USCIB Urges Reversal of 1-800 Contacts FTC Ruling

USCIB filed an amicus brief with regards to 1-800 Contacts, Inc. case to highlight the challenges American businesses would face under the recent Federal Trade Commission’s (FTC) decision’s approach to antitrust liability for trademark settlements, and explain the potential negative impacts the decision would have on businesses, consumers and competition if left to stand.

USCIB General Counsel Nancy Thevenin led the process for USCIB. “The Commission’s decision creates substantial uncertainty regarding the enforcement and settlement of intellectual property rights, increases the risk of arbitrary enforcement against even routine settlements, and potentially exposes settlements to such risk for decades,” warned Thevenin. “The decision should be reversed.”

Earlier this year, the FTC decided to impose antitrust liability against 1-800 Contacts, the largest online retailer of contact lenses in the U.S., on the basis that 1-800 Contacts’ settlements of trademark infringing lawsuits against at least fourteen competing online contact lens retailers restricted trade. Among other things, USCIB’s amicus argues that the Commission’s decision ignores the critical importance to business of intellectual property rights and its enforcement and would unfairly require the lawful exercise of such rights to a higher pro-competition standard.

USCIB thanks Eileen M. Cole, Bryant D. Gant and Seiji Niwa of member firm White & Case for their work with the amicus.

 

USCIB Responds to US Tariff Escalation With China

In response to the recent escalation of tit-for-tat tariffs between the United States and China, USCIB submitted comments on June 17 to the office of the United States Trade Representative (USTR) on the proposed modification to Section 301 regarding China’s policies and practices related to technology transfer, intellectual property and innovation. USCIB members are concerned that proposed tariffs on essentially all Chinese imports will stifle the U.S. economy and will not achieve the Administration’s goal of changing China’s behavior.

Following this submission, USCIB’s China lead Eva Hampl is getting ready to testify at USTR on Friday, June 21. “While China’s forced technology transfer requirements, state interventions, and other unfair trade practices harm many U.S. companies, workers, consumers, and competitiveness, these tariffs can also similarly endanger the U.S. economy,” warns Hampl. “Specifically, this proposed list now includes categories of products that only impact U.S. companies, and not their global competitors. Ceding market share to competitors is not weakening the Chinese economy, it is merely weakening the U.S. market.”

USCIB also joined with Tariffs Hurt the Heartland, alongside 661 other companies and association, to send a letter to President Trump on June 13 urging the administration to negotiate a strong deal with China that addresses longstanding structural issues, improves U.S. global competitiveness and eliminates tariffs. “This goal can be achieved without taxing Americans,” the letter emphatically stated.

The letter also stated that “broadly applied tariffs are not an effective tool to change China’s unfair trade practices” and would “result in the loss of more than 2 million U.S. jobs, add more than $2,000 in costs for the average American family of four and reduce the vale of U.S. GDP by 1.0 percent.”

USCIB Sponsors Seminar on Mitigating Business Risk With Arbitration

USCIB/ICC USA sponsored a seminar in Albuquerque, New Mexico on June 14 on international arbitration and how that state’s businesses can use arbitration to mitigate the risks of doing business overseas. Some thirty New Mexico business executives, lawyers and law students attended the presentation, which was opened by Roberta Cooper Ramo, former president of both the American Bar Association and the American Law Institute.

Marek Krasula, counsel for the ICC International Court of Arbitration in New York and David Wilson, partner at Sherman & Howard in Denver, provided an overview of ICC arbitration and how to best draft contracts to provide for it. Matthew Draper, a partner at Draper & Draper in New York and Santa Fe, moderated a panel discussion addressing issues of particular relevance to local companies, such as using arbitration to protect IP rights, recovery of attorneys’ fees by prevailing parties, and keeping the costs of arbitration to a minimum.

“The ICC’s new Expedited Procedures, which apply when less than two million dollars is at stake, reduce significantly the time and cost of dispute resolution, and may be a good fit for New Mexico companies,” said Draper.

Vice Dean of the University of New Mexico School of Law Camille Carey noted in her closing remarks that she hoped the law school would expand opportunities for students to learn about international arbitration.

