The imperatives of dealmaking require quick and decisive action. Any successful executive knows that delay can cause a transaction to collapse because business conditions change and competitors intervene. When ambiguous laws and indecisive legal advice cause the delay, lawyers become designated javelin catchers as companies lose opportunities or forge ahead into unknown risks. And nowhere are the laws and their application more fraught with uncertainty than in the expanding U.S. assertion of extraterritorial criminal and regulatory jurisdiction.

Imagine that a U.S. company has decided to enter into a joint venture abroad. The prospective foreign partner has a valuable license from the foreign government. The U.S. company learns that its future partner secured the license by bribing government officials. The corporation's lawyers warn that continuing with the deal could provoke a U.S. criminal investigation under the Foreign Corrupt Practices Act, a federal statute that prohibits U.S. companies and individuals from bribing foreign government officials. (See 15 U.S.C. § 78dd-1, et seq.) But the lawyers caution that they cannot be sure because the precise fact pattern has never been litigated before.

Imagine a U.S. company wants to provide financial services to a foreign company that does some a portion of its business in countries sanctioned under U.S. law, like Cuba or Iran. Could that arrangement draw the U.S. company into an unwitting violation of U.S. sanctions?

Such gray areas loom large, and it is often hard to know where regulators will draw the line -- and that is especially true in the realm of international dealmaking, where jurisdictions blur and accurate facts can be hard to discern. Broad statutory and regulatory language, the dearth of case law applying criminal statutes to corporations, and the infinite variety of real-world fact patterns mean that corporations often must choose between a profitable business that carries some risk of criminal enforcement and abandoning a deal because it may draw scrutiny from regulators.

U.S. enforcement agencies typically have some mechanism to issue an advisory opinion that can clarify these gray areas in the law. Some work well, but businesses and outside counsel shy away from others. U.S. enforcement agencies are trying to fix that problem. They should make their advisory opinion mechanisms reliably swifter and, therefore, commercially practicable.

The Securities and Exchange Commission's "no-action letter" procedure is one long-standing and efficient process for responding to informal requests for advice on proposed transactions. In response to company requests, SEC staff can issue no-action letters, indicating that the staff would recommend against enforcement action if the deal went forward. (See Procedures Utilized by the Division of Corporate Finance for Rendering Informal Advice, Securities Act Release No. 6253, 45 Fed. Reg. 72,644 (Nov. 3, 1980).) The SEC staff issues thousands of informal letters each year, allowing companies to obtain guidance cheaply and without risking public controversy. Although the staff's letters are nonbinding, they provide some comfort against future enforcement action. (See 17 C.F.R. § 202.1(d).) Additionally, because the no-action letters are publicly available, they create valuable precedent for other companies to follow. (See Securities Act Release No. 6253, supra.)

The Office of the Inspector General, or OIG, of Health and Human Services, or HHS, provides a similar service for companies concerned about violations of the federal anti-kickback statute. The process was instituted in response to complaints that the statute was so unclear that it discouraged healthcare organizations from pursuing lawful activities. (See Issuance of Advisory Opinions by the OIG, 42 C.F.R. § 1008 (1997).) The OIG's advisory opinions go beyond SEC no-action letters in that a favorable opinion confers immunity from HHS enforcement action. (See 42 C.F.R. §§ 1008.1-1008.59.)

Other enforcement agencies' processes can be cumbersome and therefore impractical given the pace of the deal. One flawed process is the advisory opinion procedure mandated by the Foreign Corrupt Practices Act. The FCPA carries potentially steep fines and individual criminal liability, but its broadly worded terms remain vague because the statute is rarely litigated in court. And companies doing business internationally have reason to fear FCPA investigations. The Department of Justice and the SEC have achieved substantial FCPA settlements, and they have pledged to continue to confront what they see as endemic corruption by pursuing broad investigations, sometimes with increasingly creative theories.

