Trump's FCPA pause may aid Adani

President Donald Trump has asked the US attorney general to not initiate any new cases and review all old cases under the Foreign Corrupt Practices Act (FCPA), possibly opening the door for a legal reprieve for billionaire tycoon Gautam Adani and the Adani Group that were indicted under the law in November last year.

- Prashant Jha

WASHINGTON:

In an executive order issued on Monday, Trump said that FCPA was "systematically stretched beyond proper bounds and abused". This harmed presidential power to conduct American foreign policy and meet foreign policy objectives by harming American business competitiveness, he added. For this reason, the President ordered the AG to come up with new guidelines under the act, and pursue only those cases based on these guidelines personally approved by the AG.

"Overexpansive and unpredictable FCPA enforcement against American citizens and businesses - by our own government - for routine business practices in other nations not only wastes limited prosecutorial resources that could be dedicated to preserving American freedoms, but actively harms American economic competitiveness and, therefore, national security," the order said.

Even though the order is driven by the stated intent to give American companies more room to operate businesses elsewhere, it might also apply to other companies whose actions fall within the ambit of the act. This leaves the decision on whether to pursue the case against the Adani Group and eight of its senior executives, including Gautam Adani, under the discretionary authority of the US Department of Justice (DOJ).

Under the current administration, with the DOJ widely expected to act as an adjunct of the president, the space to exercise this discretionary authority in effect rests with the political executive. On November 21, DOJ had indicted the Adani Group companies, its chief Gautam Adani and seven others for allegedly orchestrating a $265 million (₹2,029 crore) scheme to bribe Indian officials in order to secure green energy supply deals -- an act that invites provisions of FCPA.