Congressional Review Act Developments

In response to the unprecedented use of the Congressional Review Act (“CRA”) by the 115th Congress and the Trump Administration, the Center for Biological Diversity (“Center”), a nonprofit dedicated to wildlife conservation, filed a lawsuit in an Alaska federal court challenging the constitutionality of the Act.

The CRA is a statute that requires federal agencies to submit new regulations to Congress before those rules can take effect. As we have previously explained, the Act also, significantly, gives Congress the opportunity to pass a joint resolution of “disapproval,” which nullifies the entire regulation at issue, leaving the rule with “no force or effect.” The agency is also prohibited from later promulgating any rule that is “substantially the same” as the rejected rule.

The Center’s lawsuit concerns the Federal Wildlife Services “Refugees Rule,” 81 Fed. Reg. 52,247 (Aug. 5, 2016), which, according to the complaint, protects certain wildlife from “cruel and ecologically harmful predator control practices.” The Refugee Rule was promulgated by the Obama Administration, and, because it was issued within 60 legislative days of the end of the 114th Congress, is subject to CRA review by the 115th Congress.

The lawsuit attacks the CRA on two fronts. First, it broadly challenges the “substantially the same” prohibition, arguing that Congress violated the constitutional separation of powers between the Executive and Legislative Branches by revoking a properly promulgated rule without amending the underlying statute through the legislative process.  In other words, because Congress has delegated to the Department of the Interior the power to make certain regulations, Congress cannot, without amending the Department’s substantive authorities, alter or revoke an action taken by the Executive Branch.

Second, the lawsuit argues that Congress lacks the power to revoke the Refugee Rule because the Rule falls under a specific exception, found in 5 U.S.C. § 808, to the CRA’s requirement that regulations be submitted to Congress before they take effect: rules that concern a “regulatory program for a commercial, recreational, or subsistence activity related to hunting” do not require submission to Congress, and may take effect “at such time as the agency . . . determines.” Thus, the Center argues, because no submission to Congress was required, the Rule was not subject to disapproval.

This argument that Congress cannot revoke rules subject to Section 808 would also apply to regulations “for which an agency for good cause finds . . . that notice public procedure are impracticable, unnecessary, or contrary to the public interest,” and thus do not require a submission to Congress under the CRA.

While it is too soon to determine whether this novel legal case has merit, a constitutional challenge to the CRA is significant. If federal courts determine that the “substantially the same” prohibition in the CRA is unconstitutional, many federal agencies would be free to reenact nullified rules in a similar fashion.  Such a ruling would also likely trigger litigation to determine the meaning of “substantially the same,” as well as a flurry of lobbying efforts to encourage (or discourage) agencies to re-promulgate rules similar to those overturned by Congress.

This is one of the first legal challenges to the CRA, since the statute, historically, has been rarely used: until the Trump Administration and the 115th Congress, only one rule had ever been nullified under the CRA.  This Congress and Administration have made frequent and significant use of the CRA to reverse Obama Administration rules:  56 disapproval resolutions, affecting 32 rules have been introduced in Congress, and 15 resolutions have passed in at least one chamber.  President Trump has already signed ten resolutions of disapproval into law.

While the 60-day window (“continuous session”) since January 30 to introduce new CRA resolutions has passed for this Congress, each chamber has an ongoing window from the date of introduction to act on the dozens of CRA resolutions still pending. Pending resolutions that have not passed both chambers include resolutions concerning:

  • the privacy rights of broadband customers
  • requirements for offshore drilling off the Alaska coast
  • the EPA’s cross-state pollution rule and air quality initiatives
  • endangered and threatened species policy
  • emissions standards for the oil and natural gas sector
  • IRS treatment of certain interests in corporations as stock or indebtedness
  • rules governing drug testing for unemployment compensation applicants

The ongoing use of the CRA to overturn these and other regulations will be of interest to companies that support or oppose these rules or other rules facing congressional scrutiny.

China’s 2017 Party Leadership Transition

As the dramatic political shifts in Washington captivate the world, and the US reconsiders its traditional global leadership role, Chinese President Xi Jinping is positioning China to increase its own global role and influence. In a highly touted speech at the World Economic Forum in January, Mr. Xi mounted a rousing defense of economic globalization (though some business executives fighting market access barriers in China found more than a touch of irony in the rhetoric). Similar themes were echoed during the annual dual meetings of the National People’s Congress and the Chinese People’s Political Consultative Conference—also known as the “Two Sessions”—last month. At the same time, Mr. Xi has sought to engage with the new Trump Administration and bring a measure of stability to China’s external environment, meeting with U.S. President Donald Trump earlier this month at Mr. Trump’s Mar-a-Lago resort in Florida.

It is against this backdrop that China is preparing for its own leadership transition later this year. The interplay between political transitions at home and abroad could present a complex and intriguing plot for China watchers in the months to come.

This fall, the 19th Party Congress will meet to appoint the new senior leadership of the Chinese Communist Party (“CCP”), and Mr. Xi will undoubtedly begin his second five-year term as CCP General Secretary. The Party Congress convenes once every five years to elect the more than 200-member Central Committee of the CCP, which is formally the highest authority within the Party. Afterwards, the newly elected Central Committee will hold its first annual plenary session, during which it will appoint or elect individuals to the Party’s most important leadership positions. Although top Party leaders determine the rosters in advance, the political process is an important piece of political theater displaying the Party’s commitment to intra-Party democracy and democratic centralism. In addition to appointing and confirming the make-up of various Party commissions, organs, and the CCP Secretariat, the Central Committee will elect the General Secretary, members of the Central Military Commission, the 25 members of the Politburo and, most importantly, the now seven members of the Politburo Standing Committee. Under the leadership of the General Secretary, the Standing Committee is where true power ultimately resides within the Party and, in this one party state, within the entire Chinese political system.

Guide to the Leadership Organs of the Chinese Communist Party - 2

During Hu Jintao’s administration from 2002-2012, the Standing Committee was widely seen as a leadership body where decisions were made by consensus. Some view Mr. Xi as having changed that, reducing the number to seven members and consolidating power in a more visibly hierarchical institution. Meanwhile, others such as Alice Miller at the Hoover Institution, believe that the collective leadership model for decision-making remains intact under Mr. Xi. In any case, after the Standing Committee makes a decision, the Secretariat and lower leadership organs implement its mandate. Members of the Standing Committee typically have powerful roles in other parts of the government and Party apparatus that reflect their work portfolios. For instance, as the Premier, Standing Committee member Li Keqiang leads the State Council (composed of the Chinese government’s ministers and other heads of agencies) and is responsible for macroeconomic policy, particularly economic reform—though some believe that Mr. Xi has taken over some of the economic portfolio in the past few years. Standing Committee member Wang Qishan is now the Party’s renowned anti-corruption czar and unofficial Party whip, and correspondingly holds the position of Secretary of the Central Disciplinary Commission. Mr. Xi Jinping, for his part, is General Secretary of the Chinese Communist Party, President of the PRC government, and the Chairman of the Central Military Commission.

Decisions regarding the composition of the future Standing Committee will convey crucial bits of data, such as the potential identity of Mr. Xi’s successor or, alternatively, whether Mr. Xi plans to stay on past 2022, contravening the Party’s informal two-term limit that has developed in recent decades. Observers will be watching to see if Wang Qishan stays on the Standing Committee or transitions to another role, despite being past the traditionally understood retirement age. There is also some speculation as to whether power on the Standing Committee will be further consolidated through another reduction in its size. In 2012, the number of seats on the Standing Committee was reduced from nine to seven.

Politburo Standing Committee

During his first term, Mr. Xi has accumulated an unprecedented level of political power for the post-Deng era, and has recently been referred to as the “core leader” of the Chinese Communist Party, essentially equating Mr. Xi’s policy views with the Party’s. The eventual selection of the Standing Committee will likely be a confirmation of Mr. Xi’s dominance, but analysts will be looking closely at its particular composition and size to determine whether other intra-Party factions still hold sway. Speculation will continue to build as the fall meetings approach.

 

This Week in Congress – April 24, 2017

After a two-week district work period, members of Congress return to Washington, D.C. this week with a major fiscal deadline looming on Friday.  The current continuing resolution is scheduled to expire at midnight on April 28, leaving the House and Senate very little time to strike a deal to keep the government funded and avert a government shutdown.  While congressional negotiators had been optimistic at the start of the two-week recess about the prospects for a compromise finalizing Fiscal Year (FY) 2017 funding, there still appears to be some work to do in resolving major issues surrounding the spending package.  Press reports now indicate leadership is hoping to at least avert a shutdown by quickly passing a one or two-week extension allowing for more time to reach an agreement on a larger spending bill for the remainder of FY 2017, which ends on September 30.  One of the major hang-ups in the negotiations is a new demand from the White House that the spending bill include funds for border security, including President Trump’s proposed border wall with Mexico, which congressional Democrats adamantly oppose.  GOP leadership in the House and Senate are likely to need Democratic support in order to pass a final funding package, particularly in the Senate.  Other issues involved in the discussions include funding for health care subsidies related to the Affordable Care Act (ACA) and the ongoing debate over increasing military spending versus non-defense domestic programs.  Even though White House Press Secretary Sean Spicer stated publicly last week “no one wants a shutdown,” it is unclear how far the White House is willing to go in securing funds for its border security priorities during the remainder of this fiscal year.

