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Journal of the united StateS SPrinG no. 1Vol. XXX,iVal BuSineSS Interna Iotna Bl usiness Human Trafficking in the Inside page 3 Chain Empowerin7 womenernet The nuts and bolts of exporting the first Peter M. Robinson, President and CEO, USCIB word For the online world to continue to grow and prosper, we need to ensure integrity and policy coherence. Ensuring a Dynamic and Secure Internet R eading the news recently – with social media’s explosive role in the Arabess is also closely engaged in discussions surrounding a new White spring, increasingly sophisticated cyber-attacks, and recurring uproars overonsumer privacy bill of rights” and related U.S. efforts to promote privacy – you might think the Internet is flying apart in all directions.e security and innovation. We are heartened that the Obama administra- But in fact, things are converging. The world is increasingly data-driven.as recognized the importance of ensuring international interoperability, including recently agreed OECD Internet principles and APEC cross-border Public reliance on the global Internet as a channel for essential coprivacy rules to which USCIB and business have contributed mightily (see the tion and information has increased exponentiallyCross-border data flows continue to grow, as does the proliferation of mobile devices. This meansissue of International Business). that how the Internet is managed is now everybody’s business. Equally important, we are working hard to ensure the continued integrity of the global Internet and fight back against efforts to fragment it. This will be So it’s important that we all – businesses, governments, consumers, every- one – look closely at proposals to shift responsibility for Internet governances we approach the WCIT conference, and also at the UN’s Internet Governance Forum (IGF), which takes place in November in Baku, Azerbaijan. away from the multi-stakeholder model, which has held sway for over The IGF has been an essential bulwark for the multi-stakeholder approach, decade, toward a more government-dominated approach. engaging business, civil society and the Internet technical community along This will be a core topic at December’s World Conference on Internationalgovernments in discussions on a range of Internet policy issues, and Telecommunications (WCIT) in Dubai. The treaty conference is convenedocusing on building capacity across all groups to address challenges and by the UN’s International Telecommunications Union, and many have voicedre continued growth, investment and innovation. concern at proposals by Russia and some Arab countries to increase tWCIT has the potential to open the door for greater government involve- ITU’s authority. As an alternative, USCIB and its sister business organizations around the world are pushing hard to maintain and reinforce a vibrant multi-a the ITU, in regulating the Internet, for example through proposals to broaden the definition of “telecommunications” to encompass the entire stakeholder model. Internet. Such proposals may seem incremental, but they would really prove Why? In two words, interoperability and integrity.intBeyroperability, welutionary and quite damaging. mean policy coherence, ensuring that national and regional policy regimes Business believes that the existing ITU mandate is sufficient for it to continue work in concert with each other.ntegrity, we mean avoiding the frag-to perform its essential work in regulating global telecommunications – tra- mentation of the global Internet into many separate networks. The digital economy can’t function without both of these, and with more and more of ourlly a heavily regulated field, after all. But the Internet has grown and prospered, and we along with it, precisely because it has been lightly regu- lives now taking place online, neither could a lot of things. lated and effectively governed via the multi-stakeholder model. Now is not To ensure continued interoperability, USCIB and allied groups are engagingme to throw that all away. closely with policymakers to update the OECD’s privacy guidelines, the in- As a broad-based, multi-sectoral organization with links to essential global ternational standard for privacy protection, which date to 1980, befpolicy platforms, USCIB has long played a vanguard role in representing in- widespread use of personal computers, much less the Internet, cloud com- dustry in this critical area. We look forward to working with our members to puting and the rise of “big data,” in a way that maintains the origipromote a dynamic and secure Internet. useful principles. . We are also focusing business attention on proposed new privacy regulations in the European Union, which have the potential – if done right – to harmonize rules and increase legal certainty throughout Europe. But if done wrong, the new rules could hamper Europe’s economic recovery and prove difficult to implement. Contact Peter Robinson at (212) 703-5046 or probinson@usci..or USCIB International Business Spring 2012 www.uscib.org 2 Forum Examines Human Trafficking’s Impact on Supply Chains A n estimated 27 million people worldwide are victims of human trafficking, which can take many forms – affecting men, women and children – and is making its presence felt in global supply chains. To help companies understand the scope of the problem and take appropriate steps to address it, USCIB joined with the U.S. Chamber of Commerce and the International Organization of Employers, part of our global network, to organize a February forum,“Engaging Business: Addressing Human Trafficking in Labor Sourcing,” at the Atlanta headquarters of The Coca-Cola Company.: Ronnie Goldberg (USCIB), Christine Bader (Kennan Institute), David Arkless (ManpowerGroup), Letty Ashworth (Delta Airlines), Dirk Vande Beek (Travelport) Common forms of human trafficking include bonded labor, debt bondage, The prohibition of human trafficking is a human right that requires immediate fraud, coercion, and other forms of modern slavery. Often it involves migra- tion of legal workers – within a country and across borders – who have beenof supply chains by business, and mitigating action where it misled by recruiters into assuming coercive debt and loss of their travelAtlanta program focused on potential business impacts, national and international legal trends, networks, strategies and best practices for papers. The Atlanta forum focused on trafficking in the workpeliminating human trafficking in labor sourcing. Attendees gained a better via labor sourcing. understanding of the various forms of human trafficking in labor sourcing, Human trafficking is increasingly being targeted by policy mathe scope of legal and stakeholder expectations, and how to identify and lators. In 2000, the United Nations adopted the Palermo Protoaddress instances of human trafficking in labor sourcing. Organized Crime Convention, and the United States enacted the Trafficking Also at the forum, USCIB member ManpowerGroup and the NGO Verite Victims Protection Act. Three-quarters of the world’s nations have ratified the Palermo treaty, and two-thirds have passed laws against trafficking. In guide to help companies prevent trafficking in their addition, since the beginning of this year, the California Transparency ing,“An Ethical Framework for Cross-Border Labor Recruitment,” a detailed framework for combating human trafficking Supply Chains Act requires California manufacturers and retailers with over $100 million in annual worldwide gross receipts to disclose their efforts tor. eliminate slavery and human trafficking from their direct supply chains. “Today’s environment requires businesses to be global and talent to be mobile, therefore ManpowerGroup has made it a priority to be at the fore- front of ensuring that global recruitment markets operate transparently and ethically,” saidDavid Arkless, ManpowerGroup’s president of global corporate and government affairs. “Leading firms already commit to high ethical standards, but too many other operators exploit workers through re- cruitment debt, fraudulent contract substitution, and other forms of abuse. And even well-intentioned businesses face reputational risk from unwittingly becoming entangled with unethical partners.” It was clear from the presentations and discussion at the forum that, while this is a highly complex issue, there are steps that companies can and should take to minimize the risk of trafficking in activities linked to their operations. Kevin Bales, president of the NGO Free the Slaves USCIB International Business Spring 2012 www.uscib.org 3 Looking Toward the Rio+20 Earth Summit W ith just a few months to go, the UN Conference on Sustelrpen Dialogues ment in Rio de Janeiro is still a largely unknown quantity foWorking through the United States Council Foundation, USCIB members and munity. The June 20-22 event has been dubbed “Rio+20,” since it comes two others in the policy community are developing business perspectives and aca- decades years after the UN’s seminal 1992 Earth Summit in thedemic input on green economy policy input een Economies Dia- logue project (www.green-dialogue.org). According toNorine Kennedy, USCIB’s vice president for environment and energy, as negotiated in numerous preparatory sessions, the aDialogue meetings were planned for March and April in Beijing, Tokyo and Rio+20 is broad but vague, encompassing “the green economy,” “institutional in Brasilia, following successful meetings in Washington and Paris last fall. frameworks” and “emerging issues.” USCIB is also working directly with These remain largely empty outlines – the U.S. State Department and the although there are a wealth of proposals Obama administration on an array from governments and NGOs. of issues expected to be front-and- “Inanticipationoflast-minuteandintense center in Rio. preparation between now and the sum- An additional component of the Green mit, USCIB is focusing on the main busi- Economies Dialogue project is the ness issues on the table, and is working commissioning of more than a dozen to engage its members in shaping prep- peer-reviewed research papers to be arations for the event and influencing published in the joul nvironmen- its expected outcomes, mainly through tal Economics prior to Rio+20. dialogue with the Obama administration, UN officials and other international policy makers,” Kennedy said. efforts to organize business input to the Rio+20 process include Business Action for Sustainable Development 2012 (BASD2012) – a joint In January, USCIB provided business input for the so-called “effort between the International Chamber of Commerce, the World Busi- cussed at UN meetings in New York – both directly and in a joint submission ness Council for Sustainable Development, the UN Global Compact and with several other business groobert Hormats, under-secretaryseveral other business organizations – as well as the UN Global Compact in state for economic, energy, and agriculture affairs – seekingits own right.busi- ness community’s official role in the summit. In follow-up, Hormats met with USCIB’s Environment Committee in March. The international symbol for opportunity Women represent the largest emerging market in our world and the greatest natural resource for knowledge, talent and investment. They serve as an untapped resource of spending power, an educated and diverse source of talent for private and public institutions, and role models who can be an inspiration to billions of women and