U.S. Chamber of Commerce

International Policy Update

January 21, 2022

Chamber Urges Action on Trade in “Competition for Global Leadership”

Uyghur Forced Labor Prevention Act Implementation Forges Ahead

House China Package Said to be “Very Close”

Additional Russia Sanctions Under Consideration

 One-Third of House Members Call for New Tariff Exclusion Process

Export-Import Bank Nominations Advance

U.S., UK Launch Discussions to Resolve Section 232 Dispute

From the Home Front

Chamber Opposes American Innovation and Choice Online Act

​​​​​​​Chamber Launches Bipartisan Commission on Artificial Intelligence to Advance U.S. Leadership

Chamber Urges Action on Trade in “Competition for Global Leadership”

On January 18, U.S. Chamber policy experts examined how the United States can demonstrate leadership on the international stage in an event entitled “Competition for Global Leadership: Trade, AI, and Security.” The panel was part of The Competition Series, which is comprised of four follow-on sessions to the Chamber’s annual State of American Business address and aims to help U.S. companies better understand the top trends and issues in 2022.

On the trade front, Senior Vice President for Asia Charles Freeman highlighted the importance of U.S. commercial statecraft in the Indo-Pacific. He urged the administration to negotiate a digital trade agreement starting in the region and encouraged the Biden administration to move forward in articulating its China policy. “We need to get back in the game on trade,” he insisted.

Senior Vice President for Europe Marjorie Chorlins acknowledged the European Union’s quest to become more competitive in digital and advanced technologies and the risk that some of its policy proposals may discriminate against U.S. companies. She urged the Biden administration to prove the new U.S.-EU Trade and Technology Council is capable of securing tangible outcomes to improve what is already the world’s largest economic relationship; she also called for the United States to resume negotiations for a free trade agreement with the United Kingdom.

Senior Vice President for the Americas Neil Herrington discussed the upcoming Summit of the Americas, which will take place in Los Angeles in June, and credited it as an opportunity “to build regional consensus around pro-growth policies for an inclusive health and economic recovery.” He also emphasized the need for the United States to press the Mexican government in particular to comply with its obligations under the U.S.-Mexico-Canada Agreement in areas such as energy, agricultural biotech, and pharmaceutical procurement. He described enforcement as key to unlocking the full potential of the U.S. relationship with its top two trading partners.

Senior Vice President for Africa Scott Eisner recommended the administration identify opportunities to step up its engagement in Africa. He urged the U.S. to resume the stalled negotiations on a free trade agreement with Kenya, prepare for renewal of the African Growth and Opportunity Act (which expires in 2025), and take advantage of new opportunities presented by the African Continental Free Trade Agreement.

Executive Vice President and Head of International Affairs Myron Brilliant closed the conversation by calling for bold U.S. trade leadership. In comments picked up by the trade press, he said the administration must act on the tariffs it inherited because they are “taxes paid by Americans and a burden on U.S. competitiveness.”

The event also featured a discussion with former Acting and Deputy Director of the CIA Michael Morell on international security and cyber risks. In addition, the Chamber hosted a panel to launch its Artificial Intelligence (AI) Commission on Competition, Inclusion, and Innovation to advance U.S. leadership in the use and regulation of AI technology. The commission is co-chaired by former Representatives John Delaney (D-MD) and Rep. Mike Ferguson (R-NJ).

For further information, please contact Senior Vice President for International Policy John Murphy (jmurphy@uschamber.com).

Uyghur Forced Labor Prevention Act Implementation Forges Ahead

The signing of the “Uyghur Forced Labor Prevention Act (UFLPA)” last month kicked off a 180-day input process that involves a public comment period as well as a hearing.

The new law prohibits imports from the Xinjiang Uyghur Autonomous Region (XUAR) from entering the U.S. and assumes goods from that area are made with forced labor unless proven otherwise (an approach dubbed the “rebuttable presumption”). Previous withhold release orders (WROs) covered specific products. However, the new law covers all products from the XUAR, including downstream goods made in — or with inputs from — the XUAR. The scope of the legislation covers products not just imported into the United States from the XUAR but also goods that go through third countries or regions in China on their way to the United States. The law also covers goods entering the United States that have been transformed into other products suspected to be made with inputs from the XUAR.

The law sets out a timeline for the administration to put together an enforcement strategy due around June 21, which is the same day the rebuttable presumption takes effect. A Federal Register notice establishing the start of the public comment period is scheduled to be published on January 24. This period will last 45 days and will be followed by a public hearing, which could take place at the end of April. These are opportunities for companies to participate in shaping this enforcement strategy.

The public comments will focus on how best to ensure that goods mined by or produced with forced labor by persecuted groups in the Xinjiang region are not imported into the U.S. The hearing will focus on measures that can be taken to trace supply chains for goods mined or produced in whole or in part with forced labor in China and to ensure that goods made with forced labor do not enter the U.S.

