The Foreign Emoluments Clause and the Chief Executive

By Amandeep S. Grewal. Full text here.

The 2016 presidential election brought widespread attention to a part of the Constitution, the Foreign Emoluments Clause, that had previously enjoyed a peaceful spot in the dustbin of history. That clause generally prohibits U.S. Officers from accepting emoluments from foreign governments, absent congressional consent. Several commentators believe that President Trump will inevitably run into this prohibition, given the global business dealings of the Trump Organization. They read emolument as referring to any payment received from a foreign government, such that even a diplomat’s payment of a room reservation fee at the Trump Hotel establishes a potentially impeachable offense.

This Article argues that the commentators have interpreted emoluments far too broadly. Numerous legal authorities show that an emolument, as used in the Foreign Emoluments Clause, refers to payments from a foreign government made in exchange for the U.S. Officer’s performance of services (office-related compensation). The term does not refer to any and all payments from a foreign government.

After establishing the proper definition of emolument, this Article considers the vexing questions that arise when attempting to apply the Foreign Emoluments Clause to transactions involving business entities owned by, or affiliated with, a U.S. Officer. The Office of Legal Counsel and the Comptroller General have each proposed tests to deal with these issues, but their approaches suffer from conceptual flaws. This Article proposes an alternative three-part business entity test to help analyze these problems.

After tangling with the definitional questions related to emoluments and the complications presented by business entities, this Article examines whether the activities of the Trump Organization establish violations of the Foreign Emoluments Clause. It concludes that market-rate transactions between the Trump Organization and foreign governments do not come within the clause. However, payments to the Trump Organization in excess of market rates may establish potentially unconstitutional gifts, emoluments, or bribes. Payments made to President Trump personally in exchange for services would also raise constitutional problems.