[Federal Register Volume 68, Number 108 (Thursday, June 5, 2003)]
[Rules and Regulations]
[Pages 33629-33631]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-13947]


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DEPARTMENT OF JUSTICE

28 CFR Part 5

[AG Order No. 2674-2003]
RIN 1105-AA45


Foreign Agents Registration Act

AGENCY: Department of Justice.

ACTION: Final rule.

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SUMMARY: The Department of Justice is amending its existing regulations 
implementing the Foreign Agents Registration Act of 1938, as amended. 
The rule establishes 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 the Foreign Agents Registration Act, and makes technical 
amendments to existing regulations.

DATES: July 7, 2003.

FOR FURTHER INFORMATION CONTACT: Heather H. Hunt, Attorney, 
Registration Unit, Counterespionage Section, Criminal Division, United 
States Department of Justice, 1400 New York Avenue, NW., Washington, DC 
20530, telephone (202) 514-1216, facsimile (202) 514-2836. These are 
not toll-free numbers.

SUPPLEMENTARY INFORMATION:

Why Is the Department Changing the Foreign Agents Registration Act 
Regulations?

    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, Pub. L. 104-65, 2 U.S.C. 1601-1613 (LDA), and 
the Lobbying Disclosure Technical Amendments Act of 1998, Pub. L. 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 Second, Congress repealed section 1(q) of the Act, 22 U.S.C. 
611(q), 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 the FARA regulations.

Did the Department Solicit Public Comments?

    On July 9, 1999, a proposed rule was published in the Federal 
Register (64 FR 37065). Interested persons were afforded the 
opportunity to participate in the regulatory process. The comment 
period ended on September 7, 1999. No written comments were received on 
the proposed rule. Notwithstanding the fact that comments were not 
received, the Department made minor clarifying adjustments to the 
proposed rule under 28 CFR 5.304 and 5.307 to more clearly construe the 
section 3(d)(2) and 3(h) exemptions.

How Does This Final Rule Change the Current Regulations?

    The amendments to FARA required changes implementing, among others, 
sections 3(d)(2), 3(g), 3(h) and 4 of FARA. First, this rule clarifies 
the reach of section 3(d)(2) in light of the repeal of section 1(q) of 
FARA. Section 3(d)(2) of the Act exempts from registration under FARA 
activities of a political nature ``not serving predominantly a foreign 
interest.'' Under the rule, political activities of an agent on behalf 
of a foreign corporation, even if the foreign corporation is owned in 
whole or in part by a foreign government, where the political 
activities further the bona fide commercial, industrial, or financial 
operations of the foreign corporation, are not directed by a foreign 
government or foreign political party, and do not directly promote the 
public or political interests of 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). Even after the deletion of section 1(q), any 
person, including a foreign or domestic corporation, who engages in 
political activities, not in furtherance of the bona fide commercial, 
industrial, or financial operations of a foreign corporation, but, 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 it 
clarifies the reach of the revised ``attorneys' exemption'' in section 
3(g). In addition, the rule strikes

[[Page 33630]]

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 references to other repealed sections of the Act 
and to enable the Registration Unit to administer the statute more 
effectively by allowing for electronic filing in the future.

Certifications and Determinations

Regulatory Flexibility Act

    The Attorney General, in accordance with the Regulatory Flexibility 
Act (5 U.S.C. 605(b)), has reviewed this 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 
500 primary registrants and 2,500 individual short form registrants. 
The rule merely conforms Department regulations to changes made by the 
LDA and the LDTAA. These acts reduced the number of people who had to 
file reports with the Department.

Executive Order 12866

    This 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.

Small Business Regulatory Enforcement Fairness Act of 1996

    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.

Unfunded Mandates Reform Act of 1995

    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.

Executive Order 13132

    This rule will not have substantial direct effects on the States, 
on the relationship between the national government and the States, or 
on distribution of power and responsibilities among the various levels 
of government. Therefore, in accordance with Executive Order 13132, it 
is determined that this rule does not have sufficient federalism 
implications to warrant the preparation of a Federalism Assessment.

Executive Order 12988

    This regulation meets the applicable standards set forth in 
sections 3(a) and 3(b)(2) of Executive Order 12988.