Complicating the fiscal negotiations are reports that the White House may also be pressuring House leadership to schedule a vote this week on a new version of the healthcare “repeal and replace” bill related to the provisions ACA.  With President Trump nearing the 100-day mark of his Administration, there is widespread speculation that the White House is eager to achieve a legislative victory and deliver on a major Republican campaign promise of the 2016 election to repeal and replace Obamacare.  Over the recess, several House leaders, including members of the House Freedom Caucus, and the Administration worked on amendments to the American Health Care Act, the ACA repeal-and-replace bill that was pulled from House floor consideration last month after it became clear the GOP majority did not have sufficient votes for passage.  A draft summary of the new legislation that has been circulating among media outlets shows that the new legislation would create an option for states to obtain “Limited Waivers” from certain federal standards created under the ACA.  The waivers would allow states to opt out of Obamacare mandates for Essential Health Benefits and community rating rules.  While these changes may be enough to placate the conservative members of the House Freedom Caucus, they may be problematic for more moderate Republicans.  As of this writing, legislative text has not been made available and a vote is not currently on the House floor schedule, which does not bode well for swift action this week.  President Trump may be impatient to get any repeal and replace bill out of the House during his first 100 days in office, a milestone he will reach on April 29, but congressional Republicans will likely need more time to work out the details.  There is also general concern that scheduling a vote on the ACA-repeal bill during the same week as a must-pass spending bill could harm any spirit of compromise with congressional Democrats on the appropriations measure.

While leadership works through these larger issues, the House and Senate will undertake other legislative business on the agenda.

The Senate returns on Monday, with two roll call votes scheduled in the chamber.  First members will vote on the confirmation of former Georgia Governor Sonny Perdue to be Secretary of Agriculture.  Members will then vote on cloture on the nomination of Rod Rosenstein to serve as Deputy Attorney General, setting up a final confirmation vote on the nominee later in the week.  The floor schedule beyond these two votes is unclear, although action can be expected on a continuing resolution or larger government funding bill if an agreement is reached.  In the meantime the Majority Leader may move to consider other nominations awaiting consideration on the Executive Calendar.  Among the pending nominations is that of Alexander Acosta to be Secretary of Labor, the final Cabinet Secretary awaiting Senate confirmation.

The House is scheduled to return to legislative business on Tuesday, when members will consider eight bills under suspension of the rules.

On Wednesday, members will consider H.R. 1695, the Register of Copyrights Selection and Accountability Act of 2017, bipartisan legislation that would make changes to the selection process for the head of the U.S. Copyright Office, known as the Register of Copyrights.  Under the current law, the Copyright Office is part of the Library of Congress, and the Register of Copyrights is appointed by and serves at the sole discretion of the Librarian of Congress.  The proposed legislation would retain the Copyright Office within the Library of Congress but would give the President the authority to nominate a candidate for the Register of Copyrights position, subject to confirmation by the U.S. Senate.  H.R. 1695 would also limit the Register to a renewable 10-year term.  Additionally, the President would have the authority to terminate the Register’s services at any time.  Introduced by House Judiciary Committee Chairman Bob Goodlatte (R-VA) and Ranking Member John Conyers (D-MI), H.R. 1695 was reported by the full Judiciary Committee in March on a bipartisan 27-1 vote. Consideration of H.R. 1695 will be subject to a rule.

The House will take up H.R. 1694, the Fannie and Freddie Open Records Act of 2017, on Thursday.  The legislation would apply the Freedom of Information Act (FOIA) to the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) during periods when these entities are in conservatorship or receivership, as they are now.  Consideration of H.R. 1694 will be subject to a rule.

The House Majority Leader’s schedule indicates other legislative items are possible during the week, leaving room for consideration of any resulting legislation making further appropriations for FY 2017.

One other matter that will hold great interest for members of Congress this week will be the expected release by the President of the outline for his tax reform proposal.  Tax reform has been a high priority for congressional Republicans and the President.  House Republicans have been working on legislation since last year.  The President announced last week that the Administration would be releasing its proposal this week, though aides subsequently clarified that the Administration will be releasing its tax reform principles.  That act should jump-start the debate on Capitol Hill.

Congressional committees have a lighter-than-normal schedule following the two-week recess, but there are several high profile events scheduled throughout the week.

The U.S. response to North Korea’s aggressive posturing and its recent warning of a “preemptive strike” on South Korea and the U.S. mainland is the subject of four events this week.  The Senate Armed Services Committee will hold a Tuesday hearing on “Policy and Strategy in the Asia-Pacific.”  The House Armed Services Committee is scheduled to meet on Wednesday morning regarding the “Security Challenges in the Indo-Asia-Pacific Region” with Admiral Harry Harris, Commander of the U.S. Pacific Command, appearing as the sole hearing witness.  Admiral Harris is also scheduled to provide testimony on the U.S. Pacific Command before the House Appropriations Subcommittee on Defense later on Wednesday afternoon.  On Thursday, he will appear yet again to discuss the status of U.S. forces in South Korea with the Senate Armed Services Committee.

The U.S. border wall with Mexico, a point of contention in the current FY 2017 funding negotiations discussed previously, is also the subject of a hearing before the House Oversight and Government Reform Subcommittee on National Security on Thursday.

Three Trump Administration nominees will see activity in Senate committees on Wednesday.  On Wednesday morning the Senate Health, Education, Labor and Pensions Committee will vote on the nomination of Scott Gottlieb to be Commissioner of the Food and Drug Administration.  The Senate Judiciary Committee will hear from Makan Delrahim on his qualifications to serve as Assistant Attorney General for the Antitrust Division.  And the Senate Select Intelligence Committee will hear from Courtney Simmons Elwood on her nomination to serve as general counsel of the Central Intelligence Agency.

The full schedule of congressional committee events during the week ahead is detailed below:

 
Tuesday, April 25, 2017

Senate Committees

Policy and Strategy in the Asia-Pacific
Senate Armed Services
Full Committee Hearing
9:30 a.m.

The Crisis in Libya: Next Steps and U.S. Policy Options
Senate Foreign Relations
Full Committee Hearing
9:45 a.m., SD-419

Intellectual Property – Driver of Innovation: Making Our Lives Healthier, Safer, and More Productive
Senate Judiciary
Full Committee Hearing
10 a.m., SD-226

U.S. Assistance for Egypt
Senate Appropriations – Subcommittee on State, Foreign Operations and Related Programs
Subcommittee Hearing
2:15 p.m., SD-124

Intelligence Matters
Senate Select Intelligence
Full Committee Briefing
2:30 p.m., SH-219

Wednesday, April 26, 2017

House Committees

Military Assessment of the Security Challenges in the Indo-Asia-Pacific Region
House Armed Services
Full Committee Hearing
10 a.m., 2118 RHOB

A Legislative Proposal to Create Hope and Opportunity for Investors, Consumers, and Entrepreneurs (CHOICE)
House Financial Services
Full Committee Hearing
10 a.m., 2128 RHOB

Oversight of the Federal Bureau of Orisons and the U.S. Marshals Service
House Judiciary – Subcommittee on Crime, Terrorism, Homeland Security and Investigations
Subcommittee Hearing
10 a.m.

Unfunded Mandates: Examining Federally Imposed Burdens on State and Local Government
House Oversight and Government Reform – Subcommittee on Information Technology
Subcommittee Hearing
10 a.m., 2154 RHOB

Advances in the Search for Life
House Science, Space and Technology
Full Committee Hearing
10 a.m., 2318 RHOB

Storm Watch: Making Sure SBA’s Disaster Loan Program is Prepared
House Small Business
Full Committee Hearing
11 a.m., 2360 RHOB

Stopping Disability Fraud: Risk, Prevention and Detection
House Ways and Means
Full Committee Hearing
10 a.m., 2020 RHOB

U.S. Pacific Command
House Appropriations – Subcommittee on Defense
Subcommittee Hearing
1:30 p.m., H-140

Creating a Flexible and Effective Information Technology Management and Acquisition System: Elements for Success in a Rapidly Changing Landscape
House Armed Services – Subcommittee on Emerging Threats and Capabilities
Subcommittee Hearing
2 p.m., 2118 RHOB

Questionable Case for Easing Sudan Sanctions
House Foreign Affairs – Subcommittee on Africa, Global Health, Global Human Rights and International Organizations
Subcommittee Hearing
2:30 p.m.

