The US Department of Justice’s (‘DOJ’) National Security Division (‘NSD’) released new guidelines on 13 December, for voluntary disclosures of export control and sanctions violations.
It seeks to give concrete rewards and benefits to the private sector in return for voluntary disclosure.
The new voluntary self-disclosure (‘VSD’) policy includes key changes from earlier guidance, all of which provide incentives for corporations to voluntarily self-disclose any violations.
It states that companies that voluntarily disclose a violation, fully cooperate with NSD, and ‘timely and appropriately remediate’, will receive a non-prosecution agreement and will not be given a fine.
If circumstances warrant an enforcement action, but the company satisfies all other criteria, the VSD policy states that DOJ will recommend a reduced fine that is 50% or more lower.
The update also states that any disclosures made to other regulatory agencies – and not to the DOJ – will not qualify for VSD benefits.
The new rules, which build on guidance NSD issued in October 2016, underscore the emphasis on voluntary self-disclosure, rewarding cooperating companies with a presumption in favour of a non-prosecution agreement and significant reductions in penalties.
Earlier guidance did not provide a presumption of any kind, and did not assign any concrete benefits to companies that met certain criteria.
‘Protecting our nation’s sensitive technologies and preventing transactions with sanctioned entities are DOJ priorities, but we cannot succeed alone,’ said Assistant Attorney General for National Security John C. Demers.
‘We need the private sector to come forward and work with DOJ. The revised VSD Policy should reassure companies that, when they do report violations directly to DOJ, the benefits of their cooperation will be concrete and significant.’