New changes to two documents related to USAID’s contract and certification process have reduced the “look-back” period from 10 to three years, and clarified that grantees need only check U.S. government and UN terrorist lists when screening partners and other persons and entities. The previous language in both of these documents had facilitated “lawfare” attacks on nonprofit organizations working in Palestine, in the form of False Claim Act lawsuits. The new language will make those claims more difficult.
On May 18, 2020 USAID published significant revisions to its anti-terrorism requirements for grantees in two documents – the Anti-Terrorism Certification (ATC) and the Standard Provision on Preventing Transactions with, or the Provision of Resources or Support to Sanctioned Groups and Individuals (Standard Provision). These changes will provide improved clarity and reasonable standards regarding grantees’ obligations in all grant agreements going forward.
The first update, to the ATC, pertains to assurances that the grantee has not provided material support to terrorist entities within the last three years (reduced from previous “look-back” requirement of 10 years). The second change, to USAID’s Standard Provision, prohibits grantees from engaging in unlicensed transactions with entities or persons on the U.S. government or UN terrorist lists. This revision eliminates the overly broad and vague requirement that all publicly information be considered when screening partners and other parties.
The revisions are the product of constructive engagement between civil society and USAID and are a substantial improvement over the previous versions. Joel Charny of the Norwegian Refugee Council said, “This victory is a demonstration of how effective our community can be when we work together. We presented a constructive collective proposal for changes in the ATC and the response from USAID was positive from the beginning. The result does not solve all of our problems by any means, but it reduces the risk of USAID partners being trapped in legal minefields as they pursue their humanitarian missions.”
The new provisions were published as part of an update to USAID’s ADS Chapter 303 Grants and Cooperative Agreements to Non-Governmental Organizations, which requires USAID agreement officers to obtain a series of certifications from grantees, including the ATC (See p. 34, Sec. 303.3.8(a)(4)). The revised ATC appears in Certifications, Assurances, Representations, and Other Statements of the Recipient A Mandatory Reference for ADS Chapter 303 (see 303d section 4, p. 4-5). The Standard Provision is part of the overall Standard Provisions for U.S. Nongovernmental Organizations A Mandatory Reference for ADS Chapter 303 (see section M12, p. 12).
Key changes to the ATC include:
- Reducing the “look-back” time a grantee certifies it has not provided material support to terrorist entities from 10 years to three. Note that the provision does not changes USAID’s policy that the certification applies to all funds and programs of a grantee, from any source or in any location).
- Only requires that the grantee did not “knowingly engage in” prohibited transactions, eliminating the vague requirement that the grantee had no such transactions “to the best of its current knowledge.”
- Added a knowing standard to the limit on assistance to beneficiaries, barring assistance if the “applicant knew or had reason to believe that one or more of these beneficiaries was subject to U.S. or U.N. terrorism-related sanctions.” The previous certification only included the “reason to believe” standard.
The key change in the Standard Provision is a clear requirement that the “recipient will not engage in transactions with, or provide resources or support to, any individual or entity that is subject to sanctions administered by OFAC or the United Nations (UN)” and elimination of problematic language that required the recipient to “consider all information about that individual or entity of which it is aware and all public information that is reasonably available to it or of which it should be aware.” The definition of material support of terrorism has not been changed, as that is a statutory definition and must be changed by Congress.
The 10-year “look-back” provision of the ATC, combined with vague and broad obligations for grantees, has been used by the Zionist Advocacy Center (TZAC) to file False Claims Act lawsuits against USAID grantees that work in Palestine. These “lawfare” attacks are based on the spurious claim that some grantees had falsely certified they did not provide “material support.” Of the cases filed by TZAC, two settled prior to trial and two were dismissed at the request of the Department of Justice. No court has ruled that TZAC’s expansive interpretation of material support is correct. For more information on “lawfare” attacks see https://charityandsecurity.org/issue-areas/false-claims-act-lawsuits/.