Highlighting Key Activities, December, January, and February 2018-2019

During the months of December, January, and February 2018-2019, USCIB Staff submitted comments on potential trade agreements with Japan, the EU, and the UK, testified on a potential trade agreement with the UK, issued recommendations in on how business can support WTO reform, met with Nan Fife at the State Department on OECD issues, provided two sets of comments on drafts of the B20 Tokyo Summit Joint Recommendations, met with State department officials following the ITU Plenipotentiary Meeting and IGF, provided input on the development of a 21st Century Customs Framework, commented on proposals concerning determining the foreign tax credit and the Base Erosion Anti-abuse Tax, and much more. Below are summaries of these and other highlights from the activities of USCIB in Washington, D.C. over the last three months. If you have any questions or comments, or want more information on a specific topic, please contact any of the staff members listed at the end of this brief.

Table of Contents:

Trade and Investment – Opening Global Markets for Trade and Investment

ICT Policy – Promoting Sound Policies for New Technologies

Tax – Advancing Tax Policies that Promote U.S. Competitiveness

Customs and Trade Facilitation – Reducing Barriers and Costs from Customs and Border Control Practices

China – Supporting Policies and Relationships that Enhance U.S.-China Business

Membership

Upcoming Events

Staff List

Trade and Investment – Opening Global Markets for Trade and Investment

Business Pushes for Comprehensive Trade Deal with Japan: USCIB submitted comments in late 2018 to the United States Trade Representative (USTR) outlining negotiating objectives for a U.S.-Japan Trade Agreement. USCIB supports negotiation of a comprehensive trade agreement with Japan as part of a broader strategy to open international markets for U.S. companies and remove barriers and unfair trade practices in support of U.S. jobs. USCIB outlined its priority issues, which include digital trade, intellectual property, media and entertainment services, investment, customs and trade facilitation, express delivery services, electronic payment services, regulatory coherence, government procurement and financial services. The Administration has released negotiating objectives for a U.S.-Japan FTA, negotiations for which are due to begin soon.

USCIB Submits Negotiation Objectives for U.S.-EU Trade Deal: USCIB submitted negotiation objectives for a U.S.-EU Trade Agreement to the United States Trade Representative (USTR) on December 11, 2018. The submission was filed in response to USTR’s request for comments and emphasized the importance of a comprehensive negotiation, covering not only market access for goods, but also critical services issues. The USTR request for comments follows the administration’s announcement to Congress on October 16, 2018 of its intention to initiate negotiations on a U.S.-EU Trade Agreement. USCIB supports negotiation of a comprehensive trade agreement with the EU as part of a broader strategy to open international markets for U.S. companies and remove barriers and unfair trade practices in support of U.S. jobs. USCIB priority issues for negotiation of a U.S.-EU agreement include investment, customs and trade facilitation, express delivery services, improved regulatory cohesion, digital trade, intellectual property, government procurement and SOEs, and financial services.

U.S.-UK Trade Agreement: USCIB Submits Negotiating Objectives and Hampl Testifies: USCIB submitted negotiating objectives for a high standard and comprehensive U.S.-UK Trade Agreement on January 16, 2019. USCIB’s submission was based on the assumption that the UK will be successful in exiting the EU, allowing for the ability to negotiate trade agreements with trade partners outside of the EU. Priority issues for negotiations of a U.S-UK Trade Agreement include digital trade (including cross border data flows, forced localization, cybersecurity and digital taxation), intellectual property, media and entertainment services, financial services, electronic payment services, customs and trade facilitation, express delivery services, regulatory cohesion, investment, government procurement, and chemicals. Eva Hampl, Senior Director, Investment Trade and Financial Services, provided testimony before the Trade Policy Staff Committee (TPSC) at the public hearing on January 29, 2019.

USCIB Urges Removal of Steel and Aluminum Tariffs in USMCA: USCIB joined a coalition of other trade and industry organizations to send a letter to Secretary Wilbur Ross and Ambassador Robert Lighthizer on January 23, 2019, regarding the 232 tariffs on steel and aluminum. The coalition, recognizing the importance of the new U.S.-Mexico-Canada Agreement ratification to the economic interests of all three countries, underscored the importance of lifting these tariffs, as well as the removal of all retaliatory tariffs on trade among the three countries.

