And the Beat Goes On (Part 1)
New DOJ Antitrust Guidelines on Corporate Compliance Programs
For many, “And the Beat Goes On” awakens memories of Sonny & Cher’s anthem to changing times. Perhaps not surprisingly, the words are just as applicable to business ethics—change keeps on coming. This month, the US Department of Justice continued its push for change with release of its Antitrust Division’s Evaluation of Corporate Compliance Programs in Criminal Antitrust Investigations.
This probably sounds familiar: didn’t the DOJ just release something like this? Yes, in April the Department’s Criminal Division released Evaluation of Corporate Compliance Programs, the broader guidance about how the DOJ will investigate compliance efforts of organizations that come to its attention. These new Antitrust guidelines serve as companion guidance specifically to antitrust (or fair competition) cases—what the Antitrust Division will specifically examine.
While these new antitrust guidelines may be viewed as just one additional, small step in the DOJ’s larger efforts, here’s another perspective: The US Government through its various departments and agencies continues its march to define compliance management at a specific level. Organizations that run afoul of specific laws will find it difficult to argue that a generalized compliance effort is sufficient.
Consider these past government efforts to promote strong compliance management practices:
- US Equal Employment Opportunity Commission (EEOC) regarding workplace harassment and discrimination
- US Department of Justice (DOJ) and Securities and Exchange Commission (SEC) Foreign Corrupt Practices Act (FCPA) Resource Guide
- US Health and Human Services (HHS) Model Compliance Program (for hospitals, nursing facilities, pharmaceutical manufacturers, ambulance suppliers, physician practices, Medicare choice facilities, clinical laboratories, etc.)
- US Federal Acquisition Regulations (FAR) and associated government contracting standards for compliance management
- US Sarbanes-Oxley Act (SOX) compliance management requirements for publicly-traded compliance
- US Occupational Health & Safety Administration (OSHA) Recommended Practices for Safety and Health Programs
- US Environmental Protection Agency (EPA) Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Violations
- US Federal Energy Regulatory Commission (FERC) Policy Statement on Compliance
- US Securities and Exchange Commission (SEC) Compliance Programs for Investment Companies and Investment Advisers
- US Federal Deposit Insurance Corporation (FDIC) Compliance Management System requirement
In short, the US Government doesn’t simply want to see businesses try to comply with laws and regulations—it wants to see active compliance management efforts that seek to avoid violations and, when they occur, quickly identify, mitigate and report them.
This approach by the US Government serves two objectives:
- It pushes businesses to identify their greatest legal and regulatory risks to focus compliance efforts there.
- It encourages businesses to look broadly at compliance to find more efficient ways to promote it instead of managing several standalone topic-specific compliance efforts.
Keep in mind that the DOJ’s April release updated 2017 guidance from its Fraud Section, and the update is designed to broaden the guidance’s applicability to all criminal conduct. Any business that thinks it doesn’t need to address compliance holistically – but only through focus on specific areas – is likely to find that is efforts won’t meet regulators’ tests, and it certainly is not an efficient means to build a culture of compliance.
Part 2 of this blog will look specifically at expectations in the DOJ Antitrust Division’s Evaluation of Corporate Compliance Programs in Criminal Antitrust Investigations.