Federal Regulation of International Adoption

It has been over ten years since the United States signed the Hague Convention on Intercountry Adoption. It has been nearly seven years since the White House transmitted the treaty to the Senate for ratification. It has been four years since the Senate ratified the treaty and President Clinton signed the enabling legislation, the Intercountry Adoption Act (IAA) into law. It has been over three years since the State Department held a series of public meetings to elicit information to inform the process of writing implementing regulations.

International adoption has been a widely accepted practice in the United States for over fifty years. Yet for most of that time, our government has not regulated adoption businesses in any meaningful way. Despite assurances that the IAA would be implemented some time ago, the State Department continues to equivocate about issuing final regulations or what those regulations will do to create greater transparency and accountability. Now, nearly four years after both consumers and industry should have received clear guidelines; the outcome of this process has never seemed more compromised. With the lines drawn between maintaining the status quo and achieving the first meaningful federal regulation and real protections for consumers of international adoption real progress is at risk.

The Regulatory Failure
Fundamentally, the Hague Convention, an international treaty, and the Intercountry Adoption Act, its implementing legislation, were developed to address a range of problems identified in international adoption practice, from concerns about child trafficking to complaints about skyrocketing costs to a rising number of wrongful adoption suits. Nevertheless, over a decade of discussion, debate, Congressional hearings, legislation, meetings and a myriad of detailed comments, four years after the Intercountry Adoption Act was signed into law an impasse remains on how inter-country adoption should be regulated.

No one, it seems – including the “experts” – can agree on how the federal government should appropriately regulate this important, growing but ultimately complicated process. Our national “policy” remains allowing large sums of cash to leave the country in an entirely unregulated system and browbeating foreign governments into surrendering children in a decision making process for their foster children that none of our fifty states would permit for America’s waiting children.

For years, the argument against greater regulation of adoption by the federal government has been rooted in the notion that adoption is a state law issue. While adoption is an important benevolent response to the needs of orphaned children around the world, it is also a big business that generates millions of dollars in revenue. All international adoption is inherently interstate commerce. While the federal government regulates everything from coal mining to organ transplants, international adoption has remained beyond the reach of most federal enforcement or oversight. The State Department’s equivocation has ensured that consumers have more protections when they join a health club than they do when they make this profound and life altering decision.

This country’s failure to adequately regulate international adoption has already had serious consequences. By allowing each state, each agency, indeed, each family to pursue adoption differently the US government has ensured consumers of adoption services have no coherent guidelines to protect their interests. This lack of consistency has only been amplified by the use of the Internet to market adoption services and the growing demand for children. Lacking training in foreign policy or a sound regulatory framework would be adoptive families and their adoption agencies are encouraged to navigate the increasingly complex and treacherous geopolitics of countries around the world with virtually no training and in many cases a vested self-interest. The result has been diplomatic and emotional chaos.

Foreign Adoption at Risk
Predictably, many foreign governments have elected to suspend or ban adoption rather than manage the independent diplomacy of these competing interests. They have also demonstrated increasing resistance to permitting large cash payments to facilitators. According to Ethica: A Voice for Ethical Child Placement in the past fifteen years, 13 countries have suspended or ended their adoption programs. In addition, four additional countries have closed temporarily to investigate charges of corruption or child trafficking. These countries represent 43% of the countries that have provided the majority of children adopted to the US. Though the total numbers of international adoptions have risen slightly the numbers of sending countries has decreased.

Superficially, the adoption industry and the consumers of its services appear to agree that the stated purpose of the Hague Convention on Intercountry Adoption and its implementing legislation in the US served a valuable purpose. By creating uniform standards abuses in adoption could be minimized and the practice itself could grow.