China’s Technological Rise : Challenges to U.S. Innovation and Security
House Foreign Affairs – Subcommittee on Asia and the Pacific
Subcommittee Hearing
2:30 p.m., 2172 RHOB

Reviewing the Unintended Consequences of the Foreign Account Tax Compliance Act
House Oversight and Government Reform – Subcommittee on Government Operations
Subcommittee Hearing
2 p.m., 2154 RHOB

Examining the 2017 Tax Filing Season
House Ways and Means – Subcommittee on Oversight
Subcommittee Hearing
2 p.m., 1100 LHOB

Senate Committees

National Guard and Reserve Programs and Readiness
Senate Appropriations – Subcommittee on Defense
Subcommittee Hearing
10:30 a.m., SD-192

Reopening the American Frontier: Reducing Regulatory Barriers and Expanding American Free Enterprise in Space
Senate Commerce, Science and Transportation – Subcommittee on Space, Science and Competitiveness
Subcommittee Hearing
10 a.m., SR-253

A Review of the Technical, Scientific, and Legal Basis of the WOTUS Rule
Senate Environment and Public Works
Full Committee Hearing
10 a.m., SD-406

Pending Legislation/FDA Commissioner Nomination
Senate Health, Education, Labor and Pensions
Full Committee Markup
9:30 a.m., SD-430

Duplication, Waste, and Fraud in Federal Programs
Senate Homeland Security and Governmental Affairs
Full Committee Hearing
10 a.m., SD-342

Nominations
Senate Judiciary
Full Committee Hearing
10 a.m., SD-226

CIA General Counsel Nomination
Senate Select Intelligence
Full Committee Hearing
10 a.m., SD-106

Ambassador Nominations
Senate Foreign Relations
Full Committee Hearing
2 p.m., SD-419

The Challenges and Opportunities of Running a Small Business in Rural America
Senate Small Business and Entrepreneurship
Full Committee Hearing
3 p.m., SR-428-A

Thursday, April 27, 2017

House Committees

Members Day
House Armed Services
Full Committee Hearing
10 a.m.

Strengthening School Accreditation
House Education and the Workforce
Full Committee Hearing
10 a.m.

Pending Legislation
House Veterans’ Affairs – Subcommittee on Disability Assistance and Memorial Affairs
Subcommittee Markup
10:30 a.m.

PTSD/Traumatic Brain Injury
House Armed Services – Subcommittee on Military Personnel
Subcommittee Hearing
2 p.m.

Senate Committees

U.S. Forces in Korea
Senate Armed Services
Full Committee Hearing
9:30 a.m.

Intelligence Matters
Senate Select Intelligence
Full Committee Briefing
2 p.m.

Friday, April 28, 2017

House Committees

Amphibious Warfare in a Contested Environment
House Armed Services – Subcommittee on Seapower and Projection Forces
Subcommittee Hearing
8 a.m., 2118 RHOB

Trump Moves on Steel Under Section 232

On April 20, 2017, President Trump issued a memorandum announcing that the Secretary of Commerce had initiated an investigation to determine the effects of imported steel on national security. The investigation was initiated under Section 232 of the Trade Expansion Act of 1962, as amended.

I. Conduct of Section 232 Investigations

Under Section 232, Secretary of Commerce Wilbur Ross will have 270 days to determine whether steel is being “imported into the United States in such quantities or under such circumstances as to threaten to impair the national security.” Based on the Commerce Secretary’s findings, the President must issue a report to Congress and may take such actions as he deems necessary to “adjust” steel imports “so that such imports will not threaten to impair the national security.”

In his press briefing on this Section 232 action, Secretary Ross promised “at least one and perhaps more public hearings” in connection with the Section 232 investigation. Ross also suggested that the Trump Administration would invite “public commentary” as it “go[es] through the research project” called for by President Trump’s memorandum. Indeed the Section 232 regulations contemplate such public hearings and public commentary. Prior investigations have involved multiple hearings across the United States and permitted both written comments and oral testimony of individuals supporting and opposing the allegations made in the investigation.

According to Secretary Ross’ April 19, 2017 letter to Secretary of Defense James N. Mattis, the investigation report will also include information that the Department of Defense can provide regarding the national defense requirements for steel. Such consultations with the Secretary of Defense are also contemplated in the Section 232 statute and regulations.

Section 232 has previously been invoked in connection with imports of items such as machine tools, uranium, and ceramic semiconductor packaging. The Nixon and Ford Administrations took action in connection with Section 232 in response to oil imports, and these actions were subject to a challenge in federal court. Use of Section 232 is rare, however, and the most recent prior investigation concerning iron ore and semi-finished steel dates from 2001. Section 232 is one of several unilateral powers that President Trump may invoke under U.S. law, including Section 338 of the Tariff Act of 1930, described in this article. Pursuant to Section 232, Section 338, and other statutes, the President has substantial albeit qualified powers to adjust imports by raising tariffs, imposing quotas, or taking other steps.

II. Trump’s Prior Statements and Actions on Global Steel Issues

Yesterday’s action was foreshadowed by numerous statements by President Trump during his campaign for president. As Secretary Ross noted in his press briefing on the Section 232 action, candidate Trump asserted that “[f]oreign nations are dumping vast amounts of steel all over the United States,” and stated that this action was “essentially . . . killing our steel workers and steel companies.” Candidate Trump also promised to “put new American steel into the spine of this country” as part of a general America-first agenda.

The initiation of this Section 232 investigation is only the most recent action that the Trump Administration has taken with respect to trade issues in steel and other raw materials. Just a few days into his presidency, on January 24, 2017, President Trump issued a Memorandum Regarding Construction of American Pipelines that required the Secretary of Commerce to develop a plan to use American material and equipment—including steel—“to the maximum extent possible and to the extent permitted by law” for all new, retrofitted, repaired, or expanded pipelines. Although President Trump issued a Memorandum Regarding Construction of the Keystone XL Pipeline on the same day, administration officials later acknowledged that this pipeline would not be built using American steel.

III.        Previous U.S. Action on Global Steel Issues

The Obama Administration also sought to address global steel trade issues. Last November, U.S. government officials discussed steel issues with their Chinese counterparts during the U.S.-China Joint Commission on Commerce and Trade (“JCCT”) meetings in Washington, D.C. A press report of that November 21-23 meeting states that “[e]xcess capacity and structural problems in steel and other industries is a global challenge which requires collective responses.” Pursuant to these JCCT discussions, the Global Forum on Steel Excess Capacity was launched in December 2016.

Even before the JCCT, U.S. agencies had engaged in fact-finding with respect to global steel trade issues. In April 2016, U.S. agencies convened public hearings concerning “Policy Recommendations on the Global Steel Industry Situation and the Impact on U.S. Steel Industry and Market.” The United States has also engaged internationally on steel capacity issues. On April 11, 2016, the U.S., Canada, and Mexico released a joint statement calling for effective and immediate commitments to address “global steel excess capacity.” Shortly thereafter, on April 18, 2016, the Belgian government and the OECD hosted a meeting in Brussels of senior officials and private sector representatives from the U.S., China, and around 30 other countries to address excess capacity in the steel sector. The United States has also been party to numerous steel-related disputes at the World Trade Organization.

*           *            *

In his April 20 memorandum, President Trump observed that existing efforts to address global steel trade issues had “little meaningful effect” and that these actions had “not substantially alleviated the negative effects” on the American steel industry. While it remains to be seen what actions the Administration might ultimately take pursuant to the findings of the Section 232 investigation, the Administration’s invocation of this rarely used trade tool further suggests the Administration’s interest in “Buy America” strategies.

 

Trump, Xi Kick Off Economic Relationship

On Friday, April 14, the U.S. Department of Treasury published a widely anticipated semi-annual report detailing the foreign exchange practices of America’s major trading partners. Although he regularly called for China to be labeled as a “currency manipulator” as a candidate, President Donald J. Trump and his administration declined to use the occasion of this report to do so. Mr. Trump previewed this decision days earlier in an interview with the Wall Street Journal, reflecting the consensus among economists that the Chinese “are not currency manipulators.” While, according to many economists, the Chinese government did keep the value of the Renminbi (“RMB”; also known as the “Chinese yuan”) at an artificially low level for many years, Chinese policymakers have been hard at work trying to prop up the currency since 2014 due, in part, to a strengthening U.S. dollar and surging capital outflows.

The decision not to label China as a currency manipulator comes on the heels of the first in-person meeting between Mr. Trump and Chinese President Xi Jinping. On April 6 and 7, Mr. Trump hosted Mr. Xi at his Mar-a-Lago estate in Florida for a two-day summit, an important weather vane for near-term relations between the United States and China. Despite concerns that strategic differences over thorny issues such as North Korea and the South China Sea or harsh rhetoric regarding U.S.-China trade relations from Mr. Trump in advance of the meeting might sour the mood, both sides came out of the meetings with a buoyant step. The two sides agreed to implement a new, comprehensive framework for bilateral negotiations that will shape U.S.-China engagement in the years to come. Further, U.S. and Chinese officials announced a plan to reach agreement, within 100 days, on steps that can be taken to address trade-related frictions between the two countries.

