Communication Department Archives

ICC Warns Against Double Taxation in BEPS Action Plan

Published on November 4, 2014

4879_image002The International Chamber of Commerce (ICC) has expressed concern that the Organization for Economic Co-operation and Development (OECD) Action Plan on combating Base Erosion and Profit Shifting (“BEPS”), mandated by the G20, may inadvertently incur severe collateral damage on compliant taxpaying companies of all sizes as a result of well-meaning measures undertaken unilaterally by states to mitigate double-non-taxation.

While ICC fully supports the BEPS Action Plan and actively engages with the OECD and the UN on the issues at hand, concern was raised during back-to-back meetings with the United Nations (UN) Committee on International Cooperation in Tax Matters at UN Headquarters in Geneva last week.

Stressing that taxation systems should be sound and stable – to encourage transparency, efficiency and predictability and to incentivize long-term investment, job creation and economic growth – ICC advises governments and policymakers to take the following into consideration:

  1. ICC strongly believes that several of the 15 BEPS Action Points are interdependent and recommends an overall perspective and coordination of the various recommendations – including the 2014 deliverables of Phase 1 in Phase 2 of the project.
  2.  ICC calls for a coordinated implementation of the combined deliverables of the G20/BEPS project on a multilateral basis with a consensus approach in order for the solutions to be consistent and uniformly applied on an international level. ICC therefore cautions against implementation of domestic tax legislation through unilateral and divergent actions which risk leading to disparate rules, increased complexity and double taxation.
  3. ICC urges mitigating the increased unavoidable and foreseeable risk of double taxation via a solid dispute resolution mechanism, with mandatory agreements forcing competent authorities to agree on how to tax certain transactions, or simplified, how to split the ‘tax cake.’

ICC strongly opposes tax fraud and tax evasion but warns that it is crucial to distinguish these illegal activities from the use of lawful methods of tax planning and tax management, provided they are aligned with commercial and economic activities.

More on ICC’s website.

Staff contact: Carol Doran Klein

More on USCIB’s Taxation Committee

USCIB Gears Up for APEC Summit With Business Priorities

Published on October 31, 2014
More: Boost for APEC Agenda on Marketing

The Asia-Pacific Economic Cooperation (APEC) is a forum comprised of 21 Pacific Rim member economies that promotes free trade and economic cooperation throughout the Asia-Pacific region. In the lead-up to APEC’s November meetings in Beijing, which will close out China’s host year, USCIB welcomes the committed partnerships that APEC sustained with the private sector to address the region’s complex economic challenges.
The Asia-Pacific Economic Cooperation (APEC) is a forum comprised of 21 Pacific Rim member economies that promotes free trade and economic cooperation throughout the Asia-Pacific region. In the lead-up to APEC’s November meetings in Beijing, which will close out China’s host year, USCIB welcomes the committed partnerships that APEC sustained with the private sector to address the region’s complex economic challenges.

The Asia-Pacific Economic Cooperation (APEC) is a forum comprised of 21 Pacific Rim member economies that promotes free trade and economic cooperation throughout the Asia-Pacific region. In the lead-up to APEC’s November meetings in Beijing, which will close out China’s host year, USCIB welcomes the committed partnerships that APEC sustained with the private sector to address the region’s complex economic challenges.

Throughout 2014, USCIB advanced a wide range of policy discussions through APEC to promote a pro-business agenda on chemicals regulation, advertising self-regulation, data privacy, customs, women in the economy and local content requirements.

USCIB engaged in several APEC working groups, including the Chemical Dialogue, Customs Business Dialogue and the Electronic Commerce Steering Group, to encourage discussions between governments and the private sector on topics of interest to business.

Next week, USCIB President and CEO Peter Robinson will attend the APEC CEO Summit in Beijing, China from November 8 to 10 as a business delegate and representative of the U.S. APEC Business Coalition along with Helen Medina, USCIB senior director of product policy and innovation, and USCIB member company CEOs and executives. Robinson and Medina will discuss USCIB’s work and members’ APEC priorities, and will join with other coalition partners to pursue common business objectives.