men worldwide. An opportunity exists to better weave women’s experiences, perspectives and voices into the fabric of organizations and systems. Deloitte is proud to support the engagement of USCIB and BIAC with the OECD’s Gender Initiative. Learn more at www.deloitte.com. © 2012 Deloitte Global Services Limited USCIB International Business Spring 2012 www.uscib.org 4 Business Presses for China Market Access D uring Chinese Vice Preti Linping’s February visit to the Unitednoted progress by China toward closer bilateral ties with other States, USCIB urged leaders from the U.S. and China to tackle importantncluding the signature of a trade and investment agreement with commercial and economic matters in order to keep this mutually beneficialk prior to Xi’s visit to the U.S. relationship on an even keel. “We should be looking seriously at developing new agreements, such as a “The U.S.-China relationship extends across an array of geopolitical as wellent treaty with China,” he said. “These could ensure contin- as economic issues, and our economies are now deeply intertwined,” statedtion of key markets and provide important security to American USCIB President and CPeter M. Robinson. “On balance, it providestments in the country. Absent such agreements, American companies significant benefits for both countries. However, there remain too manycould be disadvantaged when competing in China with compa- commercial and economic issues handicapping the ability of American firmstries already benefitting from such agreements. We shouldn’t to compete in China and in third markets, thereby placing our workers at the sidelines.” a disadvantage and impeding progress on the overall relatioRobinson also called attention to an October USCIB statement on Chi- need to be urgently addressed.” na’s compliance with its WTO accession commitments. “As we noted Robinson said major trade and investment priorities for American companies in that statement, China has made in China include, but are not limited to: important progress, but much work “We shouldn’t remains. Priority issues include improv- • improving market access for key industries • resolving longstanding currency disputes be sitting on ing transparency in China’s regulatory • improving protection of intellectual property rights, and environment, the need for fair and in- the sidelines.” dependent regulators, greater market • ensuring competitive neutrality for state-owned enterprises. access, non-discriminatory treatment “We urge the two governments to focus on resolving these issues through and inadequate intellectual property diplomatic means, both bilateral and multilateral, and to rlaws. We urge the U.S. and Chinese governments to take up these issues forums like the WTO, the Strategic and Economic Dialogue, aon a priority basis, and we stand ready to provide business views to help Commission on Commerce and Trade,” he said. ensure a fully informed discussion.” USCIB International Business Spring 2012 www.uscib.org 5 Business Applauds Rollback of Ex-Im Bank Reauthorization Urged Foreign Trade Zone Changes USCIB joined with a number of other industry groups in February to urge quick passage of the four-year reau- thorization bill for the Export-Import Bank of the United I nFebruary,USCIBapplaudedtheObama and other industry groups had expressed States. administration’s announced rollback oserious concern about this proposed planned changes to the rules governinchange. In a joint letter toPresident Obama, the groups said U.S. foreign trade zones (FTZs). USCIB that “failure to reauthorize Ex-Im would amount to “Our message all along has been that thenilateral disarmament in the face of other nations’ ag- had earlier said some of the proposed gressive trade finance programs.” Furthermore, failure changes would impose significant hurdleseign Trade Zone Board should strongly for exporters. promote, rather than inhibit, U.S. exports,eauthorize Ex-Im’s operations at an internationally and avoid taking steps that would resultompetitive level would disadvantage small and large The U.S. Foreign Trade Zone Board, anin a loss of manufacturing jobs in foreign. companies in foreign markets, potentially result- ing in the loss of thousands of U.S. jobs. In fiscal year teragency body chaired by the Commerctrade zones,” said USCIB President and Department, recently published final CEOPeter M. Robinson. “The proposed 2011, Ex-Im supported export sales that created or sus- lations that replace the current FTZ change would have negatively affected theined approximately 290,000 U.S. jobs at over 3,600 ulations. The new rules do away with a companies. ability of U.S. manufacturers to process proposed change that would have requimaterials for export, which runs countern a February speech to workers at USCIB member com- advance approval to bring goods into to the purpose of a foreign trade zone.”any Boeing, Mr. Obama pledged to boost support for for manufacture, even for export, that U.S. foreign trade zones accounted for U.S. manufacturers facing subsidized foreign competi- would, if entered for consumption, be sub- tion, in part through expanded Ex-Im financing for U.S. ject to antidumping or countervailing duty billion in exports in 2010 and emfacing competition from state-subsidized firms. orders. In an October statement, USCIB ploy some 330,000 American workers. McGraw-Hill is proud to support the United States Council for International Business for its global business leadership. USCIB International Business Spring 2012 www.uscib.org 6 OECD Gender Initiative Gains Business Support M ao Zedong famously commented that women hold up half the sky. For business executives and policy makers facing an increasingly complex global economy and the need to energize job