Governments Reject Discriminatory Barriers to Business at UN Climate Talks

Following intense and sometimes contentious negotiations, governments meeting in Bonn under the UN climate treaty last month rejected any reference to “conflict of interest” or conditionality for observer organizations. Commenting on the successful conclusion of UN discussions to allow transparent and inclusive involvement of business, Justin Perrettson (Novozymes), who co-chairs the USCIB Environment Committee encouraged  “all Parties to take full advantage of the depth and breadth of business engagement and experience with climate change issues and to partner with business to help inform and implement ambitious national pledges.”

Countries including the Africa Group, China, Ecuador, Venezuela and Cuba began the Bonn deliberations arguing for new measures to protect against “undue business influence,” and proposing language to:

  1. define “conflict of interest” in a way that would inherently discriminate against business
  2. require a statement of support of the UNFCCC in order for any non-governmental entity to be allowed to observe the climate negotiations.

Climate Justice, Youth, Indigenous Peoples and Women and Gender NGOs all advocated restricting, or even banning, certain sectors of business from the UNFCCC discussions, asserting a distorted interpretation of “conflict of interest,” and citing the precedent of the World Health Organization Framework of Engagement for Non State Actors (FENSA).

Along with Perrettson, USCIB representatives Nick Campbell (Arkema) and USCIB Vice President for Strategic International Engagement, Environment and Energy Norine Kennedy met with U.S. and other government delegations to make the case for inclusive and transparent engagement opportunities for all stakeholders, including business. In addition to the U.S.,  Australia, New Zealand and Norway spoke out definitively against the addition of any such business discriminatory practices.

The Bonn Climate Change Conference took place from April 30 to May 10 in Bonn, Germany. Approximately 4000 participants from governments, UN bodies and agencies, intergovernmental organizations, business and civil society organizations, and the media were on hand to make final preparations for the 24th Conference of Parties (COP24) in Katowice, Poland, which will take place later this year (December 3-18, 2018).

The main objective of the Bonn negotiations was to advance the Paris Agreement Work Programme (also known as “the Paris Rulebook”) and develop “negotiating text” for the decisions required to make the Paris Agreement operational by COP24. When complete, the Paris Rulebook would set out procedures for carbon markets and guide the tracking of comparability of effort across different national pledges.

Limited progress in Bonn necessitated the announcement of a supplementary negotiation session to be held in Bangkok, Thailand (August 31 to September 8).  It will be critical to have a negotiating text at the end of the Bangkok session if the Paris Rulebook is to be agreed at COP24.

USCIB members seeking more information on climate change and conflict of interest discrimination should contact Norine Kennedy and attend USCIB’s June 7 Environment Committee in NYC

Qatar Joins the World ATA Carnet Council

Earlier this month Qatar has officially joined the World ATA Carnet Council (WATAC). The official announcement was made by Sheikha Tamadar Al Thani, director of international relations and chambers’ affairs at Qatar Chamber (QC) and the International Chamber of Commerce Qatar, during her participation in a WATAC meeting organized by the International Chamber of Commerce’s World Chambers Federation on May 9, 2018 in Xi’an, China. The ATA Carnet system is expected to be implemented in Qatar as of August 1, 2018 but will only accept Carnets issued for Exhibitions and Fairs.

During her address to WATAC, Al Thani noted that the State of Qatar’s formal accession to the Council as a full member came as a result of lengthy negotiations conducted during the previous sessions with WATAC leadership and council members. The ATA Carnet plays an important role towards advancing the cause of free trade as a mechanism of trade facilitation.

Al Thani further noted that world trade is facing momentous challenges nowadays, with protectionist policies on the rise again and the State of Qatar’s accession to the Council is a testimony to its adherence to free trade, and to its belief in the importance of the free movement of goods and services around the world.

