2017 USCIB International Leadership Award Dinner

USCIB is delighted to honor Ajay Banga, president and chief executive officer of MasterCard. Each year this gala event attracts several hundred industry leaders, government officials and members of the diplomatic community to celebrate open markets and the recipient of USCIB’s highest honor.

Established in 1980, USCIB’s International Leadership Award is presented to a senior business executive who has made significant policy contributions to world trade and investment, and to improving the global competitive framework in which American business operates. Join us for what will be a truly memorable evening!

USCIB Applauds 20 Years of Anti-Bribery Convention

As the OECD celebrates 20 years of the Anti-bribery convention this year, the U.S. Department of Justice, the Organization for Economic Cooperation and Development (OECD), and the U.S. Securities and Exchange Commission and Business at OECD will host a conference on “No Turning Back: 40 Years of the FCPA and 20 Years of the OECD Anti-Bribery Convention” on November 9th in New York.

USCIB, through its affiliation with Business at OECD, has been working with the OECD Working Group on Bribery, which monitors the implementation and enforcement of the OECD Anti-Bribery Convention. Through annual consultations and USCIB’s advocacy efforts, the Working Group has taken up issues that are of interest to U.S. business in their future work plan.

The conference will draw upon expertise and examine the major impact of ground-breaking instruments and corporate behavior and law enforcement priorities. It will explore the role of cooperation between nations in investigating and persecuting foreign bribery and the effectiveness of different approaches to corporate responsibility for bribery.

The event will be hosted by NYU School of Law’s Program on Corporate Law and Enforcement. U.S. businesses interested in anti-bribery issues may learn more about the conference and register here.

Hampl Advocates for Open and Fair Investment Policies at OECD

As USCIB continues to advocate for open and fair investment policies in NAFTA and at recent discussions in the United Nations Conference on Trade and Development (UNCTAD) in Geneva, USCIB Director of Investment, Trade, and Financial Services Eva Hampl was in Paris last week, participating in the meetings of the Organization for Economic Cooperation and Development (OECD) Investment Committee. Hampl also held several bilateral meetings with various OECD investment staff and officials from the U.S. Mission to the OECD.

The agenda of the OECD Investment Committee was extensive, including the work of the Freedom of Investment Roundtable, covering issues including societal costs and benefits of international investment agreements, investor-state dispute settlement (ISDS) and related issues, particularly regarding an overview of arbitrators in investment arbitrations and adjudicator compensation systems in dispute settlement. The meetings also discussed the strategic direction for the OECD investment work.

During the stakeholder consultation, Business at OECD made strong statements focused primarily on international investment agreements, specifically ISDS and related issues.

“We maintained our position that investment agreements are very important to business, and are necessary for a robust international investment environment,” said Hampl. “Unfortunately, the OECD has not yet been able to produce reliable data definitively proving the benefits of IIAs,” she added.

Hampl also made an intervention on behalf of U.S. industry, underlining the importance of empirical research in this area, and raising concerns about leaving a vacuum of information in the space related to IIAs.

“In today’s political environment that appears to be progressively more hostile toward foreign investment, advocating for these protections is vital,” said Hampl. “As the OECD continues to develop policy documents on these issues, USCIB will actively participate in shaping these policies.”

Big Turnout on Capitol Hill Raises Alarm on NAFTA Talks

Last week, as the fourth round of talks between the United States, Canada and Mexico on the future of the North American Free Trade Agreement unfolded, USCIB joined many of its members and other associations in flooding Congressional offices on Capitol Hill, raising serious concern over the direction of talks. According to Eva Hampl, USCIB’s director of trade and investment policy, who took part, private-sector representatives spent a full day talking to House Republicans as well as a few Democrats, mainly staff members but also including a few members themselves.

Hampl stated: “The views from House offices varied from understanding the problems presented by statements coming from many U.S. negotiators and administration officials, to having a few specific issues they cared about, to not yet having decided a position on NAFTA modernization. We spent a good amount of time explaining to those who were bogged down in specific issues, or those who did not yet care, that the key elements of the U.S. trading system of the U.S. are at risk.”

Worrisome, and potentially protectionist, proposals coming from the U.S. side in the NAFTA talks address rules of origin, government procurement, investor-state dispute settlement, and a proposed sunset provision that would essentially force NAFTA to be renewed at regular intervals.

“At the same time, a lot of progress is being made in the negotiations in chapters such as customs, digital trade, and in the regulatory space,” Hampl noted. “The U.S. could certainly log a win in this modernization effort if NAFTA 2.0 included those provisions.” But she said there is “great concern” in the business community that NAFTA is being set up to fail with some of the proposals that are being tabled.

USCIB co-sponsored a reception on the sidelines of the NAFTA talks, where Hampl amplified USCIB’s central message of urgency, noting that USCIB members rely on the agreement and its benefits for their operations, which provide jobs for U.S. workers. “NAFTA has done a lot for the U.S. economy and USCIB member companies over the last 23 years, so while this is a great opportunity to bring this agreement into the 21st century, if the existing benefits are lost, that effort will be significantly undermined,” she said.