For much of the Obama presidency, bilateral negotiations between the U.S. and China were centered around two main events: the U.S.-China Strategic and Economic Dialogue (“S&ED”) and the Joint Commission on Commerce and Trade (“JCCT”). During this first face-to-face encounter, Mr. Trump and Mr. Xi agreed to a new framework for high-level negotiations called the “U.S.-China Comprehensive Dialogue,” which is to cover four main tracks: diplomacy and security, economics, law enforcement and cybersecurity, and society and culture. Few details have been released as to how the new dialogue will work in practice, and which of the components of the S&ED and JCCT might be preserved in this new framework.

The 100-day plan for trade negotiations is aimed at addressing trade frictions, particularly with regard to increasing U.S. exports and reducing the U.S. trade deficit with China. Few details about what the 100-day plan will entail have been released, and many details are yet to be negotiated. However, it appears that these negotiations will focus on securing Chinese commitments on a range of U.S. exports including beef (banned in China since 2003) and other agricultural products, steel, oil, and gas. Additionally, the Chinese might provide greater market access for U.S. investments in the financial sector—e.g., in securities and insurance. U.S. Treasury Secretary Steven Mnuchin explained during a press briefing that there was a “very wide range of products that we discussed.” According to some reports, at least some Chinese commitments proposed at this early stage may have originally been intended for offer in the context of the bilateral investment treaty negotiations between the U.S. and China, the prospects for which are now less certain.

The current dynamics present significant opportunities for individual businesses and industry groups. Businesses seeking access to the Chinese market for exports or investment should consider engaging with U.S. policymakers to leverage the situation and make a case for addressing their specific needs during the current round of negotiations. Even if the 100-day plan does not bring about the kind of comprehensive economic benefits potentially possible under a bilateral investment treaty, companies with interests in China should see this as an opportunity to seek relief in a Chinese business environment that, according to over 80% of member companies responding to an AmCham China survey, has become less friendly to foreign business than in the past.

Air Pollution in India

India is home to 13 of the 20 most polluted cities in the world as documented by the World Health Organization (WHO). Half of Delhi’s 4.4 million children have permanent lung damage that they will never fully recover from.  The 2017 State of Global Air report, published by the Health Effects Institute, shows that air pollution-related deaths in Indian between 1990 and 2015 rose by almost 150%.  More simply, today in India 14.7 people in every 100,000 die of an o-zone related illness.  The figure is 5.9 people in every 100,000 in China, which is frequently maligned for its record on air pollution.  In her first trade trip as UK Prime Minister, Theresa May’s visit to India in November 2016 attracted a number of headlines, some of which claiming that her short trip to Delhi had a similar effect on her life as smoking 60 cigarettes on account of the levels of pollution being 15 times over world safety limits. 

The issue of air pollution in India is as complex and diverse as the country itself.  Broadly speaking, tackling air pollution in India is not merely a case of Indian Government-led policy-making that is both incentivizing and punitive for businesses and individuals when considering the environment.  A significant contributing factor to the pollution problem in Indian is poverty-driven pollution.  Around a quarter of the 1.6 billion people of the world that live with no access to electricity live in India and a further 300 million people in India live with “very, very limited access to electricity.”  This has resulted in most of those individuals turning to inefficient sources of energy such as burning agricultural waste, firewood, and waste plastics in cities. 

At the other end of the spectrum is the rapid capitalizing and expansion of Indian cities’ infrastructures that seek to keep pace with the speed at which Indian industry is advancing.  Traffic congestion is the oft-quoted example of this and a number of initiatives have been proposed by the Indian Government that aim to ease congestion by disincentivizing the use of private vehicles through higher congestion taxes and investment in flyovers and dedicated bus lanes that could alleviate up to 50% of congestion.  Late last year, while pollutant levels were at a high in Delhi, the Delhi Chief Minister announced emergency measures aimed at protecting Delhi residents from air pollution.  These measures included a five-day ban on construction and demolition and a 10-day ban on operations for a coal-power station just south of Delhi. These initiatives, while well-intended, are often either knee-jerk reactions to drastic developments or they are hamstrung by political bureaucracy, which can be a significant delaying factor for effective implementation. 

At the same time, Indian government policy can work counter to the fight against air pollution.  Take, for instance, Indian government policy subsidizing diesel in an attempt to gain favor with farmers who rely on it to power water pumps and tractors.  This initiative encouraged a significant shift in the Indian vehicle market and helped see the proportion of new cars with diesel engines rise from on in 20 cars to one in two between 2000 and 2013.  This policy was then scrapped in 2014, and sales of diesel vehicles have already dropped. 

There is an increasing drive to supplement Indian Government-led action and industry engagement with profile-raising and awareness among those most affected by air pollution, especially children.  Perceptions towards air pollution are rapidly changing in India and the issue frequently appears in the public agenda.  Charities and NGOs are now focusing on educating India’s future generation to better understand the effects of air pollution.  One recent example of this is the work of UK-based charity Catch Your Breath India (“CYBI”).  James Kitt, Director of CYBI, explains that CYBI’s aim is partnering with a network of Indian schools, Indian media, and children’s health charities to “empower India’s next generation as a force for change in the fight against air pollution.”  

 

A U.K. criminal offence: “Failure to prevent human rights abuses”?

The Joint Committee on Human Rights – comprised of members of both Houses – has published a report calling on the U.K. government to take significant further steps to improve corporate human rights practices, including criminalising “failure to prevent human rights abuses”.

The Committee acknowledges that the U.K. Government’s introduction of reporting requirements under the U.K. Modern Slavery Act 2015, and the publication of the first National Action Plan to implement the U.N. Guiding Principles on Business and Human Rights, have effected a change in corporate behaviour.  However, the report urged the Government to introduce stronger regulation.

The Recommendations 

Reminding the Government of its National Action Plan commitment to “support, motivate and incentivise U.K. businesses to meet their responsibility to respect human rights throughout their operations both at home and abroad”, the Committee called for:

  • an obligation on large companies to put in place human rights due diligence processes both for their subsidiaries and across their whole supply chain, with appropriate monitoring and enforcement procedures;
  • civil remedies against parent companies when human rights abuses occur;
  • a criminal offence of “failure to prevent human rights abuses” for all companies, including parent companies;
  • government power to publish a list of all companies required to publish a modern slavery statement;
  • company obligations to publish a modern slavery statement in their annual reports and accounts; and
  • exclusion from public sector contracts of companies that have not undertaken appropriate and effective human rights due diligence.

The Committee recommends that the proposed new criminal offence mirror that contained in the U.K. Bribery Act 2010.  The legislation would include a defence for companies that can prove they have conducted effective human rights due diligence (“adequate procedures”). This proposal comes at a pivotal time of legislative reform for corporate accountability in the U.K..  Among other developments, the Criminal Finances Bill, which is expected to be passed in mid- to late-2017, includes a civil power to seize assets of persons who have accumulated wealth by conduct connected with the commission of a gross human rights abuse or violation.

A rapidly evolving landscape 

The Committee report reflects a global trend to tighter regulation of human rights practices, and increased transparency.  Last week, a French “duty of vigilance” came into force, requiring large French companies to implement a “vigilance plan” to assess and address adverse human rights impacts of activities in their global supply chains, including impacts linked to companies under their control and of certain suppliers and subcontractors. The Dutch Parliament recently approved a child labour due diligence law, requiring companies to declare that they have conducted due diligence on child labour in their supply chains. A new E.U. regulation on conflicts minerals may impose mandatory due diligence on importers of certain materials.  And Canadian and Australian governments are contemplating introducing reporting requirements similar to those existing in the U.K.

The report also gave a nod of approval to the investor-led Corporate Human Rights Benchmark (CHRB) initiative, published recently, which ranked the human rights practices of certain companies in the agricultural, apparel and extractives industries.  Publishers of the CHRB hope that it will contribute to a race to the top between peers in corporate human rights compliance.

Conclusions 

Imminent legislative reforms by the U.K. Government are perhaps unlikely, particularly in the midst of a packed Brexit agenda. However, the report provides further evidence of a clear direction of travel in this space.

The Week Ahead in the European Parliament – April 7, 2017

Summary

Next week will be a committee week in the European Parliament.  There will be a number of interesting discussions in committee and public hearings.

On Tuesday, the Committee on the Environment, Public Health and Food Safety (“ENVI”) will vote on a its own-initiative draft report on resource efficiency: reducing food waste, improving food safety.  This report aims to cut food waste by 50% by 2030, through means such as facilitating the donation of food.  The report will also contribute to ongoing discussions on a legislative package on waste management and the circular economy.  See the draft report here.