The ATA Carnet is the global gold standard for temporary admissions under the auspices of the World Customs Organization. ATA Carnets are international tools of trade facilitation, which serve as a temporary export-import documentation. The ATA System is in place in over 85 countries and territories, and provides duty-free and tax-free imports on goods that will be re-exported within 12 months.

Please visit the Qatar ATA Carnet page for more info.

UN Global Pact for Environment Negotiations to Begin

After months of informal discussion, UN Member States have voted to launch a negotiation toward the development of a “Global Pact for Environment.” An initiative of French President Emanuel Macron, the Pact is to be a binding, universal “umbrella text” providing a common global legal basis for:

  • environmental policy principles, such as the polluter-pays and precautionary principles;
  • environmental rights-based approaches;
  • other international environmental regulations and treaties.

The United States voted against the resolution to launch the negotiations, while 143 countries voted in favor.  A copy of the resolution is available here.

U.S. Ambassador to the UN in New York Nikki Haley commented on the new General Assembly resolution stating, “When international bodies attempt to force America into vague environmental commitments, it’s a sure sign that American citizens and businesses will get stuck paying a large bill without getting large benefits. The proposed global compact is not in our interests, and we oppose it.”

As a basis for the deliberations, the UN will develop a report “that identifies and assesses possible gaps in international environmental law and environment-related instruments with a view to strengthening their implementation,” to be delivered to the UN General Assembly in New York. It is widely expected this report will be prepared by UN Environment.

“An ad hoc open-ended working group, under the auspices of the General Assembly, (will) consider the report and discuss possible options to address possible gaps in international environmental law and environment-related instruments, as appropriate, and, if deemed necessary, the scope, parameters and feasibility of an international instrument, with a view to making recommendations to the General Assembly, during the first semester of 2019, which may include the convening of an intergovernmental conference, to adopt an international instrument.”

Non-governmental organizations, including those representing business, will be allowed to observe the negotiations.  A first “organizational” meeting will take place in New York in late July; following that, deliberations will begin in Nairobi, Kenya at UN Environment headquarters based on a review of the report.

“USCIB will closely follow the negotiations, and work with the Administration, other governments and the International Chamber of Commerce to understand the specifics of what is to be proposed,” said Norine Kennedy, who leads USCIB’s work on strategic international engagement, environment, and energy. “USCIB will continue to gather intelligence, as questions remain on the legal form of the ‘Pact,’ and how it would relate to other existing agreements, such as UN Climate and chemicals conventions,  and the Sustainable Development Goals.”

USCIB members seeking more information on the GPE should contact Norine Kennedy, and attend USCIB’s June 7 Environment Committee in NYC.

USCIB Warns of Potential Harms to the US Following China Tariffs

In light of the Trump administration’s proposed Section 301 tariffs on Chinese goods, USCIB sent comments last week to the U.S. Trade Representative Robert Lighthizer expressing concern about the potential unintended negative consequences the proposed tariffs will have on sectors vital to the U.S. economy and jobs. With $587.6 billion in total goods trade in 2016, China has become the United States’ largest goods trading partner. China was also the third-largest export goods market in 2016 for the U.S., while U.S. foreign direct investment in China was $13.8 billion in 2016, with the ICT sector alone encompassing $4.34 billion.

“China can be a challenging market for U.S. companies to navigate. The ongoing intellectual property rights violations, forced technology transfer requirements, and state interventions harm U.S. companies, workers, consumers, and competitiveness,” stated Eva Hampl, who leads USCIB work on China-related issues.

Made in China 2025 is considered by many an indication that China plans on further advancing in developing their high-tech industries, such as robotics, advanced information technology, aviation, and new energy vehicles, with the eventual goal of global dominance in those industries through uncompetitive means such as subsidies.

“While this unfair advantage to Chinese companies in the high-tech industry space is a legitimate threat to U.S. leadership in innovation, continued engagement in the Chinese market is also very important for U.S. companies in terms of their ability to be globally competitive,” emphasized Hampl. “USCIB members are very concerned that these proposed tariffs will stifle the U.S. economy, and not achieve the important goal of changing China’s behavior in the space of emerging technologies and intellectual property rights. China’s threat of retaliation further exacerbates uncertainties caused by this proposed action. Rather than create more opportunities for U.S. business, sweeping tariffs will stifle U.S. agriculture, goods, and services exports and raise costs for businesses and consumers.”