Another Capitol Hill business lobbying day is planned for October 24. At the conclusion of the fourth round of NAFTA talks, negotiators agreed to defer the next round by at least a month, and to extend negotiations at least through the first quarter of 2018. The next round is slated to begin November 17 in Mexico.

Mulligan Talks NAFTA at CSI Summit

Rob Mulligan at CSI

USCIB Senior Vice President for Policy and Government Affairs Rob Mulligan spoke at a Coalition of Services Industries (CSI) summit earlier this week on USCIB’s North American Free Trade Agreement (NAFTA) priorities.

USCIB members have benefited from NAFTA and believe the current negotiations should ensure that the beneficial parts are preserved, that is ‘do no harm,’ while also taking advantage of the opportunity to improve it in areas that were not addressed two decades ago.

Mulligan noted that NAFTA can be brought into the 21st century by including provisions that ensure cross-border data flows, include strong e-commerce rules, protect against data localization requirements, and level the playing field for firms competing against state-owned enterprises.  More can also be done to improve the customs processes with Canada and Mexico.  Increased transparency in the publication of laws, regulations and procedures would improve customs administration. And bringing de minimis thresholds into relative alignment would facilitate trade, especially for small businesses. All of these steps will help U.S. businesses grow and create jobs.

However, Mulligan raised concerns over several moves by the U.S. during the fourth round of negotiations, “Recent U.S. proposals for a sunset clause, to restrict government procurement, allow an opt out of ISDS, and impose new content requirements for autos will not expand trade and we are concerned that they could force eventual failure of NAFTA that would severely impact the U.S. economy and millions of jobs that are tied to NAFTA.”

Mulligan noted that while USCIB member companies strongly support NAFTA and have greatly benefited from it over the last 23 years, they want the governments to avoid changes to existing parts of NAFTA that would harm trade rather than expand it.

USCIB Huddles with US Mission in Geneva

USCIB’s Shaun Donnelly at meetings in Geneva

On the margins of the UN Conference on Trade and Development  (UNCTAD) meetings in Geneva, USCIB Vice President for Trade Services Shaun Donnelly went to the U.S. Mission (i.e. the multilateral US Embassy) to UN agencies for a morning of meetings on October 12. Donnelly, a retired State Department ambassador, had a wide-ranging, hour-long meeting with the U.S. Mission Chargé D’affaires Ted Allegra in the absence of a new U.S. Ambassador (yet to be nominated.)

Donnelly also had a roundtable with U.S. Mission staff managing U.S. participation on a range of UN agencies including the International Labor Organization, World Health Organization, WIPO, Human Rights Commission and the World Trade Organization. They discussed concerns of USCIB and its members on policies, budgets, and business access in several Geneva agencies.

Donnelly noted afterwards, “I really appreciated the opportunity to sit down with U.S. Chargé in Geneva Ted Allegra, an experienced and respected diplomat, and to highlight priorities and policy concerns of our members.”

Donnelly and other USCIB staff routinely stay in close contact with various staffers in the U.S. mission in Geneva. “But the opportunity to voice our key concerns directly to the acting U.S. Ambassador in Geneva was both timely and useful,” he added.

USCIB Leads Geneva Fight for Strong Investment Agreements

 

As anti-business rhetoric continues to emerge in various intergovernmental forums, USCIB Vice President for Trade and Financial Services Shaun Donnelly led a small but vocal international business delegation at last week’s annual High-level International Investment Agreements (IIAs) Conference at the UN Conference on Trade and development (UNCTAD) in Geneva.

As with many UNCTAD events, this three-day investment conference was dominated by government, UN and international organization experts, NGO activists and academics.  Donnelly was joined by USCIB’s partner BDI, the leading German business association, as the only business voices among over 200 delegates.

Issues on the UNCTAD agenda included reforming investment agreements, alternatives to Investor-State Dispute Settlement (ISDS) to resolve disputes, rebalancing rights and obligations between investors and host governments and alternative strategies to fix IIAs.

UNCTAD gave Donnelly a prominent spot in the opening plenary and keynote slots on two major breakout groups as well as in the closing plenary. In addition to rebuting some anti-IIA and anti-ISDS political diatribes, Donnelly emphasized some basic themes, including that it is private investors who drive growth, jobs and progress. “The IIA protections do matter to investors,” emphasized Donnelly. “Strong ISDS provisions are critical to ensure implementation of investment agreements. Investment agreements which earn rave reviews from governments, academics and UN bureaucrats but which don’t work for business won’t yield investments and all the benefits which flow from private investment flows,” he added.

USCIB Testifies on China WTO Compliance

In response to Federal Register notice 82 FR 36071, USCIB Director, Investment, Trade and Financial Services Eva Hampl, provided oral testimony on Wednesday, October 4 to the U.S. government interagency Trade Policy Staff Committee (TPSC) regarding China’s compliance with its WTO commitments on behalf of USCIB and its members.