creation, women are a critical resource, both as an emerging market and as a significant, often untapped pool of human talent. Against this backdrop, BIAC – the Business and Industry Advisory Committee to the OECD, part of USCIB’s global network – joined with AmCham France and the OECD to welcome some 100 experts from business, government USCIB’s Ronnie Goldberg (center) and U.S. Ambassador to the OECD Karen Kornbluh (right) and international organizations to a February workshop“T onhe Business Case for Women’s Economic Empowerment” at the OECD Conference Center in Paris. U.S. Ambassador to the OECK Daren Kornbluh and OECD Deputy Secre- tary GeneralYves Leterme thanked BIAC and AmCham for the initiative of Chaired by BIAC Chairman and USCIB board memb Cehrarles Heeter (Deloitte),thegatheringprovidedbusinessperspectivesandbestpracticesto organizing the workshop, highlighting the importance of business perspec- tive in effective policy development. the OECD Gender Initiative, a multi-disciplinary program to update indicators, analyze policy experiences and recommend good practices to achieve “By focusing on ‘the how, not the why’ for creating economic opportunity for greater gender equality in education, employment and entrepreneurship. women, BIAC’s business workshop has greatly assisted the United States Ronnie Goldberg, USCIB’s executive vice president and senior policy and other OECD member countries in our efforts to show that countries can officer, participated in the workshop. increase equity and growth by harnessing women’s talents, innovation and leadership,” Kornbluh stated. “We are fortunate to live at a time when technology, the internet and mobility enable information sharing, communications and resource allocation that USCIB’s Goldberg observed that recent discussions, including the BIAC can help advance gender equality,” said Heeter. “Nevertheless, despite thisorkshop, supported the view that the old analogy of a “glass ceiling” is out positive environment and past efforts over decades to advance economic of date. “From the perspective of women in the workplace, as well as soci- empowerment of women, progress has been slow. Today’s workshop was ety as a whole, we are increasingly faced with a ‘leaky pipe,’ where women, an important opportunity for business to contribute to OECD efforts to ac-for a variety of reasons, are forced out or remove themselves from the labor celerate change on this issue.” force,” she said. “We need to find ways to patch that pipe.” Global Reach and a World of Experience with a 138-year legacy, an established international presence and comprehensive knowledge of diverse legal disciplines, Shearman & Sterling offers a sophisticated, integrated approach to m&A that meets the needs of today’s marketplace. our strong presence in key world markets allows us to provide the highest standard of m&A advice both internationally and domestically. Abu DhAbi | beijing | bruSSel| üD SSelDorF |rF AnkFurt | hong kong | lonDon | mil An | munich | new York pAloAlto | pAriS | r ome | SA nFrAnciSco | São pAulo | ShA nghAi| SingA pore| tokYo | t oronto | wAShingtoDc www.shearman.com USCIB International Business Spring 2012 www.us7ib.org global network Business and Industry Advisory International Chamber Committee to the OECD of Commerce www.biac.org www.iccwbo.org Business World Economic Welcomes Joint Climate Brightens Action on FATCA Slightly In February, BIAC welcomed a joint According to the latest World Economic statement by the United States, France, Survey, published by ICC and the Munich- Germany, Italy, Spain and the United based Ifo Institute for Economic Research, Kingdom to develop an intergovernmen- the global economic climate has begun to tal approach to the implementation of improve after two quarters of successive the U.S. Foreign Account Tax Compliance decline, although it still remains significantly Act (FATCA). Chris Lenon, chair of the below its long-term average. The January BIAC Committee on Taxation and Fiscal survey polled 1,129 economic experts Affairs, complimented governments on from business and academic institutions the multilateral approach taken by the in 120 countries to assess current and signatory countries toward improving expected economic developments. Their international tax compliance. answers were analyzed to reach a quarterly figure representative of the current Fostering Private global economic climate with an overall Sector-Led Growth improvement driven by a more optimistic six-month outlook than the previous ICC-Ifo Against the backdrop of the eurozone crisis and high rates of long-term survey in October of last year. unemployment in many countries, BIAC G20 Business Task devoted its January consultation with OECD ambassadors to what is needed Forces Launched for to foster private sector-led economic Mexico Summit USCIB at Your Service growth and development. Led by BIAC At the annual Davos gathering, the ICC joined USCIB Policy and Program Chairman and USCIB board member 212-703-5082 with the World Economic Forum in organizing Charles P. Heeter (Deloitte), executives a number of business task forces designed USCIB President’s Office highlighted the need for urgent, decisive to fuel this June’s B20 business summit, held 212-703-5049 and collective international policy USCIB Member Services in concert with the 2012 G20 Summit in Los responses by governments in order to Cabos, Mexico. USCIB Chairman Harold 202-682-1291 regain market confidence and private- McGraw III is a vice chair of the world USCIB Communications sector investment. At the same time, 212-703-5063 business body and is a member of ICC’s G20 they said, action must be taken to foster Advisory Group. In Davos, Mexican President USCIB Washington Office development and to attain sustainable Felipe Calderon invited ICC Secretary 202-371-1316 growth for the widest number of General Jean-Guy Carrier to take part in ATA Carnet Export Service countries globally. The role played by a breakfast meeting to launch task forces, 1-800-5-DUTYFREE the private sector in terms of trade, which aim to provide recommendations ICC Arbitration and Dispute investment and job creation is essential from global business to G20 leaders on Resolution in both cases, and is supported by key issues, in preparation for the next B20 212-703-5044 closer cooperation among governments, Business Summit. ICC Books USA especially at the G20 level. 