It is clear that the DOJ is making a concerted effort to clarify its stance on FARA enforcement and it is therefore crucial that legal entities, both private and public, adjust their practices accordingly.
Further analysis and commentary on these advisory opinions can be obtained from legal experts at Wiley Rein LLP, who provided an initial summary of the DOJ’s guideline changes.