Japan hopes to quickly reach a trade agreement with the United Kingdom after Brexit based on the European Union-Japan Economic Partnership Agreement, two Japanese officials said Jan. 31. Japan wants to “promptly” agree to a trade deal with the U.K. to minimize impacts on Japanese companies after Brexit, Japan’s minister of economy, trade and industry said during a press conference, according to an unofficial translation of a transcript. “If a trade agreement between the U.K, and the [European Union] is not reached by the end of the transition period, the activities of Japanese companies may be adversely affected,” the minister said. “The idea is to work on construction quickly.” Japan will continue to operate its Brexit Service Desk (see 1910040013) during the transition period, the minister added.
China’s Ministry of Commerce recently issued a circular detailing the expansion of its pilot program for cross border e-commerce retail imports, according to a Jan. 30 report from the Hong Kong Trade Development Council. The program will add 50 “cities or regions,” including the whole Hainan Island, which are now able to conduct “bonded import business” for online imports.
A letter from the Mexican government obtained by Reuters reassures local stakeholders that seasonal antidumping cases against Mexican produce will bring retaliation against U.S. agricultural exports. The letter was sent Jan. 27 to a trade group for Mexican agricultural exporters. The president of that trade group told Reuters that if America targets Mexican mangoes, tomatoes or berries, “U.S. exports like yellow corn, wheat and pork could be retaliated against.”
The United Kingdom’s Office of Financial Sanctions Implementation issued a Jan. 31 guidance on its financial sanctions regimes after Brexit, detailing U.K. companies’ reporting obligations and providing information on exemptions, licensing, enforcement, compliance, challenging designations, penalties and more. The guidance also clarifies that the U.K. can introduce its own sanctions regime during the Brexit transition period even though the European Union sanctions regimes will continue to be in effect in the U.K. until the end of the transition period.
The Treasury’s Office of Foreign Assets Control removed sanctions against a COSCO subsidiary that it had designated in September (see 1909250050), according to a Jan. 31 notice. The move removed sanctions from COSCO Shipping Tanker (Dalian) Co. but kept sanctions against COSCO Shipping Tanker (Dalian) Seaman & Ship Management Co., the other COSCO subsidiary designated by OFAC last year. OFAC had recently renewed a license authorizing certain transactions with COSCO Shipping Tanker (Dalian) Co., which was set to expire Feb. 4 (see 1912200032).
The Strategic Trade Research Institute released a winter-spring report in January on emerging technologies that examines how companies can mitigate trade risks, advocates for a new approach to export controls, and explores the challenges and compliance mechanisms for emerging technology controls from a European perspective. The report from the STRI, a non-profit trade research institute, also provides background on the U.S. effort to control emerging technologies, including the beginning of the export control reform movement in 2010 and the U.S.’s “critical technology approach,” which defines which technologies to target. Among several topics, the report argues more “innovative approaches” are needed to address the rapid rise of emerging technologies, such as an “omni-use” term instead of a “dual-use” term to address the lack of a “broad consensus” on the potential military and civilian uses of certain emerging technologies. The report also introduces a “model” to identify parameters to determine “technology controllability” as governments face the difficult task of controlling “intangible technology exports.”
The Treasury’s Office of Foreign Assets Control is becoming progressively worse at addressing specific sanctions questions from industry stakeholders, leaving queries unanswered and causing companies to hesitate before completing transactions, according to Nixon Peabody trade lawyer Alexandra Lopez-Casero. Companies can employ certain strategies to get responses from OFAC, Lopez-Casero said, but OFAC is typically not as responsive and helpful as other agencies, such as the Commerce Department Bureau of Industry and Security.
Although the Defense Department reportedly objected to a proposed Commerce Department rule that would have further restricted foreign sales to Huawei that contain U.S. goods (see 2001240012), the administration will continue considering other ways to increase controls on shipments to Huawei, which may include a “compromise” rule, according to a Jan. 31 research report from Raymond James & Associates. Political support for the proposed rule, including by three senators in a January letter (see 2001270026), may “convince” the Defense Department to “ease its opposition in some form.” If the agency concedes, it will still likely push back on other restrictions on China's technology industry “to preserve some of the revenue stream to the U.S. industrial base,” the report said.
Airbus agreed to pay more than $3.9 billion in combined penalties for violations of the Foreign Corrupt Practices Act, the Arms Export Control Act and the International Traffic in Arms Regulations, the Justice Department said Jan. 31. The bribery charges, levied by U.S., French and United Kingdom authorities, stem from Airbus’s scheme to bribe non-governmental airline executives and government officials, including officials in China, to retain aircraft contracts.
Oman’s Ministry of Commerce and Industry will introduce a value-added tax in 2021, according to a Jan. 29 post from KPMG. Companies operating in Oman should prepare now for the VAT implementation based on the existing VAT legislation in the Gulf Cooperation Council (GCC) and the GCC Common VAT Framework Agreement, KPMG said.