While the legislation does not clarify what evidence would be necessary to meet the “clear and convincing” standard outlined in the import ban, we believe similar documentation used for previous WROs could be a good template. Such evidence could include certificates of origin, purchase orders, invoices, affidavits from the producers, proof of payment, list of production steps, transportation documents etc. This list was confirmed by a CBP official this week as documents importers should be able to provide.

The official also noted that the process could be streamlined if submissions are well-organized and include English translations as well as a roadmap that CBP can easily follow. Potential due diligence tools to start getting familiar with include the implementation of audit systems, traceability protocols, risk assessments — all of which are tied to comprehensive supply chain mapping.

For further information, please contact Director for International Policy Isabelle Icso (iicso@uschamber.com).

House China Package Said to be “Very Close”

Speaker Nancy Pelosi (D-CA) on January 20 said in her weekly press conference that the House “China competition” package is “very close” to being ready for consideration. This may open the door for conference negotiations with the Senate to iron out differences with the Senate-passed “U.S. Innovation and Competition Act (USICA).” The House’s legislation is expected to include versions of following bills:

In a new addition to this list, the “Import Security and Fairness Act,” introduced on January 18 by House Ways and Means Trade Subcommittee Chairman Earl Blumenauer (D-OR), would prevent goods from China and other non-market economies from benefiting from the U.S. $800 de minimis threshold. Blumenauer has said the de minimis standard allows Chinese companies to split up bigger shipments to avoid paying U.S. duties, including Section 301 duties. He also argues the bill would reduce the number of counterfeit goods or products made with forced labor that enter the U.S. duty-free and without inspection. If enacted, any goods from countries designated as a non-market economy and listed on the U.S. Trade Representative’s Watch List would be prohibited from using de minimis, as would any goods subject to trade enforcement statues.

The Chamber earlier commented on several potential provisions and will continue Hill advocacy throughout the conference process. Members are encouraged to share their views with Chamber staff.

For further information, please contact Director for International Policy Isabelle Icso (iicso@uschamber.com).

Additional Russia Sanctions Under Consideration

The Chamber is engaging with member companies and the Biden administration on various proposals for sanctions the United States may apply in the event Russia launches a further invasion of Ukraine. Several possible forms of sanctions are said to be under consideration, including the following:

Last year, the Chamber shared its Principles for Sanctions as a Tool of Effective Statecraft with the Treasury Department during its 2021 sanctions review. The Chamber will continue to engage with the administration as officials develop a sanctions strategy.

For further information, please contact Director for International Policy Isabelle Icso (iicso@uschamber.com).

One-Third of House Members Call for New Tariff Exclusion Process

Representatives Suzan DelBene (D-WA), Ron Kind (D-WI), Darin LaHood (R-IL), Jackie Walorski (R-IN), and 137 of their colleagues on January 20 sent a bipartisan letter to U.S. Trade Representative Katherine Tai urging the creation of “a comprehensive and fair exclusion process that would allow U.S. producers, manufacturers, and importers to request relief from Section 301 tariffs on imports from China,” as they stated in a press release.

The letter notes that the tariffs have been “raising the costs of critical inputs, components, and machinery. These increased costs are undermining the competitiveness of American manufacturing workers whose inputs are now more expensive compared to those made by foreign competitors. Sadly, the Section 301 tariffs have broadly impacted U.S. businesses in the manufacturing, agriculture, fishing, retail, energy, technology, and services industries. These impacts have been strongest for small-and medium-sized enterprises that are less able to absorb the increased cost of tariffs. Section 301 tariffs have also harmed American families and consumers by raising prices on a wide range of consumer products.”

The letter also notes that the current exclusion process “is too narrow, opening only 1 percent of the original exclusion applications for reconsideration. Expanding this process to more products is especially important given the significant challenges with transparency and procedure in the original exclusion process, as the Government Accountability Office found in its July 2021 report to Congress.”

A similar letter has been circulating in the Senate. The Chamber has weighed in with offices encouraging them to sign on. For further information, please contact Director for International Policy Isabelle Icso (iicso@uschamber.com).

Export-Import Bank Nominations Advance

On January 19, the Senate Banking Committee held an Executive Session to consider a number of nominations, including three nominees to serve on the board of the Export-Import Bank of the United States (Ex-Im). The Chamber previously supported these nominees in September when they were initially reported out of Committee on a voice vote. Ranking Member Pat Toomey (R-PA), who has long held critical views of Ex-Im, would not agree to hold over these three nominees at the end of last year, so the White House was obliged to resubmit them for consideration.

