Recently, U.S. Deputy Attorney General Lisa O. Monaco introduced a novel Safe Harbor Policy for corporations. This policy surrounds voluntary self-disclosure made in context with mergers and acquisition activities. This new policy seeks to foster a consistent framework ensuring going forward that corporations that transparently and voluntarily divulge criminal misconduct within the Safe Harbor period will be able to take advantage of certain protections. The policy also covers companies that cooperate with the ongoing investigation and engage in requisite, timely and appropriate remediation.
The Deputy Attorney General emphasized upon the necessity of prioritizing good corporate citizenship and described the new policy as an initiative encouraging companies to engage proactively in proper oversight, detection and disclosure of criminal misconduct typically associated with acquiring companies.
Moreover, the policy also outlines specific expectations from corporations seeking to qualify for the benefits of the Safe Harbor policy. These include requirements for immediate disclosure of criminal misconduct, full cooperation with Department of Justice investigations and undertaking corrective actions in a timely manner. Additionally, the policy also emphasizes the requirement for corporations to keep ‘pre-existing compliance program requirements’, that were earlier in place, intact for any newly merged or acquired entities.
The new Safe Harbor policy not only seeks to encourage corporate transparency, but also aims to bring about and maintain consistency in DOJ’s dealings with mergers and acquisition processes. It establishes a certain level of clarity and expectation for legal professionals working within the corporate sector. However, the implementation and impact of the policy remains to be seen in practice.
For more detailed information about the new Safe Harbor policy, you may access the official announcement and analysis here.