Very Rare Move as Democrats Are Backing President Trump on China trade probe

WASHINGTON: Three top Democratic senators, in a rare show of bipartisanship, on Wednesday urged US President Donald Trump to stand up to China as he prepares to launch an inquiry into Beijing's intellectual property and trade practices in coming days.

Senate Democratic leader Mr Chuck Schumer pressed the Republican President to skip the investigation and go straight to trade action against China.

"We should certainly go after them," said Mr Schumer in a statement. Senators Ron Wyden of Oregon and Sherrod Brown of Ohio also urged Mr Trump to rein in China.

Tensions between Washington and Beijing have escalated in recent months as Mr Trump has pressed China to cut steel production to ease global oversupply and rein in North Korea's missile program.

Sources familiar with the current discussions said Mr Trump was expected to issue a presidential memorandum in coming days, citing Chinese theft of intellectual property as a problem. The European Union, Japan, Germany and Canada have all expressed concern over China's behavior on intellectual property theft.




US Trade Representative (USTR) Mr Robert Lighthizer would then initiate an investigation under the Trade Act of 1974's Section 301, which allows the president to unilaterally impose tariffs or other trade restrictions to protect US industries, the sources said.

It is unclear whether such a probe would result in trade sanctions against China, which Beijing would almost certainly challenge before the World Trade Organization (WTO).

The Chinese Embassy in Washington said in a statement to Reuters that China "opposes unilateral actions and trade protectionism in any form."

A spokesman for China's Ministry of Commerce told reporters in Beijing on Thursday that China puts a strong emphasis on intellectual property rights and that all WTO members should respect the rules of the organization.

"We hope the positive momentum of cooperation can continue following recent bilateral trade talks," said Commerce Ministry spokesman Gao Feng.

LEVERAGE FOR NEGOTIATIONS
U.S. Section 301 investigations have not led to trade sanctions since the WTO was launched in 1995. In the 1980s, Section 301 tariffs were levied against Japanese motorcycles, steel and other products.




"This could merely be leverage for bilateral negotiations," Mr James Bacchus, a former WTO chief judge and USTR official, said of a China intellectual property probe.

Some trade lawyers said that WTO does not have jurisdiction over investment rules such as China's requirements that foreign companies transfer technology to their joint venture partners, allowing sanctions to proceed outside the WTO's dispute settlement system.

But Mr Bacchus argued the United States has an obligation to turn first to the Geneva-based institution to resolve trade disputes, adding: "There is an obligation in WTO to enforce intellectual property rights that is not fully explored."

Mr Lighthizer and Mr Trump's Commerce Secretary, Wilbur Ross, have complained the WTO is slow to resolve disputes and is biased against the United States.

The threat comes at a time when Mr Trump has become increasingly frustrated with the level of support from Beijing to pressure Pyongyang to give up its nuclear and missile program.

Mr Trump has said in the past that China would get better treatment on trade with the United States if it acted more forcefully against Pyongyang. Beijing has said its influence on North Korea is limited.

China counters that trade between the two nations benefits both sides, and that Beijing is willing to improve trade ties.

A senior Chinese official said on Monday there was no link between North Korea's nuclear program and China-US trade.

Mr Wyden, the top Democrat on the Senate Finance Committee, wrote to Mr Lighthizer urging action to stop China from pressuring US tech companies into giving up intellectual property rights.

Mr Wyden's state of Oregon is home to several companies that could make a case regarding intellectual property rights and China, including Nike Inc. and FLIR Systems Inc.

To Run An Import/Export Business, Here Are Major Agencies You Will Need Most

Let’s take a look at the agencies you may be working with as you manage your import/export business. While they can be divided in broad strokes into importers and exporters, there are many variations on the main theme.

Export management company (EMC). An EMC handles export operations for a domestic company that wants to sell its product overseas but doesn’t know how (and perhaps doesn’t want to know how). The EMC does it all -- hiring dealers, distributors and representatives; handling advertising, marketing and promotions; overseeing marking and packaging; arranging shipping; and sometimes arranging financing. In some cases, the EMC even takes title to (purchases) the goods, in essence becoming its own distributor. EMCs usually specialize by product, foreign market or both, and -- unless they’ve taken title -- are paid by commission, salary or retainer plus commission.

Export trading company (ETC). While an EMC has merchandise to sell and is using its energies to seek out buyers, an ETC attacks the other side of the trading coin. It identifies what foreign buyers want to spend their money on and then hunts down domestic sources willing to export, thus becoming a pseudo-EMC. An ETC sometimes takes title to the goods and sometimes works on a commis­sion basis.

