Foreign Extortion Prevention Act (FEPA) Expands US Authority To Reach Foreign Bribery

• Published date: 12 February 2024
• Law Firm: Goodwin Procter LLP
• Author: Allan Medina, Mark Beardsworth, James D. Gatta, Anna Wittman and Dina Ljekperic

Congress Enacts the Foreign Extortion Prevention Act

On December 22, 2023, President Biden signed the Foreign Extortion Prevention Act (FEPA), a new anti-bribery statute long considered as a likely accompaniment to the Foreign Corrupt Practices Act of 1977 (FCPA). The legislation, which was passed by the US Congress as a part of the National Defense Authorization Act, criminalizes the "demand" side of foreign bribery by making it illegal for any foreign government official to demand, receive, or agree to receive a bribe from a United States citizen, company, or resident in exchange for obtaining business. The FCPA criminalizes only the "supply" side of illegal foreign bribery'the offering or payment of bribes to foreign government officials. With this addition, both sides are now criminalized.

Key Provisions: A Complement to the FCPA

The FEPA largely shares the FCPA's baseline elements. For instance, the FEPA requires the same jurisdictional nexus to the US'demands must be made to an issuer of US securities, to a US domestic concern, or to any person within the territory of the United States'and at the heart of each law is the corrupt exchange or quid pro quo requirement: the bribe demand must be in return for the taking or omission of some official government act or otherwise conferring some business-related benefit. While the FEPA mirrors in significant part the FCPA's elements, the FEPA is not an amendment to FCPA; rather, it amends 18 U.S.C. '201, the US domestic bribery statute, to include foreign officials. The FEPA also expands on the FCPA's definition of a foreign official to include not only "any official or employee of a foreign government or any department, agency, or instrumentality thereof" but also any person "acting in an unofficial capacity" on behalf of those entities.

Violators of the FEPA will face a maximum of 15 years imprisonment and a maximum fine of $250,000 or three times the value of the bribe, whichever is greater. The FEPA also requires the US Attorney General to submit an annual report summarizing demands made by foreign officials, US diplomatic efforts to protect US entities from foreign bribery, actions taken by the Department of Justice (DOJ) under the new law, and resources or legislative action needed by the DOJ to enforce the FEPA.

Until now, US enforcement authorities have relied largely on the FCPA to combat foreign corruption. Under the FCPA, companies and individuals may be charged for the offering, promising...