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Legislative Update: Cargo Scanning, Forced Labor, Offshoring, Sanctions

Tuesday, March 17, 2020
Sandler, Travis & Rosenberg Trade Report

For more information on pursuing trade policy interests through the legislative process, please contact trade consultant Nicole Bivens Collinson at (202) 730-4956.

Cargo Scanning. The Senate Homeland Security Committee approved March 11 the Securing America’s Ports Act (H.R. 5273, introduced Nov. 26 by Rep. Torres Small, D-N.M.), which would require the Department of Homeland Security to develop a plan to increase to 100 percent the rate of scanning commercial and passenger vehicles entering the U.S. at land border ports of entry using large-scale non-intrusive inspection systems. A press release from Torres Small’s office states that U.S. Customs and Border Protection currently scans 15 percent of commercial trucks entering the U.S. and that NII scanning rates vary significantly by land port of entry. The House of Representatives approved this bill Feb. 10.

Forced Labor. The Uyghur Forced Labor Prevention Act (H.R. 6210 and S. 3471) would ensure that goods imported from the Xinjiang Uyghur Autonomous Region of China are not made with forced labor. According to a press release from Sen. Marco Rubio, R-Fla., the requirements that would be imposed by this bill include a determination by the president that “reasonable grounds exist” to conclude that forced labor under section 307 of the Tariff Act of 1930 exists in the region. If such conclusions are made, corporations would have to prove with “clear and convincing evidence” that any imported products sourced from Xinjiang are not made with forced labor.

Offshoring. The End Outsourcing Act (S. 3425, introduced March 10 by Sen. Gillibrand, D-N.Y.) would provide incentives for businesses to keep jobs in the U.S. According to a press release from the office of co-sponsor Sen. Tammy Baldwin, D-Wisc., this bill would “prevent employers from deducting expenses related to outsourcing, deny certain tax breaks to outsourcing employers, and require federal agencies awarding contracts, loans, loan guarantees, and grants to establish a negative preference for employers who have outsourced in the last three years.” It would also tax foreign profits at the same rate as domestic profits and prevent outsourcing companies from bidding on federal contracts or grants without disclosing their outsourcing practices.

Sanctions. The Neutralizing Emerging Threats from Wireless OEMs Receiving direction from Kleptocracies and Surveillance States Act (S. 3469 and H.R. 6235, introduced March 12) would add foreign companies producing 5G technology, like Huawei, to the Treasury Department's Specially Designated Nationals List if they engage in economic or industrial espionage or sanctions violations. A press release from Sen. Tom Cotton, R-Ark., notes that placing a company on the SDN List effectively freezes them from accessing the U.S. financial system.

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