Remembering John Kloosterman, Labor Standards Expert

John Kloosterman (2nd from left) relaxed prior to the 2016 ILO conference with (L-R) then-USCIB International Labor Counsel Ed Potter, USCIB President and CEO Peter Robinson, and USCIB Corporate Responsibility and Labor Affairs Committee Chair Laura Chapman Rubbo (Disney).

USCIB members, staff and friends mourn the passing of John Kloosterman, a widely respected labor and employment lawyer who was an active member of USCIB’s Corporate Responsibility and Labor Affairs Committee, and who served on many U.S. employer delegations to the International Labor Organization (ILO). John passed away tragically in a traffic accident on May 28, and will be greatly missed by USCIB and our members.

In particular, John’s contributions to the work of the ILO’s Committee on the Application of Standards, an important part of the ILO’s supervisory mechanism on which he served from 2012 to 2017, were recognized and appreciated by his peers in the global employer community.

We extend our heartfelt condolences to John’s family, especially his wife Jamie. The couple were serial adopters of large, lovable shelter dogs. In lieu of flowers or food, Jamie has asked that donations be made in John’s name to the San Francisco SPCA.

In 2018, John joined the Canadian law firm of Hicks Morley. Read more about his career and legacy in this tribute on the firm’s website.

Business Pushes Back Against Mexico Tariff Plan

Following President Trump‘s announcement of his administration’s plan to impose tariffs on imports from Mexico, to compel the country to act more forcefully against unauthorized migration, USCIB joined a broad array of U.S. business groups in criticizing the plan.

The groups wrote in a June 7 joint statement that the plan – involving five-percent tariffs that would ratchet up to 25 percent over a period of months – would impose undue hardship on American companies and consumers, and would jeopardize passage of the U.S. Mexico Canada Agreement, the successor to NAFTA.

“We have committed to work with the administration and both sides of the aisle in Congress to support congressional passage of USMCA,” the business groups wrote. “We are supportive of the constructive discussions members of the administration have had with members of Congress. But imposing unilateral tariffs on Mexico jeopardizes a successful bipartisan vote on USMCA and approval of the agreement.

President Trump withdrew the threat of tariffs following a pledge by Mexico to increase its enforcement efforts.

Business for 2030 Platform Honored by International Chamber of Commerce

The Business for 2030 initiative, launched by USCIB in 2015 as a platform to showcase private-sector efforts aligned with the UN Sustainable Development Goals, was honored by our partners at the International Chamber of Commerce in May.

At a meeting of ICC National Committees in Paris, Business for 2030 took third place in the Americas region in the “NC Initiative of the Year” competition for 2018-2019. USCIB President and CEO Peter Robinson accepted on behalf of USCIB and its Business for 2030 team.

“I couldn’t be prouder of our team and of the many, many companies and organizations that have contributed to this essential platform over the past four years,” Robinson said.

Business for 2030 showcases past and ongoing contributions by companies and business organizations to sustainable development, through the lens of the SDGs. It currently features projects in over 150 countries, which can be viewed by specific SDGs, by company and by country.

The site aims to stimulate a more productive partnership between the public and private sectors – at the UN and at national levels – and to demonstrate the need for a proportionate role for business in the negotiations, implementation and follow-up mechanisms of the 2030 Development Agenda at both the UN and at national levels.

Rounding out the winners from the Americas region were ICC Brazil, which won 1st place (and the top worldwide prize overall) for its ITTI Cognitive Trade Advisor program, and ICC Guatemala in 2nd place for its GuateIntegra anti-corruption initiative.

USCIB Statement on WTO e-Commerce Negotiations

USCIB has issued Recommendations on the WTO e-Commerce negotiations, reflecting member priorities and goals for the negotiations, which had their first round in May. The recommendations are being shared with relevant government officials and stakeholders.

At the December 2017 WTO ministerial in Buenos Aires, 71 countries agreed to begin discussing new global rules to facilitate the expansion of the digital economy. Thanks to intensive work by those countries, last January 76 countries (notably including the U.S., EU, and China) announced the launch of formal negotiations.

In addition to this paper, USCIB is actively engaging in the negotiations in Geneva via various efforts, including the Digital Trade Network and the International Chamber of Commerce.

