A wide range of industries asked to be spared -- or protected -- in the first day of a U.S. Trade Representative office hearing on the proposed Chinese tariffs that to include more than 120 companies, a major union and many trade associations in sessions that run through Thursday. The agency will refine the list of products subject to 25 percent tariffs over China's alleged unfair trade practices. In testimony through Tuesday, Best Buy and Roku were among many opposing full-on IP tariffs. Mike Mohan, chief merchandise officer at Best Buy, dismissed the argument of General Counsel David Baer of TV maker Element Electronics, which supports keeping the proposed tariffs on finished TV sets from China. Tariffs could raise retail prices as much as 23 percent, Mohan said. Chas Smith of Roku, which employs 800 of its 900 worldwide employees in the U.S., said if fewer TVs are bought because of price increases from the tariffs, that will harm its ability to add more users. That won't just cut licensing fees from its Chinese manufacturing partners but also advertising and content distribution revenue, the hearing was told.
Mara Lee
Mara Lee, Senior Editor, is a reporter for International Trade Today and its sister publications Export Compliance Daily and Trade Law Daily. She joined the Warren Communications News staff in early 2018, after covering health policy, Midwestern Congressional delegations, and the Connecticut economy, insurance and manufacturing sectors for the Hartford Courant, the nation’s oldest continuously published newspaper (established 1674). Before arriving in Washington D.C. to cover Congress in 2005, she worked in Ohio, where she witnessed fervent presidential campaigning every four years.
Customs and Border Protection will launch a two-to-four-week pilot program on blockchain technology this fall related to North American Free Trade Agreement and Central America Free Trade Agreement certificate of origin processes, a CBP spokesman said. CBP needs to reach further back into the supply chain than just the exporter and can "message multiple partners via blockchain at the same time," he said. The agency and the Department of Homeland Security's Science and Technology Directorate will examine how much the blockchain system reduces duplicative data and whether multiple blockchain programs can communicate simultaneously. The pilot also has a goal of evaluating "the usefulness of blockchain for a law enforcement agency," the spokesman said. Advisory committee members (see 1708250025) helped to choose this pilot subject.
The Office of the U.S. Trade Representative proposed tariffs on some $50 billion worth of Chinese imports, with an accompanying list including some tech and telecom-related products. "Sectors subject to the proposed tariffs include industries such as aerospace, information and communication technology, robotics, and machinery," the USTR announced. The tariffs likely wouldn't take effect before June as a result of the administrative process. A result of a Trade Act Section 301 investigation, the levies are meant as a response to a pattern of forced technology transfers, intellectual property theft and cyber business espionage. The Chinese ambassador to the U.S. warned Monday that China would likely retaliate with tariffs of similar scope in response to Section 301 tariffs. We couldn't reach anyone right away Tuesday at that country's embassy. Tech groups have opposed the U.S. move (see 1803220043). Comments are due May 11, and there is a May 15 USTR hearing, at 10 a.m. in the main hearing room of the International Trade Commission, 500 E St. SW.
Customs and Border Protection needs more authority to combat counterfeiters, the Senate Finance Committee was told. Brenda Smith, executive assistant commissioner in CBP's Office of Trade, said it will take a few months of consultation with the private sector to say what kind of authority. Ranking member Ron Wyden, D-Ore., pressed for a deadline, and when Smith demurred, asked her to report back within 60 days. "I will do my best," she responded. Smith said Congress might also need to increase penalties for counterfeit goods. Finance Committee Chairman Orrin Hatch, R-Utah, told her, "We'll see what we can do to back you up and help you." The hearing highlighted a recent GAO report that 20 of 47 items ordered by auditors from online sellers were counterfeit (see 1803060042). CBP reported that intellectual property rights seizures rose again in FY 2017, though the dollar value fell. Wyden noted solving the counterfeiting issue "isn’t going to be as simple as putting a few more policy tools in CBP’s kit." Agency hiring difficulties hurt its ability to protect "U.S. consumers and businesses from illegal and unfairly traded goods," he said: "The internet has transformed" commerce and "CBP is too often playing catch-up ball tracking these fake products down." Smith said "the scope of the challenge is tremendous." Cooperation from package shippers is improving, she told senators. The agency receives advance electronic data from Chinese and Hong Kong mail services; 88 percent of counterfeits originate from those locales.