Information Communications and Technology Archives

USCIB Releases 2020 Trade and Investment Policy Priorities

Published on January 14, 2020

Each year the Trade and Investment Committee of the U.S. Council for International Business (USCIB) conducts an extensive consultation process among members in identifying priorities for the coming year. The 2020 USCIB Trade and Investment Agenda includes a list of key principles our members support for open trade and investment and an action plan for addressing our trade and investment policy priorities.

The action plan anticipates another busy year on trade and investment including:

  • pressing for final approval and implementation of USMCA,
  • seeking Administration action on phase 2 agreements with China and Japan,
  • supporting movement on trade negotiations with the EU and UK,
  • seeking continued progress on negotiations in the WTO on a digital trade agreement and
  • modernizing the WTO.

“The Agenda provides the framework for USCIB work to advance policies and negotiations that will open international markets for our member companies and strengthen the global rules-based trade and investment framework,” said USCIB Senior Vice President for Policy and Government Affairs Rob Mulligan. 

USCIB Opposes Proposed Rule on ICT-Related Transactions 

Published on January 13, 2020

USCIB joined a coalition of over thirty other associations to send a letter to U.S. Secretary of Commerce Wilbur Ross regarding a proposed rule to implement an Executive Order on Securing the Information and Communications Technology and Services (ICTS) Supply Chain. This rule would provide the U.S. government with the authority to block, intervene in and unwind certain ICTS-related transactions on the grounds of national security.

The letter stated: “Our members share the Administration’s commitment to ensuring that ICTS transactions do not pose undue risks to national security. However, we view the proposed rule as vague and highly problematic because as written, it would provide the Department with nearly unlimited authority to intervene in virtually any commercial transaction between U.S. companies and their foreign counterparts that involves technology, with little to no due process, accountability, transparency, or coordination with other government programs that are also designed to protect national security.”

According to the letter, the proposed rule does not provide sufficient legal clarity to American companies to identify transactions that could be in scope, which would create significant uncertainty in the business community, disrupt global supply chains and make a range of trade and investment decisions very difficult. Under the proposed rule, companies may also bear higher costs as they alter long-standing business relationships, search for new suppliers and unwind transactions, which will harm U.S. competitiveness and technology leadership.

“An open investment climate with predictable rules is vital to economic growth and development,” said Eva Hampl, senior director of investment, trade and financial services at USCIB. “While national security concerns should be a consideration, virtually unlimited government authority to intervene in transactions could cause significant economic harm to U.S. businesses and consumers.”

Stakeholders at IGF Seek to Avoid Fragmentation of the Internet

Published on December 3, 2019
L-R: Barbara Wanner, USCIB (moderator); Ben Wallis, Microsoft; Jane Coffin, Internet Society; Alex Cooke, Government of Australia; and David Gierten, OECD

The fourteenth Internet Governance Forum (IGF) wrapped up on November 29 with an invigorated call from stakeholders for an Internet governance mechanism that preserves the IGF’s multistakeholder model and expands its institutional capabilities, amid warnings from UN and German officials about the potential fragmenting of the Internet. USCIB Vice President for ICT Policy Barbara Wanner attended the four-day IGF in Berlin and reported from the field.

German Chancellor Angela Merkel, who formally opened the IGF on November 26, warned of the crippling effect of growing nationalism that will increasingly fracture the Internet. “The [digital] infrastructure has become the very core of our global economy… [but] there are some who remain in their little bubble and do not actually exchange views with people who are of a different opinion and that is one of the challenges that we face in this overall development of the Internet,” she said.

United Nations Secretary General Antonio Guterres offered a similarly dire outlook, telling the IGF audience that the today’s “accessible, free, secure and open Internet is at risk of fracturing along three intersecting lines … a profound digital divide, a social divide and a political divide.”

According to Wanner, Merkel and Guterres concurred that a comprehensive dialogue involving all stakeholders – citing the IGF as a model – can help to prevent such fragmentation, as this approach best ensures a healthy and thriving digital economy that can realize the Sustainable Development Goals (SDGs), connect the unconnected and bridge the digital skills gap. “The Internet must not and cannot be shaped only by governments alone because the basic issues revolving around the Internet have an impact on each and everyone’s life, and this is why we need a multistakeholder approach,” Merkel said.