“USCIB and its members understand and appreciate that U.S.-China economic relations are complex and multifaceted, and American business holds a direct and important stake in this relationship and in its success,” noted Hampl in her testomony.

The testimony amplified priority issues for USCIB members, in addition to the written submission made in September. The Q&A session following the oral statement included questions from the various agencies on issues of regularly transparency, technology transfer, trade secrets, discriminatory industrial policies, and agricultural biotech.

On IT security measures, Hampl emphasized, “The Cybersecurity Law, which went into effect in June of this year, establishes a number of burdensome restrictions on the cross-border flow of data and establishes intrusive security reviews of equipment and services used by network operators and operators of critical information infrastructure.” Hampl therefore urged the U.S. government to continue to press for full suspension of all existing and proposed measures involving trade-restrictive requirements in this area.

In addition to discussing these issues with the interagency committee, Hampl emphasized USCIB’s support of continuing negotiations of a US-China Bilateral Investment Treaty (BIT), expressing USCIB’s hope that efforts to conclude a high-standard BIT will soon resume on the remaining issues.

USCIB Washington Update August – September 2017

Highlighting Key Activities, August – September 2017

During the months of August and September 2017, USCIB staff arranged a meeting with John Melle, USTR, and Angela Ellard, Ways and Means staff, on NAFTA negotiations; engaged with Alan Wolff, WTO, and Chris Wilson, USTR, in Geneva on deliverables for MC 11; organized a Symposium on Business and Human Rights with over 70 business representatives; submitted comments to USTR on China’s compliance with its WTO commitments; hosted a meeting for members with Ken Ash, OECD, on their trade work and Colombia accession; had a dialogue with Martha Newton, Department of Labor Deputy Undersecretary for International Affairs on ILAB; received briefings from USTR’s Jason Bernstein and Christina Kopitopoulos on Customs in NAFTA; shared business views on the OECD Going Digital project with Andrew Wyckoff, OECD; and much more. Below are summaries of these and other highlights from the activities of USCIB in Washington, D.C. over the last two months. If you have any questions or comments, or want more information on a specific topic, please contact any of the staff members listed at the end of this brief.

Table of Contents:

    1. Trade and Investment – Opening Global Markets for Trade and Investment
    2. ICT Policy – Promoting Sound Policies for New Technologies
    3. Tax – Advancing Tax Policies that Promote U.S. Competitiveness
    4. Customs and Trade Facilitation – Reducing Barriers and Costs from Customs and Border Control Practices
    5. Corporate Responsibility and Labor Affairs – Shaping the Development of CR Principles and Increasing Awareness of Business’s Positive Social Contributions
    6. Competition – Creating Global Legal Practices for an Open and Competitive Business Environment
    7. Membership
    8. Upcoming Events
    9. Staff List

Trade and Investment – Opening Global Markets for Trade and Investment

John Melle, USTR, and Angela Ellard, Ways and Means, Brief USCIB Trade Committee: On September 12, 2017, Assistant U.S. Trade Representative for the Western Hemisphere and Lead Negotiator for NAFTA modernization, John Melle, provided an off-the-record briefing for members on the latest round of NAFTA talks. He engaged with members on questions concerning negotiating timelines and deadlines, text proposals, investment and ISDS, rules of origin, addressing the trade deficit, digital trade, energy, and other topics. Members reinforced with Melle that withdrawing from NAFTA would go against the principal of “do no harm”. 

Angela Ellard, House Ways & Means Committee Chief Trade Counsel and Trade Subcommittee Staff Director of the U.S. House of Representatives, discussed NAFTA and other trade and investment topics in Congress, off-the-record. Ellard highlighted how closely Congress was working with USTR and the administration on the NAFTA process, despite the tight timelines. She noted the strong pushback from Congress to withdrawing from the Korea Free Trade Agreement. Ellard also discussed Trade Enforcement issues, implementation of the Customs Bill, the Miscellaneous Tarif Bill (which has 1,800 provisions suggested for inclusion), and GSP renewal. All of which she emphasized take significant time and resources. Members inquired about potential timelines for the 232 case, specific chapters in NAFTA, the U.S.-China trade relationship, and TPA renewal.

 USCIB Calls on Administration to Do No Harm in NAFTA Modernization: On June 12, 2017, USCIB released its recommendations to the Trump Administration on priorities for the modernization of the North American Free Trade Agreement (NAFTA). The submission calls on the Administration to update the 23-year-old agreement to accommodate new realities in global commerce, including the rise of the digital economy, while keeping what works from the original agreement. Specifically, the document calls upon the Administration to update and strengthen key NAFTA provisions, including the liberalization and protection of investment flows, protection of intellectual property, trade facilitation and improved agricultural market access. It also recommends tackling new areas not included or anticipated in the original agreement, such as the digital provision of goods and services, data localization requirements, and treatment of state-owned enterprises. It further urges U.S. negotiators to work closely with a range of private-sector stakeholders to ensure that a revamped agreement meets business needs in the 21st With the third round of negotiations just having concluded in Ottawa, Canada, the negotiations are continuing at a rapid pace.