On the same day, the ENVI Committee will consider first a draft motion for a Resolution on HIV/AIDS, Tuberculosis and Hepatitis C.  Among its multiple proposals, the ENVI Committee calls on the Commission and the Member States to develop a comprehensive EU policy addressing HIV/AIDS, Tuberculosis and Hepatitis C; reinforce their work with vulnerable communities through multi-sectoral cooperation (including by involving NGOs); facilitate access to innovative treatments and work on tackling the negative image associated with HIV infection; encourage EU Member States to make HIV tests free of charge, particularly for vulnerable groups; and cooperate in establishing cross-border measures to prevent the spread of  Tuberculosis through the conclusion of bilateral agreements and joint actions.  In addition, the ENVI Committee highlights the impact of tackling the antimicrobial resistance crisis by funding research and development programs for new vaccines,  and through innovative and patient-centered approaches, diagnostics and treatment for tuberculosis. See the draft motion for a Resolution here.

Also on Tuesday, there will be a hearing organized by the Committee on Civil Liberties, Justice and Home Affairs (“LIBE”) dedicated to “ePrivacy Reform”.  This hearing seeks to help the LIBE Committee prepare its views on the proposal for a Regulation on Privacy and Electronic Communications introduced by the Commission in January (see here).  The LIBE Committee aims to obtain the views of the various stakeholders involved (including NGOs, communication services providers, and actors from the telecoms sector) on various topics, such as the confidentiality and security of electronic communications.  See the draft program here.

Finally, on the same day, the Legal Affairs Committee (“JURI”) and ENVI Committee will hold a public hearing on the Environmental Liability Directive (see here).  The public hearing brings together Members of the European Parliament, experts, academics and interest representatives.  The Committees will seek their views on the successes and failures of the Directive’s implementation in the EU Member States.  Both parliamentary committees want to analyze the impact the Directive had on the environment, consumers and businesses, and how this could be improved.  See the program here.

Meetings and Agenda

Monday, April 10, 2017

Committee on Foreign Affairs

15:00 – 18:30 Jointly with the Committee on International Trade and in association with the Delegation for relations with the Maghreb countries and the Arab Maghreb Union:

·         Consideration of draft report and accompanying resolution – Joint debate: Council decision on the conclusion, on behalf of the European Union, of the Political Dialogue and Cooperation Agreement between the European Union and its Member States, of the one part, and the Republic of Cuba, of the other (2016/0298(NLE) and 2017/2036(INI))

o    Rapporteur: Elena Valenciano (S&D, ES)

·         Discussion on the situation in Syria

Committee on Economic and Monetary Affairs

15:00 – 18:30

·         European Central Bank Annual Report for 2016 – Discussion and presentation of the Annual Report by the ECB Vice-President, Vitor Constâncio

Committee on the Environment, Public Health and Food Safety

15:00 – 18:30

·         Hearing of the candidate for the function of Executive Director of ECDC

·         Discussion with Mr Hans Bruyninckx, Executive director of the European Environment Agency (EEA)

Committee on Transport and Tourism

15:00 – 18:30

·         Agenda not available

Tuesday, April 11, 2017

Committee on Foreign Affairs

09:00 – 12:30

Voting

·         Adoption of amendments on draft report on Statelessness in South and South East Asia (2016/2220(INI))

o    Rapporteur Amjad Bashir (ECR, UK)

End of voting

·         Discussion with Igor Crndak, Minister of Foreign Affairs of Bosnia and Herzegovina

·         Discussion with Valentin Inzko, UN High Representative for Bosnia and Herzegovina

Committee on Development

11:30 – 12:30

Joint committee meeting (Rule 55)

·         Consideration of amendments on European Fund for Sustainable Development (EFSD) and establishing the EFSD Guarantee and the EFSD Guarantee Fund (2016/0281(COD))

o    Rapporteurs: Eduard Kukan (EPP, SK), Doru-Claudian Frunzulică (S&D, RO), Eider Gardiazabal Rubial (S&D, ES)

Subcommittee on Human Rights

15:00 – 18:30

Jointly with the Committee on Women’s Rights and Gender Equality

·         Hearing on Child marriages (see Public hearings) 15.00 – 17.00

Subcommittee on Security and Defence

15:00 – 18:30 

With the Council and Commission and EEAS

·         The future of conventional arms control in Europe – discussion with Robin Mossinkoff, Head FSC Support Section, OSCE and William Alberque, Head Arms Control and Coordination Section, NATO

Committee on Budgets

11:30 – 12:30 

·         Consideration of amendments – European Fund for Sustainable Development (EFSD) and establishing the EFSD Guarantee and the EFSD Guarantee Fund (COD)

o    Rapporteurs: Eduard Kukan (EPP, SK) , Doru-Claudian Frunzulica (S&D, RO) and Eider Gardiazabal Rubiall (S&D, ES)

Committee on Employment and Social Affairs

15:00 – 18:30

·         Public hearing  – Social protection and the Commission proposal on coordination of social security systems

Committee on the Environment, Public Health and Food Safety

09:00 – 12:30

Votes

·         Adoption of question for oral answer to the Commission – HIV/AIDS, Tuberculosis and Hepatitis C

o    Co-rapporteurs: Françoise Grossetête (EPP, FR), Claudiu Ciprian Tănăsescu (S&D, RO), Urszula Krupa (ECR, PL), Frédérique Ries (ALDE, BE), Kateřina Konečná (GUE/NGL, CZ), Martin Häusling (Greens/EFA, DE), Piernicola Pedicini (EFDD, IT), Mireille D’ornano (ENF, FR)

·         Adoption of draft report – Initiative on resource efficiency: reducing food waste, improving food safety

o    Rapporteur: Biljana Borzan (S&D, HR)

·         Adoption of draft opinion – A longer lifetime for products: benefits for consumers and companies

o    Rapporteur: Christel Schaldemose (S&D, DA)

End of votes

·         Consideration of draft motion for a resolution – HIV/AIDS, Tuberculosis and Hepatitis C

o    Co-rapporteurs: Françoise Grossetête (EPP, FR), Claudiu Ciprian Tănăsescu (S&D, RO), Urszula Krupa (ECR, PL), Frédérique Ries (ALDE, BE), Kateřina Konečná (GUE/NGL, CZ), Martin Häusling (Greens/EFA, DE), Piernicola Pedicini (EFDD, IT), Mireille D’ornano (ENF, FR)

·         Joint JURI / ENVI hearing on The Implementation of the Environmental Liability Directive: the way forward (15.30 – 17.00)

Committee on Transport and Tourism

09:00 – 18:30

·         Vote on a draft directive on Registration of persons sailing on board passenger ships operating to or from ports of the Member States of the Community and amending Directive 2010/65/EU of the European Parliament and of the Council on reporting formalities for ships arriving in and/or departing from ports of the Member States (COD)

o    Rapporteur: Izaskun Bilbao Barandica (ALDE, ES)

·         Vote on a draft directive on System of inspections for the safe operation of ro-ro ferry and high-speed passenger craft in regular service and amending Directive 2009/16/EC of the European Parliament and of the Council on port State control and repealing Council Directive 1999/35/EC (COD)

o    Rapporteur: Dominique Riquet (ALDE, FR)

·         Vote on a draft directive on Safety rules and standards for passenger ships (COD)

o    Rapporteur: Daniela Aiuto (EFDD, IT)

·         Hearing on “Women and Transport – the role of women in solving the shortage of qualified staff in transport” (10.30-12.30)

Committee on Agriculture and Rural Development

15:00 – 18:30

·         Discussion with Bernhard URL, Executive Director of the European Food and Safety Authority (EFSA), on recent and current EFSA activities relevant for the agricultural sector

Committee on Legal Affairs

15:00 – 18:30

·         Joint hearing of the Committees on Legal Affairs, and on the Environment, the Public Health and the Food Safety, on The Implementation of the Environmental Liability Directive: the way forward (15.30 – 17.00)

17-18.30 in camera

·         Request for waiver of the parliamentary immunity of Marine Le Pen (IMM)

o    Rapporteur: Angel Dzhambazki (ECR, BG)

Committee on Civil Liberties, Justice and Home Affairs

15:00 – 18:30

·         Consideration of amendment on Establishment of ‘Eurodac’ for the comparison of fingerprints for the effective application of Regulation (EU) No 604/2013, for identifying an illegally staying third-country national or stateless person and on requests for the comparison with Eurodac data by Member States’ law enforcement authorities and Europol for law enforcement purposes (recast) (COD) (possibly, 9.00 – 9.40)

o    Rapporteur: Monica Macovei (ECR, RO)

·         Report from the Commission to the European Parliament and the Council on the application of, and delegation of power under, Regulation (EU) 98/2013 of the European Parliament and of the Council on the marketing and use of explosives precursors (9.40 – 10.10) – Presentation by Hans Das, Head of Unit for Terrorism and radicalization, DG HOME, European Commission

Joint debate (10.10 – 11.00)

·         Commission Recommendation on making returns more effective when implementing the Directive 2008/115/EC of the European Parliament and of the Council;

