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Legislative Update: Origin Labeling, Corporations, Iran

Tuesday, February 16, 2016
Sandler, Travis & Rosenberg Trade Report

Origin Labeling. S. 2474, introduced Feb. 1 by Sen. Cotton, R-Ark., and H.R. 4503, introduced Feb. 9 by Rep. Poe, R-Texas, would allow the words “Israel” and “Product of Israel” to be used for country of origin marking requirements for goods made in the West Bank and Gaza Strip. The bills seek to counter guidance issued by U.S. Customs and Border Protection in late January. “While some say the directive merely ‎restates an old labeling rule originally drafted 20 years ago with no intention to stigmatize Israel,” Cotton said, “the truth is the rule was lightly if ever enforced and serves little purpose today,” and “its vigorous enforcement now” will give other nations “an excuse to unfairly treat Israel in trade relations.”

The Non-Discrimination of Israel in Labeling Act (H.R. 4555), introduced Feb. 12 by Rep. Lamborn, R-Co., would address this issue by clarifying the application of section 304 of the Tariff Act of 1930 as it relates to articles from areas of the West Bank and Gaza that are not administered by Israel. Lamborn said the labeling guidelines were originally intended to ensure that the Palestinian-administered areas govern their own import/export procedures and compliance and were never intended to apply to Israeli-controlled territory within the West Bank or Gaza.

H.R. 4409, introduced Feb. 1 by Rep. Carney, D-Del., would direct the Federal Trade Commission to establish labels that may be used as a voluntary means of indicating to consumers the extent to which products are of U.S. origin.

Corporations. The Incorporation Transparency and Law Enforcement Assistance Act (S. 2489 and H.R. 4450), introduced Feb. 3, seeks to ensure that persons who form corporations in the U.S. disclose the beneficial owners of those corporations to prevent the formation of corporations with hidden owners, stop the misuse of U.S. corporations, and assist law enforcement in detecting, preventing and punishing terrorism, money laundering, tax evasion, and other criminal and civil misconduct involving U.S. corporations.

The Corporate Rate Equality and Trade Empowerment Jobs Act (H.R. 4518), introduced Feb. 10 by Rep. Emmer, R-Minn., would set the U.S. corporate income tax rate (which is currently 39 percent) at five percentage points lower than the average for members of the Organization for Economic Cooperation and Development (which is currently 25 percent).

Iran. The State Sanctions Against Iranian Terrorism Act (H.R. 4448), introduced Feb. 3 by Rep. DeSantis, R-Fla., would provide that state sanctions passed pursuant to the Comprehensive Iran Sanctions, Accountability and Divestment Act of 2010 are not preempted by any federal law, regulation, policy or agreement and allow states to control significant commerce with Iranian businesses, including those owned by the government of Iran and its instrumentalities like the Iranian Revolutionary Guard Corps.

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