USCIB Co-chairs Business Meeting with USTR’s NAFTA Investment Negotiators: USCIB co-chaired an August 29, 2017, meeting for a coalition of U.S. companies and trade associations with USTR’s key NAFTA negotiators on investment. In a free-wheeling session with USTR’s Chief of Staff, lead NAFTA negotiator and the key USTR investment policy team, business laid out a strong view on the importance of maintaining, indeed strengthening, key investment provisions in the NAFTA, including strong enforcement mechanisms through a proven Investor-State Dispute Settlement (ISDS) system. We and other business representatives made very clear to USTR leadership that any reported “opt-in/opt-out” system for ISDS would undercut the proven implementation/enforcement system which is critical to mobilizing the foreign direct investment flows so essential for business in today’s competitive global markets.

Rob Mulligan Meets with WTO Officials on Planning for Ministerial: While participating in the WTO Public Forum and the ICC Trade and Investment Commission meeting in Geneva from September 25-30, 2017, Rob Mulligan, USCIB Senior Vice President for Policy and Government Affairs, met with the new WTO Deputy Director General, Alan Wolff, the WTO Director for Information and External Relations, Keith Rockwell, and the WTO Director for Services, Hamid Mamdouh. He also met with Chris Wilson, DCM for USTR in Geneva, Didier Chambovey, Swiss Ambassador to the WTO, and Julian Braithwaite, Ambassador to the UK Mission in Geneva. In the discussions with them and others there is still much uncertainty about the potential for significant results coming out of the WTO Ministerial (MC 11) in Argentina being held in December. There is hope that at least work plans can be developed for movement on a range of issues such as e-commerce/digital trade, investment facilitation, fisheries, services facilitation and other areas and this may involve pursuing plurilateral approaches in some cases.

USCIB Hosts Meeting with Ken Ash, OECD, on Trade Work and Colombia Accession: On September 20, 2017, Ken Ash, Director of the OECD Trade and Agriculture Directorate, met with USCIB members and staff to discuss the projects he has planned over the next year. He detailed the work the OECD has done over the past year on both Trade and Agriculture policy, as well as the outlook for his upcoming work with the G20. Members raised issues and offered ideas for the OECD Trade Committee to pursue, and were also able to inquire about the status of Colombia and other countries seeking to join the OECD. Ken provided an open and frank perspective on Colombia, as well as the other countries including Brazil and Argentina.

Donnelly and Hampl Defend ISDS for a NAFTA 2.0: USCIB’s Vice President for Investment and Financial Services Shaun Donnellyalong with its Director for Investment, Trade and Financial Services Eva Hampl contributed an op-ed in The Hill titled, “NAFTA 2.0 needs to enshrine investor protections” on July 28, 2017. In the leadup to the update of the North American Free Trade Agreement (NAFTA), Hampl and Donnelly noted that, “overall, the administration’s “NAFTA 2.0” wish-list is solid.” However, one of the more crucial objectives, investor protection under the agreement’s Chapter 11, is not included. “These provisions, which allow U.S. investors both small and large to seek compensation for unfair, discriminatory or inequitable treatment at the hands of foreign governments, are based on bedrock principles embedded in our own Constitution prohibiting abusive government treatment and the taking of private property without just compensation. Without this provision, domestic courts become the only legal recourse for a wronged investor. While Mexico has made great strides in many respects, its court system is still far from impartial. Indeed, miscarriages of justice can happen in any country, including advanced democracies like the United States and Canada,” they noted.

USCIB Urges China Compliance with WTO Commitments: On September 20, 2017, USCIB submitted a statement to the United States Trade Representative (USTR) on China’s compliance with its World Trade Organization (WTO) commitments, which incorporated a wide array of input from USCIB members across various sectors. In the statement, which is submitted annually, USCIB commended the U.S. and Chinese governments for important work in on-going bilateral dialogues, as well as in support of working relationships between U.S. and Chinese agencies which provide invaluable opportunities for exchanging information and addressing agency-specific issues. The statement addressed important issues to U.S. business including taxation, customs and trade facilitation, information technology and intellectual property rights. Furthermore, it advocated for continuing negotiations of a Bilateral Investment Treaty (BIT) between the U.S. and China. While USCIB acknowledges the efforts China has made since joining the WTO in 2001 to meet its obligations under the terms of its accession agreement, there still remain significant WTO obligation compliance concerns. These concerns include government procurement, trade restrictions in information technology and continued intellectual property violations in audiovisual, software, agriculture biotechnology and chemicals.

