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ICC: New Leadership for World Business Organization

Published on March 12, 2018

International Business HandshakeThe International Chamber of Commerce (ICC) has announced the election of a new secretary general and new first vice chair at its March 12 meeting of the ICC World Council in Tokyo. CEO of the leading Australian law firm Corrs Chambers Westgarth John W.H. Denton has been elected as the next secretary general of ICC.

Denton is a legal expert and adviser on global policy, international trade and investment and infrastructure. Denton, who was unanimously elected, will succeed outgoing ICC Secretary General John Danilovich. Denton previously served on ICC’s Executive Board and, in 2016, became the first Australian to hold the position of first vice chair of the Paris-based organization.

Commenting on his election, Denton added, “I’m deeply honored to have been elected as secretary general of the International Chamber of Commerce. At a time when the dual threat of populism and protectionism still loom large, it’s more vital than ever for business to have a seat at the table in global policy-making. ICC has a unique role to play in ensuring the views and experience of the global private sector are taken into account in key global forums, from the United Nations to the G20. I look forward to working with ICC’s global network in over 100 countries to do just that.”

CEO of Unilever Paul Polman has also been unanimously elected as ICC’s new first vice-chair. Polman will succeed current ICC Chairman Sunil Bharti Mittal on July 1, 2018, who in turn will take the position of honorary chair. Polman is a globally recognized business leader and a pioneer in the field of corporate sustainability having served as a member of the UN Secretary General’s High-Level Panel responsible for formulating the Sustainable Development Goal (SDGs), launched in 2015, and was subsequently appointed as a UN SDG Advocate responsible for promoting the “Global Goals.”

Commenting on these appointments, USCIB President and CEO Peter Robinson said, “USCIB has appreciated the opportunity to work with John Danilovich and Sunil Mittal in recent years and thank them for their service to ICC. We now very much look forward to working closely with John Denton and his team. And of course we welcome the addition of renowned business statesman Paul Polman to ICC’s chairmanship, which will surely elevate the world business organization’s stature on sustainable development and many other topics.”

For more information, please visit ICC’s website.

Post-Brexit Trade: An Opportunity to Set New Standards

Published on March 12, 2018

By Chris Southworth

As the United Kingdom prepares to leave the European Union, the country is at a crossroads. To deliver success means delivering trade deals fast, and the only way to do that is to be more innovative, explains Chris Southworth, the secretary general of ICC UK, USCIB’s partner in the global International Chamber of Commerce network. This was also the topic of a recent ICC UK podcast featuring USCIB’s Rob Mulligan. The views presented here are the author’s own and do not necessarily reflect USCIB policy positions.

ICC UK Secretary General Chris Southworth

The UK government has committed itself to renegotiate its entire stock of trade relationships and bring home the largest number of trade deals ever delivered in a short space of time – the task has no precedent.

The first round of post Brexit deals will be with 88 countries and nine trade blocs, covering non-EU countries with EU deals – almost half the world. The scale and pace at which this task must be delivered presents a unique opportunity to be innovative – it’s the only way the government will deliver on its promises of a “free trade model that works for everyone.”

The government has begun the process of passing legislation to set up a new Trade Remedies Authority, share customs data and maintain an open procurement market, but there is currently no proposal for how the government will deliver so many deals in such a short space of time. The government says that the 60-plus countries with EU deals will roll over on the same trade terms, so no extra consultation is required, but that is highly unlikely according to the experts.

In a rare display of unity, business groups, NGOs, unions and consumer groups all agree that to move forward on trade, the UK needs a more transparent, inclusive and democratic framework to handle trade policy if there is any chance of ensuring trade benefits everyone.

The UK has become one of the most centralized G7 countries, with wide disparities across its regions, a stubborn trade deficit and a history of under-performance on productivity and competitiveness. London now dominates the UK economy, with every other region a long way behind. Brexit presents a golden opportunity for trade to play a central role in boosting regional economies as well as address the frustration and disparity that is all too clear to spot, but only if the mode of engagement changes.

If the government wants to deliver new trade deals at the pace and scale required, fresh thinking and reinvented processes are required – those who generate trade will need to be consulted on what works, not only because it is necessary, but because it is democratic. To deliver a trade model that works for everyone means giving stakeholders a say in the decisions.

The Trade Bill

The Trade Bill – currently under review in Parliament – sets out an initial framework for an independent trade policy: a Trade Remedies Authority, an open procurement market, rolling over terms with countries with third party EU agreements sharing customs data. Controversially, the bill also proposes “Henry VIII” powers giving the government the ability to overrule Parliament.