The APEC forum is a valuable space for business to engage with the region’s political leaders, and USCIB has assumed a leadership role in APEC on behalf of our members. At the CEO Summit this year, USCIB will organize a breakfast event on November 10 through the U.S. APEC Business Coalition to discuss the role of global value chains (GVCs) in strengthening economic integration across Pacific Rim countries. The event will feature private sector representatives and APEC government officials who will offer their perspectives on how policies and regulations impact investment decisions, supply-chain routing, cost efficiency, and key ingredients for climbing the GVC-ladder. Please find the current draft agenda here.

USCIB has also consulted with members engaged in APEC’s work to develop top-level messaging for the CEO Summit and related meetings in Beijing, as well as an APEC priorities document ahead of the 2015 APEC Summit to be hosted by the Philippines.

On October 14, the USCIB APEC Working Group met with Ed Brzytwa, Director for APEC Affairs, Office of the U.S. Trade Representative (USTR) and Bob Wang, U.S. Senior Official for APEC, U.S. Department of State, where members voiced their thoughts on priority areas including:

  • the integration of global value chains throughout the APEC region;
  • the importance of digital trade in economic development and issues regarding local content;
  • alignment to international best practices in advertising and the promotion of self-regulatory bodies (see below);
  • intellectual property rights enforcement and capacity building;
  • rule of law and ethical business practices in supply chains (child labor and human trafficking); and
  • the importance of energy security and strategic infrastructure to sustainable development.

Additionally, USCIB plans to meet with Deputy Secretary of Commerce Bruce Andrews to discuss USCIB’s APEC work and priorities.

More information on USCIB’s APEC activities will be available after the summit concludes next week.

Staff contact: Rachel Spence and Helen Medina
More on USCIB’s APEC Working Group

Boost for APEC Agenda on Marketing

Earlier this month, USCIB and the Grocery Manufacturers Association (GMA) convened a well-attended roundtable in Washington, DC, on moving forward with the promotion of marketing and advertising standards work in APEC. There are strong signals that the Chinese government (this year’s APEC host) is pushing for leaders at the November APEC summit in Beijing to endorse the APEC action agenda on advertising standards, which was agreed by ministers at the August senior officials meeting.

Among other things, the action agenda calls for APEC economies to develop principles to use in constructing their ad standards regimes, as well as an advertising regulatory checklist of key elements in a regulatory (including self-regulatory) framework. USCIB and GMA members discussed with U.S. government representatives what industry would like to see next. They agreed to send a letter to U.S. Trade Representative Michael Froman laying out the case for additional APEC work in this area in order to facilitate cross-border trade and investment in the APEC region.

Staff contact: Jonathan Huneke

More on USCIB’s Marketing and Advertising Committee

U.S. says hard to imagine EU trade deal without investor protection

Published on October 30, 2014

Several press outlets covered the USCIB/BIAC trade and investment conference with keynote remarks by United States Trade Representative Michael Froman about America’s ongoing trade agreements.

 

U.S. warns China against dragging out technology trade deal
Reuters – October 30, 2014

U.S. says hard to imagine EU trade deal without investor protection
Reuters – October 30, 2014

Froman Confirms No Deal on TPP By Time of APEC Summit in November
Bloomerg BNA – October 30, 2014

USCIB Talks Trade and Investment in the Americas at IDB Forum

Published on October 23, 2014

The global trade environment is changing rapidly, with the emergence of new global trade architecture, the uncertain fate of the WTO’s trade facilitation agreement, and increasing opposition to investment protections in trade agreements such as the Trans-Atlantic Trade and Investment Treaty (TTIP).

On October 20, the Integration and Trade Sector of the Inter-American Development Bank (IDB) hosted a forum on “The 21st Century Trade Architecture: Implications for Latin America and the Caribbean” for a discussion about the most pressing trade policy challenges, with an emphasis on Latin American economies.

Rob Mulligan, USCIB’s senior vice president for policy and government affairs, participated in a panel on “Trends in Trade and Integration: Trading against Headwinds,” in which he spoke about global value chains (GVCs), where companies move intermediate goods between countries in producing a final product, and of the benefits to be gained from the participation of Latin American economies in GVCs.

