Last week, a bipartisan, bicameral group of legislators introduced the Retroactive Foreign Agents Registration Act (“RFARA”) in the U.S. Congress.  Led by Chairman Mike Gallagher (R-Wis.) and Ranking Member Raja Krishnamoorthi (D-Ill.) of the U.S. House Select Committee on the Chinese Communist Party, the bill would amend the Foreign Agents Registration Act (“FARA”) to clarify that foreign agents have an ongoing obligation to register under the statute even after ceasing to act on behalf of a foreign principal.  The bill was prompted by a recent decision in Attorney General of the United States v. Wynn, which interpreted the statute’s requirements.

Wynn Decision

In Wynn, the Department of Justice (“DOJ”) pursued a civil injunction to force Stephen Wynn to register retroactively for activities allegedly conducted on behalf of the People’s Republic of China (“PRC”).  In a ruling that surprised the FARA bar, a federal district court judge in Washington, D.C. dismissed the complaint, holding that because Mr. Wynn terminated his agency relationship with the PRC — if one even existed — prior to the lawsuit, as both parties has acknowledged, Mr. Wynn no longer had an obligation to register.  The court concluded that he therefore could not be enjoined to register under FARA, even retroactively. The court’s reasoning underlying its holding was complicated and based on a prior D.C. Circuit case, United States v. McGoff, and textual analysis of the statutory provision relating specifically to civil injunctive actions.  The government has appealed the district court decision, and the appeal is pending.

Congress’s Response

Although the Wynn decision only applies in the D.C. Circuit, Members of Congress have expressed concerns that the Wynn decision could have more far-reaching consequences.  For example, a recent press release lamented that “an unregistered agent could simply announce that he is ending the agent relationship, never register, and face no penalty.”

The new legislation is designed to overturn the conclusion in Wynn.  The bill provides that DOJ “may make application for an order requiring a person to comply with [FARA and its regulations] . . . while the person acts as an agent of a foreign principal or at any time thereafter.”  Additionally, the bill makes clear that it applies to any individual who “serves as the agent of a foreign principal . . . at any time before, on, or after the date of the enactment [of the Act.].”  Accordingly, agents that have previously relied on the Wynn decision as a basis for non-registration would have new registration obligations under this bill, if enacted.

Curiously, the language of the bill only applies to “any individual who serves as the agent of a foreign principal.”  This language would seemingly not extend to partnerships, associations, corporations, organizations, or any other combinations of individuals currently covered by the definition of a “person” under the statute.  It is unclear whether Congress intends that the bill will only cover individuals like Mr. Wynn or whether the reference to “any individual” was a drafting error that could be changed in future iterations of the bill.

What Comes Next?

Given the strong bicameral and bipartisan support to regulate foreign agents, there may be an appetite in the full House to consider the bill.   As we previously reported, there are a number of other bipartisan bills related to FARA reform pending in Congress, revealing Congress’s continued bipartisan attention to the statute.  Covington will continue to monitor developments in changes to FARA and its regulations.

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Photo of Robert Kelner Robert Kelner

Robert Kelner is the chair of Covington’s nationally recognized Election and Political Law Practice Group.  He counsels clients on the full range of political law compliance matters, and defends clients in civil and criminal law enforcement investigations concerning political activity. He also leads

Robert Kelner is the chair of Covington’s nationally recognized Election and Political Law Practice Group.  He counsels clients on the full range of political law compliance matters, and defends clients in civil and criminal law enforcement investigations concerning political activity. He also leads the firm’s prominent congressional investigations practice.

Rob’s political law compliance practice covers federal and state campaign finance, lobbying disclosure, pay to play, and government ethics laws. His expertise includes the Federal Election Campaign Act, Lobbying Disclosure Act, Ethics in Government Act, Foreign Agents Registration Act, and Foreign Corrupt Practices Act.

He is also a leading authority on the arcane rules governing political contributions and marketing activities by registered investment advisers and municipal securities dealers.