The comments urge the administration to use this public comment period to listen to USCIB members and other U.S. stakeholders who explain how they will be directly affected by the proposed tariffs.

“It is critical that the administration exclude from its tariffs particularly those products that cannot feasibly be replaced by non-Chinese sources, where the harm of potential tariffs would fall more on U.S. businesses, workers, and exporters than on Chinese entities,” said Hampl. “Hurting American exporters cannot be the outcome of a process designed to level the playing field in China.”

USCIB has also signed on to a broader coalition of trade associations to echo these and other business concerns. Additionally, USCIB is co-sponsoring a reception later this week for Hill staff centered around the China 301 hearing, as well as NAFTA, celebrating Great American Jobs Supported by Trade. Finally, USCIB will also testify this week as part of the China 301 hearing.

USCIB Members Honored with Best Corporate Citizens Ranking

Corporate Responsibility magazine has honored several USCIB members, including Microsoft, Lockheed Martin, AT&T, Qualcomm and Walt Disney, among many others, in their annual 100 Best Corporate Citizens rankings. Each year, the 100 Best Corporate Citizens ranking measures the success of the Brands Taking Stands movement by celebrating the most successful, most transparent companies that report on their responsible practices.

The 100 Best Corporate Citizens list documents 260 ESG data points of disclosure and performance measures—harvested from publicly available information in seven categories: environment, climate change, employee relations, human rights, governance, finance, and philanthropy & community support.

The list ranks the Russell 1000 Index and research is conducted by ISS Corporate Solutions.  There is no fee for companies to be assessed. Companies listed on the Russell 1000 are analyzed using publicly available records from their websites, annual reports, shareholder calls, media interviews, NGOs and government documents. The analysis includes 260 data points on environmental, climate change, human rights, employee relations, corporate governance, philanthropy, and financial performance.  As a result, companies are rated on what information they disclose as well as how much they disclose.

To compile this ranking, data is obtained from public records and not from private self-reports to the analysts. Many rankings ask companies to fill out surveys and questionnaires about internal operations and ours relies on what is publicly available. That’s because transparency and public commitments help make a company’s sustainability program stronger.

 

Download a copy of the complete list and information on the methodology here

View past 100 Best Corporate Citizens winners here

Russian Sanctions: How Do They Affect US Business?

A roundtable discussion was held at HodgsonRuss LLP in New York on April 26, connecting participants from Washington DC, New York and Europe to discuss the recent sanctions imposed by the U.S. Government on Russia, enforcement trends and how they affect the way the U.S. companies conduct business around the globe. This event was organized by the Committee on Eastern Europe and Committee on International Trade of the International Section of the New York State Bar Association. Distinguished panelists included Charles R. Johnston (Citi), chair of USCIB’s Trade and Investment Committee, Michael Hendrix, OFAC, U.S. Department of Treasury, Hon. Volodymyr Yelchenko, permanent representative of Ukraine to the United Nations and Robert J. Leo, chair of the Committee on International Trade. The discussion was moderated by Serhiy Hoshovsky, chair of the Committee on Eastern Europe. Participation from overseas was moderated by Oleh Beketov, chapter chair in Kiev.

The event was opened by Paul M. Frank, a former chair of the International Section and renown international law attorney who hosted the event at his law firm. Yelchenko provided a comprehensive political context for the Russian sanctions and reminded of the events that led to their initial imposition in 2014. Michael Hendrix, an enforcement officer with OFAC, summarized legal framework for the sanctions and enforcement priorities as well as discussed some recent enforcement actions. Johnston provided a great overview of the sanction regime from the perspective of the U.S. business community, explaining in detail how the sanctions are becoming a new reality and how the U.S. businesses adapt to doing business. He also shared practical experiences of what U.S. companies do to stay compliant. Leo shared a very useful handbook on sanctions and practical tips on what to do when issues arise and how to stay compliant.

