Foreign Corrupt Practices Acts (FCPA): Significantly increased compliance risk for companies with ties to Latin America

Enforcement of the Foreign Corrupt Practices Act (FCPA) resumed in the summer (after a 180-day standstill period). New guidelines from the Department of Justice (DOJ) now focus investigations on corruption related to transnational crime and foreign terrorist organizations. The priorities are in line with "America First": protecting US competitive fairness and national security. Furthermore, FCPA proceedings can now only be initiated with the approval of the DOJ. German companies should therefore reassess their counterparties and strengthen FCPA-compliant controls.

Political realignment of the FCPA

The fight against cartels and other transnational criminal organizations (TCOs) is the Trump administration's declared top priority. To this end, a number of Latin American companies and individuals have already been designated as FTOs (Designated Foreign Terrorist Organizations) in order to take more drastic action against them under anti-terrorism laws. A further step is the alignment of the FCPA with the fight against cartels and TCOs. The new FCPA guidelines now only allow FCPA investigations if they pursue corruption in connection with the promotion of cartels and TCOs.

FCPA prosecution only in the service of "America First"

In a memo dated June 9, 2025, the DOJ makes it clear that the Trump administration's priorities are also reflected in FCPA enforcement practice. Prosecutors are instructed to give absolute priority to FCPA proceedings related to the promotion of cartels and TCOs. If this connection is missing, FCPA proceedings are no longer to be initiated.

Another goal is the declared "America First" maxim. The memo implements this by requiring that all FCPA proceedings take into account the protection of fair competition opportunities for US companies and America's national security. Accordingly, violations that have caused US companies to suffer competitive disadvantages are to be prioritized.

Finally, the achievement of strategic advantages by American companies in the areas of raw materials, deep-sea ports, and infrastructure is to be taken into account in criminal proceedings. In future, every new FCPA investigation must be approved by the head of the Criminal Division of the US Department of Justice (the DOJ).

The focus on "America First" issues distorts the original enforcement of the FCPA, which was at the discretion of prosecutors based on general criteria such as the severity of the violation. Instead, only FCPA violations that are linked to Latin American cartels in particular and at the same time disadvantage US companies will be prosecuted going forward.

Consequences for German companies

This investigative practice significantly affects companies that compete directly with American companies. The new guidelines and enforcement practices suggest a prioritization of foreign companies that trade with Latin America. Any business relationships with Latin American countries in particular must be reviewed for connections to organizations classified as TCOs or cartels.

Practical note

The compliance management systems (CMS) of German companies should first be adapted to the accounting and internal control system requirements of the FCPA. Furthermore, the CMS should meet the requirements of the Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP), which continues to apply to criminal proceedings. This is because, in the event of voluntary disclosure, comprehensive cooperation, and an effective CMS, the CEP offers mitigation of penalties up to and including dismissal of proceedings. Similarly, according to the Principles of Federal Prosecution of Business Organizations (see in particular Section 9-28.800), the "adequacy and effectiveness of a compliance program at the time of the violation" is a decisive factor in the decision to bring charges.