Being a member of the EU means that the UK has no formal structures or procedures for reviewing treaties, and Parliament does not have to debate, vote on or approve deals. Trade agreements are scrutinized via the usual Parliamentary means such as written questions and answers, internal debates and select committee inquiries.

If government negotiators have any chance of delivering trade deals on the scale and pace required, there needs to be a more structured approach that provides organised forums for the international community, business, unions, NGOs and civil society organisations to engage on the issues and make consensus based decisions.

There is a myth that consultation and transparency slows the decision-making process. But without dialogue there is scope for mistrust to grow, which if unchecked, has more than enough weight to derail trade negotiations – as we saw with the lack of public support for the Transatlantic Trade and Investment Partnership (TTIP). As hard is may be to hear, public services and food standards trumped trade and that is exactly how people expressed their views.

The TTIP negotiations collapsed, losing five to seven years of negotiation with no sign of an opportunity to restart discussions. It was a colossal waste of resources that could have been easily avoided if the engagement process had been better organised and more inclusive from the start.

The Canada-EU trade agreement (CETA) very nearly went the same way. The issues surrounding Wallonia’s role in Belgium that almost derailed CETA could very well apply in a host of UK regions. Good-quality engagement throughout the decision-making process would prevent such scenarios happening in the future and most importantly give people a stake in making trade a success.

Trade policy now influences all walks of life – it’s not possible to separate trade from public policy and it’s imperative to have the public on board if deals need to be done.

International Models

The US trade model is often cited as an option for the UK but it’s not the only country that has a better system of engagement. New Zealand has successfully integrated private sector groups, civil society and the Maori – its indigenous population – into its model for developing trade positions.

Beyond regular public meetings regarding trade policy, the government established a ministerial advisory group to oversee high-level consultations. The group consists of representatives from key export sectors, NGOs, business and minority groups to reflect the overall priorities of New Zealand’s trade agenda, and to provide feedback to the nation’s minister of trade. In short, it’s a more inclusive system.

The scale of the UK challenge provides an opportunity to set a new international benchmark – no country has it completely right. A deal with 27 EU countries, followed by 60-plus countries with EU agreements, and then the rest of the world is a lot of ground to cover in a short space of time – if the UK government is going to return the benefits of Brexit as promised.

In fact, the success or failure of Brexit will hinge on the government’s ability to deliver trade deals – this is central pillar of the Brexit strategy to offset costs incurred from leaving the EU, especially for SMEs. To do that, it means breaking from the past, opening up and building a model of engagement that is more transparent, consensual and democratic in approach – and doing it fast!

Published March 12, 2018

Controversial Proposals Remain Following Recent NAFTA Round

Published on March 6, 2018

Eva Hampl, USCIB director for trade and financial services was in Mexico City last week for the 7th Round of negotiations of the North American Free Trade Agreement (NAFTA). The negotiations for this round started on February 25 and concluded with a Ministerial on March 5. U.S. Ambassador Robert E. Lighthizer, Canadian Minister of Foreign Affairs Chrystia Freeland, and Mexico’s Economy Minister Ildefonso Guajardo made statements at a press conference in Mexico on the final day relating to the relative progress of the negotiations, where three new chapters and two sectoral annexes were closed out.

In Mexico, Hampl participated in an event entitled NAFTA Negotiations Status – Current Situation & Impact Analysis hosted by the Canadian Chamber of Commerce in Mexico (CanCham) and organized by Galicia Abogados, a law firm in Mexico City with expertise in arbitration and ISDS issues. Hampl’s remarks at this event addressed the business perspective and priorities, covering the current status of the negotiations, highlighting the substantive and political difficulties, and outlining what these various developments mean for U.S. business. Hampl was joined by Salvador Behar, director for North America in the Secretariat of Economy, part of Mexico’s negotiating team and Jean-Dominique Ieraci, minister-counsellor for trade for the Embassy of Canada, and part of Canada’s negotiating team. The off-the-record remarks were followed by a discussion with the three speakers, joined by Jennifer Haworth McCandless, partner at Sidley Austin and international arbitration and trade expert. The discussion was moderated by Armando Ortega, president of the CanCham Mexico. Following the event, Galicia hosted a lunch for industry, which provided another opportunity to amplify the message about the importance of NAFTA negotiations, particularly investment protection / ISDS and the general enforceability of the agreement. The casual discussion included many questions on the U.S. political process, and the differences between the U.S. government position and business on several of the proposals.

