Category: Press Releases and Statements

NFTC Expresses Concern Over ‘Worldwide Debt Cap’ Rules in Proposed UK Tax Legislation

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Washington, DC – The National Foreign Trade Council (NFTC) today expressed concern over draft tax legislation currently under consideration in the United Kingdom (UK), which includes “worldwide debt cap” rules that would create a web of complexity and uncertainty for foreign investors. In a letter sent by NFTC President Bill Reinsch to UK Chancellor of the Exchequer Alistair Darling, MP, the NFTC expressed deep concern over the draft legislation.

“The proposed legislation is very wide reaching and complex, and its introduction in its current form would cause great uncertainty both for existing and potential inbound investors,” wrote Reinsch. “These factors will have a negative impact on the UK’s attractiveness as a location for inward investors and could lead to the overall foreign profits package (including the dividend exemption) being seen as making the UK less competitive in the international arena. Particularly in a time of recession, that cannot be a constructive policy for the UK.”

The NFTC letter also pointed out that the proposed rules would be both difficult to apply and administer, as they would require investors to generate many separate calculations, including some that must be made on a gross basis and others on a net basis. Further, the NFTC, noted that “the detailed calculations lead to unintended results and disallowances due to their complexity” and that “the time periods for making calculations and the associated additional returns are very restrictive and do not fit into the existing administrative framework, thus making all of the administration still more time-intensive (and prone to error).”

In addition, the NFTC questioned the rationale behind the rules, noting that the UK already has in place three other rules that restrict interest deductibility and add complexity for foreign investors – thin capitalization rules, the “unallowable purpose” rule, and the anti-arbitrage rules.

The NFTC suggested that the UK not adopt the worldwide debt cap rules now as proposed and instead continue to work with the private sector to make the proposed system less complex. “Given the current economic downturn, and significant losses being made by the banking and other sectors, we do not believe that a short delay in implementing the worldwide debt cap rules would adversely impact tax revenues,” wrote Reinsch.

“In short, we do hope that you will reconsider the introduction of the worldwide debt rules in their current form, except with the very broadest of safe harbors. There is much that is good in the foreign profits package, and that our members think is forward-looking. It would be unfortunate if the worldwide debt cap rules were to negate all of that, and, instead, discourage foreign investors,” Reinsch concluded.

To read a full copy of the letter, please click here.

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Advancing Global Commerce for Over 90 Years
The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.

 

NFTC Applauds President Obama’s Choice for Commerce Secretary

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Washington, D.C. – The National Foreign Trade Council (NFTC) today praised President Obama’s nomination of Senator Judd Gregg (R-NH) to serve as U.S. Commerce Secretary. NFTC President Bill Reinsch released the following statement.

“We congratulate Senator Gregg on his nomination and applaud President Obama for selecting such a seasoned veteran to take the helm at Commerce.

“As a third-term senator and an appropriator, he has vast knowledge and insight into the inner workings of Congress, and how he could best work with his colleagues on the other side of Pennsylvania Avenue as Commerce Secretary.

“Sen. Gregg consistently received solid scores in the NFTC’s annual Congressional rankings on support for liberalized U.S. trade and investment policies. While in Congress, he cast important trade votes, most recently voting in favor of free trade agreements with Peru and Oman, CAFTA-DR, and against imposing unilateral sanctions on Iran.

“There is much pressing work to do, including working with Congress and President Obama to stimulate the flow of commerce, manage the national transition to digital television and the 2010 Census.

“We look forward working with Commerce Secretary-designate Gregg to ensure future U.S. economic growth and prosperity for our workforce.”

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Advancing Global Commerce for Over 90 Years
The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.

NFTC Launches Global Innovation Forum

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Washington, DC The National Foreign Trade Council (NFTC) today launched a major new initiative designed to better protect and promote American jobs and ingenuity in todays increasingly challenging economy. The Global Innovation Forum will seek to create new opportunities and enable solutions to global challenges through effective protection and enforcement of intellectual property rights (IPR) worldwide.

