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Section 301 tariffs

Section 301 Tariffs are levied under the Trade Act of 1974 which grants the Office of the United States Trade Representative (USTR) authority to investigate and take action to protect U.S. rights from trade agreements and respond to foreign trade practices. Section 301 of the Trade Act of 1974 provides statutory means allowing the United States to impose sanctions on foreign countries violating U.S. trade agreements or engaging in acts that are “unjustifiable” or “unreasonable” and burdensome to U.S. commerce. Prior to 1995, the U.S. frequently used Section 301 to eliminate trade barriers and pressure other countries to open markets to U.S. goods.

The founding of the World Trade Organization in 1995 created an enforceable dispute settlement mechanism, reducing U.S. use of Section 301. The Trump administration began using Section 301 in 2018 to unilaterally enforce tariffs on countries and industries it deemed unfair to U.S. industries. The Trump administration adopted the policy shift to close what it deemed a persistent "trade gap" between the U.S. and foreign governments that it said disadvantaged U.S. firms. Additionally, it pointed to alleged weaknesses in the WTO trade dispute settlement process to justify many of its tariff actions -- particularly against China. The administration also cited failures in previous trade agreements to enhance foreign market access for U.S. firms and workers.

The Trump Administration launched a Section 301 investigation into Chinese trade policies in August 2017. Following the investigation, President Trump ordered the USTR to take five tariff actions between 2018 and 2019. Subsequent rounds of Section 301 actions against China have continued since. The Office of the U.S. Trade Representative administers Section 301 tariffs, and has also created an exclusion process for importers to seek exemptions from the tariffs.

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Oil Executives Plead Guilty to FCPA Violations
November 1, 2019 |Penalties and Courts

Two oil executives pleaded guilty to violations of the Foreign Corrupt Practices Act after trying to use bribes to secure oil and gas contracts, the Justice Department said in an Oct. 30 press release. Cyrus Ahsani and Saman Ahsani, the CEO and COO of a Monaco-based intermediary company, tried to bribe officials in multiple countries with millions of dollars, the press release said.

Topics:Foreign Corrupt Practices Act
Miami-Based Financial Adviser Pleads Guilty to FCPA Violations
October 16, 2019 |FCPA

A Miami-based financial adviser pleaded guilty to money laundering charges after violating the Foreign Corrupt Practices Act, the Justice Department said in an Oct. 11 press release. Frank Roberto Chatburn Ripalda, a citizen of the U.S. and Ecuador, tried to bribe officials at Empresa Pública de Hidrocarburos del Ecuador (PetroEcuador), Ecuador’s state-owned oil company, the press release said. Chatburn faces a 20-year maximum prison sentence.

Topics:Foreign Corrupt Practices Act
China Increasing Enforcement to Counter Commercial Bribery
October 10, 2019 |FCPA

China is increasing enforcement of compliance with measures aimed at countering commercial bribery by foreign companies, according to an Oct. 7 Lexology post from AnJie Law Firm. As companies increase efforts to comply with the U.S. Foreign Corrupt Practices Act, they may also have to review their compliance under China’s recently amended Anti-unfair Competition Act, the post said, which cracks down on “unlawful commercial activities” by both domestic and foreign companies. The changes are “set to become as big a focus area as domestic companies' compliance with foreign laws,” the law firm said.

Corporations Incurred $78 million in FCPA Violations During Q3
October 4, 2019 |FCPA

The FCPA Blog released its Foreign Corrupt Practices Act enforcement report for the third quarter of 2019, featuring seven enforcement penalties worth close to $78.5 million. The penalties include two civil settlements, two indictments, one prison sentence and another awaiting sentencing after pleading guilty, according to the report. There were also three corporate declinations from the Justice Department. The penalty total for 2019’s third quarter was less than for the third quarter in each of 2018 and 2017, which added up to $1.97 billion and about $1 billion, respectively.

Topics:Foreign Corrupt Practices Act
Micronesian Government Official Sentenced to Prison for FCPA Violations
July 31, 2019 |FCPA

A Micronesian government official was sentenced to 18 months in prison and three years of supervised release after facing money laundering charges that violated the Foreign Corrupt Practices Act, the Justice Department said July 30. Master Halbert, a Micronesian Department of Transportation, Communications and Infrastructure official, pleaded guilty to the charges in April (see 1904040035). Halbert conspired with Frank James Lyon, owner of a Honolulu-based engineering and consulting company, to award Lyon corrupt government contracts. Lyon pleaded guilty and was sentenced to 30 months in prison in May (see 1905140033).

Topics:Foreign Corrupt Practices Act
Microsoft Settles After FCPA Violations
July 23, 2019 |FCPA

Microsoft will pay a total of about $25 million in penalties, including a nearly $9 million criminal fine, to resolve an investigation into violations of the Foreign Corrupt Practices Act, the Department of Justice said in a July 22 press release. The violations arose from Microsoft's subsidiary in Hungary, Microsoft Magyarország Számítástechnikai Szolgáltató és Kereskedelmi Kft, which was involved in a “bid rigging and bribery scheme” related to the sale of Microsoft software licenses to government agencies, the press release said. The DOJ also released the non-prosecution agreement and statement of facts.

Topics:Foreign Corrupt Practices Act
Winston & Strawn Adds Export Controls Lawyer
June 25, 2019 |Trade People

Winston & Strawn hired Christopher Monahan, previously with Crowell & Moring, as a partner, Winston said in a June 24 news release. Monahan "counsels clients across a broad scope of industries regarding compliance with the International Traffic in Arms Regulations (ITAR), the Export Administration Regulations (EAR), the sanctions programs administered by the Office of Foreign Assets Control (OFAC), and on the Foreign Corrupt Practices Act (FCPA)," the firm said.

Topics:OFAC, Foreign Corrupt Practices Act