“The event provided a unique opportunity for the participants, especially those from the overseas, to ask questions and hear from people who are on the forefront of the sanction policy and enforcement at the US government, business community and legal profession,” said Nancy Thevenin, USCIB’s general counsel. “All panelists and participants agreed that the event was a major success and provided a great platform for sharing views and discussing major issues affecting business and legal community not only in the U.S. but also internationally.”

USCIB Sponsors National Governors Association North American Summit

From left to right: CEO of Rassini Eugenio Madero; USCIB VP for Trade and Financial Services Shaun Donnelly; Woodrow Wilson Institute and former US Ambassador to Mexico Tony Wayne; National Restaurant Association Senior VP Steve Danon

USCIB was an organizational sponsor for the National Governor Association (NGA) North American Summit in Scottsdale, Arizona, which was held May 4-6. USCIB Vice President for Investment Policy and Financial Services Shaun Donnelly represented USCIB at the weekend event. The NGA welcomed Mexican Governors and Canadian provincial premiers to the North American Summit, which focused on strengthening North American economic integration and competitiveness in today’s and tomorrow’s global economy.

“The good news is that governors, across the three nations of North America, get it!” said Donnelly. “Open trade and investment gets broad bipartisan support across the political spectrum of governors and premiers. They welcome trade and investment and they welcome business comments and recommendations at these sessions. Obviously, NAFTA, and the on-going negotiations to update that key agreement, were key areas of discussion.”

Business speakers from the three countries were united in urging governors across all three countries, particularly in the U.S., to be strong advocates for a strong updated NAFTA with their national governments at this key moment in the negotiations.

USCIB member company representatives were also present and active at the NGA Summit with UPS, Walmart, and Squire Patton Boggs executives among the formal speakers/panelists to the Governors; CenturyLink was another active participant in the corridors. Former Canadian Foreign Minister Perrin Beatty, CEO of USCIB’s Canadian counterpart organization the Canadian Chamber was another clear pro-NAFTA, pro-business panelist in his presentation to the assembled governors.

Donnelly commented, “I come away from this NGA weekend with some key governors from across North America very encouraged that they really understand and support NAFTA and importance of an integrated, competitive North American economy/marketplace going forward. At this trilateral Summit, I saw none of the partisanship and anti-trade grand-standing we see so much of in Washington these days. The coming weeks will be critical for the fate of NAFTA and America’s governors, of wither party, can be important allies in convincing the Administration and, then down the road, the Congress to do the right thing…….and not to do the wrong thing on NAFTA.”

World Trade Week NYC Celebrates Gotham’s Export Champs

Cheryl Moore of the New York Genome Center

USCIB is a longtime partner in the annual World Trade Week festivities in New York City. World Trade Week, a celebration of international commerce in cities across the United States, was launched by President Franklin Delano Roosevelt and brings together trade champions and companies of all sizes to mark the critical importance of cross-border commerce in promoting American competitiveness and global leadership.

World Trade Week NYC 2018 – despite the name, actually a full month of events and activities – kicked off this week with a high-level awards breakfast hosted by the Weissman Center for International Business at Baruch College, part of the City University of New York. Among the award honorees was the New York Genome Center, whose president and COO Cheryl Moore also served as the breakfast keynote speaker, providing an overview of New York’s efforts to foster growth in the life sciences industries.

Other businesses recognized for export success included Magnetic Analysis Corp., Innodata, Inc. and Classic Rug Collection, Inc. Empire State Development’s Global NY initiative was also honored, as was Irving A. Williamson, a member of the U.S. International Trade Commission, who was presented with a lifetime achievement award.

USCIB Vice President Jonathan Huneke served on the steering committee for World Trade Week NYC 2018. For a full list of World Trade Week events in and around New York City, click here.