·         Communication from the Commission to the European Parliament and the Council on a more effective return policy in the European Union – A renewed Action Plan – Presentation by Ioan-Dragos Tudorache, Head of Unit for Irregular Migration and Return Policy (C.1), DG HOME, European Commission

Votes (11.10 – 11.30)

·         Vote on a draft report – Agreement on Operational and Strategic Cooperation between the Kingdom of Denmark and Europol (CNS)

o    Rapporteur: Agustín Díaz de Mera García Consuegra (EPP, ES)

End of votes

·         Hearing on “The proposed rules for the respect for private life and the protection of personal data in the electronic communications in the EU” (15.00 – 18.30)

Committee on Constitutional Affairs

15:00 – 18:30

·         No agenda available

Committee on Women’s Rights and Gender Equality

17:15 – 18:45

·         Joint DROI/LIBE Hearing on Child marriage (15.00 – 17.00)

Votes (17.15 – 17.30)

·         Vote of a question for oral answer on The humanitarian situation in Gaza, in particular concerning women and girls

Wednesday, April 12, 2017

Subcommittee on Human Rights

9:00 – 12:30

·         Discussion with Stavros Lambrinidis, EU Special Representative for Human Rights 10.00 – 11.00

Subcommittee on Security and Defence

09:00 – 12:30

·         Workshop “Implementation of the EU arms export control system”

·         Review of EU’s crisis management structures and civil-military coordination – discussion with Kenneth Deane, Director of the Civilian Planning and Conduct Capability (CPCC), EEAS and Rear Admiral Waldemar Głuszko, Deputy Head of the European Union Military Staff, EEAS

Committee on Budgetary Control

09:00 – 12:30

·         Votes and adoption of draft report – Partial renewal of members of the Court of Auditors – HU nominee (NLE)

o    Rapporteur: IIndrek Tarand (Greens/EFA, EE)

·         Hearing of Ildikó Gáll-Pelcz – Candidate nominated by the Hungarian authorities – In camera – Evaluation

Committee on Agriculture and Rural Development

9:00 – 18:30

·         Special Report No 31/2016: Spending at least one euro in every five from the EU budget on climate action: ambitious work underway, but at serious risk of falling short, presentation by Phil Wynn Owen, Member of the European Court of Auditors

Committee on Legal Affairs

9:00 – 18:30

·         Joint Workshop for the Committees on Legal Affairs, and on Civil Liberties, Justice and Home Affairs, on The training of judges and legal practitioners -ensuring the full application of EU law

Committee on Civil Liberties, Justice and Home Affairs

Joint committee meeting (Rule 55) with the Committee on Women’s Rights and Gender Equality (9.00 – 9.45)

end of joint committee

·         Adoption of opinion(s) in letter form on EGF application(s) – Technical assistance at the initiative of the Commission

·         European Solidarity Corps Initiative – Adoption of question for oral answer

End of votes

·         Consideration of a draft report – Union Resettlement Framework (COD) (9.45 – 10.30)

o    Rapporteur Malin Björk (GUE/NGL, SE)

·         Consideration of amendments – Establishing the criteria and mechanisms for determining the Member State responsible for examining an application for international protection lodged in one of the Member States by a third-country national or a stateless person (recast) (COD) (10.30 – 11.30)

o    Rapporteur Cecilia Wikström (ALDE, SE)

·         Establishing an EU common list of safe countries of origin for the purposes of common procedures for granting and withdrawing international protection (COD) (11.30 – 12.00) – Presentation of the state of play of the negotiations by the rapporteur and feedback from the Maltese Council Presidency

o    Rapporteur: Sylvie Guillaume (S&D, FR)

·         Joint LIBE/JURI Workshop on Judicial Training (in collaboration with the Policy Department C): “The training of judges and legal practitioners as a tool to ensure the full application of EU law” (15.00 – 16.30)

Committee on Women’s Rights and Gender Equality

09:00 – 09:45

Joint meeting with the Committee on Civil Liberties, Justice and Home Affairs (LIBE) (rule 55)

·         The EU accession to the Council of Europe Convention on preventing and combating violence against women and domestic violence

Thursday, April 13, 2017

·         No meetings scheduled

This Week in Congress – April 3, 2017

This week, all eyes will be on the Senate as the chamber prepares for a showdown on President Trump’s nominee to the U.S. Supreme Court, Judge Neil Gorsuch.

The Senate is scheduled to return to legislative business on Monday, when members will vote on S. 89, legislation sponsored by Sen. Roy Blunt (R-MO) and Claire McCaskill (D-MO) to allow the Delta Queen, historic steamboat, to operate and carry passengers overnight on U.S. waters.

On Tuesday, the Senate is expected to vote on the nomination of Elaine Duke to be Deputy Secretary of Homeland Security.  Additional votes on executive nominations are possible during the week.

The focus of the week will be the Senate’s consideration of the nomination of Judge Neil Gorsuch of Colorado to be an Associate Justice of the U.S. Supreme Court.  The nomination is on the Monday markup agenda of the Senate Judiciary Committee, which is expected to report the nomination favorably on a party-line vote. Also on the committee’s agenda on Monday are votes on the nominations of Rod Rosenstein and Rachel Brand to be deputy and associate attorney general, respectively.  Majority Leader Mitch McConnell has stated that the chamber will vote on Judge Gorsuch’s nomination on Friday, April 7.  Before getting to a vote, however, Senate Republicans are likely to have to invoke the so-called “nuclear option” by voting on a simple majority vote whether to continue to permit the filibuster over Supreme Court nominations.  Because there are only 52 Republican senators, and only two Democratic senators have expressed their support for Judge Gorsuch, Democrats appear to have the votes to block the Senate from voting on the nomination under the traditional rules of the Senate.  When Democrats last controlled the chamber, then-majority Leader Harry Reid used the “nuclear options” to eliminate filibusters over nominations to executive branch positions and district and circuit court judgeships; the filibuster remained available for Supreme Court justices, but in sowing the wind, Democrats appear on the cusp of reaping the whirlwind.  It is unclear whether some coalition of senators will come together and allow a vote on Judge Gorsuch’s nomination without eliminating the filibuster or whether the nuclear option will have to be invoked.  There remain institutional voices in the chamber seeking to avoid the show-down, but for now it is likely by the end of the week, the nation will have a new member of the Supreme Court and the Senate minority will have lost another tool.

Across the Capitol, the House of Representatives will also return to legislative business on Monday, when members are scheduled to take up under suspension of the rules three bills reported by the Foreign Affairs Committee.  The suspension package includes two measures related to North Korea: one bill to require the Secretary of State to determine whether or not North Korea meets the criteria for a State Sponsor of Terrorism, and a resolution condemning North Korea’s development of multiple intercontinental ballistic missiles.

On Tuesday, members are scheduled to consider under suspension of the rules the Senate’s amendments to a bill to improve weather research and forecasting (H.R. 353).  The House will then take up H.R. 1343, the Encouraging Employee Ownership Act of 2017.  The legislation would amend current Securities and Exchange Commission disclosure rules to raise the regulatory threshold from $5 million to $10 million for securities that private employers can provide as part of an employee-benefit plan before needing to provide disclosures.  A previous version of this legislation passed the House in 2016.  Consideration of H.R. 1343 will be subject to a rule.

On Wednesday, the House will consider under suspension a bill (H.R. 369) regarding the Veterans Choice Program.  Members are then scheduled to consider H.R. 1304, the Self-Insurance Protection Act, which would clarify existing law to ensure that federal regulators cannot define stop-loss insurance as traditional health insurance.  The legislation is aimed at preserving the ability of self-insured employers to purchase “stop-loss” insurance, protecting those employers from potentially catastrophic claims expenses. Consideration of H.R. 1304 will be subject to a rule.

The final item on the House agenda for the week is H.R. 1219, the Supporting America’s Innovators Act of 2017, set to be considered on the House floor on Thursday.  The legislation would amend the Investment Company Act of 1940 to increase the investor limitation for qualifying venture capital funds from 100 to 250 people.  The aim of the bill is to increase venture capital investments in small businesses and startup companies.  A previous version of this legislation passed the House on a bipartisan basis in 2016.  Consideration of H.R. 1219 will be subject to a rule.

Both chambers are expected to adjourn at the end of this week for a scheduled two-week district work period and resume legislative business during the week of April 24. Hanging over the entire week is the coming end of the current continuing resolution, which is scheduled to expire on April 28.  Thus, when both chambers return to session the last week of April, members will have very few days to agree on an appropriations bill to keep the government funded beyond the week they return.  To meet that deadline, negotiations are likely to be occurring during the recess.  The fissures in the Republican party that helped bring down the healthcare reform legislation are likely to be problematic for the appropriations process as well, and Democrats are not likely to want to help Republicans from failing.  With the country’s voters themselves still badly split, a spirit of compromise is not expected to overtake members when they are back in their states and districts during the recess; the opposite is probably more likely.  And if the Senate does invoke the nuclear option on the Gorsuch nomination, there will be little comity left in that chamber to help fashion a deal to avoid a government shutdown at the end of the month.