USCIB Pushes Market Access Concerns in BIAC Colombia Paper: USCIB has been working with Business at OECD (BIAC) to advocate on behalf of business in the OECD accession process of Colombia. With the Market Openness Review concluded by the OECD Trade Committee, and the Formal Opinion now in draft form, Business at OECD finalized a document in September with recommendations for pre-accession commitments. These recommendations, which include significant USCIB member input, address market access concerns for industry on issues where Colombia has not yet risen to the standard of OECD countries. The draft formal opinion is set to be reviewed in November at the next meeting of the OECD Trade Committee.

GSP Back on the Agenda: With the U.S. Generalized System of Preferences (GSP) system facing another of its periodic reauthorization deadlines at the end of the year, USTR is moving to get ducks in a row on pending country and product eligibility petitions, some of very long standing. USCIB has played and will continue to play a lead role on a specific request by Ecuador, with its problematic record toward international investors and respecting international arbitral awards, to add flowers and vegetables to the GSP eligible products list. USTR’s kick-off hearings September 26-27, 2017, focused on country eligibility petitions where, again, Ecuador was a key country of concern. Beyond the policy issues inherent to GSP and the challenge of identifying budget offsets for “foregone revenues”, the yearend legislative calendar looks daunting with urgent competing legislation so GSP risks again lapsing.

USCIB Aggressively Blogging for Strong Investment Protections: USCIB Staff have been actively blogging on major investment policy issues over the summer. Posting on the blog site of Investment Policy Central, Shaun Donnelly and Eva Hampl jointly penned “NAFTA 2.0 Needs to Enshrine Investor Protections” (an op-ed originally placed in The Hill in early August. Shaun also had an IPC blog post in mid-August “U.S. Business Speaks Up Forcefully for Strong Investment Provisions in NAFTA.” Investment Policy Central is a joint effort of USCIB, the U.S. chamber and other leading U.S. trade associations, committed to strong policies and program to promote Foreign Direct Investment (FDI).

Donnelly Co-Authors Commercial Diplomacy Volume 2: USCIB Vice President Shaun Donnelly has co-authored Part 2 of “Support for American Jobs”, a major report on “commercial diplomacy” by the American Academy of Diplomacy (AAD), a prestigious organization of former senior U.S. government foreign policy leaders where Shaun is a member. Shaun and co-author Ambassador (ret.) Chuck Ford lay out in their report the progress made and also the challenges remaining for the U.S. Government, including its embassies and Ambassadors abroad, to provide the kind of high-level aggressive support needed to assist U.S. companies to win sales, contracts, investment and joint venture deals in today’s competitive global environment. Thanks to the USCIB member companies and others in the business community who provide valuable input to this important study.

ICT Policy – Promoting Sound Policies for New Technologies

USCIB Discourages Regulatory Overreach in Comments to ITU: USCIB filed comments with the International Telecommunications Union (ITU) on August 14, 2017 as part of the its public consultation on “Public Policy Considerations for OTTs.” USCIB urged the ITU to avoid expanding its jurisdiction and work programs to include Internet-related issues. USCIB acknowledged the ITU’s primarily technical mission to develop international technical standards and enable telecommunications network interconnectivity, noting that these are the ITU’s “core competencies and uncontested remit that should not be compromised.” Expanding the ITU’s work program to included Internet-related issues is well beyond its remit, core competencies, and budgetary resources, USCIB underscored. USCIB further highlighted: (1) the promise of innovative online services and applications for realizing the economic, developmental, and societal benefit goals set forth in the U.N. Sustainable Development Goals (SDGs); and (2) the related need to ensure an enabling environment for continued innovation and investment in these services.

USCIB Members Promote APEC Electronic Commerce Steering Group (ECSG) Work with EU: Members of USCIB’s ICT Policy Committee made important contributions at the August 20-23 meetings of APEC’s Electronic Commerce Steering Group (ECSG) in Ho Chi Minh City, Vietnam. USCIB’s Barbara Wanner, Vice President, ICT Policy, joined representatives from Apple, C&M International, Cisco, HP, ITI, and The Walt Disney Company. They shared best practices and highlighted the benefits of participating in APEC’s Cross-Border Privacy Rules System (CBPR) via formal presentations, interventions, and informal discussions with other delegates. Highlights of this meeting included: (1) formal announcement that South Korea was approved to become the fifth APEC member economy to participate in the Cross-Border Privacy Rules (CBPR) system and that Singapore had submitted dual applications to be certified under the CBPR system and the complementary Privacy Recognition for Processors (PRP) system; (2) a dialogue with the European Commission concerning possible approaches to realize interoperability of the CBPR and EU General Data Protection Regulation (GDPR); and (3) consideration of a U.S. Government proposal to “Modernize the ECSG.” The latter is aimed at broadening the scope of the ECSG work to addressing issues arising from the digital transformation of the economy.