Like the HHS and SEC staff, the DOJ will give advice in response to requests from companies on the legality of real and anticipated "specified prospective conduct" under the FCPA. A green light from the DOJ creates a rebuttable presumption that the conduct complies with the anti-bribery provisions of the statute. (See 15 U.S.C. § 78dd-1(e); 28 C.F.R. §§ 80.1-80.16.) Yet despite the stakes and the protections that an opinion can confer, U.S. businesses rarely avail themselves of this process. Since 1993, the DOJ has published only about two opinions a year.

Why are companies so hesitant to seek advisory opinions? Quite simply, business people see the process as slow and impractical. By regulation, the DOJ must respond to companies' inquiries within 30 days of submission (see 28 C.F.R. §§ 80.7-80.8), but in practice, the process can take months. One final opinion published in 2004, for example, came eight months after the initial request. (See FCPA Opinion Procedure Releases Nos. 04-01 (January 6, 2004).) A common cause for delay is that the DOJ often follows up with requests for additional information before issuing an opinion. At times, a company may not know critical details until it is too late to hold up the deal. Companies also fear attracting unwanted regulatory scrutiny because requests for advice may alert the DOJ to possible FCPA issues.

An FCPA opinion process that moved fast enough to satisfy business needs would be invaluable to U.S. companies operating abroad. There is some indication that the DOJ is dedicated to speeding up the procedure. In 2006, the assistant attorney general for the DOJ's criminal division stated that the FCPA opinion procedure should serve as a "useful ... guide to business." (See Alice S. Fisher, Remarks at ABA National Institute on the Foreign Corrupt Practices Act 7-8 (Oct. 16, 2006).) In June 2008, the DOJ issued an opinion on a proposed acquisition by Halliburton Co., the Houston-based oil company. According to a lawyer involved in the deal, the DOJ issued this opinion quickly and provided valuable, real-time guidance. The four other opinions published since June 2008 were issued in four days, 38 days, 54 days and 60 days, and all but the first opinion involved requests for additional information. (See FCPA Opinion Procedure Releases Nos. 08-03 (July 11, 2008); 09-01 (Aug. 3, 2009); 10-01 (April 19, 2010); 10-02 (July 16, 2010).) The DOJ has not yet built a consistent record of devoting the time and resources necessary to turn requests around quickly, but these recent efforts are promising.

The Office of Foreign Assets Control's licensing procedure also strains commercial practicality. The OFAC administers economic sanctions against certain foreign individuals, groups and countries like Burma, Cuba and Iran. The OFAC can conduct investigations into alleged sanctions violations, impose civil penalties and refer matters to the DOJ for criminal enforcement. (See Economic Sanctions Enforcement Guidelines, 74 Fed. Reg. 57,593-01 (Nov. 9, 2009).)

Recent high-profile OFAC sanctions cases include the January 2009 settlement with Lloyds TSB, which agreed to pay $350 million to resolve allegations that it violated OFAC sanctions against Iran and Sudan. In May 2010, ABN Amro Bank NV, now named the Royal Bank of Scotland NV, agreed to pay a total of $580 million (adding in an earlier $80 million) to settle criminal and civil sanctions violations.

Despite, or perhaps because of, the significant potential penalties, there is little case law interpreting these sanctions regulations. To avoid gray areas, companies frequently seek advice from the OFAC on whether they need a legal license to engage in certain business. (See 31 C.F.R. § 501.801.) Unfortunately, the OFAC's schedule for responding to companies' licensing requests can be too slow for most commercial timetables. Anecdotal experience shows that the OFAC can take up to year to respond to licensing requests.

U.S. laws carry severe penalties, and especially when enforced abroad, their interpretation can be uncertain. Enforcement agencies should help U.S. companies compete by revamping their procedures to offer prompt and clear guidance on complex transactions. Some agencies already do this well. The alternative is expense, delay, uncertainty and missed business opportunities, not to mention the threat of unanticipated individual criminal liability for executives.

Andrew C. Hruska is a partner in the special matters and government investigations practice group in the New York office of King & Spalding LLP. Louisa B. Childs is an associate in the group.