212-703-5066 Visit www.uscib.org for a full list of staff including e-mail addresses (click “Business Services”) USCIB International Business Spring 2012 www.uscib.org 8 Working to Break Deadlock washington wire in Global Trade Talks Business leaders and trade experts met in Geneva in March for the first conference on the ICC Business World Trade Agenda, an initiative aiming to ensure that business works together with governments to drive more effective trade talks. More than 70 business “Robust” Trans-Pacific plan. USCIB President and CEO Peter Partnership Sought M. Robinson stated: “The international experts, including CEOs, senior corporate executives provisions fail to recognize that U.S. and representatives of business organizations, USCIB joined 30 other leading U.S. together with World Trade Organization Director business associations in February business competes for customers in in pressing for an ambitious and the global marketplace. While most General Pascal Lamy, took part in the event. USCIB was represented by Chairman Harold McGraw III comprehensive Trans-Pacific countries have adopted territorial Partnership agreement, with robust systems seeking to facilitate the and Senior Vice President Rob Mulligan as well as competitiveness of their multinationals a number of member executives. Global business enforcement and dispute settlement leaders involved in this initiative aimed to define provisions. The business groups made by taxing income only where it is their case in a letter to President earned, the U.S. is going in the multilateral trade negotiation priorities for business, and to help governments set a trade policy agenda Obama in which they urged the United opposite direction. By proposing a States to push back strongly against minimum tax on foreign earnings, a for the 21st century that contributes to tax on so-called ‘excess profits’ and economic growth and job creation. Australian resistance to investor- state dispute settlement mechanisms the disallowance of interest expense, like those found in other U.S. trade the administration proposes a step agreements. The letter pointed out backward.” that investor-state provisions are Call for Policies to already included in thousands of trade Support Investment agreements and related instruments International Organization worldwide, including many to which USCIB welcomed President Obama’s of Employers call, in his January State of the Union www.ioe-emp.org Australia is a party. Such provisions, the business associations said, address, for closer international coop- eration and expanded trade in support “promote the rule of law and serve of American jobs and economic growth. CSR Newsletter Launched as an important backstop to ensure that investors who risk their capital, In a statement, USCIB noted that the The IOE in March launched a newsletter dedicated business community, including the property and talent in foreign countries to corporate social responsibility and the business will be able to enforce due process, U.S.-based global companies that make responsibility for human rights. Coming off a up the core of USCIB’s membership, highly successful forum in Atlanta, organized with non-discrimination, basic property was “contributing actively to this cause and related protections in a neutral, USCIB (see page 3), the new publication looks at balanced and objective forum.” USCIB already through exports, R&D and other developments in the UN and OECD, national policy measures to increase our competitive- co-chairs the TPP Business Coalition’s issues in India and other states, and a new IOE investment committee, reflecting its ness in fast-growing overseas markets.” Employers Guide to the UN Guiding Principles on USCIB added: “U.S. businesses now Business and Human Rights. USCIB members should role as a premier voice for liberalizationoperate in a world of highly competitive, of both trade and investment regimes contact Adam Greene (firstname.lastname@example.org) to around the world. multi-country supply chains. Their suc- subscribe. cess serving overseas markets drives Obama Tax Proposals employment, R&D and growth at home. a “Step Backward” The Administration and Congress must Reacting to the president’s proposals in take steps to recognize the benefits February on business tax reform, USCIB of both inbound and outbound invest- applauded the overall goal of lower ment to our economy, support such rates and a more efficient corporate tax investments, and avoid measures that system, but expressed disappointment penalize companies seeking to remain with the international aspects of the competitive in global markets.” USCIB International Business Spring 2012 www.uscib.org 9 A Gloomy Outlook for Trade Finance N ew research published in January by the International Chamber of.S. financial institutions may exacerbate the situation, since trade Commerce (ICC) and the International Monetary Fund (IMF) has revealed ad largely denominated in U.S. dollars. pessimistic outlook for demand for trade finance products like letters of Many respondents noted that one of the challenges