The NFTC represents more than 300 companies, many of which are global innovation leaders that rely on intellectual property protection and a predictable global trade system to employ tens of millions of workers, said NFTC President Bill Reinsch. There are few more cost effective ways to stimulate the economy than to ensure a predictable global IP system that protects jobs. The U.S. Department of Commerce estimates that intellectual property accounts for half of American exports and 40% of U.S. economic growth, so it is critical that we have the appropriate resources, rules and enforcement of those rules in place to support these workers.

The Forum will initially focus on international policy issues related to fostering innovation and innovation job growth, intellectual property protection, technology transfer and efforts to address global challenges. The Forum will launch a Web site next month focused on these issues and intends to hold a series of meetings to advance a dialogue among innovative company representatives and workers, consumer groups, international development organizations and policymakers.

The global economic slowdown is creating new pressures on both innovators and consumers at a time when the world is confronting enormous challenges related to developing new energy solutions, improving public health, creating environmental sustainability, securing access to food and nutrition and raising global living standards, said John Stubbs, Executive Director of the Global Innovation Forum. These challenges will be met by the hard work of creative minds in the United States and around the world our goal is to provide a forum to advance policies that support that creative effort and promote active ecosystems for innovation.


About the NFTC

The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.

NFTC Cautions Against Global Protectionism in Response to Financial Crisis

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Encourages World Leaders to Fulfill G-20 Pledge

Washington DC – In response to a report released late last week by the World Trade Organization (WTO), which revealed that key U.S. trading partners are imposing higher tariffs on exports, NFTC Vice President for Global Trade Issues Jake Colvin today released the following statement.
 
“Two months ago, leaders of the G-20 nations convened in Washington to develop policies aimed at mitigating the impact of the global financial crisis.  In addition to other commitments, world leaders pledged not to put in place new protectionist tariff and non-tariff barriers to trade. 

“Today, as the new WTO report indicates, some nations are backtracking on their G-20 pledges.  Breaking the trade barriers promise threatens to undermine the global trading system and the credibility of the G-20.
 
“While the WTO report suggests that the impact of the crisis on tariff rates has been limited thus far, demands continue to mount for new and higher levels of protection.  India’s decision to raise steel tariffs, for example, has been met with calls by Indian industry for even higher tariffs. Brazil just announced new measures which require importers of cars, motor vehicles, wheat, capital and other goods to obtain ‘pre-approval’ prior to receiving goods from overseas. In the United States and around the world, overly-trade-restrictive ‘buy national’ provisions are being debated as part of stimulus and recovery packages.  The world’s response to the global financial crisis really has yet to be seen.

“We call on world leaders gathering in Davos this week and in London for the G-20 meeting in April to find new ways to build bridges to prosperity rather than erecting new walls that jeopardize the global trading system and economic growth.  Enforcing the ‘no new tariffs pledge’ and working towards a successful conclusion to the Doha Round of trade negotiations would contribute to global growth and help bolster the credibility of global institutions like the G-20.  As history tells us, erecting new trade barriers could worsen the global crisis.”

For a full copy of the WTO report, please click here.

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Advancing Global Commerce for Over 90 Years
The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.

Citing Preemption, USA*Engage and NFTC File Amicus Brief in Florida Travel Act Appeal

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Washington, DC – The National Foreign Trade Council (NFTC) and USA*Engage today filed an amicus curiae brief with the U.S. Court of Appeals for the Eleventh Circuit in support of the plaintiffs in the case of Faculty Senate of Florida International University vs. the State of Florida. The case revolves around the Florida Travel Act, a state law that inhibits academic travel from Florida to Cuba and other countries designated by the U.S. State Department as sponsors of international terrorism.
 
“Our support for the educators in this case stems from the NFTC’s longstanding view that federal government action preempts states on matters of foreign policy,” said NFTC President and USA*Engage Co-Chair Bill Reinsch. The arguments made in the brief refer to the landmark 2000 U.S. Supreme Court decision in Crosby v. NFTC, which struck down a Massachusetts Burma sanctions law on constitutional grounds.