Mulligan Joins BIAC to Push for Business Priorities at OECD

USCIB Senior Vice President for Policy and Government Affairs Rob Mulligan was in Paris the last week of April attending Business at OECD (BIAC) and OECD Trade Committee meetings, which included dialogues with several OECD officials, including Director of the OECD Trade Directorate Ken Ash, OECD Deputy Secretary General Mari Kiviniemi, Head of the OECD Investment Division Ana Novik, and Head of the OECD Services Trade Division John Drummond, among others.

“BIAC’s meetings were integral in getting the business community on the same page regarding several issues, including possible accession to the OECD by Argentina, Brazil, Peru, Croatia, Romania and Bulgaria, BIAC’s upcoming work with B20 Argentina on joint meetings later this month in Paris, as well as the OECD release of a Trade Facilitation publication this summer,” noted Mulligan.

According to Mulligan, BIAC members also discussed BIAC talking points on the OECD’s draft Program of Work and Budget for 2019-20 (PWB), providing suggestions for inclusion of services trade, de-minimis, overcapacity, digital trade, cybersecurity, customs simplification for SMEs, trade distortions, international regulatory cooperation, and government procurement.  These were in addition to the points based on the BIAC Trade as a Priority for All paper approved by the Committee last year. At a subsequent OECD Trade Committee Meeting later that week, member countries provided feedback to the secretariat about the draft PWB and BIAC, represented by its Chair Cliff Sosnow, noting the areas it would like to see the committee focus on during this cycle, which aligned with many of the areas BIAC had suggested.  However, BIAC noted that the PWB did not seem to include further work on localization requirements and state-owned enterprises that continue to be key areas of concern for its members and encouraged the OECD to include this in their work plans going forward.

Mulligan also had the opportunity to attend the BIAC Roundtable on Data Localization, Digital Trade and Market Openness which enabled a dialogue among the 25 people around the table. Ash, who recently met with the Japanese business group Keidanren, emphasized his desire to understand the realities of business and digital trade issues and noted Keidanren’s plans to make digital trade a focus when they host G20/B20 in 2019.

Mulligan then joined Pat Ivory of the Irish Business Federation Ibec, in their capacities as vice chairs of the BIAC Trade Committee to provide overviews on the BIAC digital trade priorities.

“Members are increasingly voicing concerns about data localization requirements related to the impact on cybersecurity and the conflicts they can cause for highly regulated industries,” stressed Mulligan. “The impact of rapidly changing technology and the need for regulators to take approaches to digital trade that do not end up restricting trade, stifling innovation, and undercutting economic growth.”

BIAC members noted challenges they deal with when assessing where to do business and suggested that localization requirements that can increase security risks in some developing countries and can make it less likely for them to do business there.

USCIB’s Geneva Delegation Supports Innovation at World IP Day

As part of USCIB’s Geneva Week, USCIB staff and members had the opportunity to participate in the annual World Intellectual Property Day on April 26 in Geneva to celebrate the role that intellectual property rights play in encouraging innovation and creativity. This year’s campaign celebrated women who are driving societal change and shaping “our common future” through innovation and creativity.

The USCIB delegation attended a reception sponsored by Mexico, Indonesia, South Korea, Turkey and Australia (MIKTA), an informal partnership created in 2013 on the sidelines of the United Nations General Assembly to support effective global governance.

“USCIB appreciated the opportunity to attend World IP Day and to support the importance causes of promoting intellectual property rights and bridging the gender divide in innovation,” noted Mike Michener, who leads USCIB’s Committee on Innovation and Intellectual Property. “USCIB’s goal within our recently revamped Intellectual Property and Innovation Committee is to improve our members’ global competitiveness as well as identify international initiatives to secure IP rights and promote innovation. World IP Day is an exemplary forum to help endorse our long-standing beliefs that intellectual property protection and innovation go hand-in-hand.”