NSD Issues First Declination Under New Mergers And Acquisitions Policy

In March 2024, the National Security Division (NSD) of the Department of Justice (DOJ) issued a new Mergers and Acquisitions (M&A) Policy as part of its Enforcement Policy for Business Organizations. The NSD M&A Policy provides that when a company (1) completes a lawful bona fide acquisition of another entity, (2) voluntarily and timely self-discloses¹ to NSD potentially criminal violations of laws affecting U.S. national security committed by the acquired entity (such as violations of sanctions and export control laws), (3) fully cooperates with NSD's investigation, and (4) timely and appropriately remediates² the misconduct, NSD generally will not seek a guilty plea from the acquiror, and there is a presumption that NSD will decline to prosecute the acquiror. The M&A Policy further provides that, although a presumption of declination is not available for the acquired entity, NSD will credit the acquiror's timely voluntary self-disclosure (VSD) to the acquired entity