Background

On February 10, 2025, President Trump issued an executive order titled “Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security,” directing the U.S. Department of Justice (DOJ) to halt Foreign Corrupt Practices Act (FCPA)¹ investigations and enforcement actions for a 180-day review period—the first such pause since the statute’s enactment in 1977.

The order cites concerns that “overexpansive and unpredictable” FCPA enforcement creates “an uneven playing field” for U.S. companies, harming national security and economic competitiveness. The order asserts that enforcement has been “stretched beyond proper bounds” by targeting “routine business practices in other nations.”

During the pause, the DOJ must review its FCPA policies, refrain from initiating new investigations unless an exception is approved by U.S. Attorney General Pamela Bondi, reassess ongoing cases, and issue updated guidelines to align enforcement with Presidential foreign policy prerogatives, American economic interests, and efficient law enforcement resource allocation. In the last few days, we are witnessing the U.S. Securities and Exchange Commission (SEC) (despite not being referenced in the Executive Order) also pause enforcement too.

U.S. vs. Non-U.S. Companies: Given the Executive Order’s focus on “American economic competitiveness and national security,” do U.S. companies and non-U.S. companies need to approach the pause differently?

With an “America First” agenda espoused by this Administration, when enforcement resumes, I expect non-U.S. companies to remain in the crosshairs. Among the largest historical FCPA resolutions², non-U.S. companies are the significant majority. Such an approach would be argued as promoting competitiveness for American businesses.

I also assess that there will be a greater link in enforcement strategy and activity tied to the Oval Office, the DOJ and geopolitical considerations in a way we have not so openly seen before. Section 2 of the Pause detailed a large amount of discretion in the hands of Pam Bondi, the current Attorney General.

U.S. companies also need to be mindful of local (non-U.S.) regulators. When the U.S. President describes conduct that has been investigated as “routine business practices in other nations,” he is alluding to bribes. Bribery in local markets remains illegal under local laws, and whilst local enforcement can be uneven across different industries or markets, we already see local Asian regulators enforcing these laws.

Local enforcement, especially in the absence of activity by the DOJ, continues to matter. Singapore has always prosecuted individuals and is prioritising money laundering cases; Indonesian authorities, given Indonesia’s abundant natural resources, continue to examine oil and energy projects; the growing middle classes in emerging markets like Vietnam, India, and China prompt regulatory scrutiny in sectors that grow alongside such demographic change like consumer and life sciences.

The Executive Order mentions “critical minerals, deep-water ports, and other strategic assets.” Does the pause have varying implications across different sectors, and how should companies in these industries think about a potential shift in enforcement priorities?

Critical minerals, deep-water ports, key infrastructure and assets are areas that the President says are integral to American national security, and important for the U.S. and its companies gaining strategic business advantages over. We see this interest in resources deals the Administration is concurrently pursuing with regard to Ukraine and Greenland.

Focusing on these words within the Executive Order pausing FCPA enforcement should turn heads towards Asia. Asia is integral to the minerals, ports, energy, and infrastructure the U.S. relies on for growth. Asia is where this investment, and thus enforcement, activity will take place: 36% of global rare earth minerals are in Myanmar and Vietnam; there is an abundance of nickel stores in Indonesia and the Philippines, as well as in China. Major deep-sea ports, an area referenced in the Executive Order, are also predominantly in Asia. The top eight ports in the world are in China, South Korea and Singapore; should we extend the list to the top 20 ports, 14 are in Asia.

These resources and hubs are essential for access to crucial materials, and for unlocking energy and technology growth.

Corruption in accessing these resources will cause societal and environmental harm and actually lead to higher costs of transacting due to heightened expectations and demand for improper payments in the supply chain, inadequate environmental protections, and limited consideration of the communities impacted by these resources.

Where standards might be slipping, now is the time to elevate your compliance situation.

What key decisions do companies face in adjusting their compliance approach during the pause? What are the risks and opportunities of each?

Compliance makes commercial sense. Still, too often compliance is considered by the stick of enforcement, rather than the carrot of future investment and possibilities.

Compliance is much more than just fighting bribery and corruption too. A business or executive that looks the other way at misconduct—such as financial fraud, improper payments by a third party, negligence in health and safety, excessive influence or hospitality for a government official, or a toxic work culture—may achieve a short-term escape from a situation. But this behaviour could lead to inflated, inaccurate financial reporting, risk of regulatory scrutiny, personal injuries and liability, demands for greater benefits in order to continue business or the loss of valuable workforce talent respectively, as well as personal criminal penalties.

Investors looking at buying assets will still need to understand the compliance environment (beyond just bribery and corruption considerations) at their target, and their due diligence will inform their future steps. Sellers can increase their purchase price with a sound compliance system.

A sound compliance process (not just policy) can increase your asset value, sustain a solid foundation for revenue, and will have long-term growth possibilities. The risks of getting it wrong are always ultimately more expensive than the investments in doing it right.

Parting Words

What this means is clear: non-U.S. companies may be primary targets when DOJ and SEC enforcement resumes. U.S. companies operating in the stated sectors may face heightened scrutiny from local regulators, given the messaging that compliance standards can slip to allow for success (and, from what we are seeing and experiencing, if the SEC is now following this pause too).

However, this is a U.S.-driven pause, not a conclusion to local and international corruption enforcement.

Khushaal Ved is a Partner at Hogan Lovells Lee & Lee, based in Singapore.