AMENDMENT 695

Amendment: The Commentary to §8C2.5 captioned "Application Notes" is amended in Note 12 by striking the last sentence as follows:

"Waiver of attorney-client privilege and of work product protections is not a prerequisite to a reduction in culpability score under subdivisions (1) and (2) of subsection (g) unless such waiver is necessary in order to provide timely and thorough disclosure of all pertinent information known to the organization.".

Reason for Amendment: This amendment deletes the last sentence of Application Note 12 to §8C2.5 (Culpability Score), which stated that “[w]aiver of attorney-client privilege and of work product protections is not a prerequisite to a reduction in culpability score . . . unless such waiver is necessary in order to provide timely and thorough disclosure of all pertinent information known to the organization.” The Commission added this sentence to address some concerns regarding the relationship between waivers and §8C2.5(g), and at the time stated that “[t]he Commission expects that such waivers will be required on a limited basis.” See Supplement to Appendix C (Amendment 673, effective November 1, 2004).Subsequently, the Commission received public comment and heard testimony at public hearings on November 15, 2005, and March 15, 2006, that the sentence at issue could be misinterpreted to encourage waivers.

Effective Date: The effective date of this amendment is November 1, 2006.