USCIB Members Engage with OECD Secretariat on Going Digital Project: On September 6, 2017 USCIB hosted a special meeting to enable members to engage with Andrew Wyckoff, Director of the OECD Directorate for Science, Technology and Innovation (STI) in informal discussions about the status of various elements of the OECD’s ambitious Going Digital horizontal project. The OECD’s Committee on Digital Economy Policy (CDEP) will lead this effort, working closely with the Trade and Agriculture Committee and some 12 other OECD committees. Wyckoff encouraged USCIB members to comment on papers that will form the substantive foundation of the Going Digital project as well as to actively intervene during November meetings of the CDEP and its Working Parties. Related to the Going Digital Project, on September 7, USCIB convened a video conference with Rachael Bae, OECD Senior Counsellor for Trade and Agriculture, and her colleagues. The video conference enabled USCIB members to provide feedback and engage in discussions with Bae and colleagues about elements of a draft scoping paper aimed at providing a conceptual framework for thinking about market openness in the digital economy.

USCIB Members Help Develop 2017-2018 Strategy for ICC Digital Economy Commission: Microsoft and USCIB co-hosted the fall meeting of the ICC Digital Economy Commission (ICC-DEC) on September 13-14, 2017, in Washington, D.C.. The meeting featured guest remarks by Susan Ritchie, U.S. Department of State, and Christopher Smart, Harvard Kennedy School’s Mossavar-Rahmani Center for Business and Government. Ritchie discussed the U.S. Government’s digital economy policy priorities and challenges to them in the United Nations, G20/G7, and OECD; Smart explored the difficulties of setting common guidelines for data flows that promote economic and commercial interests while also protecting privacy and security. Joining Barbara Wanner, Vice President, ICT Policy, were USCIB members from Amazon, Apple, AT&T, BT America, CCIA, Facebook, Google, KPMG, Microsoft, Oracle, PayPal, The Walt Disney Company, TMG, and Verizon. They made important contributions to ICC-DEC discussions concerning: (1) prime international forums at which to advocate the ICC policy statement on ICT, Policy and Sustainable Economic Development; (2) application of technology in financial services; (3) real-time business transaction controls; (4) identity management for business; (4) effective engagement on cybersecurity; (5) navigating policy dialogues on Artificial Intelligence (AI) and creating a special ICC-DEC Working Group to take this work forward; (6) preparing for the 2018 ITU Plenipotentiary; (7) and developing a roadmap of activities and targeted forums at which to promote the ICC’s vision of an enabling environment for ICT investment and innovation.

USCIB Supports Continuation of EU-US Privacy Shield Framework: On September 15, 2017 – the eve of the first joint review of the EU-U.S. Privacy Shield Framework — USCIB reaffirmed support for the Framework and issued a statement underscoring its importance in ensuring continued robust and reliable transatlantic data flows, which have proved vital for healthy U.S.-EU commercial relations. USCIB highlighted three important points for consideration in the Annual Review: (1) the Framework is realizing stronger personal data protections; (2) the Framework is serving as an effective mechanism for certification by Small and Medium Enterprises (SMEs); and (3) the longevity of the Framework remains important.

Tax – Advancing Tax Policies that Promote U.S. Competitiveness 

USCIB Represents Members at OECD VAT/TAG Meeting: Carol Doran Klein, USCIB Vice President and International Tax Counsel, participated in the recent VAT/TAG meeting where the TAG discussed issues relating to collecting VAT on transactions that take place on platforms. As this was an initial discussion of platforms most of the discussion related to the operation of various business models. There is concern that collecting the proper amount of VAT in the context of platforms is difficult as the information on the customer and supply may be separate from the payment. These issues would be similar to the issues that would arise in the context of some of the proposals that have been floated as methods to increase the amount of tax paid on digital transactions.

USCIB Submits Letters to OECD on Profits Splits and Attribution of Profits to Permanent Establishments. USCIB submitted comment letters on the discussion drafts on profit splits and profit attribution. The letters both emphasized the lack of detailed guidance in areas where detailed guidance is needed. The profit split letter also pointed out the guidance might create a de facto preference for profit splits in cases in which other methods would be more appropriate. The letter on the profit attribution guidance pointed out that the discussion draft seemed to move away from the Authorized OECD Approach. The move away from the AOA and lack of detail may lead to increased disputes as countries interpret the guidance in various inconsistent ways.

Customs and Trade Facilitation – Reducing Barriers and Costs from Customs and Border Control Practices


Speakers from USTR, CBP, USAID Meet with USCIB Customs Committee: The September 20, 2017, USCIB Customs and Trade Facilitation Committee Meeting featured six speakers, including five from the U.S. Government. Jason Bernstein, USTR Director of Customs Affairs, World Trade, and Christina Kopitopoulos, USTR Director for Customs and Trade Affairs, provided an update on the status of the Customs chapters in the ongoing NAFTA modernization process. Jose Raul Perales, Deputy Director of the Global Alliance for Trade Facilitation, and Virginia Brown, USAID Director, Office of Trade and Regulatory Reform, discussed the latest in the work of the Global Alliance for Trade Facilitation, as well as its next projects. Finally, Kristin Isabelli U.S. CBP Congressional Liaison Specialist, and Michael Schreffler, U.S. CBP International Trade Liaison, discussed their team, the WCO E-Commerce Working Group, and the COAC E-Commerce/Section 321 Working Group.

