Regulation of lobbying

General

Is lobbying self-regulated by the industry, or is it regulated by the government, legislature or an independent regulator? What are the regulator’s powers?

In the United States, lobbying is regulated by federal and state governments in attempt to balance the tension between the right to petition the government and the regulation of access to and power over policymakers. At the federal level, lobbyists must report lobbying activities to the Secretary of the Senate and the Clerk of the House of Representatives, who refer acts of non-compliance (or suspected non-compliance) to the Department of Justice, specifically the US Attorney for the District of Columbia. The law does not allow the Secretary or the Clerk to write substantive regulations or make definitive opinions on the interpretation of the law, but they have occasionally issued guidance on registration and reporting requirements. The US Attorney’s Office for the District of Columbia has the power of enforcement as in other matters, and, in general, it offers lobbying registrants the opportunity to take corrective action before taking further action. If a registrant fails to correct the non-compliance issue, prosecutors can levy civil penalties of up to US$200,000 per violation and up to five years’ imprisonment.

At the state level, all states require lobbyists to report on certain activities, but have a range of different rules relating to reporting requirements, campaign finance rules and ethics. For example, in some states lobbyists can give certain gifts to lawmakers whereas in other states (and the federal government), gifts are highly limited. To lobby a state legislature, it is typically necessary for an individual to register with the state entity that oversees state lobbying activity. In addition, states levy a variety of different penalties for non-compliance or violations of lobbying regulations.

Definition

Is there a definition or other guidance as to what constitutes lobbying?

The United States does not have a single definition for lobbying. For federal lobbying, the Lobbying Disclosure Act of 1995 (LDA), which governs federal lobbying, defines lobbying activities as any oral, written or electronic communication made to an executive or legislative branch official on behalf of a client with regard to:

  • the formulation, modification or adoption of federal legislation;
  • the formulation, modification or adoption of a rule, regulation, executive order or any other programme;
  • the administration or execution of a federal programme or policy; and
  • the nomination of a person subject to confirmation by the Senate.

Any preparation or planning activities and research that is intended to be used in lobbying activities is also included in the definition.

The same statute defines a lobbyist as an individual who is employed or retained by a client for financial or other compensation for services that include more than one lobbying contact, other than an individual whose lobbying activities make up less than 20 per cent of the time engaged in the services provided by such individual to that client over a three-month period.

Registration and other disclosure

Is there voluntary or mandatory registration of lobbyists? How else is lobbying disclosed?

The lobbying reporting requirements have changed historically based on the way lobbying has been practised and perceived in US society. In general, reporting requirements have been implemented to allow Congress to enhance transparency and disclosure of lobbying activities while avoiding infringing on Americans’ right to petition their government. Federal law mandates that lobbying firms and organisations must register and file reports of lobbying activities with the Secretary of the Senate and the Clerk of House of Representatives. Lobbyists are required to register a client and each registrant must file a quarterly activity report disclosing the amount of income from a client. The report must provide specific details of which governmental bodies were lobbied, and on what issue and topic. Lobbyists and special interests are also required to report political donations on a semi-annual basis. Lobbyists representing the interests of a foreign country or entity must also make periodic disclosures regarding the relationship, related activities and finances to the Department of Justice.

Activities subject to disclosure or registration

What communications must be disclosed or registered?

Oral and written communications are not disclosed on an individual basis, but lobbyists are required to report quarterly which offices of the executive and legislative branches of government have been lobbied. As a result, there is a growing concern, including from the non-partisan Office of Congressional Ethics, that ‘shadow lobbying’ exists under the currently regulatory scheme. Shadow lobbying is where lobbyists might choose not to register under the LDA or to report discussions with governmental officials despite their active attempts to influence public policymaking.

Documents controlled by the federal government are subject to disclosure in certain circumstances. Under the Freedom of Information Act, the public has the right to request access to federal agency records and information unless the records are exempt from disclosure. Exemptions exist for sensitive information that may be classified, invade a person’s privacy, or cause other harm. The Freedom of Information Act only applies to the executive branch of the federal government. Congress and private citizens are not subject to the statute. Therefore, communications made to executive branch agencies may be subject to disclosure if a person files a Freedom of Information Act request with that agency.