WTO Modernization: USCIB Recommendations and Robinson Op-Ed: As World Trade Organization (WTO) member governments move forward this year with efforts to reform the WTO, USCIB issued recommendations in January 2019 on how business can support the WTO and its efforts to improve the organization. USCIB’s recommendations also noted the importance of the WTO as a cornerstone of the global rules-based trading system that has helped spread growth and development for decades. They focused on addressing subsidies and other market-distorting support provided to state-owned enterprises (SOEs), the establishment of new rules for current issues such as digital trade and customs processes on electronic transmissions, and ensuring a properly functioning appellate body, among others. USCIB President and CEO Peter Robinson appealed for a strong business role in efforts to modernize the global trade body in an Op-Ed published in The Hill. Robinson wrote that he views of the private sector, which has a direct stake in the rules that result from such government-to-government discussions, should be actively solicited and given careful consideration by WTO member states.

Broad-Based Business Coalition to Press for USMCA Adoption: The United States Council for International Business (USCIB), which represents America’s most successful global companies, has joined with an array of U.S. companies and industry associations to urge swift approval by Congress of the United States-Mexico-Canada Agreement (USMCA), an updated and modernized framework for expanded trade, investment and market integration in North America. The USMCA Coalition, encompassing more than 200 leading companies and major associations representing farmers and ranchers, manufacturers, service providers and technology companies, was formally launched on February 26, 2019.

BIAC Chair O’Reilly Talks/Listens to USCIB: The Chair of “Business at OECD” or Business and Industry Advisory Committee (BIAC), Phil O’Reilly met in person in New York, and by video link to Washington, on January 11, 2019, with USCIB Board members, committee chairs and staff. Phil reported on BIAC’s annual meeting with the OECD senior leadership (Secretary General Gurria, Deputy Sec Gens, and key ambassadors) and laid out BIAC’s agenda and priorities for 2019. Rick Johnston of Citi and a Vice-Chair of the BIAC Board, also offered his perspectives on BIAC priorities and challenges and on where the OECD is heading. Russel Mills, the new BIAC Secretary General, also called in for the session. Russel has long experience in the U.S. chemical industry (Dow and Dupont) and was long-time Chair of BIAC’s Environment committee. We had an excellent, candid discussion with Phil O’Reilly. BIAC is in good hands.

USCIB Team and Members Discuss with Senior State Department Leaders Business Access/Treatment at UN Agencies: USCIB and some key member companies have become increasingly worried about discrimination against business in several U.N agencies, including but not limited to the World Health Organization. We have been active in raising these concerns with the U.S. Missions to the UN in New York City, Geneva, and Rome as well as to the International Organizations (“IO”) Bureau at the Department of State. On January 24, 2019, despite the challenges of the government shutdown, key leaders from the IO Bureau came to USCIB’s Washington office e for a very candid discussion with key member companies and staff about business treatment access in the parts of the UN system. We followed that up with a more detailed meeting with State IO experts at the Department on February 15. USCIB VPs Norine Kennedy, Mike Michener and Shaun Donnelly are taking the lead on this important work. The State Department and our U.S. Mission have been great partners, as have some international counterparts in our global network, but this will be a long-term issue with parts of the UN system and a top priority for USCIB.

USCIB Talks OECD with State Department: On February 12, 2019, USCIB Senior Vice President for Policy and Government Affairs, Rob Mulligan, led a USCIB staff team in a detailed meeting with the OECD “desk” team at the Department of State which coordinates overall U.S. dealings with the OECD and backstops the U.S. Mission to the OECD in Paris. Nan Fife, Director of the Economic Policy and Public Diplomacy office in state’s Economic and Business (“EB”) Bureau led the State team. We had an excellent, frank exchange on a range of issues related to the OECD and ended up in agreement on assessments and priorities, and concerns. One important development we will be actively monitoring is progress in getting a new U.S. Ambassador confirmed and out to Paris on the ground. Pamela Bates, an experienced former State Department economist, has been quickly renominated after her earlier nomination (and many others) expired at the of the previous Congressional session. Getting Ms. Bates confirmed and on-the-job in advance of the OECD’s annual May Ministerial is an important priority for USCIB and for State.

Donnelly Talks Business and BIAC Issues at Training Session for USG Delegates to OECD: USCIB Vice President Shaun Donnelly was a panelist again this year at the third annual “Delegates Training Session” organized and hosted by our State Department partners who coordinate all OECD work. State annually invites all U.S. Government employees (senior or junior) from all USG agencies who represent the USG at any OECD Committee, Working Group, or other meeting to this all-day training session on “how to be an effective delegate/advocate” and broad USG policies and priorities regarding the OECD. Again this year, our State colleagues devoted a lengthy session to the importance of coordinating with the U.S. private sector, featuring the USCIB and BIAC network. Shaun, the only business panelist, explained BIAC and USCIB, our unique roles, and how we operate. He was joined on the panel by three USG experts active in their respective OECD committees and with USCIB. We appreciate State organizing the session, for the focus on working with the private sector, and especially for including USCIB.

