The U.S. needs to increase engagement with China to convince it to limit restrictions on foreign companies and to end unfair government subsidies, former U.S. Trade Representative Michael Froman said. Although Froman said he is “hopeful” the U.S. can secure these concessions through more trade negotiations, he also said the U.S. may need to focus more on its own industrial policy to remain technologically competitive with China.
Ian Cohen
Ian Cohen, Deputy Managing Editor, is a reporter with Export Compliance Daily and its sister publications International Trade Today and Trade Law Daily, where he covers export controls, sanctions and international trade issues. He previously worked as a local government reporter in South Florida. Ian graduated with a journalism degree from the University of Florida in 2017 and lives in Washington, D.C. He joined the staff of Warren Communications News in 2019.
The Federal Maritime Commission said its May rule on detention and demurrage charges (see 2004290037) is helping to reduce unfair penalties imposed by carriers, but industry said the fees are continuing and the FMC’s guidance is not being followed. The rule “at first seemed to be a great victory,” said Rich Roche, vice president of international transportation at Mohawk Global Logistics, speaking during a virtual conference hosted by the National Customs Brokers & Forwarders Association of America Sept. 14. But Roche, who is also the chair for the NCBFAA’s Non-Vessel Operating Common Carrier Subcommittee, said some carriers increased their demurrage and detention fees the same week the rule was finalized.
The Trump administration issued an advisory for companies doing business with China’s Xinjiang region, which could expose companies to sanctions, export controls and forced labor risks. In a 19-page guidance issued July 1, the departments of State, Commerce, the Treasury and Homeland Security describe supply chain risks and possible sanctions exposure for companies trading with the region, and includes suggested due diligence practices. The guidance comes less than a month after President Donald Trump authorized sanctions against Chinese officials for human rights violations against the country’s Uighur population in the Xinjiang region (see 2006170064).
Mexican companies may struggle to comply with U.S.-Mexico-Canada Agreement provisions due to uncertainty caused by the COVID-19 pandemic and confusion about certificate of origin provisions, two former Mexican government officials said. Some Mexican businesses may opt to forgo the preferential treatment under USMCA, which takes effect July 1, and instead pay most favored nation rates on imports until they better understand the agreement’s provisions, the former officials said.
The Justice Department released an updated compliance program guidance urging industry to rely more on data, learn from past compliance penalties and improve compliance training. But the guidance, issued June 1, also introduces a “subtle” shift in how prosecutors will assess compliance programs, law firms said: More of an emphasis will be placed on determining whether programs are built to adapt to new compliance risks or whether they only rely on bare minimum measures.
China reportedly ordered its state-controlled companies to stop buying certain U.S. agricultural products after the U.S. certified last week that Hong Kong no longer qualifies for special trade treatment. The decision also came after President Donald Trump said the U.S. will sanction Chinese officials, increase export controls on dual-use technologies, and end the special customs territory in response to Beijing’s so-called national security law (see 2005290047), which the State Department said threatens Hong Kong’s autonomy (see 2005270026).
The U.S. and United Kingdom will begin virtually negotiating a trade deal this week, U.K. Trade Secretary Elizabeth Truss said. The talks, which have been expected for months (see 2002190021, 2003020061 and 2001280042), will start through video conferences, the Office of the U.S. Trade Representative told Politico May 3, and will be held remotely until international travel resumes. In a May 3 tweet, Truss said the U.K. will “be working to bring benefits to all parts of [the U.K.] and boost our economies during #coronavirus recovery.” The USTR did not comment.
The U.S and Kenya will begin negotiating a comprehensive trade deal that both sides believe will act as a model for more agreements between the U.S. and other African countries, U.S. Trade Representative Robert Lighthizer said Feb. 6. Kenya hopes to conclude negotiations quickly, its President Uhuru Kenyatta said at the U.S. Chamber of Commerce, adding that the country prefers a long-term agreement that will provide U.S. and Kenyan companies with “predictable terms of engagement” in the fields of agriculture, manufacturing, energy and more. Discussions on a framework for the negotiations will begin in the “next few days,” Kenyatta said.
A group of 17 World Trade Organization members announced plans for an interim appeals process to settle disputes between members, according to a Jan. 24 joint statement. The members, including the European Union and China but not the U.S., said they will put in place “contingency measures” to allow for appeals of WTO panel reports “in disputes among ourselves.” The system would only be in place until a reformed WTO appellate body “becomes fully operational,” the statement said.
President Donald Trump signed bills that could remove Hong Kong from receiving special customs and export controls treatment and restrict exports of rubber bullets, tear gas and other items to the region. The bills (see 1911200036), signed Nov. 27, led to backlash from China, which said the country is prepared to retaliate. “We urge the U.S. to not continue going down the wrong path, or China will take countermeasures, and the U.S. must bear all consequences,” a Chinese Foreign Ministry spokesperson said Nov. 28.