Plain Language

    We try to write clearly. If you can suggest how to improve the 
clarity of these regulations, contact Heather H. Hunt, Attorney, 
Registration Unit, Counterespionage Section, Criminal Division, United 
States Department of Justice, telephone (202) 514-1216.

List of Subjects in 28 CFR Part 5

    Aliens, Foreign relations, Reporting and recordkeeping 
requirements, Security measures.

0
Accordingly, the Department of Justice amends Part 5 of title 28 of the 
Code of Federal Regulations, chapter 1, as follows:

PART 5--ADMINISTRATION AND ENFORCEMENT OF FOREIGN AGENTS 
REGISTRATION ACT OF 1938, AS AMENDED

0
1. The authority citation for Part 5 continues to read as follows:

    Authority: 28 U.S.C. 509, 510; Section 1, 56 Stat. 248, 257 (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]

0
2. a. Amend Sec.  5.5 in paragraph (d)(10) by adding the words 
``informational materials,'' following ``reports,''.
0
b. Amend Sec.  5.5 in paragraph (d)(11) by adding the words 
``informational materials,'' following ``reports,''.


Sec.  5.100  [Amended]

0
3. a. Amend Sec.  5.100 in paragraph (c) by removing ``1(q),''.
0
b. Amend Sec.  5.100 in paragraph (d) by removing ``1(q),''.


Sec.  5.200  [Amended]

0
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]

0
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''.
0
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]

0
6. a. Amend Sec.  5.202 in paragraph (b) by adding the word 
``registrable'' before the word ``activity''.
0
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]

0
7. Amend Sec.  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]

0
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]

0
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]

0
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 word ``ink''.
0
11. Revise paragraph (c) of Sec.  5.304 to read as follows:


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

* * * * *
    (c) For the purpose of section 3(d)(2) of the Act, a person engaged 
in political activities on behalf of a foreign corporation, even if 
owned in whole or in part by a foreign government, will not be serving 
predominantly a foreign interest where the political activities are 
directly in furtherance of the bona fide commercial, industrial, or 
financial operations of the foreign corporation, so long as the 
political activities are not directed by a foreign government or 
foreign political party and the political activities do not directly 
promote the public or political interests of a foreign

[[Page 33631]]

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

0
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 or 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 or 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]

0
13. Amend Sec.  5.306 in paragraph (b) by removing the word ``like'' 
and adding, in its place, the word ``fall''.

0
14. Add Sec.  5.307 to read as follows:


Sec.  5.307  Exemption under 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, 2 U.S.C. 1601 et seq. (LDA), 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 principal beneficiary will 
the exemption under 3(h) be recognized.


Sec.  5.400  Filing of informational materials.

0
15. a. The section heading of Sec. 5.400 is revised to read as set 
forth above.
0
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''.
0
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, the word ``materials''.
0
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]

0
16. Remove Sec.  5.401.


Sec.  5.402  Labeling informational materials.

0
17. a. The section heading of Sec.  5.402 is revised to read as set 
forth above.
0
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''.
0
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 which are'', and by removing the word 
``is'' from the phrase ``which is in the form of prints'' and adding, 
in its place, the word ``are'', and by removing the word ``item'' from 
the phrase ``such item'' and adding, in its place, the word 
``materials''.
0
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 word ``is'' from 
the phrase ``which is not in the form of prints'' and adding, in its 
place, the word ``are''.
0
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 word ``is'' before the word ``caused'' and adding, in its 
place, the word ``are''.
0
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''.
0
g. Amend Sec.  5.402 in paragraph (f) by removing the words ``political 
propaganda'' and adding, in their place, the words ``informational 
materials''.


Sec.  5.500  [Amended]

0
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]

0
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]

0
20. a. Amend Sec.  5.601 in paragraph (a) by adding the words 
``informational materials,'' following the word ``thereto,''.
0
b. Amend Sec.  5.601 in paragraph (b) by adding the words 
``informational materials,'' following the word ``thereto,''.

    Dated: May 28, 2003.
John Ashcroft,
Attorney General.
[FR Doc. 03-13947 Filed 6-4-03; 8:45 am]
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