While the Committee once again reported out by voice vote the nominations of Judith DelZoppo Pryor as First Vice President and Owen Herrnstadt as a Member of the Board, Senator Toomey requested a roll call vote on the nomination of Reta Jo Lewis to serve as President and Chair. Senator John Kennedy (R-LA) joined all of the Committee’s Democrats in supporting the nomination, while the rest of the Republicans on the Committee opposed. Lewis previously served as Vice President and Counselor to the President at the U.S. Chamber, where she led the Chamber’s initiatives focused on fostering strategic alliances between small businesses, especially women and minority-owned businesses, entrepreneurs, and executives.

Senate Majority Leader Chuck Schumer (D-NY) has subsequently filed cloture on Lewis’s confirmation, with a potential vote likely the week of January 31. The Chamber maintains that Ex-Im plays a vital role supporting U.S. exporters by leveling the trade finance playing field for American companies. The Chamber will engage in outreach in advance of a floor vote to press for swift confirmation of the nominees.

For further information, please contact Senior Vice President for International Policy John Murphy (jmurphy@uschamber.com).

U.S., UK Launch Discussions to Resolve Section 232 Dispute

On January 19, the United States and United Kingdom announced the start of bilateral discussions to settle the trade dispute stemming from the U.S. Section 232 tariffs on steel and aluminum imports first imposed in 2018. Secretary of Commerce Gina Raimondo, U.S. Trade Representative Katherine Tai, and United Kingdom Secretary of State for International Trade Anne-Marie Trevelyan will, according to the joint statement, “enter into discussions on the mutual resolution of concerns in this area that addresses steel and aluminum excess capacity and the deployment of effective solutions, including appropriate trade measures, to preserve our critical industries.”

The statement also emphasized the “close and long-standing” partnership between the two countries and their “similar national security interest as democratic market economies.” The U.S. is also engaging in Section 232 consultations with Japan.

In October, the United States and the European Union agreed on a tariff-rate quota (TRQ) system to replace the tariffs on steel and aluminum. They also committed to negotiate a global arrangement to address the effects of high-carbon steel and aluminum production and to cooperate on non-market excess capacity in the steel and aluminum sectors. The Chamber has urged that all Section 232 tariffs and quotas on our close allies be dropped.

For further information, please contact Senior Vice President for International Policy John Murphy (jmurphy@uschamber.com).

From the Home Front

Chamber Opposes American Innovation and Choice Online Act

On January 19, Executive Vice President and Chief Policy Officer Neil Bradley issued the following statement in advance of the scheduled markup in the Senate Judiciary Committee of S.2992, the “American Innovation and Choice Online Act”:

"The Chamber strongly opposes the misnamed American Innovation and Choice Online Act. This bill will raise prices, reduce choices for American families, limit opportunities for small businesses, and harm our economy.

“This bill is the definition of the government picking winners and losers in the marketplace, arbitrarily subjecting certain companies to one set of rules and everyone else, including their competitors, to a separate set. It gives federal agencies, including the Federal Trade Commission, which is already engaged in extensive overreach, the power to micromanage a large sector of the economy. In the future, the government will decide whether a company can innovate, lower prices, or offer free shipping and other services. And whether such vigorous competition is ‘unfair.’

“The companies that are being targeted are the very ones that had the scale and innovation to help us through the pandemic, whether that was enabling millions to work remotely, get essentials delivered to our front door, or seamlessly bring entertainment into our homes. These companies, contrary to popular belief, are helping fuel a dynamic, competitive economy.

“The Senate Judiciary Committee is moving forward on this legislation without the benefit of even a full committee hearing. The Chamber is confident that any objective review will lead to the conclusion that this current proposal remains significantly flawed and should not become law.”

Chamber Launches Bipartisan Commission on Artificial Intelligence to Advance U.S. Leadership

On January 18, the U.S. Chamber announced the launch of its Artificial Intelligence (AI) Commission on Competition, Inclusion, and Innovation to advance U.S. leadership in the use and regulation of AI technology. President and CEO Suzanne Clark stated upon the announcement:

“Artificial intelligence is rapidly changing how businesses operate, and this emerging technology can be a tremendous force for good in developing new medical treatments, identifying cyberthreats, expanding opportunities for the underserved, and making communities safer and more prosperous. Technological innovation is foundational to a thriving 21st century economy. We must leverage AI to compete globally, and we need reasonable and responsible rules governing the use of AI that harness its potential while effectively mitigating its risks.”

The Chamber’s AI Commission, co-chaired by former Rep. John Delaney (D-MD) and Rep. Mike Ferguson (R-NJ), will convene thought leaders with experience in government, industry, and civil society to address the advancement and challenges of adopting AI in communities across the country.

The Commission will request input from all relevant stakeholders, meet with top researchers, and conduct field hearings to see AI issues firsthand. The Commission will then recommend durable, bipartisan AI policy solutions to ensure the United States continues to lead in innovation while fostering fairness in deploying this revolutionary technology.

The Commission is composed of AI experts from the public and private sector as well as academia. Click here for a complete list of members. For more information on the Commission’s work, visit AmericanInnovators.com/AICommission.