Corporate Responsibility and Labor Affairs – Shaping the Development of CR Principles and Increasing Awareness of Business’s Positive Social Contributions

Corporate Responsibility and Labor Affairs Committee Hears from Martha Newton, Department of Labor: USCIB’s Corporate Responsibility and Labor Affairs Committee met on September 11-12, 2017, in Washington D.C., under the direction of Gabriella Rigg Herzog, USCIB Vice President of Corporate Responsibility and Labor Affairs. Hosted by Baker McKenzie, the meeting was attended by over 50 representatives from member companies, and speakers included a variety of U.S. government officials, civil society and industry. Martha Newton, the newly appointed Deputy Undersecretary for International Affairs at the U.S. Department of Labor (DOL) spoke about the engagement between DOL’s International Labor Affairs Bureau (ILAB) and U.S. business, and other DOL officials demonstrated the newly-launched “Comply Chain” app, a toolkit for responsible business. Members also heard from officials from USAID on partnerships with the private sector, and Lewis Karesh of USTR and Steve Moody of the State Department spoke on trade and labor. Several other USCIB members and civil society organizations served as guest speakers, touching on the UN Business & Human Rights Forum, the 2017 International Labour Conference, the future of work, and other topics.

USCIB leads Symposium on Business and Human Rights: In partnership with Article One and Barrick Gold, and hosted by Marriott International, USCIB coordinated a “Symposium on Human Rights and Remedy in Business Relationships with Limited Leverage” on September 13, 2017 in Washington, D.C. Attended by over 70 business representatives, as well as U.S. government officials and civil society, the symposium discussed stakeholder expectations for business, brainstormed on how to increase trust between stakeholders and business on the issue of leverage, the challenge of defining remedy, and moving from theory to action around key issues like performance, timing and achieving scale. Speakers included representatives from Mars, Inc., The Walt Disney Company as well as the Global Business Initiative (GBI) and the International Finance Corporation (IFC).

USCIB Foundation Organizes Roundtable on Apprenticeships: In partnership with the Global Apprenticeship Network (GAN) and the U.S. Department of Labor, and hosted by the Citi Foundation, USCIB held a Roundtable on Apprenticeships on July 20, 2017 in New York City. Participants discussed apprenticeship models and practice in the U.S. and included representatives of approximately 25 companies who are either actively implementing apprenticeship programs or are interested in getting started. The keynote remarks were given by John Ladd, the Administrator for the Office of Apprenticeship of the US Department of Labor. Apprenticeships were a priority with the previous U.S. Administration, and continue to be so with the new Administration. Underscoring that commitment, President Trump and Labor Secretary Alexander Acosta have launched a series of initiatives that call on Congress to pass reforms expanding apprenticeships and raise awareness about the fact that there are important, very viable career paths outside of the traditional four-year college experience. Apprenticeships are also a priority for the B20 and G20 leaders. USCIB has compiled a White Paper from the roundtable, available here

Competition – Creating Global Legal Practices for an Open and Competitive Business Environment

ICC/USCIB Competition Meeting Hosts DOJ Antitrust Expert: USCIB’s Competition Committee held its annual joint meeting on September 11, 2017 in partnership with the International Chamber of Commerce (ICC) Commission on Competition. Introductory remarks included comments by Paul Lugard, partner, Barker Botts LLP and chair of the ICC Competition Commission, and John Taladay, partner, Baker Botts LLP and chair of the USCIB Competition Committee. The meeting included an off-the-record exchange of views with Bernard A. Nigro, Jr., deputy assistant attorney general, U.S. Department of Justice, antitrust division, on issues of relevance to USCIB membership, including international engagement, trade related competition issues and mergers. The remainder of the meeting provided updates on the ongoing projects of the various task forces of the ICC Competition Commission, including on compliance and advocacy, merger control regimes, due process, the International Competition Network (ICN), cartels and leniency, and court proceeding in antitrust damage claims. Finally, the membership received an update on ASEAN competition issues by Hatasakdi Na Pombejra from HN Pro International, who presented on behalf of ICC Thailand.

Membership

  • Membership Meetings: USCIB President and CEO, along with the membership department and policy staff met with representatives from member companies CenturyLink, 3M, Sidley Austin, Chubb and DIAGEO to develop our understanding of their policy priorities for the next year and beyond, and to see how USCIB can better serve their policy needs.
  • New Members: USCIB has recently welcomed Barrick Gold, Comcast, Cooley LLP, and Gilead Sciences as new members.