facing the global credit in 2012, largely as the result of the Euro crisis. economy was a more stringent regulatory environment – as represented Based upon input from 337 financial institutions responding to a joint ICC-Basel III capital framework – which may impede a trade-led IMF survey, the findings also show a two-speed financial system: For emerg-his was of particular concern, as many countries were at- ing Asia the outlook is the strongest, while the Euro area is the weakest.o export their way out of their currently dire economic condi- Around 60 percent of respondents indicated that the demand for trade inRecent measures taken by multilateral development banks and Asia will show improvement in 2012, while close to 50 percent of respon-banks to facilitate trade were perceived to be of some help. For dents predicted a further deterioration for the Euro area. instance, on the issue of the reactivation of central bank swap lines, close to 60 percent of respondents indicated that the swap lines have “These results illustrate how far, and how fast, the ripples frohelped, but about one fifth were not sure. crisis are spreading,” saidMichael F. Quinn, managing director with JP Morgan Global Trade and chair of USCIB’s Banking Committee. “Theparation for the implementation of Basel III seems to be already add- ing pressure on the cost of funds and the availability of liquidity. Close to withdrawal of European banks from global trade finance has had a major impact on the ability of companies to arrange for trade finance in manyuarters of respondents said they felt impacted either to some or markets, and we expect this to continue into the future.” to a large extent. Specifically, by not treating trade finance as a low-risk asset class from a regulatory perspective, the new Basel capital frame- Factors contributing to the negative outlook for 2012 were primarily fi- work could make trade finance less accessible and less affordable to ex- nancial constraints that reduce the availability of trade financporters and importers, especially small- and medium-sized enterprises. particularly acute for large banks and those with business in developing countries. Some 90 percent of respondents indicated that “less creditese circumstances, there is an urgent need for durable solutions to be forged at the international level. “The pursuit of essential public or liquidity available at counterparty banks” would affect their trade finance activities either to a “large extent” or to “some extent.” This and regulatory reforms is crucial in 2012 and beyond,” said Kah Chye Tan, global head of trade and working capital at Barclays share is substantially higher than the just over 50 percent thatCorporate in London and chair of ICC’s Banking Commission. “We cau- same during the 2008-2009 financial crisis. tion the use of uncoordinated national initiatives and the layering of The financial constraints appeared to reflect the large share ofregulatory requirements which may pressure trade flows and eventually finance coming from Euro-area banks. The survey showed that recenegatively impact on growth worldwide. This new ICC-IMF research calls European bank deleveraging has led to tighter lending guidelineson standard setters and policy makers to carefully study the potential reduced availability of credit/liquidity. In addition, U.S. dollar funding for unforeseen impact of proposed Basel III changes on trade finance.” With you when you have needs of global proportions Import-export banking is our business. Rely on our network of trade and finance professionals to help connect you to the world. We have local knowledge, key contacts, and financial resources to support your global business. With a network covering important markets in Asia, Europe, and the Americas, we have the strength and experience to help you navigate the complexities of global trade today. Contact us 212-315-7289Gpatrick.email@example.com © 2011 Wells Fargo Bank, N.A. All rights reserved. Member FDIC. USCIB International Business Spring 2012 www.uscib.org 10 Texans Lasso Mediation Asia-Pacific Arbitration Community Competition Gathers in San Francisco After five days of intense competition in February, South Texas College of Law, emerged victorious in the battle to win the 7th ICC International Com- O ver the three days in San Francisco incontinued throughout the following day.l Mediation Competition. South Texas beat March, the North American and Asian regionalarticipants heard from a savvy corporateetitors Bar Ilan University of Israel, in offices of the ICC International Court of Arbitra- gave practical tips on dispute most challenging mediation competition to tion hosted its annual conference and relatedtion in the Asia-Pacific region, and from events, attended by members and enthusiastskers on such topics as arbitratioThe two schools thrilled an international audience of the arbitration community from North Ameri- property disputes, third partof over 250 people in the competition final, which ca, the Asia-Pacific region and Europe.of arbitrations, arbitrator selection and enforc- ing an arbitral award in light of strict sovereign the Maison du Barreau in Paris. The program began with a Young Arbitratimmunity laws, among others. Featuring over 140 mock mediation sessions, Forum (YAF) discussion, where four young rising based on real cross-border commercial disputes, stars of arbitration spoke about the differencesber of the attendees and thethe competition tested the problem-solving skills in their experiences while practicing in both Asiat I have ever experienced of 66 teams from 32 countries including teams and in North America.An impromptu guestence,” saidMary Comeau of CaSyt.even from Brazil, Singapore, the United States and panelist, ICC