The panel was moderated by Gary Hufbauer, senior fellow at the Peterson Institute for International Economics, and Mulligan was joined by John Melle, Assistant U.S. Trade Representative for the Western Hemisphere; Ken Ash, director of trade and agriculture at the Organization for Economic Cooperation and Development; Abdel-Hamid Mamdouh director of trade in services at the World Trade Organization and Sally Yearwood, executive director of the Caribbean-Central American Action.

In his remarks, Mulligan stressed the importance of using GVCs to remain competitive, innovate, and stay close to customers. He cited an OECD study that found that one-third of most countries’ imports is part of their exports, and noted that in order to remain competitive in GVCs companies require access to efficient imports of goods and services. Latin American economies have much to gain from participating in global value chains, and government policies can impact the extent of that participation.

Mulligan also discussed the factors that companies consider when they’re deciding whether to invest in a country along a global value chain. Such factors include infrastructure, workforce development, a fair and transparent tax system and effective rule of law. He noted that certain policies inhibit companies’ ability to operate through GVCs, such as forced localization, restrictions on cross-border data flows and restrictive customs rules and regulations.

Trade agreements are an effective way to pursue policies that facilitate that movement of goods and services within GVCs, and Mulligan explained that business prefers multilateral trade agreements and also supports regional agreements such as TTIP and the Trans-Pacific Partnership (TPP).

In order to take advantage of GVCs, Mulligan concluded by noting that Latin American governments could take unilateral steps to improve infrastructure and education, and eliminate localization rules and date flow restrictions. These countries could also benefit from regional trade integration.

Staff contact: Rob Mulligan

More on USCIB’s Trade and Investment Committee

 

ICC Identifies Business Priorities for Digital Economy

Published on October 23, 2014
L-R: Eric Loeb, chair of USCIB’s ICT Committee and chair of ICC’s Task Force on Internet and Telecommunication, and Christoph Steck, co-chair of ICC”s Task Force on Internet and Communications.
L-R: Eric Loeb, chair of USCIB’s ICT Committee and chair of ICC’s Task Force on Internet and Telecommunication, and Christoph Steck, co-chair of ICC”s Task Force on Internet and Communications.

Gathering 34 business experts representing companies and organizations leading the International Chamber of Commerce’s (ICC) policy work on information and communication technologies (ICTs), the biannual meeting of the ICC Commission on the Digital Economy identified next steps on priority topics for global business including Internet governance, privacy and cyber-security, and trade facilitation – and linking these specific priorities to overall strategic ICC messages. The event took place at ICC global headquarters in Paris on September 30 and October 1.

In remarks to the commission, ICC Secretary General John Danilovich said ICC plays a leadership role on behalf of world business in the Internet Governance Forum (IGF) through the ICC Business Action to Support the Information Society (BASIS).

“While attending the last IGF in Turkey, I was able to see first-hand some of the issues carried by this commission and how, through your work and that of the BASIS initiative, ICC is able to lead global business engagement in the forum,” he said.

In the context of a strategic discussion on Internet governance, Alhadeff and Eric Loeb, chair of the commission’s Task Force on Internet and Telecommunications and chair of USCIB’s ICT Committee, suggested that the preparation of the commission’s Global Action Plan – a compilation of business positions on digital economy policies – should strive to highlight the relevance of these issues to all sectors, as well as their relevance to the work of other ICC commissions and top-line business messages.

Staff contact: Barbara Wanner

More on USCIB’s Information and Communications Technology Committee

IOE European Social Charter Must Support Job Creation

Published on October 23, 2014

Europe from spaceAdopted in 1961, the European Social Charter is an EU treaty that guarantees social and economic human rights, such as the rights to fair remuneration and safe working conditions.

Speaking at the High-Level Conference on the European Social Charter in Turin, Italy on October 17, the International Organization of Employers (IOE) Vice President for Europe, Renate Hornung-Draus said that the European Social Charter will only gain relevance if it supports reforms for job creation and sustainable social security systems. She warned that the way in which the supervisory bodies of the Council of Europe interpreted the principles of the European Social Charter was undermining its relevance for Member States.