Committees are heavily scheduled this week in order to conduct business before the break.

As discussed previously, the Senate Judiciary Committee is scheduled to vote on Monday on the nominations of Judge Neil Gorsuch, Rod Rosenstein and Rachel Brand.

The Senate Committee on Banking, Housing, and Urban Affairs will vote on Tuesday morning on the nomination of Jay Clayton, of New York, to be a Member of the SEC.

On Wednesday the Senate Committee on Health, Education, Labor and Pensions (HELP) will hear testimony from Dr. Scott Gottlieb, of Connecticut, on his nomination to serve as Commissioner of the Food & Drug Administration.

Department of Defense funding and operations are the subject of three House Armed Services Committee events this week.  The full committee is scheduled to hold a Tuesday hearing where experts will provide an assessment of progress made in defense reforms and opportunities for future reform efforts.  The full committee will convene again on Wednesday to discuss the potentially damaging consequences of a continuing resolution for Fiscal Year (FY) 2017 on military operations.  The Chief of Staff of the Air Force, Chief of Staff of the Army, Commandant of the Marine Corps, and Chief of Naval Operations are all scheduled to appear before the committee to provide testimony.  On Thursday the House Armed Services Subcommittee on Oversight and Investigations will meet to evaluate the auditing process for defense contracting.

The Senate Foreign Relations Committee will meet on Tuesday to discuss ways in which the European Union can be a partner against Russian aggression.  David O’Sullivan, Ambassador and Head of the European Union delegation to the United States, is among the panelists scheduled to provide testimony to the committee.

Cybersecurity issues continue to be a focus of hearings this week. The House Energy and Commerce Subcommittee on Oversight and Investigations will meet on Tuesday morning to examine the need for greater coordination and leadership on cybersecurity issues across the health care industry.  Also on Tuesday morning, the Senate Energy and Natural Resources Committee will hold a hearing on efforts to protect U.S. energy delivery systems from cybersecurity threats.  On Wednesday afternoon, the Senate Armed Services Subcommittee on Cybersecurity will receive a classified briefing on cyber threats to the U.S.

Consumer Financial Protection Bureau (CFPB) Director Richard Cordray will appear before the House Financial Services Committee on Wednesday to report on the Bureau’s activities and will no doubt face tough questions from lawmakers on the management and actions of the Bureau.  Republicans and, increasingly, some Democrats, see the CFPB as an agency in need to reform.  Former President Obama strongly backed the agency, which was created out of the 2010 Dodd-Frank financial reform law.  The Trump Administration has been critical of the CFPB and recently joined a legal challenge to the authority of the agency.  In March, the Department of Justice submitted an amicus brief to a federal appeals court arguing that the CFPB structure is unconstitutional.  Several lawmakers, including members of the Financial Services Committee, have called for the removal of the Director, setting the stage for a tense hearing in the House on Wednesday.

With the annual income tax filing deadline approaching, two congressional committees will be examining preparations being made by the Internal Revenue Service (IRS) on Thursday morning.  IRS Commissioner John Koskinen is scheduled to appear before the Senate Finance Committee to provide testimony on “Internal Revenue Service Operations and the Taxpayer Experience.”   At the same time, the House Small Business Committee will hear testimony from the current Treasury Inspector General for Tax Administration on the integrity of the IRS tax collection system, including methods to protect taxpayers from identity theft, systems in place to identify fraudulent returns, and customer service.

Three events related to homeland and border security are scheduled this week.  The Senate Homeland Security and Government Affairs Committee (HSGAC) is scheduled to meet on Tuesday morning to discuss fencing along the Southwest border. That afternoon the House Homeland Security Subcommittee on Border and Maritime Security will hold a hearing to examine the Department of Homeland Security’s counter-network strategy to deter Mexican drug cartels and their sophisticated movements of illicit drugs across the border.  Senate HSGAC is scheduled to convene again on Wednesday morning to hear testimony from Secretary of Homeland Security John Kelly regarding border security and public safety.

Infrastructure modernization is again a focus of congressional committees this week and, in particular, the national aviation system.  The House Transportation and Infrastructure Subcommittee on Aviation is scheduled to meet on Tuesday to hold its fourth hearing as part of its preparations for a Federal Aviation Administration (FAA) reform and reauthorization bill later this year.  The hearing will be centered on new aviation and aerospace technologies and any potential challenges operators may face when trying to integrate new technology into the National Airspace System (NAS).  On Thursday the Senate Commerce, Science, and Transportation Subcommittee on Aviation Operations, Safety, and Security will convene a hearing to examine issues related to the safety and robustness of access to the NAS for rural and general aviation users.

The House Agriculture Committee continues to prepare for the development of the 2018 Farm Bill with hearings this week. Its subcommittee on General Farm Commodities and Risk Management will hold its second hearing on commodity policy on Tuesday morning, while the Subcommittee on Commodity Exchanges, Energy, and Credit will meet Tuesday afternoon to discuss credit programs.

The full details for these events and other congressional hearings scheduled throughout the week are included below:
Monday, April 3, 2017

Senate Committees

Supreme Court and DOJ Nominations
Senate Judiciary
Full Committee Markup
10 a.m., SH-216

Tuesday, April 4, 2017

House Committees

The Next Farm Bill: Commodity Policy, Part II
House Agriculture – Subcommittee on General Farm Commodities and Risk Management
Subcommittee Hearing
10 a.m., 1300 LHOB

Examining Federal Support for Job Training Programs
House Appropriations – Subcommittee on Labor, Health and Human Services, Education, and Related Agencies
Subcommittee Hearing
10 a.m., 2358-C RHOB

Assessing Progress and Identifying Future Opportunities in Defense Reform
House Armed Services
Full Committee Hearing
10 a.m., 2118 RHOB

Discussion Draft: Brownfields Reauthorization
House Energy and Commerce – Subcommittee on Environment and the Economy
Subcommittee Hearing
10 a.m., 2123 RHOB

Cybersecurity in the Health Care Sector: Strengthening Public-Private Partnerships
House Energy and Commerce – Subcommittee on Oversight and Investigations
Subcommittee Hearing
10:15 a.m., 2322 RHOB

Federal Reserve’s Mandate and Governance Structure
House Financial Services – Subcommittee on Monetary Policy and Trade
Subcommittee Hearing
10 a.m., 2128 RHOB

Oversight of the Drug Enforcement Administration (DEA) and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF)
House Judiciary – Subcommittee on Crime, Terrorism, Homeland Security and Investigations
Subcommittee Hearing
10 a.m., 2141 RHOB

First Amendment Protections on Public College and University Campuses
House Judiciary – Subcommittee on the Constitution and Civil Justice
Subcommittee Hearing
11:30 a.m., 2237 RHOB

Pending Legislation
House Natural Resources – Subcommittee on Water, Power and Oceans
Subcommittee Hearing
10 a.m.

Use of Confidential Informants at ATF and DEA
House Oversight and Government Reform
Full Committee Hearing
10 a.m., 2154 RHOB

Building a 21st Century Infrastructure for America: Enabling Innovation in the National Airspace
House Transportation and Infrastructure – Subcommittee on Aviation
Subcommittee Hearing
10 a.m., 2167 RHOB

An Assessment of Ongoing Concerns at the Veterans Crisis Line
House Veterans’ Affairs
Full Committee Hearing
10 a.m.. 334 CHOB

The Next Farm Bill: Credit Programs
House Agriculture – Subcommittee on Commodity Exchanges, Energy, and Credit
Subcommittee Hearing
2 p.m., 1300 LHOB

Increasing the Effectiveness of Non-Nuclear Sanctions Against Iran
House Financial Services – Investigate Terrorism Financing Task Force; House Financial Services – Subcommittee on Monetary Policy and Trade
Subcommittees Joint Hearing
2 p.m., 2128 RHOB

Defeating a Sophisticated and Dangerous Adversary: Are the New Border Security Task Forces the Right Approach?
House Homeland Security – Subcommittee on Border and Maritime Security
Subcommittee Hearing
2 p.m., HVC-210

Reviewing Federal IT Workforce Challenges and Possible Solutions
House Oversight and Government Reform – Subcommittee on Information Technology
Subcommittee Hearing
2 p.m., 2154 RHOB

Authorization of Coast Guard and Maritime Transportation Programs
House Transportation and Infrastructure – Subcommittee on Coast Guard and Maritime Transportation
Subcommittee Hearing
2 p.m., 2167 RHOB

Assessing VA Approved Appraisers and How to Improve the Program for the 21st Century
House Veterans’ Affairs – Subcommittee on Economic Opportunity
Subcommittee Hearing
2 p.m., 334 CHOB

Senate Committees

United States Strategic Command Programs
Senate Armed Services
Full Committee Hearing
9:30 a.m., SD-G-50

SEC Nomination
Senate Banking, Housing and Urban Affairs
Full Committee Markup
10 a.m., SD-538