“Against this backdrop, USCIB members who spoke in various workshops highlighted the importance of digital transformation by sharing business best practices and case studies that demonstrate how business’ digital innovations have improved people’s lives and livelihoods, created new commercial and employment opportunities and provided cultural connections,” said Wanner. “Their messages as workshops speakers and in bilateral meetings with UN officials and various government delegations also emphasized the importance of the multistakeholder model in considering the complexity of digital economy issues. In this regard, USCIB members reaffirmed their support for an adequately funded “IGF-Plus” architecture for Internet governance, proposed by the UN High-Level Panel on Digital Cooperation (HLPDC).”

Joining Wanner were members from Amazon, AT&T, CCIA, Disney, Facebook, Google, ITI, Microsoft, Verisign and Verizon.

OECD Turns to Practical Implementation of AI, Privacy Guidelines

Published on November 25, 2019

“Practical implementation” was an underlying theme at the recent discussions of the OECD Committee on Digital Economy Policy (CDEP), according to USCIB Vice President for ICT Policy Barbara Wanner, who reported from the field. The meetings took place November 18-22  at OECD headquarters in Paris. Wanner reported that having devoted more than a year to crafting the Council Recommendation on Artificial Intelligence, CDEP delegates and stakeholders discussed a paper outlining guidance on the implementation of the AI Recommendation, as well as the complementary AI Policy Observatory.

In a similar spirit, the Privacy Guidelines Expert Group (PGEG), which was convened to advance the mandated five-year review of the 2013 OECD Guidelines Governing the Protection of Privacy and Transborder Flows of Personal Data (the “Privacy Guidelines”), held a workshop on November 18 to explore the practicalities of operationalizing international cooperation in enforcement of privacy protections as well as consider the impact of AI on personal data protection and implementation of the Privacy Guidelines.

“Under the auspices of Business at OECD, USCIB members stepped up at the November CDEP meetings, intervening to underscore the importance of interoperability of privacy regulations to build trust and facilitate cross-border data flows for economic growth and prosperity,” said Wanner.

Citing Business at OECD’s Guiding Principles for the Review of the 2013 Privacy Guidelines, Wanner emphasized, “a consistent global approach to privacy will help companies of all sizes comply with [privacy laws], expand their commercial activities, and in turn grown their national economies with related employment benefits.”

Concerning implementation of the OECD’s AI Principles, Barry O’Brien (IBM Ireland), who chairs the Business at OECD delegation to the AI Experts Group, applauded the OECD’s proposed practical guidance as “building on the excellent work on the AI Principles and promoting the adoption and implementation of trustworthy AI.”

USCIB members actively shaped the development of the AI Recommendation as participants on a special AI Experts Group and are currently feeding business input to the PGEG.  USCIB members also made influential interventions concerning the proposed CDEP Program of Work and Budget 2020-2021 (PWB), work on online platforms, and key topics under the purview of the Working Party on Communications Infrastructures and Services Policy (CISP), such a draft report on price baskets for bundled communication services.

Joining Wanner were USCIB member representatives from Amazon, AT&T, CCIA, Comcast, Deloitte & Touche, Facebook, Microsoft and TMG Legal.

Domain Name System Abuse: A Hot Topic at Recent ICANN Meetings

Published on November 19, 2019

The Internet Corporation for Assigned Names and Numbers (ICANN) wrapped up six days of annual meetings on November 7 in Montreal, Quebec, which featured, at times, heated debate about the roles of ICANN and the contracted parties in mitigating domain name system (DNS) abuse and related security problems. According to USCIB Vice President for ICT Policy Barbara Wanner,  who attended the meetings in her capacity as the Business Constituency’s (BC) representative to the Commercial Stakeholder Group (CSG), while security threats and the way the ICANN community tracks, reports, and mitigates them have always been an important focus of ICANN’s work, attention to this issue has intensified in recent months amid reports of sharp increases in phishing attacks and studies estimating that the cost of global cybercrime reached approximately $600 million in 2018.

