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Legislative Update: Forced Labor, Labeling, PPE, IPR, Investment

Tuesday, July 28, 2020
Sandler, Travis & Rosenberg Trade Report

For more information on pursuing trade policy interests through the legislative process, please contact Nicole Bivens Collinson.

Forced Labor. The Slave-Free Business Certification Act (S. 4241, introduced July 21 by Sen. Hawley, R-Mo.) would require certain businesses to disclose the use of forced labor in their direct supply chains. A press release from Hawley’s office states that this bill would also mandate regular audits, require chief executive officers to certify that their companies’ supply chains do not and will not rely on slave labor, and create penalties for firms that fail basic minimum standards for human rights.

Intellectual Property. The Bringing Back American Jobs Through Intellectual Property Repatriation Act (H.R. 7749, introduced July 23 by Rep. LaHood, R-Ill.) would amend the Internal Revenue Code of 1986 to encourage the transfer of intellectual property from controlled foreign corporations to U.S. shareholders. “Our tax system is an obstacle for those that own valuable patents, inventions, and production know-how outside the United States and want to bring this intellectual property back home,” LaHood said. In response, this bill would allow U.S. companies to bring back IP developed overseas without any immediate U.S. tax cost and to continue to hold and use formerly foreign IP within the U.S. to support U.S. production and associated research and development. However, companies would still have to pay tax if they sell the IP in the future.

Investment. The Global Investment in American Jobs Act (H.R. 7753, introduced July 23 by Reps. Rodgers, R-Wash., and Rush, D-Ill.) would direct the Department of Commerce to report on ways to increase the global competitiveness of the U.S. in attracting foreign direct investment. This report would cover topics such as the current economic impact of FDI in the U.S., trends in global cross-border investment and data flows, U.S. policies closely linked to the ability of the U.S. to attract and retain FDI, federal government efforts to reduce barriers and improve the investment climate, challenges posed by state-owned or -backed enterprises, and the impact of protectionist policies such as forced data localization rules and infringement of IP on the ability of the U.S. to develop new technologies. 

Labeling. The Senate Committee on Commerce, Science, and Transportation approved July 22 the Reinforcing American-Made Products Act (S. 4065, introduced June 24 by Sen. Lee, R-Utah), which would make exclusive the authority of the federal government to regulate the extent to which a product is introduced, delivered for introduction, sold, advertised, or offered for sale in interstate or foreign commerce with a “Made in the USA” or “Made in America” label, or the equivalent thereof, to represent that the product was in whole or substantial part of domestic origin.

Medical Devices. The Safeguarding Therapeutics Act (S. 4225, introduced July 20 by Sen. Enzi, R-Wyo.) would give the Food and Drug Administration authority to seize and destroy counterfeit medical devices and products offered for import, including vaccines and combination products.

Personal Protective Equipment. The U.S. MADE Act (S. 4264, introduced July 22 by Sen. Graham, R-S.C.) would require personal protective equipment for the Strategic National Stockpile to be acquired from domestic producers. “Coronavirus has been a painful wake-up call that we are too reliant on nations like China for critical medical supplies,” Graham explained. “Without changes, China remains set to dominate the PPE market for years to come.” Items this bill would declare to be national priorities include testing swabs, surgical and respirator masks, face shields, surgical and isolation gowns, sanitizing and disinfecting wipes, gauzes and bandages, privacy curtains, beds, and bedding.

The Senate Committee on Homeland Security and Government Affairs approved July 22 S. 4158, which would examine the extent of U.S. reliance on foreign producers for PPE during the COVID-19 pandemic and produce recommendations to secure the PPE supply chain.

Procurement. The No Funds to China’s Military Act (S. 4256, introduced July 21 by Sen. McSally, R-Ariz.) would ban the use of federal funds to purchase products and services from companies on the Communist Chinese Military Companies in the United States list, which was made public by the Department of Defense in June.

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