All acquired companies and potential M&A targets of US companies, a call for caution or a chance to act?
The US Department of Justice (DOJ) has introduced a policy to incentivize acquiring companies to self-report misconduct within acquired companies. The DOJ has adopted a transformative approach, placing a stronger emphasis on transparency and accountability with the introduction of the Voluntary Self Disclosure: DOJ's new Mergers & Acquisitions Safe Harbor Policy.
Acquiring companies stand to gain various benefits, including the presumption of a decision not to prosecute, if they promptly and voluntarily disclose any misconduct within the acquired entities within 6 months of the closing date, regardless of whether it was discovered pre or post-acquisition.
The DOJ emphasizes, "... We are placing an enhanced premium on timely compliance-related due diligence and integration. Compliance must have a prominent seat at the deal table if an acquiring company wishes to effectively de-risk a transaction..."
Well, a compelling trigger for acquired and potential target companies to revisit and optimize their compliance mechanisms for maximum effectiveness OR even to have one in the first place!!??
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