“ICANN’s Business Constituency (BC), of which USCIB is a member, highlighted profound gaps in DNS abuse mitigation throughout the week’s meetings with the ICANN Board, senior ICANN staff, and other constituencies and the need to clarify definitions of abuse and aggressively enforce against offenders,” said Wanner.

According to Wanner, participants at ICANN 66, the organization’s Annual General Meeting, continued to advance discussions about the building blocks of a model to enable third-party access to nonpublic domain name system registration data for legitimate purposes that would comply with EU General Data Protection Regulation (GDPR) and other privacy regimes. The draft model may be finalized as soon as December, more probably in early 2020, following receipt of legal advice from the European Data Protection Board (DPB).

The meeting also continued to explore how to evolve ICANN’s multistakeholder model to improve its efficiency and effectiveness as part of the FY 2021-2025 Strategic Plan as well as other DNS management issues.

Wanner’s role as BC representative to the CSG has enabled greater input to policy discussions at the CSG executive committee-level on behalf of USCIB members and facilitated important meetings with senior ICANN officials and other key constituencies.  USCIB member representatives from Amazon, AT&T, BT Americas, CenturyLink, Facebook, Google, Microsoft, and NBC Universal were present in Montreal and actively contributed to all policy discussions.

Focus on Sustainability, New Technologies at 2019 World Trade Symposium

Published on November 11, 2019

USCIB once again sponsored the World Trade Symposium this year November 6-7 in New York. The Symposium, hosted by Finastra and programmed by The Economist Events, brought together researchers, government officials and private sector leaders to discuss “Trade in an Uncertain World.” According to USCIB Assistant Policy and Program Manager Daniella Goncalves, several themes emerged throughout the Symposium, including the impact of new technologies on trade and investment, the need for greater interoperability of new technologies, the importance of sustainability to trade and investment and the continued importance of free trade.

Political uncertainty took center stage during the event’s discussions. The rise of populism and protectionist policies, as well as perceived lack of efficiency and productivity in multilateral fora, were identified as threats to be addressed. Many participants expressed the need to reform multilateral institutions and reaffirmed their support for trade liberalization. The need for U.S. leadership in such reform and trade liberalization activities was highlighted as a priority. Participants were in agreement that the restoration of predictability, reciprocity and fairness is required to bolster global trade and investment.

Digitization has the ability to drive down costs and speed of getting goods to market, but standardization of data protection and date flow regulation are priorities. The importance of regulating data flows and the need for standardized data protection laws, new technologies and the issue of illicit trade were highlighted by several panelists, including the World Trade Organization (WTO) Deputy Director-General Ambassador Alan Wm. Wolff, Research Professor of International Affairs & Director of Digital Trade & Data Governance hub Susan Ariel Aaronson and President of the Mediterranean Shipping Company Fabio Santucci.

The use of blockchain was characterized as a means to more efficiently engage in trade and investment, as well as increase sustainability through decreased paper usage. However, interoperability of blockchains and standardization of regulatory frameworks remain hurdles to wide-spread deployment of this technology.

It was noted that the International Chamber of Commerce (ICC) is working with an Asia-based partner to develop a blockchain technology to enable traceability and tracking of goods. The goal ultimately is to promote interoperability among various blockchain networks and technology platforms.

Recognizing the rise of consumer interest in sustainability, the issue of sustainable trade and investment was discussed. According to the panelists, millennial consumers are driving interest in and profitability of sustainable goods and services. Trade has lifted hundreds of millions out of poverty; to continue to see the benefits of trade, growth needs to be inclusive. USCIB is actively advocating on these important issues in various multilateral fora, including at the Organization for Economic Cooperation and Development (OECD) in Paris.

OECD Report Weighs In On WTO Moratorium Debate

Published on November 11, 2019

The much-anticipated Organization for Economic Cooperation and Development (OECD) report on the World Trade Organization (WTO) moratorium on customs duties on electronic transmissions was de-classified on November 4.

According to USCIB Senior Vice President for Policy and Government Affairs Rob Mulligan, the report, “Electronic transmissions and international trade – Shedding new light on the moratorium debate,” concludes that revenue implications of lifting the Moratorium are likely to be relatively small and would come at the expense of more significant gains in consumer welfare (estimated at 940 million USD) and export competitiveness.