Rob’s political law clients include numerous multinational corporations, many of which are household names.  He counsels major banks, hedge funds, private equity funds, trade associations, PACs, political party committees, candidates, lobbying firms, and politically active high-net-worth individuals. He has represented the Republican National Committee, National Republican Congressional Committee, and National Republican Senatorial Committee.  He also advises Presidential political appointees on the complex vetting and confirmation process.

As a partner in the firm’s White Collar Defense & Investigations practice group, Rob regularly defends clients in congressional investigations before virtually every major congressional investigation committee.  He also defends corporations and others in investigations by the Federal Election Commission, the Public Integrity Section of the U.S. Department of Justice, federal Offices of Inspector General, and the House & Senate Ethics Committees.  He has prepared many CEOs and corporate executives for testimony before congressional investigation panels. He regularly leads the Practicing Law Institute’s training program on congressional investigations for in-house lawyers.  In addition, he is frequently retained to lead internal investigations and compliance reviews for major corporate clients concerning lobbying and campaign finance law issues.

Rob has appeared as a commentator on political law matters on The PBS News Hour, CNBC, Fox News, and NPR, and he has been quoted in the New York Times, Washington Post, Wall Street Journal, Associated Press, Legal Times, Roll Call, The Hill, Politico, USA Today, Financial Times, and other publications.

Rob is Chairman of Covington’s Professional Responsibility Committee and a General Counsel of the firm.  He also currently serves as Chairman of the District of Columbia Bar’s Legislative Practice Committee, and he previously was appointed by the President of the American Bar Association to serve on the ABA’s Standing Committee on Election Law.

Photo of Brian D. Smith Brian D. Smith

Brian Smith assists clients with challenging public policy matters that combine legal and political risks and opportunities.

Brian represents companies and individuals facing high-profile and high-risk congressional investigations and hearings, and other criminal, civil, and internal investigations that present legal, political, and public…

Brian Smith assists clients with challenging public policy matters that combine legal and political risks and opportunities.

Brian represents companies and individuals facing high-profile and high-risk congressional investigations and hearings, and other criminal, civil, and internal investigations that present legal, political, and public relations risks. He assists companies and executives responding to formal and informal inquiries from Congress and executive branch agencies for documents, information, and testimony. He has extensive experience preparing CEOs and other senior executives to testify before challenging congressional oversight hearings.

Brian develops and executes government relations initiatives for clients seeking actions by Congress and the executive branch. He has led strategic efforts resulting in legislation enacted by Congress and official actions and public engagement at the most senior levels of the U.S. government. He has significant experience in legislative drafting and has prepared multiple bills enacted by Congress and legislation passed in nearly every state legislature.

Prior to joining Covington, Brian served in the White House as Assistant to the Special Counsel to President Clinton. He handled matters related to the White House’s response to investigations, including four independent counsel investigations, a Justice Department task force investigation, two major oversight investigations by the House of Representatives and the Senate, and several other congressional oversight investigations.

Brian is a Professorial Lecturer in Law at the George Washington University Law School.

Photo of Alex Langton Alex Langton

Alexandra Langton is a member of the Election and Political Law Practice Group in the Washington, DC office. She represents clients in high-profile and high-risk congressional investigations, FEC investigations, and other criminal, civil, and internal investigations that present legal, political, and public relations…

Alexandra Langton is a member of the Election and Political Law Practice Group in the Washington, DC office. She represents clients in high-profile and high-risk congressional investigations, FEC investigations, and other criminal, civil, and internal investigations that present legal, political, and public relations risks. She also advises companies, PACs, nonprofits, and individuals on compliance with federal and state campaign finance, ethics, lobbying laws, and vetting matters.

Alexandra has particular expertise in the Foreign Agents Registration Act (“FARA”). She frequently interacts with the FARA Unit of the Department of Justice and advises clients on top-tier FARA compliance programs, including FARA policies, FARA trainings, and FARA filings. Alexandra also represents a number of clients in high-profile civil and criminal FARA enforcement actions.

Watch: Alex and colleague Kristin Mace discuss DOJ FARA enforcement trends and proposed rulemaking.