The legislative process for U.S.-Mexico-Canada Agreement approval “has just started in Canada” and the final ratification is expected to occur in March, said Joy Nott, a partner in KPMG's Canada Indirect Tax Practice, during a Feb. 5 webinar. “If it does happen at any point in the month of March,” the agreement would then come into force in July (see 2001300009), she said. “The one thing that is sort of up in the air is -- in Canada, it goes through a debate period, and we're not expecting any undue delays or whatever else, but like all politics, there is a debate period that as long as the debate is going on, it could drag the ratification into April,” she said. Still, ratification in March seems likely, she said.
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.
Trump administration officials will meet this month in an attempt to resolve differences in the matter of restricting technology exports to China and Huawei, according to a Feb. 4 Reuters report. But Commerce is also discussing expanding its export control jurisdiction to a broader array of foreign sales containing U.S. goods that go beyond exports to just Huawei, according to a person familiar with the situation. “That is the one that would be a nuclear bomb for business,” the person said, adding that Commerce is discussing expanding its export control jurisdiction to “the maximum possible point.”
Export Compliance Daily is providing readers with some of the top stories for Jan. 27-31 in case you missed them.
China took a “few positive steps” to revise the draft of its export control law (see 2001100047) but should address several key areas of concern for U.S. and Chinese companies, the U.S. China Business Council said in comments released this week. The USCBC asked China to clarify the scope of its export controls and the term “national security,” provide a clearer definition for activities that are “deemed exports,” and consider more relaxed requirements for end-user statements and certificates.
The Commerce Department still does not have a timeline for releasing its next set of controls on emerging technologies and its advance notice of proposed rulemaking for foundational technologies, despite expectations from top officials that both would be published before 2020, a Bureau of Industry and Security official said. “I would have thought that they would be out earlier,” said Hillary Hess, director of BIS’s regulatory policy division, speaking during a Feb. 4 Sensors and Instrumentation Technical Advisory Committee meeting. “I think everybody would like to see them come out, but I’m not sure how long it’s going to take. I’m having trouble getting a bead on it myself.”
As the coronavirus outbreak disrupts supply chains, U.S. agricultural exporters are unsure when normal cargo processing will resume and are concerned about penalties from ocean freight carriers, according to a Feb. 3 open letter to ocean carriers by Agriculture Transportation Coalition Executive Director Peter Friedmann.
The Treasury’s Office of Foreign Assets Control is becoming progressively worse at addressing specific sanctions questions from industry stakeholders, leaving queries unanswered and causing companies to hesitate before completing transactions, according to Nixon Peabody trade lawyer Alexandra Lopez-Casero. Companies can employ certain strategies to get responses from OFAC, Lopez-Casero said, but OFAC is typically not as responsive and helpful as other agencies, such as the Commerce Department Bureau of Industry and Security.
Although the Defense Department reportedly objected to a proposed Commerce Department rule that would have further restricted foreign sales to Huawei that contain U.S. goods (see 2001240012), the administration will continue considering other ways to increase controls on shipments to Huawei, which may include a “compromise” rule, according to a Jan. 31 research report from Raymond James & Associates. Political support for the proposed rule, including by three senators in a January letter (see 2001270026), may “convince” the Defense Department to “ease its opposition in some form.” If the agency concedes, it will still likely push back on other restrictions on China's technology industry “to preserve some of the revenue stream to the U.S. industrial base,” the report said.
Airbus agreed to pay more than $3.9 billion in combined penalties for violations of the Foreign Corrupt Practices Act, the Arms Export Control Act and the International Traffic in Arms Regulations, the Justice Department said Jan. 31. The bribery charges, levied by U.S., French and United Kingdom authorities, stem from Airbus’s scheme to bribe non-governmental airline executives and government officials, including officials in China, to retain aircraft contracts.