Your transatlantic insights from Amcham Finland
In just a few weeks time, transatlantic trade and commerce have taken a giant leap forward. Amcham Finland championed for many of these developments during the AmChams in Europe door-knock to DC, where we advocated for the Trade & Technology Council to promote constructive dialogue in the digital space, among other initiatives. We continue to urge decision-makers on both sides of the Atlantic to move forward on replacing the EU-U.S. Privacy Shield, an outcome that would support sustainable growth and job creation. This spring, we have worked closely with key figures in Finnish and U.S. governments to bring the voice of our membership to the decision-making table. There is a lot of legislation, especially at the EU level, that will have consequences for the transatlantic economy and on the Finnish economy. Amcham Finland appreciates the pragmatic response of Finnish decision-makers in our dialogue. We and our members see an important role that Finland can play in ensuring European competitiveness, now and in the future.
Amcham welcomes EU-U.S. summit outcomes
President Biden met with EU leaders in Brussels on June 15th. Among the outcomes was a cooperative framework, which includes a five-year suspension of all tariffs related to the largest, longest-running disputes in WTO history. The deal resets EU-U.S. engagement in the large civil aircraft industry. Leaders also agreed to establish a Trade & Technology Council (TTC) to expand trade and investment, avoid “unjustified technical barriers” to trade, and cooperate in high-potential economic areas, especially digital. This closely reflects priorities outlined in a joint statement of AmChams in Europe (ACE) leading up to the summit. In a statement following the summit, the U.S. Chamber urged the United States to use the TTC to push back against potentially discriminatory EU digital laws. Amcham Finland also endorses the policy recommendations set out by the U.S. Chamber. Amcham Finland has previously highlighted the disruptions to transatlantic data flows as an area of “serious concern” and joins the U.S. Chamber in their call for a swift replacement of the EU-U.S. Privacy Shield. An agreement is yet to be reached and will remain one of the core issues to address under the TTC. Just like the G7, the summit reflected a growing interest in addressing unfair Chinese practices. Leaders pledged to enhance cooperation on investment screening and called for a task force on infrastructure finance in developing countries, a nod toward offering alternatives to Chinese financing. Trade ministers will also pick up discussions on policies to eradicate forced labor in global supply chains, a serious concern but potential source of costly sanctions and new compliance requirements.
In Kauppalehti: Amcham op-ed on the future of transatlantic trade
Alexandra Pasternak-Jackson, CEO of Amcham Finland, and Timo Vuori, Executive VP of International and EU Affairs at the Finnish Chamber of Commerce, have co-authored an op-ed on the future of transatlantic trade in Kauppalehti. In anticipation of the U.S.-EU summit, they called for post-pandemic economic cooperation and a speedy consensus on the regulatory standards of digitalization. Timo and Alexandra underlined the importance of transatlantic trade to the Finnish economy and encouraged Finnish businesses to consider a stronger presence in the U.S. market.
This segment includes analyses from our friends in Washington, D.C. at the U.S. Chamber.
Amcham gains insights from Biden administration via virtual meetings in Washington, D.C.
Our three-day meetings with representatives of the Biden Administration is summed up in this comment by Acting Assistant Secretary Philip T. Reeker of the U.S. Department of State as he addressed the AmChams of Europe: “We want to raise the level of ambition, both U.S.-E.U. and U.S. with broader Europe. Regaining trust on both sides of the Atlantic is very important. Rejoining multilateral fora has been important. Keeping a constructive dialogue in place, even when we disagree, and rebooting the relationship. Shared values need defending on both sides of the Atlantic, and together, we should be strengthening our security, including global health security. It is security that provides the space for prosperity. We do this better from a position of collective strength when we are collaborating and coordinating together. A goal of Europe whole, free, and at peace remains a cornerstone for the Biden administration.” On the transatlantic front, the Biden administration is not only looking for strategic partnerships on climate change and sustainable supply chains, but also transatlantic cooperation on leveling the playing field for investments and unfair trading practices by foreign competitors (e.g. China), fostering innovation, and equitable international arbitrage. Domestically, the focus is on support for Covid-19 recovery efforts, strong and resilient global supply chains, protecting the environment, a minimum corporate tax, and securing middle-class wages. Following previous work on an enhanced U.S.-E.U. privacy shield, we were asked about the intensification of formal negotiations on a new E.U.-U.S. Privacy Shield that complies with the Schrems II ruling. Several government representatives are working 24/7 with European colleagues on this, with a working group addressing the topic every evening. It is also clear that the proposal for the Trade and Technology Council is taken very seriously, with AmChams across the board endorsing the concept.
During the doorknock, Alexandra Pasternak-Jackson, Mike Klyszeiko and Sophia Rahimeh of the Amcham team met with the following:
White House National Security Council represented by Peter Harrell, NSC International Economics Senior Director.
Digital Markets Act (DMA) developments and discussion event on June 15th
Amcham Legal Committee convened on June 15th for a panel discussion of the EU’s proposed Digital Markets Act (DMA) and its impact on competition. The panel agreed that the Act’s “one-size fits all” scope leaves a lot of space for uncertainty, and that greater clarity is needed to give all businesses a fair chance at compliance. The thinking inside the government is that the DMA harmonizes regulation of digital markets across the single market and avoids disruption from any single country. Private sector panelists questioned whether national competition authorities’ ability to independently interpret laws like the GDPR could however defeat the intended purpose of harmonization. Panelists urged participants to seize the opportunity to bring forth their concerns and push for necessary changes. This will be particularly important to small and medium-sized businesses, which may not have the capacity to adapt as swiftly as large corporations.