The Moratorium, which has been in place since 1998 and has been continuously extended every couple of years since then, is once again due to expire at the end of 2019. Keeping the Moratorium is crucial for business, and USCIB has been actively engaged in pushing back against the opponents of extending the Moratorium with the ultimate goal of making it permanent.

The OECD report also notes that the highest estimated share of opportunity cost in terms of foregone revenue is in digitizable goods, which is low, at 1.2% of total trade. This will likely remain low even with the advent of technologies such as 3D printing, which are unlikely to have far-reaching implications on trade in the near term.

The report noted that tariffs also come with costs. Tariffs are associated with lower output and lower productivity and their burden falls mainly on domestic consumers, not foreign firms. Tariffs are also an unstable source of revenue. Alternatives exist in the form of non-discriminatory value added taxes or goods and services taxes.

The WTO General Council meeting, set for December 9-11, will provide a final opportunity to extend the Moratorium.

New OECD Deputy Secretary General Meets With USCIB

Published on November 11, 2019
L-R: OECD Deputy Secretary General Ulrik Vestergaard Knudsen; Head of the OECD’s Washington office Will Davis

USCIB members and staff had the opportunity to meet with the new Organization for Economic Cooperation and Development (OECD) Deputy Secretary-General Ulrik Vestergaard Knudsen on November 5 at the USCIB Washington DC office. Knudsen’s diverse policy portfolio at the OECD includes science, technology and innovation, trade and agriculture, the OECD Center for Entrepreneurship, SMEs, as well as regions and cities.

The dialogue between Knudsen and USCIB members focused on areas of mutual interest such as taxation policy, including the pressing issue of digital taxation, as well as cross-border data flows, healthcare, trade and investment, digital trade, and the Going Digital Project. Knudsen also mentioned Artificial Intelligence (AI) as an increasingly important issue for the OECD and the establishment of the OECD AI Policy Observatory, which will help countries nurture and monitor the responsible development of trustworthy AI systems for the benefit of society.

L-R: Norine Kennedy (USCIB), Will Davis (OECD Washington), Ambassador Ulrik Vestergaard Knudsen (OECD), Peter Robinson (USCIB), Eva Hampl (USCIB), Rob Mulligan (USCIB)

USCIB members from Microsoft, IBM, General Electric, CropLife America, Walmart and others, benefited from the opportunity to hear directly from OECD leadership regarding the OECD’s priorities as well as an update on the OECD accession process. USCIB participants underlined the importance of maximizing access for business and other responsible stakeholders in all OECD committee meetings.

“We are grateful that DSG Knudsen took the time to meet with U.S. business,” said USCIB Senior Vice President for Policy and Government Relations Rob Mulligan. “USCIB staff and members always appreciate an opportunity to provide perspectives to the OECD staff and secretariat to help inform the OECD’s science-based policy recommendations.”

USCIB is the U.S. national committee of Business at OECD (BIAC).

Promoting U.S. Business Access: USCIB Submits NTE Comments

Published on October 29, 2019

USCIB filed comments on October 25 for the annual National Trade Estimate (NTE) report to highlight significant barriers that American companies continue to face with regards to exports of goods, services and U.S. foreign direct investment. The comprehensive comments included barriers faced by U.S. companies in over twenty countries, including in Brazil, China and India.

According to USCIB Vice President for ICT Policy Barbara Wanner, the comments urged the U.S. Trade Representative to encourage Brazil to promote an international, interoperable policy framework for the Internet of Things (IoT) and machine-to-machine (M2M) solutions that includes M2M permanent roaming, among other things.

“Many IOT and M2M solutions will only reach their optimal scale if they can operate around the globe,” said Wanner. Monitors on airline cargo or shipping containers must be able to operate wherever their freight travels. Automakers sell vehicles across many different countries and operators drive vehicles across national borders for commercial and personal purposes; automakers and customers alike need a single communications platform to support their connected vehicles.

“The Brazilian government should modify the regulatory framework to support providers of IoT and M2M services and devices and allow them to choose between various available options for numbering and device management (including permanent M2M roaming), rather than imposing a single, one-size alternative for all cases,” added Wanner.