Court PresidenJtohn Beechey,th, a partner at O’Melveny & MeyerAustralia. joined the YAF and offered a seasoned view onlongtime supporter of the conference, the subject. called this year’s program “fantastic.”e aim of the annual competition is to train law and business students to better meet the dispute After the YAF event, the participants and other glowing accolades and cuttinresolution needs of today’s global market, to conference registrants, gathered at the con-s,Cedric Chao, a partner at Morrknow how and when to efficiently use mediation, ference welcome reception held at the Sanerster and also a longtime conferenand how to deal with the cultural sensitivities Francisco offices of Morrison & Foerster LLP., stated, “Our collective goal should be Guests were treated to an array of northernrow this conference into a ‘must attend’ in this process. It gives students an op- portunity to test their problem-solving skills in California delicacies, such as local cheeses,” international commercial cases in which they chocolates and tastings of local wines.ICC’s Fourth Annual Asia-Pacific Conference isrole of client and counsel, while some of The conference commenced the morning ofscheduled to be held in May 2013 in Seoul,orld’s leading mediators participate to help March9,atSanFrancisco’sstoriedPalaceHotel,th Korea. the students work towards good solutions. Spend le SStime with cu Stom S, more time with cu Stomer S. Save money on import duties and taxes and save time clearing sm customs with an ATA Carnet for your boomerang freight . Contact us: (800) 282-2900 ATACarnet.com Corporation for International Business. An ATA Carnet Service Provider to USCIB USCIB International Business Spring 2112 www.uscib.org The Nuts and Bolts of Getting Equipment Overseas By Bill Armbruster for USCIB When you are traveling with high-value goods overseas, it helps to have thingsies and VATs (value-added taxes) vary widely around the world. In nailed down in advance. the European Union, the minimum VAT is 15 percent with Finland at 23 percent. Gregory Young, vice president of International Bolting Technologies Inc.,ico, the VAT ranges from 10 to 16 percent. Duty is imposed on top of the VAT. remembers the hassles he used to have when traveling outside the U.S. to demonstrate to potential foreign customers sophisticated electronic equipment.s an expensive, cigar box-sized device. Carrying it by hand, before To ensure that the product cleared Customs, Young hired a Customs broker in thesing Carnets, caused Young a lot of anxiety, as he was often required foreign country to file documents for temporary admission and airfreighted theto surrender physical possession of the unit. “Customs forms ask equipment four weeks before his (Young’s) arrival to demonstrate the equipment.have any commercial merchandise to declare. Due to the high value Once the job was complete, he again airfreighted the product back to the U.S.ds, Customs would take them from me and place them in storage, using a second broker to clear U.S. customs. leaving me with just a receipt. They would only return the goods after a customs broker had filed the necessary documents for temporary admission,” Young “Depending on the country, those steps alone could cost up to $2,00says. “Customs clearance could take days, depending on the country,” he adds. Young. “Furthermore, many countries require that goods brought in under With the Carnet, Young carries the USM-3 with him and clears customs without temporary admission be returned to their original point of entry, sthe aid of a broker. multi-country trip is not practical.” Young has used Carnets five times, most recently in October on a trip to the The USM-3 Ultrasonic Bolt Meter measures bolt stretch, as little as 0.00001 inch or 0.0001 millimeter, and diagnoses problems caused by the over- or under-tional Mining Expo in Acapulco, Mexico. “The Carnet made everything a lot smoother,” he says, noting that the equipment attracted considerable tightening of bolts. “Improper bolt stretch can result in catastropattention. He expects the leads he developed at the Acapulco show will translate adds Young. Industries using the USM-3 range from aerospace – it was used on the payload of a space shuttle mission to repair the Hubble space telescopefor his three-person company. Exports account for about half of its business, so by cutting red tape, Carnets allow Young to concentrate on sales. – to automotive, mining and petrochemical refineries.International Bolting Technologies, based in Orange City, Florida, is a distributor for Norbar USA,s that it only takes two or three days to receive his Carnet from USCIB which manufactures the bolt meter in Connecticut. after he applies for it. “It’s a short turnaround, and it’s very affordable,” he says. Carnets cost $215 to $355, depending on the value of the product. “The people In 2008, when a customer recommended to Young that he try an ATA Caat USCIB are very professional and very helpful,” citing, in particular, Carnet for demonstrating his equipment to Finland and Russia to potential customers there, Young was all ears. “The U.S. Export-Import Bank had mentioned the ATAristi Bang and Fred Mardis. Carnet to me previously, but at that time I did not grasp how it could truly benefitt his next overseas trip will be a two-week visit to three or four my situation,” Young says. countries in Europe next May. Asked whether he plans to use the Carnet then, he replied, “Absolutely. It would be too time-consuming and expensive to go back How it works to the old method. I would never even consider taking one of my products to An ATA Carnet is an internationally agreed customs document that alanother country without a Carnet.” temporary tax- and duty-free entry of goods into 