Foreign Emoluments

The Foreign Emoluments Clause is a provision of the United States Constitution that prohibits federal officials from receiving any benefit, financial or otherwise, from a foreign government. The clause requires Congress to consent to any federal official receiving a benefit from a foreign government. The clause also prohibits the federal government from granting titles of nobility.

The term "emolument" is derived from the Latin term "emolumentum," which could mean either effort or labor, or benefit, gain, or profit. In the legal context, an emolument is compensation for employment, services, or holding office. Examples of emoluments include salary, wages, and fees.

Article I, Section 9, Clause 8:

No Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.

For most of its history, courts have rarely substantively analyzed or interpreted the Foreign Emoluments Clause. During the administration of President Donald Trump, however, a number of private parties, state attorneys general, and Members of Congress sued the President based on alleged violations of both the Foreign Emoluments Clause and the Domestic Emoluments Clause (collectively, the Emoluments Clauses). Three major federal lawsuits concerning the Emoluments Clauses were filed against President Trump. Over nearly four years, these cases progressed through the lower federal courts, resulting in the first significant judicial decisions on the Emoluments Clauses.

In late 2020, the Supreme Court denied review in one of these cases, and—after the end of President Trump’s term in January 2021—instructed two federal appellate courts to vacate their judgments and dismiss the other two cases as moot. As a result, most of the lower court decisions on the Emoluments Clauses have been vacated. In the absence of definitive precedent from the Supreme Court, this section reviews these lower court holdings regarding the meaning and scope of the Emoluments Clauses, although they generally retain at most persuasive, and not precedential, value.

In the three cases, plaintiffs alleged that President Trump’s retention of certain business and financial interests during his Presidency violated the Emoluments Clauses. For example, because President Trump retained an ownership interest in the Trump International Hotel, plaintiffs alleged he received constitutionally forbidden emoluments when foreign or state governments paid for their officials to stay at the Hotel. In a series of rulings, the lower courts addressed three main issues: (1) who has standing to assert Emoluments Clause violations; (2) whether the President and other elected officials are subject to the Foreign Emoluments Clause; and (3) the meaning and scope of the term emolument.⁹

On the standing-to-sue issue, the U.S. Court of Appeals for the District of Columbia Circuit held that individual Members of Congress lacked standing to sue based on alleged injuries to the legislature as a whole (namely, the deprivation of an opportunity to vote on whether to consent to the acceptance of foreign emoluments). As to the standing of private individuals, the U.S. Court of Appeals for the Second Circuit held that hospitality-industry plaintiffs had standing based on a theory of competitive harm resulting from the allegedly unlawful acceptance of emoluments.however, a number of judges on the Second Circuit dissented from this holding and the Supreme Court subsequently vacated the decision as moot.

On the second issue, commentators have debated whether federal elected officials hold an Office of Profit or Trust under the United States are thus subject to the Foreign Emoluments Clause. The Department of Justice’s Office of Legal Counsel (OLC), which has developed a body of opinions on the Emoluments Clauses, has opined that the President surely holds an office of profit and trust under the Constitution. In litigation, President Trump did not dispute that he was subject to the Foreign Emoluments Clause, and the only lower court to directly reach the issue agreed with the OLC’s view. However, that holding was subsequently vacated.

The final litigated issue was the meaning and scope of the term emolument as used in the Emoluments Clauses—particularly, whether it includes private, arm’s-length market transactions. In the litigation, President Trump argued that emoluments included only benefits received by an officeholder in return for official action or through his office or employment. Plaintiffs urged that emoluments be defined more broadly to apply to any profit, gain, or advantage received by the President from a foreign or domestic government. The two district courts that reached the issue adopted the plaintiffs’ broader definition of emolument, although the appellate courts subsequently vacated those decisions.

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