Protecting U.S. Energy Delivery Systems from Cybersecurity Threats
Senate Energy and Natural Resources
Full Committee Hearing
10 a.m., SD-366

The European Union as a Partner Against Russian Aggression: Sanctions, Security, Democratic Institutions and the Way Forward
Senate Foreign Relations
Full Committee Hearing
10:15 a.m., SD-419

FDA User Fee Agreements: Improving Medical Product Regulation and Innovation for Patients Part II
Senate Health, Education, Labor and Pensions
Full Committee Hearing
10 a.m., SD-430

Fencing Along the Southwest Border
Senate Homeland Security and Governmental Affairs
Full Committee Hearing
9:30 a.m., SD-342

National Water Hazards and Vulnerabilities
Senate Appropriations – Subcommittee on Commerce, Justice and Science, and Related Agencies
Subcommittee Hearing
2:30 p.m., SD-192

Cyber Threats to the U.S.
Senate Armed Services – Subcommittee on Cybersecurity
Subcommittee Hearing (CLOSED)
2:30 p.m., SVC-217

Keeping Goods Moving: Continuing to Enhance Multimodal Freight Policy and Infrastructure
Senate Commerce, Science and Transportation – Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety and Security
Subcommittee Hearing
2:30 p.m., SR-253

Wednesday, April 5, 2017

House Committees

Agriculture and Tax Reform: Opportunities for Rural America
House Agriculture
Full Committee Hearing
10 a.m., 1300 LHOB

Federal Response to the Opioid Abuse Crisis
House Appropriations – Subcommittee on Labor, Health and Human Services, Education, and Related Agencies
Subcommittee Hearing
10 a.m., 2358-C RHOB

Consequences to the Military of a Continuing Resolution
House Armed Services
Full Committee Hearing
10 a.m., 2118 RHOB

The Current State of The U.S. Marine Corps
House Armed Services – Subcommittee on Readiness
Subcommittee Hearing
10 a.m., 2118 RHOB

Working Families Flexibility Act of 2017
House Education and the Workforce – Subcommittee on Workforce Protections
Subcommittee Hearing
10 a.m., 2175 RHOB

Facilitating the 21st Century Wireless Economy
House Energy and Commerce – Subcommittee on Communications and Technology
Subcommittee Hearing
10 a.m., 2123 RHOB

The 2016 Semi-Annual Reports of the Bureau of Consumer Financial Protection
House Financial Services
Full Committee Hearing
10 a.m., 2128 RHOB

Revitalizing the Economy of Coal Communities by Leveraging Local Activities and Investing More (RECLAIM) Act of 2017
House Natural Resources – Subcommittee on Energy and Mineral Resources
Subcommittee Hearing
10 a.m., 1324 LHOB

Oversight of the Federal Emergency Management Agency’s Response to the Baton Rouge Flood Disaster: PART II
House Oversight and Government Reform
Full Committee Hearing
9:30 a.m., 2154 RHOB

Taking Care of Small Business: Working Together for a Better SBA
House Small Business
Full Committee Hearing
11 a.m.

FAST (Fixing America’s Surface Transportation) Act Implementation: State and Local Perspectives
House Transportation and Infrastructure – Subcommittee on Highways and Transit
Subcommittee Hearing
10 a.m., 2167 RHOB

Pending Legislation
House Veterans’ Affairs – Subcommittee on Disability Assistance and Memorial Affairs
Subcommittee Hearing
10:30 a.m.

Turkey’s Democracy Under Challenge
House Foreign Affairs – Subcommittee on Europe, Eurasia and Emerging Threats
Subcommittee Hearing
2 p.m., 2172 RHOB

Pending Legislation
House Natural Resources – Subcommittee on Federal Lands
Subcommittee Hearing
2 p.m.

Improving the Visitor Experience at National Parks
House Oversight and Government Reform – Subcommittee on the Interior
Subcommittee Hearing
2 p.m., 2247 RHOB

Assessing the Iran Deal
House Oversight and Government Reform – Subcommittee on National Security
Subcommittee Hearing
2 p.m., 2154 RHOB

Senate Committees

Preventing Sexual Assault and Sexual Harassment at the U.S. Merchant Marine Academy
Senate Appropriations – Subcommittee on Transportation, Housing and Urban Development, and Related Agencies
Subcommittee Hearing
10 a.m., SD-192

Intelligence Programs/Threat Assessment
Senate Appropriations – Subcommittee on Defense
Subcommittee Hearing (CLOSED)
10:30 a.m., SVC-217

Pending Business
Senate Commerce, Science and Transportation
Full Committee Markup
10 a.m., SR-253

FDA Commissioner Nomination
Senate Health, Education, Labor and Pensions
Full Committee Hearing
10 a.m., SD-430

Improving Border Security and Public Safety
Senate Homeland Security and Governmental Affairs
Full Committee Hearing
9:30 a.m., SD-342

The Current State of Retirement Security in the United States
Senate Banking, Housing and Urban Affairs – Subcommittee on Economic Policy
Subcommittee Hearing
3 p.m., SD-538

A Progress Report on Conflict Minerals
Senate Foreign Relations – Subcommittee on Africa and Global Health Policy
Subcommittee Hearing
2 p.m., SD-419

Joint Committees

The Decline of Economic Opportunity in the United States: Causes and Consequences
Joint Economic
Full Committee Hearing
10 a.m., 1100 LHOB

Thursday, April 6, 2017

House Committees

Evaluating the Defense Contract Auditing Process
House Armed Services – Subcommittee on Oversight and Investigations
Subcommittee Hearing
9 a.m., 2212 RHOB

Examination of the Federal Financial Regulatory System and Opportunities for Reform
House Financial Services – Subcommittee on Financial Institutions and Consumer Credit
Subcommittee Hearing
9:15 a.m., 2128 RHOB

Enforcement Is Not Optional: The Goldman Act to Return Abducted American Children
House Foreign Affairs – Subcommittee on Africa, Global Health, Global Human Rights and International Organizations
Subcommittee Hearing
12 p.m., 2172 RHOB

The Best and Worst Places to Work in the Federal Government
House Oversight and Government Reform – Subcommittee on Government Operations
Subcommittee Hearing
10 a.m., 2154 RHOB

Scam Spotting: Can the IRS Effectively Protect Small Business Information
House Small Business
Full Committee Hearing
10 a.m., 2360 RHOB

Pending Legislation
House Veterans’ Affairs – Subcommittee on Health
Subcommittee Markup
8 a.m.

Senate Committees

Southern and Northern Command Updates
Senate Armed Services
Full Committee Hearing
9:30 a.m., SD-G-50

FAA Reauthorization: Perspectives on Rural Air Service and the General Aviation Community
Senate Commerce, Science and Transportation – Subcommittee on Aviation Operations, Safety and Security
Subcommittee Hearing
10 a.m., SR-253

The 2017 Tax Filing Season: Internal Revenue Service Operations and the Taxpayer Experience
Senate Finance
Full Committee Hearing
10 a.m., SD-215

Joint Committees

Committee Organization
Joint Library
Full Committee Business Meeting
10 a.m.

Committee Organization
Joint Printing
Full Committee Business Meeting
10:10 a.m.

 

The Week Ahead in the European Parliament – March 31, 2017

Summary

Next week will be an interesting plenary in Strasbourg with a mixture of votes on various long-awaited topics.

On Monday, the Parliament will debate a draft report prepared by the Parliament’s Committee on the Environment, Public Health and Food Safety (“ENVI”) on palm oil and the deforestation of rain forests.  The draft report seeks to reduce the environmental impact of unsustainable palm oil production, and advocates the elimination, by 2020, of the use in biofuels of vegetable oils linked to deforestation.  In addition, in its own-initiative report, the ENVI Committee calls for the implementation of a single certification scheme for palm oil entering the EU market.  The report will be put to vote on Tuesday.  See the draft report here.

On Tuesday, the plenary is also expected to debate and vote on the draft recommendations following the inquiry into emission measurements in the automotive sector.  Among other things, the draft recommendations call for a drastic improvement of market surveillance in the new EU type-approval framework; for the European Commission to launch infringement procedures against Member States that have failed to put in place effective market surveillance; and for Member States to introduce more clarity in their legislation, particularly on sanctions and possible criminal charges faced by non-compliant car manufacturers.  See the draft report here.

On Wednesday, the Parliament will vote on its position, at second reading, on the proposal for a Regulation on medical devices (“MDR”), and amending Directive 2001/83/EC, Regulation (EC) No 178/2002 and Regulation (EC) No 1223/2009, and for a Regulation on in vitro diagnostic medical devices (“IVDR”).  The revision of the MDR pursues various objectives, including adapting the regulation to the scientific and technological developments of the last 20 years; enhancing the health and safety protection of EU citizens who use such devices; and ensuring the free trade in these products across the EU.  The IVDR aims to regulate and stiffen rules on information relating to and ethical requirements Continue Reading

LexBlog