Foreign Agents Registration Act

DEPARTMENT OF JUSTICE

28 CFR Part 5

[AG Order No. 2229-99]

RIN 1105-AA45

Foreign Agents Registration Act

AGENCY: Department of Justice.

ACTION: Proposed rule.

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SUMMARY: The Department of Justice proposes to amend its existing

regulations implementing the Foreign Agents Registration Act of 1938,

as amended (FARA or the Act). The proposed rule would establish new

regulations needed as a result of the passage of the Lobbying

Disclosure Act of 1995 (LDA) and the Lobbying Disclosure Technical

Amendments Act of 1998 (LDTAA), both of which amended FARA. The

proposed regulations clarify the scope of the amended Act and some

exemptions to the Act, and make technical amendments to existing

regulations.

DATES: Written comments must be submitted on or before September 7,

1999.

ADDRESSES: Please address all written comments concerning this proposed

rule to Marshall R. Williams, Chief, Registration Unit, Internal

Security Section, Criminal Division, United States Department of

Justice, Washington, DC 20530.

FOR FURTHER INFORMATION CONTACT: Marshall R. Williams, Chief,

Registration Unit or Heather H. Hunt, Attorney, Registration Unit on

(202) 514-1216 or by facsimile on (202) 514-2836. These are not toll-

free numbers.

SUPPLEMENTARY INFORMATION: Under the Foreign Agents Registration Act of

1938 (FARA or the Act), 22 U.S.C. 611-621, agents of foreign principals

are required to register with the Department of Justice in order to

make periodic public disclosure of their relationship with the foreign

principal, activities on behalf of the foreign principal, and receipts

and disbursements in support of these activities. In the Lobbying

Disclosure Act of 1995, Public Law 104-65 (LDA), and the Lobbying

Disclosure Technical Amendments Act of 1998, Public Law 105-166

(LDTAA), Congress amended FARA in several respects. First, Congress

generally narrowed the scope of FARA to agents of foreign governments

and foreign political parties. Under new section 3(h) of FARA, 22

U.S.C. 613(h), agents of foreign principals other than foreign

governments or foreign political parties need not register under FARA

if such agents engage in lobbying activities and register under the

LDA. Second, Congress repealed section 1(q), 22 U.S.C. 611(a), which

had provided a safe harbor specifying circumstances in which agents of

multinational corporations would be exempt from registration under

section 3(d)(2) of the Act, 22 U.S.C. 613(d)(2). When Congress

authorized registration under the LDA rather than FARA for lobbying

activities on behalf of foreign principals other than foreign

governments and foreign political parties, section 1(q) became largely

unnecessary.

In addition, in the LDA Congress clarified the applicability of an

exemption in section 3(g), 22 U.S.C. 613(g), for legal representation

of a foreign principal in certain proceedings. Finally, Congress

substituted the term ``informational materials'' for the term

``political propaganda'' throughout FARA, except in section 4(e), 22

U.S.C. 614(e), which concerns the dissemination of materials on behalf

of the foreign principal, and in section 11, 22 U.S.C. 621, which

concerns the filing of a semi-annual report with Congress.

These amendments require changes in regulations implementing, among

others, sections 3(d)(2), 3(g), 3(h) and 4 of FARA. First, this

proposed rule clarifies the reach of section 3(d)(2) in light of the

repeal of section 1(q) of FARA. Section 3(d)(2) exempts from

registration under FARA activities of a political nature ``not serving

predominantly a foreign interest.'' Under the rule, activities of an

agent on behalf of a foreign commercial interest, even if the

activities are political in nature and are directed or controlled by a

foreign government or foreign political party, do not require

registration under FARA because such activities do not ``serve

predominantly a foreign interest'' for purposes of 3(d)(2). However,

the new regulation clarifies that even after the deletion of section

1(q), any person, including a foreign or domestic corporation, who

engages in political activities, not of a commercial nature, on behalf

of a foreign government or foreign political party is required to

register under FARA, as these activities will ``serve predominantly a

foreign interest'' and thus not be exempt under section 3(d)(2).

Second, the rule clarifies the circumstances in which agents of

foreign principals, other than foreign governments or foreign political

parties, can claim the new exemption provided in section 3(h), and

clarifies the reach of the revised ``attorneys' exemption'' in section

3(g). In addition, the proposed rule strikes the term ``political

propaganda'' wherever it appears in the regulations and substitutes the

LDA term, ``informational materials.'' Finally, the rule makes certain

technical amendments to the existing regulations to delete reference to

other repealed sections of the Act and to enable the Registration Unit

to more effectively administer the statute by allowing for electronic

filing in the future.

Certifications and Determinations

The Attorney General, in accordance with the Regulatory Flexibility

Act (5 U.S.C. 605(b)), has reviewed this proposed rule and, by

approving it, certifies that it will not have a significant economic

impact on a substantial number of small entities. The rule primarily

affects those persons required to register pursuant to FARA, currently

approximately 525 primary registrants and 2,464 individual short form

registrants.

