International Trade and Investment

Policy Accomplishments for 2007

• Secured congressional approval of the Foreign Investment and National Security Act of 2007, reaffirming the U.S. open door policy toward international investment.

• Peru, Colombia, and Panama: As secretariat for the Latin America Trade Coalition, the Chamber led the business community's efforts to secure congressional approval of the three Latin American trade agreements. In November, the House approved the agreement with Peru and the Senate approved it in December.
• Korea: As secretariat for the U.S.-Korea FTA Business Coalition, the Chamber led the business community's efforts to secure the conclusion of an ambitious and comprehensive trade pact with Korea.
• All Pending FTAs: The Chamber played a leading role in the advocacy campaign for all pending FTAs, including testimony before Congress and the International Trade Commission, media outreach, grassroots advocacy in dozens of cities, a small business fly-in, preparation of research and fact sheets, "messages of the week" to Capitol Hill, and hundreds of meetings with members of Congress.

• Won an eight-month extension of tariff preferences to permit most exports from Colombia, Peru, Ecuador, and Bolivia to enter the United States marketplace duty free. The act facilitates approximately $30 billion in bilateral trade between the United States and the Andean countries, sustains some 2 million jobs in the region, and provides direct benefits to U.S. consumers of particular imports (e.g., cut flowers).
  

Accomplishments and Ongoing Activities by Country and Region

• Acted as official "private sector representative" for the 6th annual African Growth and Opportunity Act forum, the largest trade forum on U.S.-Africa trade and investment, in Ghana. Also hosted the first-ever African Ministerial Tour of seven African trade ministers to West Coast cities.

• Convinced the U.S. Treasury Department to sign a Tax Information Exchange Agreement (TIEA) with Brazil's finance ministry. The TIEA is an important step toward securing a bilateral tax treaty with Brazil.

• Secured approval of an amendment to Law No. 11.452, eliminating the Contribution of Intervention on the Economic Domain (CIDE) tax on software (retroactive to January 2006). Repeal of the CIDE tax, which is a 10% charge applied to technology transfers and technical services by foreigners, will provide a substantial refund for U.S. software producers. Separately, secured the inclusion of members' priorities in the current version of the tax mediation bill that should be submitted to the Brazilian Congress in the near future.

• Successfully advocated for a protocol to update the U.S.-Canada tax treaty. The protocol eliminates the withholding tax on cross-border interest payments, a key request of the Chamber and the North American Competitiveness Council.

• Successfully advocated at the May 2007 SED meetings for Chinese commitments to resume licensing of foreign securities firms in 2007; increase the total quota for Qualified Foreign Institutional Investors to $30 billion; allow foreign property insurance companies to apply for conversions into subsidiaries and complete decisions on pending applications by August 2007; expand the number of airline routes for U.S. carriers and fully liberalize cargo services by 2011; and expand cooperation and dialogue on innovation policy according to the Guidelines for U.S.-China High Technology and Strategic Trade Development framework.

• Led the business community's successful advocacy effort for the U.S.-EU Framework for Advancing Transatlantic Economic Integration announced at the U.S.-EU Summit in April. The framework created the Transatlantic Economic Council (TEC), which directs regulators in Washington and Brussels to address regulatory barriers to transatlantic business, assess regulatory costs and benefits more fully, and avoid the emergence of new, incompatible regulations.
• Launched a strategic partnership with BUSINESSEUROPE, the leading European business federation, to provide broad political support for implementation of the regulatory cooperation framework.

• Successfully lobbied for ratification of bilateral tax treaties with several European countries. The U.S. Senate approved treaties with Belgium, Denmark, Finland, and Germany.

• Successfully lobbied the European Commission to allow non-metric U.S. indications on product packaging in the EU, which was to be banned after January 2010.

• Helped the United States and the European Commission reach an agreement on the common satellite navigation signal (GPS-Galileo).

• Worked closely with the State Department and the government of India to conclude the U.S.-India "123 Agreement" as a follow-up to the 2006 Henry Hyde United States-India Peaceful Atomic Energy Cooperation Act. Successfully incorporated two key provisions to lower the risk of U.S. commercial nuclear firms confronting a competitive disadvantage vis-à-vis state-owned Russian and French companies. Reactivated the Coalition for Partnership with India to advocate for final congressional approval upon completion of the International Atomic Energy Agency (IAEA) agreement.  

• Secured a policy that allows direct investment in the telecom sector by companies that are up to 74% foreign owned, an increase from the previous foreign ownership percentage limit. Helped two firms win telecom service licenses in India, the first for U.S. firms.
• Won a reduction in the peak rate of non-agriculture customs duties from 12.5% to 10%.
• Won agreement to open the pension sector to foreign direct investment for the first time.
• Achieved a reduction in minimum training periods for insurance agents in India from 100 days to 50 days.
• Secured a new interpretation of rules relating to tax collection freezes in double-taxation cases to provide national treatment to Indian subsidiaries of U.S. companies.
• Secured an agreement to allow the United States to import Indian mangoes.

• Helped convince India's Ministry of Defense to adopt international best practices on defense offsets, including offset banking, in its Defense Procurement Policy 2007. This encourages long-term business relationships and investments, benefiting both countries.

• Urged the Indonesian Parliament to avoid a lengthy "negative" list of areas from which foreign investors will be excluded under the country's new investment law.
• Organized a meeting in May between U.S. and Indonesian companies to discuss items they would like to see included in Trade and Investment Framework Agreement (TIFA) discussions between the two countries.

• As co-secretariat for the U.S. Section of the NACC, several of the Chamber's key recommendations were adopted by President Bush, Mexican President Felipe Calderón, and Canadian Prime Minister Stephen Harper at their August 2007 summit. These included proposals for a Regulatory Cooperation Framework, an Intellectual Property Action Strategy, a Trilateral Agreement for Cooperation in Energy Science and Technology, and a North American Plan for Avian and Pandemic Influenza.

• Pressed successfully for introduction of legislation in Russia's Parliament to bring the Law on Medicines into compliance with the IP side letter (relating to data exclusivity) linked to the U.S.-Russia agreement on Russia's WTO accession.

• Conducted successful programs targeting more than 70 members of Congress via the Chamber's TradeRoots initiative, the country's only sustained trade education program.
• China: Conducted China business education grassroots tours to highlight business opportunities in China. Representatives from more than 1,000 small- and medium-size enterprises (SMEs) participated in the programs, which featured senior Chinese diplomats, China experts from the Chamber and the Department of Commerce, and representatives of the AmChams in China.
• North America: Organized events on business opportunities in the North American Free Trade Agreement (NAFTA) market with collaboration from the governments of Canada and Mexico.
• Central America and the Dominican Republic: Held DR-CAFTA trade and investment tours to highlight the benefits of increased trade; generated several million dollars in sales by linking businesses and investors.

• Established a new bilateral business council with the United Arab Emirates focusing on bilateral investment, transshipment and export control policies, and the ongoing TIFA Plus talks between the United States and its largest trading partner in the Middle East