USCIB Discusses Digital Trade with Nick Ashton-Hart: On January 16, 2019, USCIB staff met with Nick Ashton-Hart, the Geneva Representative of the Digital Trade Network (DTN), as well as representative of ICC United Kingdom on the UK delegation to the meetings of the International Telecommunications Union. USCIB is part of the DTN along with a few other ICC national committees and several companies. The DTN is focused on supporting the effort in the WTO to move forward on the E-Commerce initiative, which is a priority issue for USCIB.

ICT Policy – Promoting Sound Policies for New Technologies

State Department Officials Explore Challenges in Internet Governance with USCIB Members Following 2018 ITU Plenipotentiary Meeting and 2018 Internet Governance Forum: The ICT Policy Committee Meeting on December 13, 2018, featured discussions with State Department officials about the implications of year-end initiatives that potentially could affect governance of the Internet stemming from the International Telecommunication Union (ITU) Plenipotentiary, October 29-November 16, 2018 in Dubai, UAE, the 2018 Internet Governance Forum (IGF), November 12-14, 2018, in Paris, France, and French President Emmanuel Macron’s Paris Call for Trust and Security in Cyberspace. The ITU Plenipotentiary meeting included positive, precedent-setting developments – namely, the election of U.S. candidate Doreen Bogdan-Martin to Director of the ITU Telecommunication Development Bureau. In addition, through thoughtful pre-meeting diplomacy, the U.S. Government was able to derail problematic resolutions that would have brought Artificial Intelligence (AI) and cybersecurity under the ITU’s purview. Nevertheless, State Department officials urged USCIB members remain vigilant in 2019 to prevent ITU “mission creep.” Concerning the 2019 IGF, State Department officials and USCIB members both concurred that President Macron’s opening speech – in which he called for greater regulation of the Internet, among other issues – was concerning and raises questions about whether the IGF will remain a forum for discussion or face growing pressure to produce policy outputs. Similarly, the group agreed that if President Macron’s “Paris Call,” which was a non-binding statement of support for cybersecurity principles, was brought into the UN process, the transition from a single-nation to a multilateral initiative could pose problems for the United States and U.S. business.

USCIB Members Provide Inputs Aimed at Shaping Japan’s B20 Report: Working under exceedingly tight deadlines, USCIB members from the ICT Policy Committee, the Trade and Investment Committee, the Customs and Trade Facilitation Committee, and the Tax Committee provided two sets of comments during the month of January 2019 concerning the first and second drafts of the B20 Tokyo Summit Joint Recommendations. Under the theme, “Society 5.0 for SDGs,” USCIB members emphasized the following: (1) promote interoperability of risk-based security and privacy protection standards across jurisdictions so as to ensure free flow of data, information, ideas and knowledge across borders; (2) foster e-commerce by ensuring free business decision regarding the location of computing facilitates and confidentiality of corporate information; (3) firmly commit to not imposing customs duties and processes on electronic transmissions, permanently; (4) prevent the weakening of intellectual property protections and enforcement mechanisms that underpin trade in digital content and products; and (5) support the OECD Inclusive Framework process to develop a consensus, income-tax based solution that can be applied to the broader digitalized economy. USCIB members further urged G20 governments to resist the temptation to regulate emerging technologies such as Artificial Intelligence, recognizing that such efforts cannot keep pace with rapid technological innovation.

USCIB Members Follow Up Comments to UN High Level Panel on Digital Cooperation by Urging a Holistic Approach to Digital Policy-Making: On January 17, the ICT Policy Committee followed up its November 30, 2018 submission to the U.N. High-Level Panel on Digital Cooperation (HLPDC) by addressing specific questions posed by the panel secretariat. By urging a “holistic approach” to digital policy, USCIB clarified that the approach envisioned would go beyond use of digital technologies by the information, communications, and technology (ICT) sector, and consider how ICTs can serve as enablers for innovations across all sectors, such as in healthcare, education, finance, and energy, to name a few. “This requires cutting across policy silos and different departments and agencies within governments and intergovernmental bodies, which we refer to as “whole-of-government,” USCIB stated. Members further urged that governments should strengthen their collaboration with internal and external stakeholders to create flexible, forward-looking and integrated policy frameworks. The HLPDC was established by the UN Secretary-General in July 2018 to advance proposals to strengthen cooperation in the digital realm and contribute to the broader global dialogue on how interdisciplinary and cooperative approaches can help ensure a safe and inclusive digital future.