This proposed rule has been drafted and reviewed in accordance with

Executive Order 12866, section 1(b), Principles of Regulation. The

Department of Justice has determined that it does not constitute

``significant regulatory action'' under section 3(f) of Executive Order

12866, Regulatory Planning and Review, and accordingly it has not been

reviewed by the Office of Management and Budget.

In addition, the Department of Justice certifies that this rule is

not a major rule as defined by section 251 of the Small Business

Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 804. The rule

will not result in an annual effect on the economy of $100 million or

more; a major increase in costs or prices; or significant adverse

effects on competition, employment, investment, productivity,

innovation, or the ability of United States-based companies to compete

with foreign-based companies in domestic and export markets.

Furthermore, this rule will not result in the expenditure by State,

local, and tribal governments, in the aggregate, or by the private

sector, of $100 million or more in any one year, and it will not

significantly or uniquely affect small governments. Therefore, no

actions were deemed necessary under the provisions of the Unfunded

Mandates Reform Act of 1995.

Finally, this rule will not have substantial direct effects on the

States, on the relationship between the national government and the

States, or on

[[Page 37066]]

distribution of power and responsibilities among the various levels of

government. Therefore, in accordance with Executive Order 12612, it is

determined that this rule does not have sufficient federalism

implications to warrant the preparation of a Federalism Assessment.

List of Subjects in 28 CFR Part 5

Aliens, Foreign relations, Reporting and recordkeeping

requirements, Security measures.

Accordingly, the Department of Justice proposes to amend part 5 of

title 28 of the Code of Federal Regulations, chapter I, as follows:

PART 5--ADMINISTRATION AND ENFORCEMENT OF FOREIGN AGENTS

REGISTRATION ACT OF 1938, AS AMENDED

1. The authority citation for part 5 continues to read as follows:

Authority: 28 U.S.C. 509, 510; section 1, 56 Stat. 248, 357 (22

U.S.C. 620); title I, Pub. L. 102-395, 106 Stat. 1828, 1831 (22

U.S.C. 612 note).

Sec. 5.5 [Amended]

2. a. Amend Sec. 5.5 in paragraph (d)(10) by adding the words

``informational materials,'' following ``reports,''.

b. Amend Sec. 5.5 in paragraph (d)(11) by adding the words

``informational materials,'' following ``reports,''.

Sec. 5.100 [Amended]

3. a. Amend Sec. 5.100 in paragraph (c) by removing ``1 (q),''.

b. Amend Sec. 5.100 in paragraph (d) by removing ``1 (q),''.

Sec. 5.200 [Amended]

4. Amend Sec. 5.200 in paragraph (b) by removing the words ``Form

OBD-63'' and adding, in their place, the words ``a form provided by the

Registration Unit''.

Sec. 5.201 [Amended]

5. a. Amend Sec. 5.201 in paragraph (a)(1) by removing the words

``Form OBD-67'' and adding, in their place, the words ``a form provided

by the Registration Unit''.

b. Amend Sec. 5.201 in paragraph (a)(2) by removing the words

``Form OBD-65'' and adding, in their place, the words ``a form provided

by the Registration Unit''.

Sec. 5.202 [Amended]

6. a. Amend Sec. 5.202 in paragraph (b) by adding the work

``registrable'' before the word ``activity''.

b. Amend Sec. 5.202 in paragraph (e) by removing the words ``Form

OBD-66'' and adding, in their place, the words ``a form provided by the

Registration unit''.

Sec. 5.203 [Amended]

7. Amend $5.203 in paragraph (a) by removing the words ``Form OBD-

64'' and adding, in their place, the words ``a form provided by the

Registration Unit''.

Sec. 5.204 [Amended]

8. Amend Sec. 5.204 in paragraph (a) by removing the words ``Form

OBD-68'' and adding, in their place, the words ``a form provided by the

Registration Unit''.

Sec. 5.205 [Amended]

9. Amend Sec. 5.205 in paragraph (a) by removing the words ``OBD-

64'' and adding, in their place, the words ``the supplemental statement

form.

Sec. 5.206 [Amended]

10. Amend Sec. 5.206 in paragraph (b) by adding the words ``or if

it is filed in an electronic format acceptable to the registration

Unit'' following the words ``ink''.

11. Revise paragraph (c) of Sec. 5.304 to read as follows:

Sec. 5.304 Exemptions under sections 3(d) and (e) of the Act.

* * * * *

(c) For the purpose of section 3(d)(2) of the Act, the term ``other

activities not serving predominantly a foreign interest'' includes

political activities on behalf of foreign commercial interests, even if

such activities are directed or controlled by a foreign government or

foreign political party. The term does not include other political

activities that are directly or indirectly supervised, directed,

controlled, financed, or subsidized in whole or in substantial part by

a government of a foreign country or a foreign political party.

* * * * *

12. Revise paragraph (a) of Sec. 5.306 to read as follows:

Sec. 5.306 Exemption under section 3(g) of the Act.