The brief was authored by Paul D. Clement, a partner in the Washington, D.C. office of King & Spalding and former Solicitor General of the United States, a position he held from June 2005 until June 2008. 
 
In the brief, the organizations highlight that federal actions including the Trading With the Enemy Act, the Cuban Democracy Act and the Cuban Assets Control Regulations preempt the Florida Travel Act, but also argue, “even beyond the preemptive effect of the existing federal statutory and regulatory regime, the Florida Travel Act represents an impermissible effort by Florida to adopt its own distinct foreign policy.”
 
“The Constitution leaves little doubt as to which level of government was to address issues of ingress and egress with respect to our national borders,” reads the NFTC brief. “While states have the authority to adopt policies with incidental effects on foreign travel, there is nothing indirect or incidental about the Florida Travel Ban. It is an avowed effort to do the federal government one better when it comes to travel to state sponsors of terrorism. Under the constitutional scheme, Florida’s rejection of the national policy is plainly impermissible.”
 
The NFTC and USA*Engage also argue that though the Florida Travel Act was intended to address Cuba-related foreign policy concerns, the Act has a broader, more intrusive impact, as it applies to all state sponsors of terrorism, who are subject to varying federal regulatory and legal regimes.

For a full copy of the brief, please click here.

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Advancing Global Commerce for Over 90 Years
The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.

NFTC Applauds Proclamation to Implement U.S.-Peru FTA

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Washington, DC – The National Foreign Trade Council (NFTC) today welcomed the President’s signing of a proclamation to implement the U.S.-Peru Trade Promotion Agreement on February 1, 2009.

“We welcome today’s announcement regarding the entry into force of the U.S.-Peru FTA in just a matter of weeks. The agreement is well-crafted and was developed based on a bipartisan vision for U.S. trade policy,” said NFTC Vice President for Regional Trade Initiatives Chuck Dittrich. “We applaud the Peruvian government for its extraordinary efforts to work with the United States to put in place high standard commitments on labor rights and the environment. We praise both governments for working together to achieve implementation in a timely fashion.”

“The Peruvian market is dynamic and growing, and implementation of the FTA will provide numerous opportunities for U.S. businesses, from farms and small and medium-sized enterprises to the multinational corporations the NFTC represents,” said NFTC President Bill Reinsch. “During this time of economic uncertainty, expanding market access for U.S. goods and services is critical to ensuring that our exports play a role in our economic recovery.”

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Advancing Global Commerce for Over 90 Years
The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.

NFTC Welcomes Richard Sawaya as New Director of USA*Engage

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Washington, DC The National Foreign Trade Council (NFTC) today announced that Richard Sawaya will join the organization as the new Director of USA*Engage, effective January 19, 2009. In this role, he will oversee the advocacy efforts of the coalition, which was formed in 1997 to promote alternatives to the use of costly and ineffective unilateral U.S. sanctions. Sawaya will also work with the NFTC to press for reform of U.S. visa and entry policies and the export control system.

We welcome Richard to the team, and look forward to working with him to continue the important work of USA*Engage, said Del Renigar, Co-Chairman of USA*Engage and Corporate Counsel for International Policy & Trade Regulation for General Electric (GE) Company. Richard brings with him many years of experience in international affairs and will be key to our efforts to press for a U.S. foreign policy that includes the right balance of diplomacy, engagement and multilateralism.

Prior to joining USA*Engage, Sawaya served in a wide range of capacities, from leadership of key U.S. business organizations and associations to teaching and advocacy work in higher education. Sawaya joined Atlantic Richfield Company (ARCO) in 1979, where he remained until 2000, holding a number of positions, including Senior Speechwriter and Manager of Planning and Corporate Issues at the companys Los Angeles headquarters. He also served as Director of Government & Tax Affairs and Director of International Affairs in ARCOs Washington, D.C. office.

