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Curtis and Varner Share Thoughts on DOJ’s New M&A Disclosure Policy

November 8, 2023

Deborah Curtis, White Collar Defense & Investigations partner, and Andrew Varner, co-head of the firm's M&A practice, were recently featured in The Wall Street Journal, Bloomberg Law, and Global Investigations Review, where they discussed the U.S. Department of Justice’s new policy encouraging acquiring companies to disclose wrongdoings uncovered during mergers and acquisitions.

Under the policy’s “safe harbor” provision, an acquiring company will have six months from a deal closing to self-report potential wrongdoing at a company being acquired, as well as one year from closing to correct misconduct to avoid prosecution. Varner told Bloomberg Law that although the DOJ’s new policy is similar to ones it has issued in the past, it explicitly states that disclosing companies may avoid prosecution, indicating there “could be changes on the margins.”

The DOJ said that acquisitions of “disruptive technologies by adversarial entities” are “the paramount concern on the horizon for U.S. national security and global security,” Curtis told The Wall Street Journal, meaning that disclosure should come immediately in instances where national security is threatened. Whether companies probing violations of sanctions and export controls also threaten national security remains unclear, but such companies should disclose as soon as possible because “it's a ticking clock once you discover something that could be a national security violation,” Curtis told Global Investigations Review.

» Read the Bloomberg Law article: “Private Equity Seeks Legal Guidance on New M&A Disclosure Policy” (subscription required).

» Read The Wall Street Journal article: “DOJ Policy on M&A to Encourage Extra Scrutiny of Target Companies’ Compliance” (subscription required).

» Read the Global Investigations Review article: “Caveats could limit impact of DOJ’s Safe Harbor policy, lawyers say” (subscription required).