Congress enacted the Foreign Agents Registration Act (FARA) in 1938 to control Nazi propaganda. This law requires a U.S. entity to register with the Department of Justice (DOJ) within 10 days of agreeing to represent a foreign principal and before
performing any of the activities listed below. Once registered, the organization must file periodic reports, include disclaimers in public communications it distributes for the foreign principal, and file copies of these communications with the DOJ within 48 hours of dissemination. Most commonly, these requirements fall on lobbying firms, PR consultants, and U.S. subsidiaries of foreign companies. Two exemptions may waive the registration and disclosure requirements, the “Lobbying Disclosure Act (LDA) Exemption” and the “Commercial Activity Exemption.” FARA compliance is a DOJ enforcement priority. Violations may result in significant fines and even jail time.
RELATIONSHIP AND ACTIVITIES
A U.S. entity will trigger FARA registration and disclosure requirements if its relationship with the foreign principal and
its activities meet the qualifications of acting as an “agent of a foreign principal”:
A “foreign principal”
is a foreign government or political party; an entity that is organized under the laws of another country or has its principal place of business outside of the U.S.; or an individual who is neither a U.S. citizen nor domiciled within the U.S.
An “agent of a foreign principal”
is any individual, partnership, association, corporation, organization or combination of individuals that acts at the order, request, or under the direction or control of a foreign principal and
engages in any amount of the following activities for the foreign principal:
- Political Activities – Attempting to influence an official or agency of the U.S. Government or any section of the U.S. public regarding U.S. foreign or domestic policy, or with reference to the political or public interests, policies or relations of a foreign government or political party;
- Public Relations Counsel – Advising on any public relations matter pertaining to the foreign principal’s political or public interests, policies, or relations;
- Publicity Agent – Producing or disseminating oral, visual, graphic, written, or pictorial materials such as press releases, op-eds, lectures, advertisements, books, movies, or in any other medium;
- Information Services Employee – Producing or distributing information about a foreign country, political party, or private organization’s political, industrial, economic, economic cultural, or other facts; or
- Political Consultant – Informing or advising the foreign principal regarding U.S. Government domestic or foreign policies, or the public interest, policies, or relations of a foreign country or political party.
The FARA registration and disclosure requirements do not apply to a U.S. entity that meets either of the following exemptions, even if it otherwise meets the “agent of a foreign principal” criteria:
LDA Exemption – (1) The foreign principal is a private sector entity, not a foreign government or political party; (2) the U.S. entity engages in some LDA-defined “lobbying activities” for the foreign principal; and (3) the U.S. entity registers under the LDA in connection with its representation of the foreign principal.
Commercial Activity Exemption – The U.S. entity engages in only private and nonpolitical activities in furtherance of the foreign principal’s bona fide trade or commerce.