* * * * *

(a) Attempts to influence of persuade agency personnel or officials

other than in the course of judicial proceedings, criminal or civil law

enforcement inquiries, investigations, or proceedings, or agency

proceedings required by statute or regulation to be conducted on the

record, shall include only such attempts to influence or persuade with

reference to formulating, adopting, or changing the domestic or foreign

policies of the United States of with reference to the political or

public interests, policies, or relations of a government of a foreign

country or a foreign political party; and

* * * * *

Sec. 5.306 [Amended]

13. Amend Sec. 5,306 in the last sentence of paragraph (b) by

removing the word ``like'' and adding, in its place, the word ``fall''.

14. Add Sec. 5.307 to read as follows:

Sec. 5.307 Exemption under section 3(h) of the Act.

For the purpose of section 3(h) of the Act, the burden of

establishing that registration under the Lobbying Disclosure Act of

1995 (LDA), 2 U.S.C. 1601 et seq., has been made shall fall upon the

person claiming the exemption. The Department of Justice will accept as

prima facie evidence of registration a duly executed registration

statement filed pursuant to the LDA. In no case where a foreign

government or foreign political party is the ultimate foreign principal

will the exemption under section 3(h) be recognized.

Sec. 5.400 [Amended]

15. a. Amend the heading of Sec. 5.400 by removing the words

``political propaganda'' and adding, in their place, the words

``informational materials''.

b. Amend Sec. 5.400 in paragraph (a) by removing the words ``two

copies of each item of political propaganda'' and adding, in their

place, the words ``informational materials'', and by adding, before the

period, the words ``no later than 48 hours after the beginning of the

transmittal of the informational materials''.

c. Amend Sec. 5.400 in paragraph (b) by removing the words ``two

copies of an item of political propaganda'' and adding, in their place,

the words ``informational materials'' and by removing the word

``material'' and adding, in its place, ``materials''.

d. Amend Sec. 5.400 in the first sentence of paragraph (c) by

removing the words ``two copies of a motion picture containing

political propaganda'' and adding, in their place, the words ``a copy

of a motion picture''.

Sec. 5.401 [Removed]

16. Remove Sec. 5.401.

Sec. 5.402 [Amended]

17. a. Revise the heading of Sec. 5.402 as set forth below.

b. Amend Sec. 5.402 in paragraph (a) by removing the words

``political propaganda'' and adding, in their place, the words

``informational materials'', by removing the words ``it has'' and

adding, in their place, the words ``they have'', and by removing the

word ``its'' and adding in its place, the word ``their''.

c. Amend Sec. 5.402 in paragraph (b) by removing the words ``An

item of political propaganda which is'' and adding, in their place, the

words ``Informational materials'', and removing the words ``which is''

and adding, in their place, the words ``which are'', and by removing

the words ``such item'' and adding, in their place, the words ``such

materials''.

[[Page 37067]]

d. Amend Sec. 5.402 in paragraph (c) by removing the words ``An

item of political propaganda which is'' and adding, in their place, the

words ``Informational materials'', and by removing the phrase ``which

is not'' and adding, in its place, the phrase ``which are not''.

e. Amend Sec. 5.402 in paragraph (d) by removing the words

``Political propaganda as defined in section 1(j) of the Act which is''

and adding, in their place, the words ``Informational materials that

are'', and by removing the words ``is caused'' and adding, in its

place, the words ``are caused''.

f. Amend Sec. 5.402 in paragraph (e) by removing the words

``political propaganda as defined in section 1(j) of the Act'' and

adding, in their place, the words ``informational materials''.

g. Amend Sec. 5.402 in paragraph (f) by removing the words

``political propaganda'' and adding, in their place, the words

informational materials''.

h. Add new paragraph (g) to Sec. 5.402 to read as follows:

Sec. 5.402 Labeling informational materials

* * * * *

(g) For the purpose of section 4(b) of the Act, a statement will be

deemed conspicuous if it prefaces or accompanies the informational

materials.

Sec. 5.500 [Amended]

18. Amend Sec. 5.500 in paragraph (a)(4) by removing the words

``political propaganda has'' and adding, in their place, the words

``informational materials have''.

Sec. 5.600 [Amended]

19. Amend Sec. 5.600 by adding the words ``informational

materials,'' following the words ``Registration statements,'' and by

removing the words ``from 10 a.m. to 4 p.m.'' and adding, in their

place, the words `'during the posted hours of operation.''.

Sec. 5.601 [Amended]

20. a. Amend Sec. 5.601 in paragraph (a) by adding the words

``informational materials,'' following the word ``thereto,''.

b. Amend Sec. 5.601 in paragraph (b) by adding the words

``informational materials,'' following the word `'thereto,''.

Dated: June 26, 1999.

Janet Reno,

Attorney General.

[FR Doc. 99-16941 Filed 7-8-99; 8:45 am]

BILLING CODE 4410-14-M