Upcoming Events:

    • ICC Commission on Corporate Responsibility and Anti-Corruption Meeting, Paris, France – October 3
    • USCIB ICT Policy Committee Meeting, Washington, D.C. – October 4
    • UNCTAD 2017 High-Level conference on International Investment Agreements, Geneva, Switzerland – Oct 9-11
    • World Telecommunication Development Conference (WTDC-17), Buenos Aires, Argentina, October 9-20
    • USCIB Environment Committee/Product Policy Working Group Joint Meeting, Washington, D.C. – October 12
    • OECD Freedom of Investment Roundtable, Paris, France – October 12
    • BIAC Consultation with OECD Investment Committee, Paris, France – October 17
    • USCIB IP and Innovation Committee Re-Launch Event, Washington, D.C. – October 18
    • BIAC Finance Task Force Meeting, Paris, France – October 20
    • USCIB Digital Trade Working Group Meeting, Washington, D.C. – October 23
    • OECD Working Party on State Ownership and Privatization Practices Meeting, Paris – France October, 23-24
    • BIAC Employment, Labor & Social Affairs Committee Meeting, Paris, France – October 24
    • ICANN 60, Abu Dhabi, UAE, October 28-November 3
    • Meeting of the OECD Working Party on Security and Privacy in the Digital Economy (SPDE), Paris, France – October 30-31
    • OECD Corporate Governance Committee Meeting, Paris, France – November 2
    • Meeting of the OECD Working Party on Communications Infrastructures and Services Policy (CISP), Paris, France – November 2-3
    • Meeting of the OECD Working Party on Measurement and Analysis of the Digital Economy (MADE), Paris, France – November 2-3
    • ICC Commission on Customs and Trade Facilitation, Paris, France – November 9-10
    • Meeting of the OECD Committee on Digital Economy Policy (CDEP), Paris, France, November 21-22

  • Eleventh WTO Ministerial Conference, Buenos Aires, Argentina – December 10 – 13
  • Internet Governance Forum (IGF), Geneva, Switzerland – December 18-21

 


USCIB Policy and Program Staff

Rob Mulligan
Senior Vice President, Policy and Government Affairs
202-682-7375 or rmulligan@uscib.org

Erin Breitenbucher
Senior Policy and Program Associate and Office Manager, Washington
202-682-7465 or ebreitenbucher@uscib.org

Norine Kennedy
Vice President, Strategic International Engagement, Energy and Environment
212-703-5052 or nkennedy@uscib.org

Shaun Donnelly
Vice President, Investment and Financial Services
202-682-1221 or sdonnelly@uscib.org

Elizabeth Kim
Policy and Program Assistant, New York
212-703-5095 or ekim@uscib.org

Megan Giblin
Director, Customs and Trade Facilitation
202-371-9235 or mgiblin@uscib.org

Carol Doran Klein
Vice President and International Tax Counsel
202-682-7376 or cdklein@uscib.org

Ronnie Goldberg
Senior Counsel
212-703-5057 or rgoldberg@uscib.org

Mia Lauter
Policy and Program Assistant, New York
212-703-5082 or mlauter@uscib.org

Eva Hampl
Director, Investment, Trade and Financial Services
202-682-0051 or ehampl@uscib.org

Mike Michener
Vice President, Product Policy and Innovation
202-617-3159 or mmichener

Alison Hoiem
Senior Director, Member Services
202-682-1291 or ahoiem@uscib.org

Chris Olsen
Policy and Program Assistant, Washington
202-617-3156 or colsen@uscib.org

Gabriella Rigg Herzog
Vice President, Corporate Responsibility and Labor Affairs
212-703-5056 or gherzog@uscib.org

Barbara Wanner
Vice President, ICT Policy
202-617-3155 or bwanner@uscib.org

Jonathan Huneke
Vice President, Communications and Public Affairs
212-703-5043 or jhuneke@uscib.org

Kira Yevtukhova
Communications Manager
202-617-3160 or kyevtukhova@uscib.org

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Multilateral Effort Needed to Address Tax in Digital Economy

In response to recent European Union proposals concerning taxation of the digital economy, Business at OECD (BIAC) expressed deep concerns that unilateral action for the taxation of the digital economy will lead to serious distortions in markets and global value chains.

“Business at OECD representing corporate communities across the globe is fully and constructively engaged in the OECD/G20 process to address Base Erosion and Profit Shifting (BEPS), including Action 1 on the digital economy”, confirmed Business at OECD Secretary General Bernhard Welschke. “We recognize there are important and complex issues concerning the digitalization of our economies. However, unilateral action in this field will lead to costly fragmentation and threatens to diminish the considerable potential for growth and innovation,” he added.

Welschke noted that only a comprehensive multilateral engagement between tax authorities, taxpayers and other stakeholders will lead to outcomes that support a successful digital transformation. “Therefore, the OECD is the most appropriate forum in which to pursue this engagement, and we encourage all countries to participate in this multilateral effort,” explained Welschke.

USCIB’s tax expert Carol Doran Klein also noted: “For business to flourish in the digital economy, tax rules must be implemented in a coherent and coordinated manner. USCIB worked actively through BIAC to shape the BEPS work toward this end. Fragmented rules are likely to result in double taxation and a negative impact on global trade and Investment.”