With regards to China, USCIB’s submission focused on China’s WTO compliance record in services, particularly China’s indiscriminate filtering and blocking of online services. China’s expansive definition of value-added services, high capitalization requirements for basic telecommunications services, lack of an independent regulator, and restrictions that specifically apply to the non-Chinese companies for provision of value-added services remain key outstanding issues for U.S. business.

Finally, while India has accelerated broadband deployment, USCIB’s comments stressed that it must also implement policies that foster an innovative environment through predictable, progressive and technology-neutral policies that are compatible with global standards.

“It is important to keep encouraging the Indian government to support further market liberalization and to remove remaining market access barriers,” said Wanner. “India should be urged to continue its efforts to provide legal and regulatory policy certainty both in the development of a body of clear and consistent laws and regulations, and in the transparent and equitable application and enforcement of those laws and regulations. Unfortunately, in recent years the government of India has implemented a number of policies that constitute significant market access barriers to U.S. companies, including in data localization, remote access policy and cloud computing.”

USCIB Holds High-Level Meetings During WTO Public Forum

Published on October 14, 2019

USCIB and several members were on the ground in Geneva the week of October 7 for the World Trade Organization (WTO) Public Forum. The Forum included a plethora of panels on critical issues of concern to business including digital trade, services, the moratorium in customs duties on electric transmissions (Moratorium), the ongoing e-commerce negotiations, and WTO reform, including issues surrounding the Appellate Body (AB).

In addition to participating in the active forum agenda, USCIB’s Senior Vice President Rob Mulligan and Senior Director Eva Hampl held side-meetings with WTO leadership, such as Deputy Director-General Alan Wolff, Director, Council and TNC Division Victor do Prado, Director, Information and External Relations Division Keith Rockwell and Counselor, Telecom, ICT & E-commerce, Trade in Services and Investment Division Lee Tuthill. Mulligan and Hampl also met with Ambassadors Dennis Shea, Stephen deBoer, and Junichi Ihara from the United States, Canada, and Japan, respectively. Finally, USCIB engaged with international business groups, including Confederation of British Industry (CBI), Ibec (Irish Business), Canadian Chamber of Commerce, ICC UK, and Confederation of Danish Industry (DI).

“Across the board, everybody is closely paying attention to the E-Commerce negotiations,” said Mulligan. “There is a general positive attitude regarding the negotiations, but also a recognition that the tough issues like data flows and localization policies are still to come. Accordingly, it is not likely that an agreement will be ready by the Ministerial Council meeting in June 2020 (MC12).”

According to Mulligan, on the issue of the Moratorium, there continue to be opponents to extending the agreement, but most WTO members support at a minimum extending it to MC12 once it runs out in December of this year. To push back against the opposing forces, several studies are being developed. Among these, the OECD is also developing a paper on the Moratorium, which is likely to be released very soon.

WTO reform domin ated the discussion, often targeted at the U.S. pushing for meaningful updates on issues like subsidies, transparency, and notifications. The U.S. position on the Appellate Body, however, continues to be controversial and there is some nervousness about what will happen to the dispute resolution arm of the WTO once the terms of two of the three remaining AB members run out at the end of the year. On the other hand, there are some who believe pragmatism will take over and the value of the institution and the important work being done on the other reforms will not be impacted.

USCIB also co-hosted a breakfast with the International Chamber of Commerce (ICC). Speakers at the breakfast included The Right Honorable Liz Truss MP, secretary of state for International Trade in the UK, who spoke on the importance of the multilateral trading system; Ambassador Sunanta Kangvalkulkij from Thailand, who provided an update in the General Council discussions; Ambassador David Walker from New Zealand, who provided an update on the AB, and Ambassador Frances Lisson from Australia, who spoke about the JSI on E-Commerce; and WTO Director General Roberto Azevedo, who spoke to the current state of play of WTO Reform.

To wrap up the busy week in Geneva, USCIB co-hosted a business reception with several other business associations, to underline the importance of a business relationship with the WTO. Invitees include member companies and associations, country delegates, and WTO staff.