“The vast majority of the world’s economy is at the table,” wrote Nick Ashton-Hart, the Digital Trade Network’s Geneva representative, in the most recent issue of USCIB’s magazine, International Business. “Since it is estimated that the digital economy underpins approximately one-third of global GDP this is a negotiation that will impact industry everywhere.”

In Peru, USCIB’s Goldberg Highlights Gender Inclusion

USCIB’s Ronnie Goldberg (center) at the UN Equal Pay International Coalition meeting in Lima, Peru

USCIB Senior Counsel Ronnie Goldberg participated in a meeting of the UN’s Equal Pay International Coalition (EPIC), May 28-29 in Lima, Peru. Launched by the UN General Assembly in 2017, EPIC aims to help stakeholders realize and achieve SDG Target 8.51: “By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value.”

Specifically, EPIC is an initiative driven by stakeholders committed to reduce the gender pay gap and make equal pay for work of equal value a reality across all countries and sectors. Coordinated by a secretariat encompassing the ILO, UN Women and the OECD, the coalition engages governments, employers, workers and their organizations, the private sector, civil society and academia to take concrete steps to accelerate the closing of the gender pay gap and the achievement of pay equity.

At the Peru meeting, which was focused on “south-south” dialogue among developing countries, Goldberg spoke on behalf of the International Organization of Employers (IOE), part of USCIB’s global business network. She said that while the rights-based case for gender equality, women’s empowerment, and equal pay is clear, there is also a robust business case for gender equality.

“To speak in the language of business, the economic empowerment of women is a critical enabler of economic development and growth,” Goldberg stated. “Representing at least half of all human talent and potential and an enormous market of consumers, women are a valuable and strategic resource in developed and developing countries alike.”

Moreover, a growing body of evidence shows that companies that commit to and enable gender diversity are realizing clear bottom line benefits, not least through the attraction and retention of talented women, Goldberg said.

Companies can do – and are doing – a lot to foster gender diversity in their workplaces, according to Goldberg. Among the many lessons learned from the private sector’s experience:

  • Buy-in at the top is essential.
  • Pay equity is not a one-time fix. Constant attention is required, including annual benchmarking exercises.
  • Unconscious bias is an important issue. Some companies have instituted training programs designed to uncover and deal with such biases.
  • HR and hiring practices/policies need to be continually monitored.
  • Some companies are opening themselves to rigorous outside audit and certification.
  • Family-friendly and gender-blind policies on flexible work hours, maternity/paternity and sick leave benefit everyone, and extending them to all employees helps to reduce gender gaps.

Goldberg said the experience of employers indicated that gender pay gaps are not going to magically disappear, and eliminating them should not be viewed as a one-time fix. “Rather, they require specific interventions that will differ according to national circumstances, corporate cultures, available resources, and political will,” she said. “The good news is that the issue is now firmly in the public eye and an increasing number of companies are stepping up to meet the challenge.”

Tax Conference Provides First Look at OECD’s Digitalization Roadmap

L-R: Pascal Saint-Amans (OECD), Gaël Perraud (French Ministry of Economy & Finance), Brian Jenn (U.S. Treasury), Pam Olson (PwC), Louise Weingrod (Johnson & Johnson)

Global companies are facing potentially seismic shifts in the taxation of their operations, with national tax authorities seeking to keep pace with a rapidly digitalizing business environment. This was the backdrop when more than 250 global tax professionals, government officials and other tax experts gathered in Washington, D.C. June 3-4 for USCIB’s annual OECD International Tax Conference. This year’s event provided an especially timely window into the Organization for Economic Cooperation and Development’s work to develop tax policy recommendations to governments.

On May 31, the OECD released a work program to develop proposals for allocating a company’s profits among countries that re-balance source and residence taxation and also result in a global minimum amount tax paid on earnings. Drawing from the views of nearly 130 jurisdictions (far broader than the OECD’s membership of 36 countries), the OECD roadmap could result in fundamental changes to national tax laws and bilateral tax treaties, including a move to a much more multilateral approach to international corporate taxation.

USCIB President and CEO Peter Robinson asked conference-goers in his opening remarks: “How will a new consensus form around reallocation of taxing rights? Many interests will need to be balanced to achieve a solution that will be ‘globally fair, sustainable and modern,’ to quote the G20. The OECD also needs to keep global growth front and center.”