The remainder of the week in Mexico City consisted of briefings from U.S., Mexico and Canada officials. Based on various briefings business had with negotiators from Mexico and Canada, as well as Congressional staff and others last week in Mexico, there continues to be very little progress in the poison pill or rebalancing proposals the United States has put on the table. There continues to be little progress on the sunset provision and automotive rules of origin, particularly as the U.S. negotiator on rules of origin was called back to Washington before negotiations could commence. On investment protection, Canada and Mexico have begun negotiating among themselves, and have similarly begun to do so on government procurement, which was a new development during this Mexico round.

“While valuable progress continues to be made on modernization chapters such as digital trade and customs, concerns remain that the progress on the controversial proposals is too incremental to bridge the dramatic divide between negotiating positions on a reasonable timeline,” said Hampl. “While Mexican officials emphasized prioritizing a good trade deal over a quick one, there are potential political complications on the horizon with the upcoming elections in Mexico. In addition, U.S. midterm elections are coming up later this year, something Ambassador Lighthizer raised in his press conference following the conclusion of the last round of negotiations.”

It does not appear likely that the negotiations will wrap up during the next round, which will take place in Washington DC, likely the week of April 9.

Additional challenges remain following last week’s announcement on steel and aluminum tariffs by the Trump administration. Trade proponents are hoping that, the more they learn about the possible impact of the new tariffs and likely retaliatory measures, the less voters will like them.  A new study from Trade Partnership Worldwide estimated the proposed tariffs would increase employment by some 33,000 jobs in the steel, aluminum and related industries, but cost some 179,000 jobs throughout the rest of the American economy.

Meanwhile, a new survey of likely voters in four key swing states by Firehouse Strategies and Optimus revealed that most voters underestimate the importance of trade on U.S. employment. Only 13.6 percent said their jobs depend on trade, while 69.3 percent said they do not. Most economists put the percentage at more than 20 percent when both exports and imports are factored in.

 

USCIB Pushes for Equitable, Stable Tax Systems and SDG Implementation at UN

Published on March 5, 2018

Over 500 participants attended the First Global Conference of the Platform for Collaboration on Taxation and the Sustainable Development Goals (SDGs) on February 14-16 at the United Nations headquarters in New York. The conference was spearheaded by the OECD, the World Bank, the International Monetary Fund and the United Nations’ office for Financing for Development (FfD). Participants included governments from over 110 countries as well as representatives across the UN system, multilateral development banks, business and other non-governmental organizations.

This meeting was the latest action pursuant to the FfD Addis Ababa outcomes calling for international cooperation on domestic resource mobilization, in relation to taxation and Base Erosion and Profit Shifting (BEPS).  As such, it aimed to advance global dialogue with relevant stakeholders on how to better design tax policy to achieve the SDGs.

Pascal Saint-Amans of the OECD Tax Policy and Administration Centre was actively involved, reminding the conference in several interventions that the Inclusive Framework on BEPS has been an open and inclusive process, in which dozens of developing country representatives have been involved.

Will Morris, chair of the Business at OECD/OECD Tax Committee stated that the combination of new tax programs, rules and reforms is moving toward enhanced international cooperation and better practice at the local level. He stated that business is rarely the source of obstacles in tax reform; more frequently, disagreements between governments are the source of blockages.

Deputy Assistant Administrator in the Bureau for Economic Growth, Education and Environment at USAID Karl Fickenscher spoke about the importance of public-private partnership involving the private sector and tax authorities relating to development projects and other SDG areas.

The wide-ranging discussions in main sessions and side events focused on three areas: opportunities to improve international cooperation and advance capacity building on taxation, options to enhance international cooperation for domestic resource mobilization relevant to SDG implementation, and tax policy to motivate SDG-facing choices for environment, health, and energy.

The host organizations confirmed that the Platform will issue “Toolkits” in the coming months for “guidance” purposes.  USCIB expects enhanced coordination between the four organizations which have committed to speak with “one voice” when providing taxation advice to developing economies.

Interventions from developing country representatives highlighted continued concerns that they are excluded from global tax policymaking. In this context, USCIB anticipates further proposals to upgrade the UN’s Tax Committee to an intergovernmental body at the next major UN financing forum in April.

“Fighting perceptions of a ‘race to the bottom’ approach by business – the reality is that business seeks equitable and stable tax systems, and level of taxation is one consideration among many,” said Norine Kennedy, USCIB vice president for strategic international engagement, energy and environment, who attended the meetings. “Successful tax reform depends on trust and confidence of citizens, and on transparency.  Collaboration among governments, labor organizations and employers’ groups can advance that trust both in taxation and overall economic policy.”

USCIB will continue to monitor developments on these issues in the OECD, UN FfD process, and in further Platform activities through USCIB’s Tax Committee and SDG Working Group.