71 countries. USCIB administers To learn more about ATA Carnets, visit www.merchandisepassport.org Carnets in the United States, under appointment by U.S. Customs and Border Protection. USCIB International Business Spring 2012 www.uscib.org 12 USCIB member and staff news Adam Greene, USCIB’s vice president for Point, a State Department official who leads labor and corporate responsibility, has been the United States work under the Guidelines. named to a State Department advisory body For more information, please visit www.state. on the OECD Guidelines for Multinational Egov/usncp. prises. Joining Adam on the paneislifford Henry, associate director of corporate sus-ason Cox has joined USCIB as a foreign tainable development with Procter & Gambleclaims examiner for our ATA Carnet depart- ment. Jason will issue Carnets along with three and chair of USCIB’s Corporate Responsibility Committee. The OECD Guidelines are volun- other Foreign Claims Examiners. He is a recent tary recommendations from governments to graduate from the University of MaryA.l- exandra Akerly is the new executive assistant multinational enterprises on responsible con- duct in such areas as human rights, labor,in the ICC International Court of Arbitration’s environment, and corruption. They are the onlyh American offices, headquartered at USCIB. She graduated from Mount Holyoke multilateral, comprehensive code of conduct, endorsed by 43 national governments. The College and worked at the offoef p. Rich- new panel will advise the U.S. National Contacteal of Massachusetts. Adam Greene New USCIB Members Wearedelightedtowelcomethefollowingcompaniesandorganizations as our newest members: American River International Apple Inc. The Clorox Company CanTwitter predict thefuture? Comcast Corporation Join DickCostolo, chief Energy Transportation Group, Inc. executive ofTwitter, as he shares his views at the Grant Thornton International Ltd. Ideas Economy: Information International Trade Counsellors event. Limited Brands, Inc. To find out how your organization can benefit from joining USCIB, contactAlison Hoiem, manager of member services, at 202-682- 1291 or firstname.lastname@example.org. 0011010Big data and the evolution ofsmartsystems1011101010101010000010101010101 01010101010101010110101110101011011010101001010101000101001101110010101201101010101011 Advertise in International Business 010101010Registertoday:10110101000101110010101010001010011011101011010111010101101101010101 information.economist| 212.541.0577 | informationevent@econTo reach an elite readership of USCIB members and friends, join our USCIB members save $500 on the standard registration fee bygrowing roster of advertisers. ContA abtby Shapiroa(shapiro@ Platinum sponsorChallenge pMarketing partner uscib.or) for more information. USCIB International Business Spring 2012 www.uscib.org 13 upcoming events 2012 OECD International Tax The Economist’s Conference Ideas Economy June 4-5, 2012 Four Seasons Hotel Information Event June 5-6, 2012 Washington, DC Join the OECD, USCIB and BIAC, in cooperation with a Yerba Buena Center for the Arts number of tax-focused business groups, for our latest San Francisco, CA annual conference on the OECD’s new international USCIB is supporting The Ecthe Ideas Economy taxation initiatives. Panels will address current OECD forum, bringing together experts from around the world to tax projects and will include speakers from business, discuss and debate innovation, intelligent infrastructure, the OECD, and U.S. government. The event provides information and human potential. Explore the next genera- a unique opportunity for U.S. business representatives tion of smart systems that will transform the global to interact directly with key representatives from the OECD’s Center for Tax Policy and Administration as well economy. There will be an opportunity to connect with some of today’s leading global thinkers, entrepreneurs, as senior tax officials from the U.S. and other OECD and technology pioneers. As a member of USCIB, save countries. For a list of featured speakers, key topics and sponsorship information, visit www.uscibtax.org. $500 on the standard fee by dF-US. Register Registration and logistical information ioin Breitenbucher (202-682-at http://information2012.eventbrite.com. For more infor- 7465 or email@example.com). For information on how you can become a sponsor,visit www.information.economist.com or please contact Abby Shapiro (617-242-0205 or firstname.lastname@example.org). call 212-541-0577. Save the date OECD WEEK 2012 Better Policies for Better Lives: Tackling Inequality, Fostering Inclusive Growth, and Generating Trust Paris, 22-24 May 2012 www.oecd.org/forum OECD Week includes the OECD Forum on 22-23 May, back-to-back with the Ministerial Council meeting on 23-24 May. All stakeholders - world leaders, government ministers, CEOs, heads of NGOs, academia and trade unions - meet to discuss the most pressing issues on the international agenda. The contribution of business is critical in shaping policies which stimulate inclusive growth and development. The Forum will address the key role of private sector-led growth, social value and job creation. The OECD will unveil: Better Life Index 2.0 Economic Outlook New Strategies on Development, Gender, Skills and Jobs USCIB International Business Spring 2012 www.uscib.org 14 www.solutionism.com ®™ The DOW Diamond Logo, the Human Element and design, and Solutionism and design are trademarks of The Dow Chemical Company ©2012. ALBERT EINSTEIN and rel™/© of Hebrew University of Jerusalem, used under license. Represented exclusively by GreenLight. THE GENIUS OF SMART. Dow solutions are used in the production of 95% of the world’s smart devices. From more vivid colors, to more speed