The Senate has kicked off the complicated process of coordinating and passing multi-committee legislation designed to bolster US technological capabilities, expand the US political, diplomatic and economic toolkit for dealing with China and curb China's growing geopolitical influence. The effort has garnered strong bipartisan support and is likely to yield landmark legislation that will be enacted with strong bipartisan support and the backing of the Biden administration.
President Joe Biden recently announced his International Climate Finance Plan as a follow up to his January 2021 Executive Order on Tackling the Climate Crisis at Home and Abroad. Among other things, the plan is supposed to be a boon to US companies, particularly manufacturers of products and technologies viewed as environmentally beneficial. Accordingly, the Export-Import Bank is expected to play a key role in helping the administration to achieve its stated goals.
New legislation may soon expand the jurisdiction of the Committee on Foreign Investment in the United States as part of a broader push by Congress to position the United States to out compete China in the coming decades and counter China's increasing global influence. The draft Strategic Competition Act 2021 calls for hundreds of millions of dollars in funding for foreign military sales and Indo-Pacific security initiatives and seeks to deter further human rights and anti-democratic actions by China.
Now that United States Trade Representative Katherine Tai has officially assumed office, there have been some early developments to take ownership of both the ongoing investigations regarding digital service taxes and the EU Airbus dispute. These developments are consistent with Tai's goal of rebuilding US alliances while continuing to address the challenges posed by China and other countries.
It has been almost three years since the 25% duties on steel imports and the 10% duties on aluminium imports pursuant to Section 232 of the Trade Expansion Act 1962 were first imposed and legal challenges are proliferating and there is renewed legislative interest in Section 232 reform. This article highlights legal challenges worth following and provides an update on the status of World Trade Organisation litigation and recent legislative proposals for Section 232 reform.
The US Court of International Trade recently issued a lengthy opinion which was sceptical of the longstanding use of first sale appraisement in non-market economies, causing an uproar in the import community – but is this much ado about nothing? Companies that have implemented first sale should rest assured that the programme is legally sound. Nonetheless, this decision may trigger increased US Customs and Border Protection scrutiny of the first sale programme.
An interim rule which introduces expansive changes to General Prohibition 7 of the Export Administration Regulations by including new controls on military-intelligence end uses and users recently took effect, making the already tricky process of conducting business with foreign entities that much more complicated. Companies should be prepared to conduct additional due diligence for any transactions involving entities in the countries enumerated in this rule.
Companies should review their supply chain and establish compliance plans because forced labour laws are here to stay. Two bills, both titled the Uyghur Forced Labour Prevention Act, have been reintroduced in Congress and may effectively ban all goods produced in whole, or in part, in the Xinjiang Uyghur Autonomous Region unless importers can prove that the goods were not made with forced labour.
The Department of Commerce has issued subpoenas on multiple Chinese companies that provide information and communications technology and services (ICTS) in the United States, signalling that Biden may continue the push to decouple US ICTS infrastructure from equipment and services providers over concerns that they might pose a national security risk. The targeting of Chinese companies is significant, with additional actions targeting Chinese companies potentially around the corner.
US Customs and Border Protection (CBP) recently announced that an Enforce and Protect Act investigation had been initiated with implementing measures against importers suspected of evading anti-dumping/countervailing duties (AD/CVDs) on quartz surface products from China via trans-shipment through Malaysia. The investigation names an unusually high number of importers as having evaded AD/CVDs on imports from China, continuing CBP's aggressive and evolving tactics through this enforcement tool.
President Biden recently signed the long-awaited Executive Order on America's Supply Chains, which initiates a 100-day process of reviewing and assessing the strengths and weaknesses of supply chains across key industries and separate one-year reviews of certain other sectors. The administration's goal is to reduce the reliance on foreign-made inputs needed by critical US industries and determine whether any changes to US legislation, regulation or policy are needed to reverse shortages of crucial supplies.
The growing role that international trade rules are playing has led many corporate leaders to look beyond regularly imposed tariffs. Recent additions to trade agreements include deep-reaching requirements on non-tariff issues, such as labour provisions, which have become intrusive to the entire supply chain – and none more so than the automotive parts industry. This article examines what is in store for the automotive industry under the Biden administration.
Following the region-wide withhold release orders (WROs) against cotton and tomato products produced in China's Xinjiang Uyghur Autonomous Region (XUAR), Customs and Border Protection (CBP) has provided XUAR-specific FAQs. The FAQs clarify CBP's approach to enforcement of the WROs and publish its requirements to satisfy the burden of proof to evidence that goods were not produced with forced labour. However, underlying challenges remain.
The US Court of International Trade recently took long-awaited action on the nearly 4,000 cases challenging the Section 301 duties imposed on goods from China. Chief Judge Timothy C Stanceu assigned the cases to a three-judge panel, which is expected to issue a case management order so that active litigation can proceed. Companies which have paid Section 301 duties on products from China that are included on Lists 3 or 4(a) may still have an opportunity to file a suit to potentially recover the duties.
The Federal Trade Commission has issued a $1.2 million fine against glue manufacturer Chemence, Inc for violating a 2016 consent order requiring the company to qualify its Made in USA claims in its promotional materials and on its product packaging. To date, this is the largest fine issued over a Made in USA claim.
President Biden recently signed an executive order (EO) to direct more spending of the federal government's procurement budget on American-made products, while rethinking the existing regulatory framework. By narrowing the loopholes that allow government purchases of foreign products, increasing agency accountability and directing agencies to seek out US suppliers, the EO aims to revitalise the domestic manufacturing industry and create American jobs in furtherance of Biden's economic recovery plan.
As one of the last official actions of the Trump administration, the US Department of Commerce issued the Securing the Information and Communications Technology and Services Supply Chain interim final rule. If implemented by the Biden administration, the rule would significantly affect companies that have an international nexus in numerous sectors, including telecoms service providers, internet and digital service providers and data hosting or computing equipment manufacturers.
Just two weeks into 2021, US Customs and Border Protection expanded its enforcement efforts against forced labour in China. This follows months of increasing pressure from labour and human rights groups and members of Congress to halt imports of cotton and agricultural products from China's Xinjiang Uyghur Autonomous Region. In addition, the government is considering seeking increased enforcement authority to prevent certain importers from being able to import into the United States.
This podcast examines how to navigate Section 889 of the National Defence Authorisation Act 2019. It focuses on the US government restrictions on the procurement and use of covered telecoms equipment and services from certain Chinese-owned entities within the US government supply chain.
The last four years have been turbulent, to say the least, with more changes to come under the Biden administration. Some issues from 2020 will remain in focus and will be tempered by the Biden administration's need to repair the damage done to US relations with key trading partners. This article aims to help businesses anticipate and prepare for these changes by examining six hot-button trade issues to watch out for in 2021.