Since 1990 many new member States have joined the Council of Europe. They have different economic and social challenges than the founding members. The interpretation of the European Social Charter by its Supervisory bodies has to be more responsive to their specific situation.

Hornung-Draus said: “The Social Charter will achieve its goal of promoting economic and social development only if its principles are implemented in a way that respect the variety of situations of Member States, and if they are conducive to the structural reforms and fiscal consolidation required by the changing economic and social context.”

Globalization, technological changes require open, dynamic and flexible labor markets and a commitment to life-long learning. In some European countries, where labor market regulation has not adapted to this changing context, very high unemployment, and especially youth unemployment, can only be properly addressed with profound structural labor market reforms.

In addition, social spending in some countries European countries has reached levels that overwhelm economic resources, leading to high public debt. Public debt crowds out investment, because social security systems in those countries become unsustainable in light of changing demographics. Fiscal consolidation in these countries is urgently required, not only to restore the credibility of financial markets and attract investment, but also as an act of social justice towards the young generation.

Staff contact: Ariel Meyerstein

More on USCIB’s Labor and Employment Committee

Conference to Shed New Light on 21st Century Trade Policy Challenges

Published on October 16, 2014
U.S. Trade Representative Michael Froman will deliver keynote remarks at the October 30 conference, “Exploring New Approaches to Trade, Investment and Jobs: Insight and Impact for Business from the OECD.”
U.S. Trade Representative Michael Froman at the Oct. 30 conference: “Exploring New Approaches to Trade, Investment and Jobs: Insight and Impact for Business from the OECD.”

Washington, D.C., October 16, 2014 – How are cross-border trade and investment changing in an era of ever-more sophisticated global value chains? What new policies and agreements are needed to ensure that trade and investment can generate high-quality jobs and other benefits to society? And how can new research from the Organization for Economic Cooperation and Development (OECD) shed light on these changes and provide insight for policy makers?

These will be among the central questions addressed at a timely, high-level conference, “Exploring New Approaches to Trade, Investment and Jobs: Insight and Impact for Business from the OECD,” to be held October 30 at the St. Regis Hotel in Washington, D.C. Organized by the USCIB Foundation (the educational arm of the United States Council for International Business), the OECD and BIAC, the Business and Industry Advisory Committee to the OECD, the conference will highlight the OECD’s innovative work in the areas of trade and investment, and address how this work impacts policy, job creation and trade negotiations around the world.

“It’s clear that a 21st-century trade policy must address a host of new concerns beyond ‘old-school’ issues like tariffs and quotas,” said USCIB President and CEO Peter Robinson. “While those types of trade barriers still exist, their importance is fast being eclipsed by the growth of global value chains, barriers to trade in services, new investment agreements, trade facilitation, and the relationship between regional and multilateral trade negotiations.”

The event will bring together experts from the OECD, U.S. and foreign governments, and business to assess the issues and discuss solutions. Participants will draw upon the innovative research and policy discussions coming from the OECD – including its Services Trade Restrictiveness Index, OECD-WTO efforts to measure trade in value-added, and studies on the importance of global value chains.

Keynote remarks at the conference will be delivered by U.S. Trade Representative Michael Froman. Other speakers include:

  • Cathy Novelli, under secretary for economic growth, energy and the environment, U.S. Department of State
  • Mari Kiviniemi, deputy secretary general, OECD, former prime minister of Finland
  • Yonov Frederick Agah, deputy director general, World Trade Organization
  • Ambassador Susan Schwab, strategic advisor, Mayer Brown, former U.S. trade representative
  • Harold McGraw III, chairman of McGraw Hill Financial [now S&P Global], chairman of the International Chamber of Commerce (ICC), chairman of USCIB
  • Ken Ash, director, Trade and Agriculture Directorate, OECD
  • The Honorable James Bacchus, chair of Greenberg Traurig’s global practice, former chairman  of the WTO Appellate Body, and chairman of the ICC Commission on Trade and Investment Policy
  • Phil O’Reilly, CEO of Business New Zealand, chairman of BIAC.