USCIB Responds to Announcement of New US Steel, Aluminum Tariffs

Published on March 2, 2018

Washington, D.C., March 2, 2018 – The United States Council for International Business (USCIB), which represents America’s most successful global companies, issued the following statement on the Trump administration’s announced plans to impose new duties of 25 percent and 10 percent, respectively, on imports of foreign steel and aluminum:

“USCIB strongly supports a more competitive America, which enjoys economic growth and jobs by increasing exports, opening global markets and securing a level playing field for our goods and services. We are disappointed with the administration’s decision. History clearly teaches that fomenting trade wars with our commercial partners is likely to backfire on the United States, harming American businesses, workers, farmers and consumers in the process.

“The imposition of tariffs on steel and aluminum will lead to higher prices for U.S.-made products, reducing the competitiveness of our exports, and will probably eliminate more jobs than it saves. In addition, it is likely to create strong disincentives for foreign investment in the United States, and to spur higher inflation. 

“Most importantly, these protectionist tariffs are likely to cause a chain reaction of retaliatory measures by our trading partners, as many of them have already indicated. Other nations are likely to target our most competitive exports and otherwise disadvantage American companies.

“We hope that these measures will be short-lived. We urge the Trump administration and America’s trading partners to work cooperatively and swiftly to address the serious issues associated with steel and aluminum dumping, and to open up new markets for our exports and new opportunities for American workers, farmers and consumers to prosper in the wider world.”

About USCIB:

USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and regulatory coherence. Its members include U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world, generating $5 trillion in annual revenues and employing over 11 million people worldwide. As the U.S. affiliate of several leading international business organizations, USCIB provides business views to policy makers and regulatory authorities worldwide, and works to facilitate international trade and investment. More information is available at www.uscib.org.

Contact:
Jonathan Huneke, USCIB
jhuneke@uscib.org, +1 212.703.5043

Thevenin Serves as Arbitrator at Annual Vis Moot Practice Session

Published on February 26, 2018

USCIB/ICC USA held it’s 12th Annual Vis Moot Practice Session earlier this month. The practice moots help law school students hone their advocacy skills in preparation for competing in one of the premier events in international arbitration – the Willem V. Vis Moot Competition in Vienna, Austria — which brings together over 300 law schools competing before hundreds of the world’s best international arbitration experts.

The Practice Session was co-organized with the ICC International Court of Arbitration’s North America office, and included eight law schools (Brooklyn, Cardozo, Fordham, Heidelberg University, New York, New York University, Pace University and the University of Bucharest) with over 30 New York-based arbitration professionals serving as mock arbitrators.

This year’s problem involved the sale of bakery goods under the United Nations Convention on the International Sale of Goods and applied the UNICTRAL Rules of Arbitration to the parties’ dispute.

“USCIB/ICC USA is proud to help support this effort to help train tomorrow’s law leaders in international arbitration,” said Nancy M. Thevenin, general counsel of USCIB/ICC USA, who also served as a mock arbitrator at the practice session. “We thank Javier H. Rubinstein of member firm Kirkland & Ellis, LLP, for hosting this event and for serving as a mock arbitrator.  We also thank Seoun “Nikole” Lee, deputy director, Alexandra Akerly, manager, strategy and development; and Mehr Kaur, promotion, officer of the ICC Court in North America for taking on the oars of organizing the practice session this year.”

Private Sector Meets with Governments on Digital Security Risk

Published on February 26, 2018

Addressing digital security across business fields, Business at OECD members participated in an OECD Workshop on Digital Security and Resilience in Critical Infrastructures and Essential Services earlier this month in Paris to contribute to the OECD‘s Going Digital Project.

The OECD Going Digital Project was officially launched in Berlin in 2017 and aims to examine how the digital transformation affects policy-making across a large spectrum of policy areas, including competition, consumer policy, digital economy policy (privacy, security, infrastructure, economic impact), science, technology and innovation, industry and entrepreneurship, insurance and private pensions, financial markets, fiscal affairs and taxation and much more. The project will draw on national experiences and policy experimentation occurring across the OECD’s 35 member countries, its accession countries, key partners and many other economies involved in the OECD’s work.

At the meeting earlier this month, which featured USCIB member Chris Boyer (AT&T), Business at OECD members emphasized the importance of a multi-stakeholder approach to cooperation and information exchange between actors – business, government, civil society and the technical community – to ensure effective and appropriate security and privacy protections.