Sawaya led efforts to facilitate ARCOs legal re-entry into Iran and successfully positioned the company to negotiate exploration contracts with Azerbaijans state-owned oil company, as well as those of the Republic of Georgia and Turkey. He also worked on ARCOs participation in the Baku-Tbilisi-Ceyhan pipeline and secured the pivotal endorsement of the Gore-Chernomydrin Commission for ARCOs partnership with LUKoil.

Sawaya then founded the U.S.-Venezuela Business Council, focusing on U.S. corporate investment in Venezuela and the promotion of other business community priorities, including the 2001 bilateral tax treaty. Sawaya also served as Special Adviser to the President at the Fund for Peace, Director of Government Relations at the American Turkish Council, and as Special Representative on the Middle East for the Chevron Corporation.

Following these posts, Sawaya became Special Adviser to the President of George Washington University, and then Vice President for Government, International and Community Relations. Concurrently, Sawaya was an Associate Professorial Lecturer at the university, teaching undergraduate and graduate courses at the Elliott School of International Affairs and the university Honors Program.

Sawaya succeeds Susan Frank, who recently left USA*Engage in light of family obligations. Frank has joined Lockheed Martins PAE subsidiary as in-house counsel.

The NTFC and USA*Engage are sorry to announce Susans departure, and on behalf of our members we thank her for all of her contributions and wish her the very best in her next endeavor, said NFTC President and USA*Engage Co-Chair Bill Reinsch.

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About USA*Engage

USA*Engage (www.usaengage.org) is a coalition of small and large businesses, agriculture groups and trade associations working to seek alternatives to the proliferation of unilateral U.S. foreign policy sanctions and to promote the benefits of U.S. engagement abroad. Established in 1997 and organized under the National Foreign Trade Council (www.nftc.org), USA*Engage leads a campaign to inform policy-makers, opinion-leaders, and the public about the counterproductive nature of unilateral sanctions, the importance of exports and overseas investment for American competitiveness and jobs, and the role of American companies in promoting human rights and democracy world wide.

About NFTC

The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.

National Foreign Trade Council Welcomes U.S.-UAE 123 Agreement

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Washington DC – The National Foreign Trade Council (NFTC) today applauded the signing of the U.S.-United Arab Emirates (UAE) 123 Civilian Nuclear Agreement, and congratulated the two nations for working together to achieve such an historic accomplishment. In response to todays signing, the Council released the following statement:

We welcome the signing of the U.S.-UAE 123 Agreement because it is a win-win for both countries and our bilateral relationship, said NFTC President Bill Reinsch. For the UAE, the Agreement will go a long way in helping the country to diversify its energy supply at a time when demand for energy is outpacing the availability of its current resources. Similarly, the United States stands to gain from the Agreement as U.S. companies could play an important role in the development of the UAEs civilian nuclear program.

The United States and the UAE are both committed to peaceful nuclear programs and work in concert with other nations to discourage the proliferation of nuclear weapons, Reinsch continued. The UAEs commitment to operational transparency, participation in the full range of international nuclear non-proliferation cooperation arrangements, the creation of an independent nuclear regulatory authority and the renouncing of any intention to develop a domestic enrichment and reprocessing capability serves as a model for other nations to adopt responsible practices that enhance global nuclear non-proliferation goals.

According to NFTC Vice President for Regional Trade Initiatives Chuck Dittrich, The UAE has long been a critical U.S. ally and partner on the diplomatic front in helping to promote peace in the Middle East and the responsible use and development of nuclear technology. Just as significant is our longstanding bilateral economic relationship, which the Agreement will help to enhance.

With nearly $13 billion dollars in two-way trade in 2007 alone and the UAE serving as the largest market for U.S. exports in the region, the United States has a vested interest in taking steps to expand our bilateral relations, Dittrich stated.

In addition to welcoming the Agreement, the NFTC urged the incoming Administration to send it to Congress for consideration in a timely fashion.

The NFTC serves as the secretariat for the U.S.-Middle East Free Trade Coalition created to promote the expansion of free trade between the US and the Middle East and to encourage economic development, transparent and accountable governance, and enhanced prospects for the people of the Middle East region.

About the NFTC

The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves hundreds of member companies through its offices in Washington and New York.