More information about the conference is available here.

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 leading international business organizations, including BIAC, USCIB provides business views to policy makers and regulatory authorities worldwide, and works to facilitate international trade and investment. More at www.uscib.org.

Contact: Jonathan Huneke, USCIB

+1 212.703.5043, jhuneke@uscib.org

World Investment Forum Looks at Leveraging FDI to Support Sustainable Development

Published on October 16, 2014
L-R Peter Robinson (USCIB) and Mukhisa Kituyi (UNCTAD)
L-R Peter Robinson (USCIB) and Mukhisa Kituyi (UNCTAD)

USCIB and the International Chamber of Commerce brought a pro-business, pro-investment perspective to the three-day World Investment Forum, which took place this week in Geneva.

Organized by the UN Conference on Trade and Development (UNCTAD), the biennial forum gathers heads of state, global CEOs and civil society leaders for dialogues on the world’s emerging investment-related challenges. This year’s event had a special focus on leveraging investment to support the UN’s Sustainable Development Goals (SDGs).

On Tuesday, the forum’s first day, ICC leaders and Mukhisa Kituyi, the UNCTAD secretary general, co-chaired the 11th meeting of the Investment Advisory Council. During the open discussion, Shaun Donnelly, USCIB’s vice president for investment and financial services, made a strong pitch for bilateral investment treaties and free trade agreements, which was echoed by a range of business and government representatives. ICC and USCIB Chairman Terry McGraw and ICC Secretary General John Danilovich spoke at the forum’s opening plenary, where they were joined by senior government officials.

Also on Tuesday, McGraw, Danilovich and USCIB President and CEO Peter Robinson met with Roberto Azevedo, the director general of the World Trade Organization, to discuss ways to restart the stalled Trade Facilitation Agreement. At the meeting Robinson thanked Azevedo for his leadership and said he looked forward to honoring him at USCIB’s annual award dinner in Washington, DC on November 19.

Mobilizing the Private Sector

On the forum’s second day, Robinson delivered plenary remarks, in which he discussed the four key elements that would crystallize private-sector support for sustainable development: good governance, economic growth, innovation and infrastructure. He noted that governments and businesses must work together to facilitate initial investments in least developing countries that lack basic infrastructure. Initial infrastructure funding can then help leverage further investments, leading to a “virtuous cycle.”  He also made the case for investment protection.

“Let’s continue the dialogue and partnership to harness investment as a key driver of economic, sustainable and inclusive development,” Robinson concluded. “And work together to create the virtuous investment circle, particularly in those countries that need it the most.”

Given the forum’s focus on investment for the SDGs, Robinson also emphasized that “taken together, open international trade and investment are important inter-related fundamentals and key drivers for engaging the private sector in achieving global economic growth that is inclusive, and environmentally and socially sustainable.”

On Thursday Robinson and Donnelly took part in key panel discussions on the role of bilateral and multilateral investment agreements and on investor-state dispute settlement (ISDS), where they spent over four hours defending investment agreements and ISDS in a morning-long Investment Agreement session, the centerpiece session during the final day of UNCTAD’s World Investment Forum.

With over 50 speakers limited to three-minute interventions, government and NGO representatives were often critical of investment agreements and ISDS in particular, whereas business voices were scarce. Robinson explained the overall importance of international investment agreements, while Shaun tackled the sensitive ISDS issue, emphasizing the need for effective enforcement measures to truly incentivize and protect FDI flows that are vital for economic growth, development and job creation. Donnely also highlighted USCIB’s strong opposition to any sectoral carve-outs from ISDS protections.

Although too many government participants opposed ISDS, Michael Tracton, director of the investment office at the U.S. Department of State, voiced support for strong investment agreements and ISDS, citing the high standards and balance of the USG’s Bilateral Investment Treaty and free trade agreement investment chapters.

