DOJ Aims to Strengthen Foreign Lobbying Disclosure Regulations
The suggested amendments aim to limit exemptions that permit foreign agents to bypass transparency requirements.
The U.S. Department of Justice (DOJ) has introduced proposals to amend the federal law that governs the disclosure of lobbying on behalf of foreign entities, with the intention of restricting the situations where exemptions from transparency obligations can be claimed.
Strengthening the ‘Commercial Exemption’
A significant aspect of the proposal relates to the so-called commercial exemption, which is one of the most frequently utilized exemptions under FARA. This exemption applies to political activities undertaken on behalf of foreign corporations—including those owned by foreign governments—as long as these activities focus on business interests and do not “directly promote” the political or public interests of a foreign government or political party.
The DOJ emphasized the ambiguity surrounding the definition of what constitutes “directly promot[ing]” the interests of a foreign government. To clarify this, the proposed amendments would eliminate the term “directly” from “directly promote,” thus making the exemption inapplicable when the foreign agent engages in political activities.
Moreover, the DOJ detailed additional circumstances that would disqualify agents from relying on the commercial exemption. These include activities aimed at benefiting a foreign government’s political or public interests; scenarios in which a foreign government exerts influence—if not oversight, control, or funding—over the activities; and situations where the agent’s actions mainly benefit a foreign government.
Enhancing Transparency Requirements
Under FARA, registered foreign agents are required to submit copies of any “informational materials” distributed on behalf of a foreign principal to the DOJ within a 48-hour timeframe. These materials must also feature a “conspicuous statement” that identifies the agent’s representation of a foreign entity.
The proposed regulations would broaden the definition of “informational materials” to encompass any content that is intended or reasonably expected to sway U.S. government agencies, officials, or the public regarding domestic or foreign policy matters. To boost transparency, the DOJ intends that the compulsory conspicuous statement must specifically mention the country or territory where the foreign principal is situated, as this information may not always be readily apparent.
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Increased FARA Enforcement
The proposed adjustments come in the wake of a surge in DOJ enforcement of FARA, which has resulted in several notable prosecutions.