OECD Kicks Off Review of 2013 Privacy Framework with Advice and Inputs from USCIB Members: On February 4, 2019, the OECD Working Party on Security and Privacy in the Digital Economy (SPDE) began a review of the 2013 Recommendation of the Council concerning Guidelines Governing the Protection of Privacy and Transborder Flows of Personal Data (i.e., “Privacy Guidelines”). The review will be undertaken by a special group of 40 privacy experts, which includes Barbara Wanner, USCIB Vice President for ICT Policy, and representatives from AT&T, Google, Oracle, Mastercard, and The Walt Disney Company. The group will consider how technological progress, changes in data-sharing practices by organizations and individuals, and the increasingly patchwork nature of global privacy frameworks may be addressed by revising and updating the OECD’s six-year-old Privacy Guidelines.

Tax – Advancing Tax Policies that Promote U.S. Competitiveness/strong>

USCIB Submits Comment Letters to Regulators: The Tax Committee dedicated significant resources to providing comments on a variety of topics over the months of December, January, and February. These comments can be found on the recent accomplishments section of the USCIB Tax Committee page. Comments included letters on: proposals concerning: determining the foreign tax credit; the Base Erosion Anti-abuse Tax; interest allocation under 163(j); the taxation of hybrid entities and transactions; and the UK digital services tax.

Customs and Trade Facilitation – Reducing Barriers and Costs from Customs and Border Control Practices

Customs and Trade Facilitation Committee Responds to 21st Century Customs Framework: On February 4, 2019, the USCIB Customs and Trade Facilitation Committee submitted comments in response to a U.S. Customs and Border Protection (CBP) Federal Register Notice request for public comments on the “21st Century Customs Framework”, a CBP initiative to better position CBP to operate in the 21st century trade environment. USCIB Comments included Recommendations, Concerns, Points for Consideration, Responses to specific CBP requests for comment on the topics of Emerging Roles in the Global Supply Chain; Intelligent Enforcement; Cutting-Edge Technology; Data Access and Sharing; 21st Century Customs Procedures; and Infrastructure.

China – Supporting Policies and Relationships that Enhance U.S.-China Business

USCIB Participates in Business Coalition Fly-in on China Tariffs: USCIB Senior Director, Investment, Trade and Financial Services, Eva Hampl participated in the Fly-In organized by Tariffs Hurt the Heartland the nationwide campaign against tariffs, combining the efforts of Farmers for Free Trade and Americans for Free Trade, of which USCIB is a member. Groups of representatives from associations and companies covered over 150 meetings with Senate and House offices from both sides of the aisle over February 6-7, 2019, in anticipation of an increase of tariffs on the $200 billion worth of Chinese imports from 10% to 25%. The group emphasized the concern about the tariff actions, noting that the various tariffs currently in place are causing significant damage to U.S. companies and jobs, with prospects even more dire were thee tariffs to continue or increase in the future. At this time, the intended increase has been formally delayed until further notice.

Membership

• Membership Meetings The USCIB membership department and policy staff met with representatives from member companies Qualcomm, Ferrero and Cargill to develop our understanding of their policy priorities for the next year and beyond, and to see how USCIB can better serve their policy needs.
• New Members: USCIB has recently welcomed Business Software Alliance, DLA Piper, Netflix, R.J. Reynolds, The Tax Foundation, and Westinghouse Electric Company as new members.

Upcoming Events:

• • UNCTAD E-Commerce Week, Geneva, Switzerland – April 1-5
  • UN Conference on International Trade Law (UNCITRAL) Working Group III on Investor-State Dispute Settlement (ISDS), New York City – April 1-5
  • CNI/ICC Event Reforming the WTO: proposals for improving the governance of the multilateral trading system, Sao Paulo, Brazil – April 2
  • Business & Society – Creating Shared Values: USCIB Responds, Washington, D.C. – April 8
  • Workshop on the New Center for Sports & Human Rights, Washington, D.C. – April 9
  • Corporate Responsibility and Labor Affairs Spring Committee Meeting, Washington, D.C. – April 10-11
  • WSIS Forum, Geneva, Switzerland – April 8-12
  • Business at OECD and OECD Trade Committee Meetings, Paris, France – April 24-26
  • Meetings of the OECD Working Parties of the Committee on Digital Economy Policy, Paris, France – May 6-7
  • USCIB Geneva Week-Business in Society: Shared Values, Geneva, Switzerland – May 6-10
  • APEC SOM 2, Valparaiso, Chile – May 6-18
  • ECOSOC 2019 Session, Geneva, Switzerland – May 29-31
  • OECD/BIAC/USCIB Tax Conference, Washington, D.C. – June 3-4