Client Alerts & Newsletters

DSS Initiative to Adopt a More Holistic Evaluation of FOCI Boards


On August 31, 2018, the Defense Security Service (DSS) issued a white paper suggesting an initiative to expand the considerations it evaluates in reviewing nominations and performance of Outside Directors or Proxy Holders (OD/PHs) serving on Boards of Directors of FOCI-mitigated entities. Specifically, DSS intends to evaluate nominees for OD/PH positions not just on their personal backgrounds but also in the context of the entire Board, suggesting that it considers OD/PH Board members to be able to contribute experience beyond a national security background. While many companies already consider such factors when identifying nominees for OD/PH positions, the new initiative suggests DSS will be seeking such justifications in the review process and hints that it may require specific OD/PH training and on-going internal or external reviews of FOCI Boards and OD/PH performance. One bit of good news is a suggestion that the strict prohibition on an OD/PH having any prior relationship with the FOCI-mitigated entity may be relaxed.

For more information, please contact the professional(s) listed below, or your regular Crowell & Moring contact.

Alan W. H. Gourley
Partner – Washington, D.C.
Phone: +1 202.624.2561

Adelicia R. Cliffe
Partner – Washington, D.C.
Phone: +1 202.624.2816

Maria Alejandra (Jana) del-Cerro
Partner – Washington, D.C.
Phone: +1 202.624.2843

Stephanie L. Crawford
Associate – Washington, D.C.
Phone: +1 202.624.2811

Crowell & Moring LLP is an international law firm with approximately 550 lawyers representing clients in litigation and arbitration, regulatory and policy, and transactional matters. The firm is internationally recognized for its representation of Fortune 500 companies in high-stakes litigation, as well as its ongoing commitment to pro bono service and diversity, equity and inclusion. The firm has offices in Brussels, Doha, London, Los Angeles, New York, Orange County, San Francisco, Shanghai, and Washington, D.C.

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