“Importantly, workshop participants underscored the importance of using existing OECD consensus-based and multi-stakeholder developed security and privacy frameworks – the 2015 OECD Digital Risk Management for Economic and Society Prosperity and the 2013 OECD Privacy Framework,” said Barbara Wanner, USCIB Vice President for ICT Policy. “There is no need for OECD member nations – or non-member nations – who are looking to improve their approaches to security and privacy to ‘reinvent the wheel’ because these two products serve as solid building blocks,” Wanner said.

USCIB Partners with Japanese Group Keidanren on NAFTA Letter

Published on February 26, 2018

With the National Governors Association meeting last week and this week and the next round of NAFTA negotiations starting this week, USCIB coordinated with the Japanese business group, Keidanren, on a joint letter to each governor expressing support for keeping and modernizing NAFTA.

“Having worked closely with Keidanren in promoting the importance of foreign direct investment to government leaders in international forums such as G20, OECD and the United Nations, we wanted to leverage our joint voices to highlight the importance of NAFTA in driving the growth of foreign direct investment into the United States,” said Rob Mulligan, USCIB senior vice president for policy. “The investment by Japanese companies into the U.S. serves as an example of this growth and each letter identifies the number of jobs in the particular state that are accounted for by Japanese-owned firms.”

The letters stress the position USCIB has urged from the beginning that the negotiations “do no harm” to the existing NAFTA framework and then reinforces key messages related to ISDS, rules of origin, government procurement, and any sunset provision.

“We hope this letter will encourage the governors to actively engage the Administration on achieving a modernized NAFTA that we can all support,” added Mulligan.

Hampl Leads Group for NAFTA Lobby Day to Voice Concerns

Published on February 20, 2018

With the next NAFTA negotiating round now set for Mexico City later this month, USCIB Director for Investment, Trade and Financial Services Eva Hampl joined more than 100 representatives from the business and agriculture community last Wednesday for a second NAFTA House Lobby Day. The Lobby Day gave business representatives the opportunity to talk about business concerns and perspectives regarding the ongoing negotiations to modernize NAFTA and to increase support on the leadup to the next round of negotiations, scheduled for February 26 to March 6.

Hampl led one of the groups on the Hill, which included representatives from other associations and companies from the business and agriculture community. “The diversity of sectors represented was extremely helpful in getting our message across,” said Hampl. “Our group alone met with 9 offices throughout the day, receiving generally positive feedback about supporting our issues and concerns, including potential interest in signing on to a House NAFTA letter.”

Hampl will be traveling to Mexico for part of the next round at the end of February.

Ericsson’s Kallay to Chair USCIB Competition Committee

Published on February 15, 2018
Dina Kallay

New York, N.Y, February 15, 2018 – A telecommunications industry executive has been tapped to spearhead a top U.S. business group’s work on global antitrust policy. The United States Council for International Business (USCIB) has announced that Dina Kallay, head of antitrust (IPR, Americas & Asia-Pacific) at Ericsson, a leading global supplier of telecommunications equipment and services, will chair its Competition Committee.

USCIB, whose member include hundreds of America’s most competitive global companies, represents private-sector views to governments and policy makers worldwide. It does so via its affiliations with global business groups to focus especially on the work of the International Competition Network (ICN) and the Organization for Economic Cooperation and Development (OECD).

“We are delighted that Dina Kallay will lend her expertise and industry leadership to our work on global competition and antitrust policy,” said USCIB President and CEO Peter M. Robinson. “As the U.S. continues to look to the ICN and OECD to foster international convergence and cooperation on competition law, including the coordination of cartel enforcement, we intend to serve as an even stronger voice for business in these forums.”

Prior to joining Ericsson in 2013, Kallay served as counsel at the U.S. Federal Trade Commission’s Office of International Affairs, where she focused on Asian and multilateral competition matters as well as on worldwide antitrust intellectual property matters. She previously worked at the European Commission’s antitrust agency (DG COMP), and practiced antitrust and intellectual property law at a number of law firms, most recently at Howrey LLP. Kallay is vice chair of the American Bar Association’s Section of Antitrust Law I.P. Committee and a non-governmental advisor to the International Competition Network. She also serves as an adjunct professor at Georgetown Law School.

The USCIB Competition Committee promotes international legal policies that favor an open and competitive environment for U.S. business. The committee monitors global competition developments and contributes industry’s perspective through USCIB’s global network.

About USCIB:

USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and regulatory coherence.  Its members include U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world.  With a unique global network encompassing the International Chamber of Commerce, the International Organization of Employers and Business at OECD, USCIB provides business views to policy makers and regulatory authorities worldwide, and works to facilitate international trade and investment. More information is available at www.uscib.org.

Contact:
Jonathan Huneke, USCIB
+1 917 420 0039, jhuneke@uscib.org