Proposal aims to create EU-wide redress mechanism
The EU is experiencing a trend towards U.S.-style class action lawsuits. At the end of April, we met with our colleagues at AmCham EU who have been actively monitoring the developments of the European Commission’s consumer redress proposal – a new directive on representative actions. Now in the transposition phase, this proposal aims to create EU-wide redress mechanisms that allow consumers harmed by illegal practices to launch collective actions and seek compensation. In the past, only five EU member states had compensatory collective redress mechanisms in place; that same measure has now climbed to nineteen. By December 2022, all 27 member states are expected to implement the new directive, which will be enforceable in member states as of June 2023. The proposal gives member states the power to determine how and to what extent they would like to enforce the directive. Countries such as Ireland, Austria, and the Netherlands stand to gain as potential hubs for litigation due to more relaxed standards on the proposal.
OECD launches report on impact of regulation on Finnish FDI
On May 19th, the Finnish Ministry of Economic Affairs and Employment hosted a launch of the report “The Impact of Regulation on International Investments in Finland”, conducted by the OECD. Amcham’s own Rosa Thurman, Director of Foreign Affiliate Services and Sustainability, addressed key points during the panel discussion. The report analyzes trends in FDI flows towards Finland and other Nordic-Baltic countries while also discussing the benefits of foreign investments for the Finnish economy. It also provides concrete policy recommendations, many of which resonate with our members and are driven forward by Amcham. Key findings of the report note the widening gap between Finland and other Nordic-Baltic countries in regard to attracting FDI, the need for a long-term and holistic vision of FDI in Finland, the current complex administrative procedures to recruit foreign talent and its effect on growth prospects, and more. Read more about the report here.
Furthermore, Amcham’s Vision for Finland Working Group will launch its FDI vision for Finland on September 15th. The working group is composed of 11 member companies, including Bayer, Medtronic, Borenius, Google, Microsoft, UPM, the International School of Helsinki, MPS, and Dittmar & Indrenius, who have come together to map out a long-term vision for FDI to Finland. Some of these companies are the biggest foreign and domestic investors in the country. Group workshops have been held to communicate that a long-term FDI vision is critical for the challenges ahead, not only for Finland’s leaders but also for attracting more foreign affiliates of international companies. The vision serves as a guide for inspiration and for the government to create a more comprehensive vision, and to create more commitment from the government.
Visa processing and immigration delays continue
Delays in U.S. visa processing continue to obstruct business travel, as a sweeping ban on travel from the Schengen area has been in effect since March 2020 and was extended by the Biden administration in January. As of June 18th, the EU has urged member states to allow leisure travel from the U.S.. Member states decide independently whether to follow the recommendation, though major players like France and Germany have been quick to give U.S. travelers the green light. Members continue to have full autonomy over testing and quarantine requirements. European travelers may need to wait for reciprocity, however. Neither the June U.S.-EU summit nor President Biden’s summit with PM Boris Johnson produced the concessions that analysts had hoped for, signalling the Biden administration’s continued hesitance on international travel. Answering a request from the White House National Security Council, we joined our colleagues from AmChams in Europe (ACE) in drafting a memo that addresses current and future constraints on transatlantic business and student mobility. As continued travel restrictions threaten to harm the U.S.’ reputation as a business partner, the issue remains a priority.
Amcham signs ‘Reform Migri’ petition in support of international talent
Amcham Finland has signed on to #ReformMigri, a petition to improve Migri’s current system and service procedures. The calls for items such as a streamlined application process with more efficient processing times of permit applications, consistent service delivery, and a transparent action plan outlining these improvements. Amcham Finland supports this petition as part of our mission to create an environment that allows international business to thrive. Finland needs to remain an internationally attractive place to work, which means conditions should be favorable for recruiting international talent. We need a constructive solution for improving the immigration experience so that individuals and their families can integrate quickly and efficiently into life in Finland. We believe that specific targets and transparent procedures will help to ensure the integrity and efficiency of the immigration process. Today, June 22nd at 3 PM, CEO Alexandra Pasternak-Jackson will represent Amcham in the Reform’s panel discussion that also features Migri General Director Jari Kähkönen and other influential speakers. You can see Reform Migri’s website here.
G7 backs new global minimum corporate tax rate of 15%
The G7 has backed a new global minimum corporate tax of 15 percent. If passed, this would require large multinational businesses to pay taxes in any country where their products are sold. The proposed accord is the product of long negotiations and follows the Biden administration’s plans to raise the U.S. domestic corporate tax rate from 21 to 28 percent, in part to finance its $2 trillion infrastructure plan. Next, the agreement will be presented to the G20 at the October summit. Open questions remain about the exact definition of a large multinational corporation, and whether the bill can pass in the U.S. Congress. According to the Financial Times, the move has already sparked strongly worded criticism on Capitol Hill. This poses a hurdle to the Biden administration, which needs a two thirds supermajority to modify international tax treaties. U.S. tech giants Facebook and Google have voiced public support for the agreement despite being particularly affected by the potential tax hike.
The Transatlantic Briefcase is curated with the latest information from trusted sources. We encourage you to forward this newsletter to your colleagues and contacts who may find it useful. Please contact us directly if you have any questions or comments.
Julia Mäklin Policy Officer julia.maklin@amcham.fi
Sophia Rahimeh Policy & Comms Assistant sophia.rahimeh@amcham.fi
Elsa Korpi Policy & Comms Intern elsa.korpi@amcham.fi
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