Ironically, attempts to ensure oversight and adequate consumer protections, requiring liability insurance, limiting cash payments and demanding greater transparency for service providers have triggered a firestorm of controversy. Despite the fact that many federal agencies engage in aggressive consumer protection and oversight, the State Department has attempted to balance the interests of service providers large and small with the interests of consumers and the demands of diplomacy. Unfortunately, the proposed regulations demonstrate an inadequate response to abuses that prompted passage of the IAA or how those abuses might be tempered or eliminated and a lack of insight into the economics of international adoption. Conflicts focus on several key areas:


For many years, adoption agencies working abroad have relied on the services of so called facilitators to identify and procure children for adoption and to navigate the often complex political issues in the sending country. Facilitators often require large cash payments, ostensibly for their services. They also work as independent contractors and have traditionally had little or no exposure to liability when issues related to their service arise. In some instances, facilitators have engaged in illegal activity including money laundering and child abduction. Even then, consumers have had little or no recourse for their actions.

The IAA addresses this problem by requiring that adoption agencies assume responsibility for all of their employees, contractors and facilitators here and abroad. Major adoption trade groups like the Joint Council for International Children’s Services (JCICS) have opposed this provision despite the fact that American companies doing business abroad are routinely expected to take responsibility for and adequately supervise their employees overseas. This loophole has left birth and adoptive families vulnerable to a variety of abuses while their service providers maintain plausible deniability.

Contractual Waivers
The IAA forbids the now common practice by adoption agencies of requiring prospective adoptive to sign waivers of liability on the part of their agency or its agents. Trade groups like the Joint Council hold that professionals in other areas are not expected to meet this standard. However, that assertion is not true. Professionals in occupations involved with the public interest – especially professionals rendering services to clients or patients dependent on them like physicians – are routinely prohibited from seeking exculpatory provisions from their clients. According to the American Adoption Congress, lawyers are specifically prohibited from doing so, for instance in the Model Code of Professional Responsibility Disciplinary Rule 6-102 which states “A lawyer shall not attempt to exonerate himself from or limit his liability to his client for his personal malpractice.” It is hard to imagine a scenario more fraught with emotional dependency that the relationship between an adoption agency and a prospective adoptive family, not to mention a birth family. Thus, there is ample precedent, both legal and ethical, to resolve the issue of waivers in favor of consumers.


Perhaps the most controversial provision in the IAA requires adoption agencies to carry professional liability insurance in the amount of $1 million per occurrence. It came as a shock to many policy makers that many adoption agencies operated without insurance. It probably never occurs to many prospective consumers of adoption services to even inquire. According to one JCICS backgrounder, such insurance is “unobtainable.” Even if such coverage were readily available, they allege, it would be prohibitively expensive. This, of course, simply isn’t true either. A number of reputable insurance carriers provide reasonably priced coverage for qualified agencies providing adoption services.

Insurance provisions as required by the new law are reasonable and there are ample precedents in other fields. Insurers will add a layer of consumer protection by helping to enforce the safeguards of professional conduct as they do in other professions. In fact, until the State Department implements consumer protections mandated by Congress the underwriting process might represent the only effective regulation the industry has. Perhaps the question the State Department should be considering is whether or not an agency that cannot be insured should be in business in the first place. It is unlikely that most adoption agency owners would undergo brain surgery by a doctor lacking malpractice insurance.

There have been many experiences where negligence or fraud in an adoption placement has led to severe financial and emotional distress for innocent adoptive families. Even if the cost of insurance premiums was passed on to consumers it would amount to a nominal fee, $300 – 1000 in the context of a costly adoption. This is a fee most prospective adoptive parents would happily assume. It is certainly a cost that could be offset by lowering cash payments to foreign facilitators. Using the ultimate scare tactic to avoid assuming this normal cost of doing business many adoption agencies go on to assert that agencies “will have no choice but to pass this cost onto adoptive families” and that “fewer families will be able to adopt” due to cost. As for that canard, it should be noted that it is impossible to quantify how many qualified; loving families around the world have already been priced out of the adoption market by double-digit fees that the federal government refuses to cap. Since the US effectively limit pricing in other industries, offsetting rising costs with federal subsidies, perhaps it is time to engage in a serious discussion to subsidize adoption costs, either for industry or consumers or both.

