Global Supply Chain Law Blog | Squire Patton Boggs Law Firm
The Global Supply Chain Law Blog discusses legal supply chain issues that often lead to litigation in the supply chain across industries. We discuss current cases, important nuances in the law that can affect supply chain relationships, and ways to make supply chain legal practices more robust, particularly in light of today’s global supply chains.
Nearly all steel and aluminum imported into the US now face additional 25% and 10% tariffs, respectively, after the Trump Administration determined such imports threatened US national security. An additional 25% tariff will be added to a growing list of products from China, following a US investigation into China’s intellectual property practices and policies. The US also launched a Section 232 investigation on auto imports, the results of which could be released as early as September. The EU and other US trading partners are responding with retaliatory tariffs, which will increase the costs of importing US products on almost 2,000 tariff lines.
While the real economic pain of these tariffs may not be felt until the fourth quarter, they have already disrupted global supply chains and added to the cost of doing business. The countries involved in and products affected by the current trade tensions are changing at a rapid pace. Recognizing the difficulties companies face in tracking current developments and potential increased costs throughout their supply chains, the trade experts of Squire Patton Boggs have been advising companies globally on impacted tariff lines and processes available to comment on and challenge these tariffs in the US and certain foreign markets, including how to apply for product exclusions.
Find out how your products, suppliers, and customers fare in the trade war by downloading Squire Patton Boggs’ Tariff Book.
The following is a guest post from Oliver H. Geiss, a partner in our Brussels and Frankfurt offices, and Tatiana Siakka, an associate in our London and Brussels offices. Oliver focuses his practice on competition law in the European Union and Germany, and Tatiana is a competition law specialist with wide-ranging experience in both contentious and non-contentious matters.
For a long time purchasing cartels have been a relatively rare phenomenon in competition law enforcement. As a result, they may have received little attention from companies implementing compliance training programs. In the past couple of years, however, the Commission has become increasingly active in investigating and fining such cartels, notably in the battery recycling and ethylene purchasing sectors.
This month the European Commission announced another investigation into a suspected purchasing cartel. The authority confirmed that it has carried out a series of dawn raids at the premises of companies that purchase styrene monomer – a chemical used as a base material for a number of chemical products.
The Commission’s latest investigation is a reminder that colluding to fix purchasing prices is just as unlawful as conspiring to fix sales prices. It also highlights that purchasing and procurement teams – often overlooked when it comes to compliance training – are equally exposed to antitrust risk as sales teams.
It is therefore of paramount importance for companies to ensure that their purchasing employees receive adequate competition law training in order to be able to identify the relevant antitrust risks and act in compliance with EU rules on restrictive business practices. The three companies involved in the battery recycling purchasing cartel were fined a total of €68 million (currently under appeal), highlighting what is potentially at stake for failing to do so.
A Value Added Tax (VAT) was introduced in the UAE on January 1, 2018. Although there do not appear to have been significant impacts on regional supply chains thus far, our colleague, Jeremy Cape, explains why there may be complications coming later this year from the introduction of VAT in the UAE.
The UK Government’s newly formed Office for Product Safety & Standards (OPSS) has introduced the first government-backed Code of Practice (the Code) for product safety recalls – PAS7100. The Code aims to provide producers and distributors with clearer guidance on how to prepare for and deal with product safety issues, and we would advise producers and manufacturers to review their product recall arrangements in line with PAS7100. Our colleagues Rob Elvin, Nicola A. Smith, Gary Lewis and Laura Clare discuss what you need to know here.
We are holding a webinar with our sector experts from the US, Germany and the UK to address some of the key concerns and issues facing manufacturers across the globe, including trade barriers, GDPR, immigration, intellectual property enforcement, pensions, and environmental matters.
This live and interactive webinar is intended to help you identify and manage some of the main risks confronting global manufacturers in 2018. The webinar is scheduled for Tuesday 12 June at 4pm BST (UK) (11-Noon EDT). For more information, and to register, please click here. We hope you can join us.
On May 8, President Trump announced that the US is withdrawing from the Joint Comprehensive Plan of Action (JCPOA) entered among the P5+1 countries (the US, China, France, Germany, Russia and the UK), the European Union and Iran in July 2015. In our publication, we provide an overview of upcoming changes to US sanctions policy toward Iran and how they could impact business operations worldwide.
We are pleased to announce the launch of our EU Conflict Minerals Regulation Flowchart, which promises to be a valuable tool for those charged with compliance with the EU conflict minerals regulation. Read more about how to use this exciting new resource on our Conflict Minerals Law Blog.
The palm oil industry has sometimes been associated with human rights abuses and adverse environmental impacts, including deforestation, soil pollution and erosion, water contamination, and threatening endangered species. However, meaningful efforts are being made to change that.
On February 16, 2018, Unilever shared information about its suppliers and mills in order to provide greater transparency into its palm oil supply chain. Though Unilever isn’t the first company to try to provide better visibility into its supply chain, the company is the first to provide such details about its sourcing and production.
In a statement posted on its website, Unilever’s Chief Supply Chain Officer, Marc Engel, said, “Unilever believes that complete transparency is needed for radical transformation. We want this step to be the start of a new industry-wide movement.”
Publically disclosing supplier information is a key method to allow consumers insight into a company’s corporate practices. Adopting a supplier policy targeted to good corporate practices is vital to ensure adherence with not only ethical concerns, but regulatory and shareholder obligations as well.
Establishing robust and comprehensive supply chain policies, however, is just the first step in providing compliance assurances. Supply chain contracts can include the right to audit suppliers to ensure proper oversight and adherence to ethical and sustainable practices. Companies can also encourage compliance with supplier codes of conduct by measuring successes via quantifiable metrics. Not only can these successes be used to manage suppliers, but they can also be published for customers to look over – better visibility and corporate accountability can lead to a public relations improvement.
Unilever’s transparency highlights the significance of prioritizing ethical global, community, and environmental practices. By working with suppliers on expectations of corporate responsibility, Unilever is helping to shift the standard towards ensuring socially responsible and environmentally friendly sourcing and production of palm oil.
Our colleague, Nicola A. Smith, brings you the most recent edition of our quarterly food and drink sector newsletter for the UK, Legal NewsBITE. The newsletter includes coverage of a recent focus in the UK on meat processing standards and inspections by the Food Standards Agency, which has had a knock on effect on trade customers such as restaurants and pubs. This has highlighted yet again the importance of demonstrating compliance and supply chain mapping in the food and drink sector. Recent delivery difficulties caused by unexpected and severe weather disruptions (with the ‘Beast from the East’ and subsequent mini-Beast from the East bringing unseasonable snow fall to much of the UK) have further underlined and demonstrated the potential reputational impact that can be caused by a third party supplier’s failure to deliver.
The newsletter may be accessed on our website or by clicking the link below:
Responsible sourcing is a vital consideration for supply chain professionals, however, sourcing valuable minerals from conflict-affected and high-risk areas is one of the most challenging supply chain concerns. Importers of conflict minerals must meet the obligations of EU Regulation 2017/821, the Conflict Minerals Regulation, requiring third-party audits and disclosures about supply chain due diligence.
Our resident conflicts minerals expert, Dynda Thomas, explains what is covered under the Conflict Minerals Regulation, sets forth considerations for importers of certain goods that must comply with regulations on conflict minerals, and discusses what to expect in the coming future.