In October 2021, President Biden announced the United States’ intention to pursue an “Indo-Pacific Economic Framework” (IPEF) as a means of strengthening U.S. ties in the Asian region.  Substantive discussions on the IPEF have not yet begun, and indeed, there has not yet been an announcement how the negotiations will be conducted or which nations will be involved.  Nevertheless, enough about this proposed framework of agreements has been announced that companies in the region can begin to prepare for the process.  This article will discuss what is known about the IPEF, why the current administration is taking this approach, and how countries in the Asian region may be affected by this new agreement.

By way of background, in February 2016, after years of negotiations, the Trans-Pacific Partnership (TPP) was signed.  The TPP covered 12 countries, including the United States, and was described as a high-standard “21st Century” trade agreement.  However, one of then-President Trump’s first actions in office was to withdraw the United States from the TPP.  The remaining TPP countries renegotiated the agreement without the United States (essentially removing certain elements of the agreement the United States alone had backed), and ultimately entered into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).  Since President Biden’s inauguration in January 2021, pressure has been building for the United States to reengage with Asia on economic and commercial matters.  The IPEF is the United States’ current policy response.

Continue Reading The Indo-Pacific Economic Framework: How the United States Intends to Re-Engage with Asia on Trade

2022 is shaping up to be a critical year for the Biden Administration regarding U.S. international trade policy.  In 2021, the Biden Administration made headway in resolving some of the challenges with United States’ allies that arose during the last Administration, and trying to build bridges in important regions that had perhaps had been neglected.  But in a number of other critical areas, and arguably in the most significant areas, the Biden Administration made little tangible progress over the past year.  The discussion below offers a look back at the key developments in 2021 with respect to U.S. trade relations with the EU, China, the rest of Asia and North America, and a look ahead at what could come in 2022.

Continue Reading The US International Trade Agenda: A Look Back, A Look Ahead

The German Federal Parliament has adopted a new Act on Corporate Due Diligence Responsibilities in Supply Chains (‘the Supply Chain Act’) on Friday, June 11, 2021, due to enter into effect on January 21, 2023.  By virtue of the Supply Chain Act, companies with a significant presence in Germany, as further explained below, must ensure compliance with human rights and environmental concerns in their business operations and impose equivalent due diligence responsibilities on their suppliers, irrespective of where they are located.

The Supply Chain Act could be of particular interest to the extractive industry, including oil and gas companies, and suppliers of the German automotive industry, but other industries will be affected as well given that the Act applies in principle across all sectors and covers both manufacturing and services, including, in principle, financial services.

Continue Reading Germany Introduces New Human Rights and Environmental Responsibilities for Parties in B2B-Relationships

This week Steptoe launched “Supply Chain University,” a series of short videos in which we dive into the legal, policy, and advocacy issues involving supply chains. As events over the past 18 months have shown, now more than ever, companies around the world are being forced to navigate challenges that threaten the operation—or, in some

On April 20, 2021, the US Department of Energy (“DOE”) revoked a December 2020 Prohibition Order issued by the Trump Administration which banned the acquisition, importation, transfer, or installation of certain bulk-power system (“BPS”) electric equipment manufactured or supplied by “persons owned by, controlled by, or subject to the jurisdiction or direction of the {People’s Republic of China (“China”)}.”  The Prohibition Order was issued pursuant to EO 13920, “Securing the United States Bulk-Power System” (May 1, 2020), which was promulgated to address “foreign adversary countries creating and exploiting vulnerabilities in the United States bulk-power system.”  In response to this alleged exploitation, the EO declared an emergency and authorized the Secretary of Energy to prohibit transactions involving certain BPS electric equipment sourced from “foreign adversary” countries for one year. In the recent revocation notice, DOE cited the need to “create a stable policy environment” while the Department conducts a new review of how best to apply its EO 13920 authorities.

Continue Reading US Department of Energy Revokes Trump Prohibition Order Restricting Chinese Bulk-Power System Electric Equipment and Seeks Comments on Securing US Critical Electric Infrastructure

In order to ensure that the United States possesses resilient supply chains that protect national security, meet America’s needs during emergencies and keep America competitive globally, the Biden Administration has issued an executive order on “America’s Supply Chains.” The order initiates two tiers of supply chain reviews: a 100-day supply chain review of four specific U.S. industries and a year-long review of six sector-wide U.S. supply chains. These reviews will lead to the issuance of reports by relevant agencies and departments that will analyze the current conditions of the respective supply chains and recommend steps to reduce reliance on specific countries for critical goods and services, and to avoid such reliance in the future.

The executive order is notable in that it represents the first serious attempt by the U.S. government to develop a comprehensive, government-wide policy on supply chains.  The fact that President Biden is taking this step during his second month in office only underscores the extent to which supply chains have become a critical issue in such a short period of time.

While the immediate cause of this increased focus may have been the pandemic, the text of the order evidences that the Administration’s concerns go beyond COVID.  Indeed, the U.S. government has been working on a new regulatory structure for the Information and Communications Technology and Services (“ICTS”) supply chain for over a year, as we previously advised here.

Continue Reading President Biden Signs Executive Order on US Supply Chains

On January 13, 2021 the US Department of Homeland Security’s Customs and Border Protection (CBP) announced that, effective immediately, all cotton and tomato products imported from China’s Xinjiang Uyghur Autonomous Region (XUAR) will be barred from entering the United States. The ban, officially called a Withhold Release Order (WRO), is “based on information that reasonably indicates the use of detainee or prison labor and situations of forced labor” according to CBP. This region-wide order joins a growing list of WROs targeting alleged forced labor in China.

Under this WRO, all cotton or tomato products originating from XUAR will be detained at all US ports of entry pending the submission to CBP within three months of entry of satisfactory proof that the products were not produced with forced labor. If CBP is unsatisfied with the provided evidence the products will be seized and potential civil and criminal investigations and penalties could occur. This particular WRO also includes apparel, textiles, tomato seeds, canned tomatoes, tomato sauce and other goods made with either cotton or tomatoes from XUAR. CBO has clarified that the WRO “applies to cotton and tomatoes grown in that region and to all products made in whole or in part using this cotton or these tomatoes, regardless of where the downstream products are produced.” Importers of record are responsible for ensuring no part of their product has cotton or tomato inputs that were harvested or produced at any point in their supply chain via forced labor from XUAR.

Continue Reading US Announces Region-Wide Ban on Cotton and Tomato Imports from Xinjiang

Recently-published reports from the U.S. government suggest that, due to COVID and U.S.-China trade tensions, U.S. policy is likely to continue a trend towards incentivizing supply chain de-coupling in the ICT sector where feasible.

On October 20, 2020, the Cyberspace Solarium Commission issued a white paper, “Building a Trusted Supply Chain,” that sets out a “five-pillar” plan to “reinvigorate American high-tech manufacturing and secure the United States’ Information and Communications Technologies (ICT) supply chains,” with a focus on materials, semiconductors, and finished ICT equipment. Established by Congress in 2018, the Commission is comprised of commissioners from both the public and private sectors and is co-chaired by Senator Angus King (I-ME) and Rep. Mike Gallagher (R-WI). This most recent white paper follows a lengthier report issued by the Commission in March 2020 that proposed a strategy of “layered cyber deterrence” as part of an ICT industrial base strategy to “reduce critical dependencies on untrusted” ICTs.

Continue Reading Recent Reports Suggest Supply Chain De-Coupling Policies Likely to Continue