Entities and persons subject to lobbying rules

Which entities and persons are caught by the disclosure rules?

In general, the lobbying rules in the United States are crafted to capture professional lobbyists and to not include grass-roots lobbying efforts and other lobbying activities that are done on a pro bono basis. There is no distinction in terms of reporting requirements between persons that lobby on behalf of themselves and for those that lobby third parties. Lobbying firms are required to file a separate registration for each client. A lobbying firm is exempt from registration for a particular client if its total income from that client for lobbying activities does not exceed US$3,000 during a quarterly period. The registration requirement is triggered when either: (i) the date the employee or lobbyist is employed or retained to make more than one lobbying contact (and meets the 20 per cent threshold for time engaged); or (ii) on the date the employee or lobbyist makes a second lobbying contact.

Lobbyist details

What information must be registered or otherwise disclosed regarding lobbyists and the entities and persons they act for ? Who has responsibility for registering the information?

Lobbyists are required to file a quarterly lobbying report that discloses a number of different items, including information about the client, income or expenses, specific lobbying issues, governmental bodies lobbied and the name of each individual who acted as a lobbyist that quarter. In addition, individuals are required to disclose whether they served in a official position prior to working as a lobbyist. Separate to a lobbying disclosure report, lobbyists, lobbying firms and organisations are required to report any federal campaign contributions of US$200 or more to organisations or candidates including candidate committees, leadership political action committees (PACs) and party committees. Lobbyists who act on behalf of foreign countries or entities must also file periodic disclosures with the Department of Justice.

Content of reports

When must reports on lobbying activities be submitted , and what must they include?

Lobbyists must report their activities on a quarterly basis, and lobbying firms adopt different reporting practices depending on their internal procedures and controls. Lobbying reports require lobbyists to identify the general issue lobbied on through a lobbying issue code and to elaborate on specific lobbying issues by writing a description of their activities. Lobbying reporting does not require lobbyists to report which officials were contacted, only the overall body they are a part of, such as the chamber of Congress or an executive agency. Some lobbying firms make an effort to be overly inclusive in reporting their activities by listing specific issues and legislation that were lobbied on, where as other firms might provide a summary that makes their activities opaque. Lobbyists are required to report income or expenses rounded to the nearest US$10,000 of all lobbying-related income from the client over the amount of US$5,000.

Financing of the registration regime

How is the registration system funded?

The United States’ lobbying registration system, the Lobbying Disclosure Act Database, depends on public financing and is managed by the Secretary of the Senate and the Clerk of the House of Representatives.

Public access to lobbying registers and reports

Is access to registry information and to reports available to the public?

The Senate and House Offices of Public Records receive, process and maintain lobbying reports received through the Lobbying Disclosure Act Database. The Database is internet-accessible and the public can look up quarterly lobbying reports based on a number of different criteria including client, lobbying firm and lobbyist. Separately, the Federal Election Commission maintains a database that keeps track of political donations. Consequently, some non-profit organisations, such as OpenSecrets, have successfully created a platform that allows the public to view a companies’ lobbying activities and the donations made by a given company’s PAC or employees in one searchable database.

Code of conduct

Is there a code of conduct that applies to lobbyists and their practice?

The code of conduct that applies to lobbyists and their practice more generally is established by the House and Senate Committees on Ethics. The Committees establish a mandatory code of conduct that members, officers and employees of Congress must adhere to and, by extension, the lobbyists who interact with them. For example, under both the House and Ethics rules, members and employees are not allowed to accept any gift from a registered lobbyist, foreign agent or an entity that employs or retains a lobbyist. In addition, members and employees are unable to attend events or meals held by lobbyists unless it meets certain criteria, which are established by the Ethics Committees.

Media

Are there restrictions in broadcast and press regulation that limit commercial interests’ ability to use the media to influence public policy outcomes?

There are no restrictions in broadcast and press regulation that limit commercial interests’ ability to use the media to influence public policy outcomes.