This sentiment was echoed by Bill Sample, tax policy advisory at Microsoft and chair of USCIB’s Tax Committee.

“Unlike the OECD’s earlier BEPS [base erosion and profit-shifting] exercise, this project will reallocate tax revenues among various countries,” he said. “It’s a political exercise, requiring compromise and the balancing of many competing interests among governments. One thing parties generally agree on is the need to keep these revenue shifts modest, and to have a predictable, sustainable model for global tax policy going forward.”

The conference was the 14th annual gathering on global tax policy developments convened by USCIB, in cooperation with the OECD and its official private-sector advisory body, Business at OECD (also known as BIAC).

The G20’s mandate

G20 leaders have tasked the OECD, with a long and distinguished history of work on international tax policies, to lead work a consensus-based solution to address the impacts of the digitalization of the economy, with a target of developing recommendations by next year.

The OECD’s effort represents “a fundamental rethink of the basics of the international tax system,” USCIB Vice President and International Tax Counsel Carol Doran Klein told Bloomberg News. “The scope could not be broader.”

Economist Ngozi Okonjo-Iweala

G20 governments will review the OECD roadmap at a June meeting in Japan.

“Despite the fact that people have been listening to all the talk about this being the largest international tax project, it’s only when people read this and see how wide-ranging this is that they’ll be able to appreciate it,” Will Morris, chair of the BIAC Committee on Taxation and Fiscal Policy and deputy global tax policy leader at PwC, told Bloomberg. “It’s not just about changing technical rules. It’s about saying, essentially, the world has changed, and this system we’re looking at needs to change with it.”

Economist Ngozi Okonjo-Iweala’s keynote remarks focused on ways to improve the tax capacity of emerging markets, which are expected to receive a growing share of global private-sector investment in the years ahead.

Other panelists and speakers at this year’s conference included:
Pascal Saint-Amans, director of the OECD Center for Tax Policy & Administration
Martin Kreisenbaum, director general for international taxation, German Ministry of Finance
Chip Harter, deputy assistant secretary for international tax affairs, U.S. Treasury
Dr. Ngozi Okonjo-Iweala, an economist and former finance minister of Nigeria
Doug O’Donnell, commissioner of the Large Business and International Division, IRS
Mike Williams, director of business and international tax, HM Treasury (UK).

It’s not too early to mark your calendars for next year’s OECD International Tax Conference, which will take place June 1-2 in Washington, D.C.

ICC Celebrates 100 Years, Sets Out Vision for Next Century

L-R: Peter Robinson (USCIB), Norine Kennedy (USCIB), Thomas Pletscher (ICC Switzerland)

The International Chamber of Commerce, the oldest and largest component of USCIB’s global business network, celebrated its centennial at a gala event in Paris on May 28. USCIB President and CEO Peter Robinson and Vice President Norine Kennedy were among the hundreds of attendees.

The world business organization was founded in 1919, out of the ashes of World War One, under a commitment by international business to build bridges through cross-border trade and investment and to serve as “merchants of peace.”

On behalf of its 45 million companies worldwide, ICC issued a declaration setting out a vision to shape the future of global business for the next century.

Mirroring the call by ICC’s founders, the declaration sets out guiding principles for ICC as a purpose-driven international organization, working with renewed purpose to “make business work for everyone, every day, everywhere.”

Listing a number of potential upheavals facing the global community – including climate change, digital transformations and rising inequality – the ICC declaration states: “In the years ahead, these disruptions will become increasingly pronounced in the absence of concerted action by global leaders to mitigate negative outcomes and drive collective solutions.”

Click here to read more and get the full declaration.

Ahead of ICC’s Centennial Summit, ICC launched a new work program to fulfill commitments set out in the Centenary Declaration. Leveraging ICC’s global membership in over 100 countries, ICC will execute the work program through five newly created and versatile knowledge hubs deploying five pivotal campaigns to enable business worldwide to secure peace, prosperity and opportunity for all.

“Faced with pressing global challenges in the 21st century, ICC and the global business community can – and must – do more as a force for good in the world,” said ICC Secretary General John W.H. Denton. “We will respond to this imperative with brave and bold action to meet the ambition of our renewed purpose.”