This time around, manufacturers have not yet meaningfully weighed in on the proposal. There can be no doubt, however, that privatizing air-traffic control could fundamentally change the system in ways that will impact supply chains. Obviously, in a “user pays” system, which is essentially what is being proposed, the direct costs of air transportation increase, though proponents of the change argue that privatization will result in decreased air costs overall – so what the financial impact will be is unclear. (Indeed, there is not even agreement among experts whether Canada’s privatization increased or decreased the cost of air transport.)
Previously, we discussed the Food and Drug Administration’s (“FDA”) seven major food safety rules mandated by the Food Safety Modernization Act (“FSMA”). (See previous posts here, here, and here.) Of the seven, the rule for Foreign Supplier Verification Programs (“FSVP”) for Importers of Food for Humans and Animals will have the biggest impact on importers of food into the United States. The FSVP is a program that requires food importers to verify that their foreign suppliers are producing food that meets appropriate safety regulations and ensure the food is not adultered or misbranded with respect to allergen labeling.
May 30, 2017 marked the first major compliance date under FSVP where the FDA is now checking to ensure food importers are performing certain risk-based activities to verify imported food meets U.S. safety standards. Continue Reading
Following up on our previous post regarding the SEC Conflict Minerals rule, the Conflict Minerals Law Blog discusses the upcoming Form SD filing deadline and the consequences of the April 7, 2017 Statement. Click below to read more:
Rosemary Coates and Sarah Rathke (authors of Legal Blacksmith: How to Avoid and Defend Supply Chain Disputes) posted an article on International Association for Contract & Commercial Management (IACCM) about Industry 4.0 and its impact on supply chain contracts. The exchange of information and integration of machines is creating sophisticated needs, not to mention leaving an audit trail that will need to be reviewed should a dispute arise and driving up costs. Rosemary and Sarah discuss how governing contracts must change to accommodate and protect.
You can read the article here: Big data, big benefits – and a ton of risk for your supply chain contracts?
We have published our legal updates for the month of April, highlighting some key commercial and intellectual property developments across Mainland China, Hong Kong, and the US. The update can be accessed by clicking on the document below.
Following up on our previous post on the Trump administration’s renegotiation of NAFTA, the President has taken further steps towards his campaign theme of promoting American industry. On April 18, 2017, President Trump signed the “Buy American, Hire American” executive order. The White House release states the order was promulgated in response to a February 2017 Government Accountability Office (GAO) report “suggest[ing] the United States is not getting its fair share of the global government procurement market through the World Trade Organization (WTO) Agreement on Government Procurement (GPA).” Further, the release contends, “companies routinely abuse the H-1B visa program by replacing American workers with lower paid foreign workers.”
Now that the matter has been remanded to the Commission, Acting Chairman Piwowar and the SEC Division of Corporation Finance have both issued public statements on the D.C. Court of Appeals decision reaffirming its prior holding that the Conflict Minerals rule “violate[s] the First Amendment to the extent the statute and rule require regulated entities to report to the Commission and to state on their website that any of their products have “not been found to be ‘DRC conflict free.'”” The Commission is now tasked with determining how to address the decision and how that affects the overall implementation of the Conflict Minerals rule. Read the full update on our Conflict Minerals Law Blog below:
The European Council has approved the conflict minerals regulation, marking the final procedural step before publication. Read the latest update and what to expect next on our Conflict Minerals Law Blog.
Last week, Sarah Rathke spoke with Derek Handova for Talkin’ Cloud about the practice of “channel stuffing” in the supply chain. Channel stuffing is the practice of booking sales before items are actually sold at retail – and is often a form of fraud meant to increase a company’s apparent sales volumes.
Channel stuffing happens in every industry, but the question is, how to stop it. The article describes several suggestions, but most involve increased oversight over sales personnel. For more details, read the entire article here:
The Trump administration has indicated its intention to renegotiate the North American Free Trade Agreement (“NAFTA”). Currently, a draft letter is being circulated by the U.S. Trade Representative to members of Congress for their review. Stephen Vaughn, acting U.S. Trade Representative, wrote in the draft notification letter that “[t]he persistent U.S. deficit in goods trade with Canada and Mexico demands that this administration take swift action to revise the relationship to reflect and respond to new 21st century challenges.” If approved by Congress, formal negotiations with Mexico and Canada could start later this year.