Overview
On December 13, the National Security Division of the Department of Justice published in the Federal Register an Advance Notice of Proposed Rulemaking (ANPRM) seeking "Clarification and Modernization of Foreign Agents Registration Act (FARA) Implementing Regulations."
FARA dates back to 1938 and seeks to bring transparency to efforts and activities undertaken by "agents of a foreign principal" to influence government officials and the American public. In recent years, there has been increased scrutiny by the Department of Justice (DOJ) of those covered by the law and enforcement of FARA's provisions. FARA is much broader than a law that only applies to foreign governments (the law applies to all foreign principals, including foreign individuals and companies with no connection to the government) or that only applies to lobbying (the law covers a much broader swath of political activities and other activities, including public relations). Additionally, the law contains an agency threshold requirement and various exemptions that are seen as less-than-clear in their applicability.
The ANPRM posed 19 questions for feedback in the general areas of agency, exemptions, inquiries, labeling informational materials, e-filing, and other miscellaneous changes. Most notably, there are opportunities to help shape both the legal representation exemption and the two exemptions commonly referred to as the commercial exemption.
The exemption for "persons qualified to practice law" has been the subject of scrutiny over recent years, with the DOJ both increasing enforcement while seeking to clarify the specific boundaries of the exemption via the Rule 2 process. See 22 U.S.C. 613(g); 28 C.F.R. 5.306(a). The ANPRM will allow the legal community to provide input as to what activities are considered to be "within the bounds of normal legal representation," and this is an opportunity to explain how such representation may include activities outside the four corners of a proceeding but should still qualify for the exemption.
The ANPRM also appears to signal the DOJ is leaning toward changing the scope of the regulations interpreting the commercial exemptions. See 22 U.S.C. 613(d); 28 C.F.R. 5.304(b), (c). The specific questions indicate that a narrowing of exemptions may be under consideration, in particular the possible exclusion from the exemptions activities that "indirectly" promote the interests of a foreign government or political party.
In addition, the DOJ is seeking feedback on the following topics:
- The scope of agency required;
- The applicability of the term "political consultant";
- Whether to clarify the regulations outlining the exemptions for "bona fide religious, scholastic, academic or scientific pursuits of the fine arts";
- How the department should respond to Rule 2 requests, otherwise known as advisory opinion requests;
- How the department should update the term "informational materials" and determine the best way to label those materials in various mediums, including social media; and
- What changes should be made to the current filing process.
Finally, while not specifically mentioned by the ANPRM, we expect there to be significant discussion in the submitted public comments about the "LDA exemption." See 22 U.S.C 613(h); 22 C.F.R. 5.307. This exemption allows those who would otherwise be required to register under FARA to register under the Lobbying Disclosure Act of 1995, as long as "the principal beneficiary" of the activities is not a foreign government or political party. A recent advisory opinion appeared to limit the application of this exemption and the statutory language, which cannot be altered by the rulemaking, is the subject of intense scrutiny in Congress.
Jay Bratt, the Chief of the Counterintelligence & Export Control Section of the National Security Division of the Department of Justice spoke December 9 at the 3rd National Forum on FARA, where Jason Abel, a Steptoe partner with the Government Affairs and Public Policy group and Chair of the Campaign Finance and Political Law practice, also presented. During Mr. Bratt's remarks, he stated that the ANRPM were the "the first major substantive changes, major substantive reworking, that we have done of the regulations in almost 30 years."
The comment period will run until February 11, 2022.
Steptoe’s widely-recognized and Chambers-ranked Campaign Finance and Political Law practice advises on all aspects of political law, including the Foreign Agents Registration Act and can assist in both legal, compliance, and enforcement needs.