Around the world, thousands of children are desperately in need of families. Around the United States there are hundreds of excellent adoption providers seeking to match those children with the thousands of well-qualified families in this country seeking to adopt. The fundamental purpose of the Inter-country Adoption Act was to provide a consistent, clearly articulated business model for inter-country adoption that would limit abuses, protect ethical agencies and consumers and make it easier for everyone to participate in this important component of international child welfare.

Over the years the inaction of the US government and the State Department in particular has penalized good agencies while creating a haven for less good ones. It has ensured that consumers of adoption services will continue to operate without protections afforded to constituents of dozens of other federal agencies and industries. It has created a diplomatic nightmare for foreign governments struggling simultaneously to establish credible child welfare agencies while attempting to accommodate the costly and constant demands of adoption agencies.

Many people with a vested interest in the adoption industry have attempted to persuade policy makers and consumers that any effort to regulate adoption is tantamount to being anti-adoption. However, it is impossible to quantify how many children have been deprived of families because we haven’t. As we fail to take adequate regulatory responsibility for adoption the tens of thousands of children who will continue to languish around the world while the US government remains confused about a task that should be crystal clear.

Guest Commentary by
Maureen Flatley
This is an update of a 1999 article which originally appeared in Decree which is published by the American Adoption Congress

4 Replies to "Federal Regulation of International Adoption"

  • Anonymous
    June 20, 2005 (10:37 pm)

    Very nice, except….

    I notice a deplorable omission in this article. The emphasis is placed, as always, on the needs and rights of the “consumers” – ie, those with money to exchange for services, and a distinct lack of emphasis on the needs AND THE RIGHTS of the original families of these commidified children.

    People whose children are taken illegally by agencies for adoption should be able to sue for malpractice, and agencies should be required by law to cay malpractice insurance.

    To carry your analogy a step further, would adoption agency personnel allow a neurosurgeon who did not carry malpractice insurance to operate on them?

  • Jeannene Smith
    June 21, 2005 (1:47 pm)

    Although the article above was articulate and well written, the writer failed to identify one of the most signicant concerns in relation to implementation of the Hague Treaty and the IAA of 2000. Although implementation of such regulation may take some steps towards regulation of unethical/illegal practices, sadly the regulation would only be enforceable in Hague to Hague countries AND in which the adoption agencies voluntarily agreed to undergo accreditation in order to exercise the ability to work in a foreign country who has also subscribed to the Hague Treaty.

    Since there are numerous foreign countries that are not signators to the Hague Treaty – this poses an ability to avoid regulation and regulatory standards for those who may work with particular countries that are not participants. So, if this regulation is meant to curb unscrupulous activities and to exercise better regulatory capability – it is sorely lacking in comprehensive ability.

    Instead, the US needs a National Policy that would provide more regulatory capability and would focus on development of a national standards of practice for which all regulatory agencies would have enforcement authority which would then apply to all intercountry adoptions whether or not they fell specifically under Hague guidelines.

  • Joanna Wright
    August 18, 2005 (7:16 pm)

    It is my belief, and experience from attempting to adopt within the United States, that the U.S. government agency given the responsibility of providing appropriate homes is in direct opposition to itself, and certainly not in the best interest of the children, as a caseworker is to make all attempts to reunify family members and in those cases where this is not possible, to find permanency for the children.

    These two positions are in direct conflict with one another and rather than appropriate families being assessed by a non-biased, third party organization, caseworkers determine whether or not they would want to work with the adoptive family. If the adoptive family does not “present” in a manner that is conducive to making the worker’s job easier, i.e., ask no questions, know how to work the system, and other arbitrative perceptions, very appropriate, experienced, families who want nothing more than to provide a forever, loving, and committed family are refused this incredible responsibility.. and we are asking to do it without accepting state or federal monies!

  • Maureen Flatley
    September 21, 2005 (2:23 pm)

    To the point about my use of the word “consumer” I identify “consumers” of adoption services as all triad members, birth parents, the adopted person and the adoptive parents. There can be no distinction among them. All are utilizing the “services” of the agencies, one way or another.