Unfortunately, opposition to ISDS from NGOs has shown no signs of letting up. “USCIB will continue to confront these pressures internationally at forums like UNCTAD and in free trade agreement negotiations, voicing our strong support for common-sense, pro-business investment policies,” Donnelly said. “We will continue to leverage our international networks BIAC and ICC to mobilize international business support for these policies.”

Staff contact: Shaun Donnelly and Eva Hampl

More on USCIB’s Trade and Investment Committee

 

Leveraging Partnerships to Combat Malnutrition

Published on October 15, 2014

4861_image002As part of a series of public discussions leading up to the Second International Conference on Nutrition (ICN2), the United Nations Food and Agriculture Organization hosted a dialogue on October 14 in Rome about the critical role public-private partnerships in fighting malnutrition. The well-attended event convened representatives from member states, the private sector and civil society to raise awareness of global nutrition issues and catalyze support for partnerships. Dr. Nancy Stetson, special representative for global food security at the U.S. Department of State, noted that partnerships are necessary to reduce global hunger and malnutrition.

Louise Kantrow, ICC’s permanent representative to the UN, made a strong case for engaging the private sector as a full partner in deciding strategies for addressing malnutrition, since business is involved throughout the entire agriculture supply chain, from seeds to food processing to all the products farmers need to grow and distribute food.

“The UN has recognized that the problems confronting the global community now know no boundaries and all actors in society must come to the table and provide inputs,” said Kantrow, who also stressed the importance of trade and investment in the agriculture industry as it relates to economic development, empowering women, and innovation as areas where the private sector can contribute to the fight against malnutrition.

USCIB will attend ICN2 in November at the FAO’s headquarters in Rome.

Read the event summary on the FAO’s website.

Staff contacts: Louise Kantrow and Helen Medina

More on USCIB’s Food and Agriculture Committee

More on USCIB’s Product Policy Working Group

USCIB Observes Nutrition Conference Negotiations

Published on October 13, 2014
4854_image002
L-R: Katy Lee (Private Sector Mechanism), Ann Steensland (Global Harvest Initiative), Nico Belzen (International Dairy Federation), and Helen Medina (USCIB)

The United Nations and World Health Organization will convene the Second International Conference on Nutrition (ICN2) next month to address the persistently high twin threats of hunger and malnutrition around the world.

In the lead-up to ICN2, member states met in Rome at the UN Food and Agriculture Organization (FAO) from October 10 to 12 to negotiate the final outcome documents for ICN2 – the political declaration and the framework for action. The meeting was a continuation of negotiations in Geneva last September where member states made progress finalizing the political declaration.

The ICN2 outcome documents will provide key priorities and technical assistance to governments and other stakeholders for improving people’s nutrition.

During the Rome meeting, USCIB partnered with the Global Harvest Initiative to represent U.S. business interests at the negotiations. USCIB’s Helen Medina, senior director for product policy and innovation, attended the meeting. Watch her summarize the meeting’s key takeaways for business.

Prior to the negotiations, private sector representatives were concerned with outstanding issues in the political declaration for ICN2. The document contained some language on “culturally acceptable food” that might have produced negative trade implications. Business believes that the document should focus on nutrition and leave discussions about trade policy to the World Trade Organization. Private sector representatives sought to eliminate language that could create potential trade barriers.

Business also paid attention to other areas of concern in the Framework for Action, including policies that deal with food pricing incentives, marketing and labeling regulations, language the puts a pejorative spin on processed food, and policies that are not inclusive of the entire agriculture industry.

“There are some good winds for the private sector,” Medina said at the end of the meeting. Negotiators deleted language in the political declaration that would have had a negative impact on trade. However issues remain with the Framework for Action, which recommends policies in international trade and investment that would be problematic for business. The U.S. government has reserved its position on the framework’s paragraphs about recommended trade and investment action, and USCIB is planning a follow-up meeting with USG to learn about any remaining issues with the framework before ICN2.

ICN2 will take place in Rome from November 19 to 21.

Staff contact: Helen Medina

More on USCIB’s Food and Agriculture Committee

More on USCIB’s Product Policy Working Group