Import/export merchant. This international entrepreneur is a sort of free agent. He has no specific client base and doesn’t specialize in any one industry or line of products. Instead, he purchases goods directly from a domestic or foreign manu­facturer, then packs, ships and resells the goods on his own. This means that unlike his compatriot, the EMC, he assumes all the risks (as well as all the profits).

Let’s say you’re an exporter with a really hot product to sell. Who do you look for? A buyer, otherwise known as an importer. Here’s the rundown on the various types of importers:

Commission agents. These are intermediaries commissioned by foreign firms searching for domestic products to purchase.

Commission representatives. Similar to independent sales reps in the United States, these folks usually work on a commission basis, and because they don’t purchase (take title to) the product, they don’t assume any risk or responsibility.

Country-controlled buying agents. These foreign government agencies or quasi-governmental firms are charged with the responsibility of locating and purchasing desired products.

Foreign distributors. Similar to wholesale distributors in the United States, these merchants buy for their own account, taking title to and responsibility for the mer­chandise.

State-controlled trading companies. Some countries have government-sanctioned and controlled trading entities. These agencies often deal in raw materials, agricul­tural machinery, manufacturing equipment and technical instruments.

The major players

There are, of course, more players than just the importers, exporters and their cast of distributors and representatives. You’ll also be dealing with the major players in the game: the government entities.

Two important goals of the U.S. Customs Facilitation and Trade Enforcement Reauthorization Act of 2009 were enhancement of supply chain security and enhancement of trade facilitation. Toward those goals, the U.S. government created the U.S. Customs and Border Protection Agency (CBP) and the U.S. Immigration and Customs Enforcement Agency (ICE). Together these two agencies take on many more tasks than just checking for contraband souvenirs. According to their websites, they also:

• assess and collect customs duties, excise taxes, fees and penalties due on imported merchandise;
• intercept and seize contraband, including narcotics and other illegal drugs;
• process people, baggage, cargo and mail;
• administer certain navigation laws;
• protect American business, labor and intellectual property rights by enforcing U.S. laws designed to prevent illegal trade practices, including pro­visions related to quotas and the marking of imported goods;
• enforce the Anti-Dumping Act;
• provide customs records for copyrights, patents and trademarks;
• enforce import and export restrictions and prohi­bitions, including the export of technology used to make weapons of mass destruction;
• protect against money laundering;
• collect import/export data to translate into international trade statistics;
• secure the national borders;
• enforce immigration laws;
• strive to guard against terrorism.

The Bureau of Industry and Security (BIS) is another entity that governs the exportation of sensitive materials such as defense systems, plutonium and encrypted software. Headed by the Department of Commerce, BIS administers export controls, coordinates Department of Commerce security activities, and oversees defense trade. The BIS manages the export of most merchandise through the Export Administration Regulations, also known as EAR.

Beyond CBP, ICE and BIS, various agencies regulate the importation and exportation of sundry products. To find out which agencies oversee your particular product(s), contact visit the CBP’s website. 

Guided tour

Depending on whether you’re importing or exporting, you can also get answers to your pesky procedure questions from a customs broker or a freight forwarder.

The customs broker (sometimes called a customhouse broker) is the importer’s pal. It’s their job to know the ins and outs of importing in intimate detail and to handle them for you. Some brokers are small outfits; others are large corporate entities. The U.S. Customs and Border Protection (CBP) licenses them all.

When you hire a customs broker, they act as your agent during the entry process. They prepare and file the entry documents, acquire any necessary bonds, deposit any required duties, get the merchandise released into their custody or yours, arrange delivery to the site you’ve chosen and obtain any drawback refunds. A customs broker isn’t a legal necessity, but a good one will make your life considerably easier.

While the customs broker is the importer’s best friend, the freight forwarder is the exporter’s pal. Acting as the exporter’s agent, the international freight forwarder uses their expertise with foreign import rules and regulations as well as domestic export laws to move cargo to overseas destinations.

Freight forwarders can assist with an order from the get-go by advising you of freight costs, port charges, consular fees, special documentation charges and insurance costs. They can recommend the proper type of packing to protect your merchandise in transit, arrange to have the goods packed at the port or containerized, quote shipping rates and then book your merchandise onto a plane, train, truck or cargo ship. Like a concierge in a really good hotel, they can get anything you’ve got anywhere you want it to go.

Like customs brokers, freight forwarders are licensed, but in this case, by the International Air Transport Association (IATA) and Federal Maritime Commission (for ocean freight). You don’t have to use the freight forwarder’s services to transport your goods, and not all exporters rely on such services, but they’re a definite plus.

'Swimming the trade channel'

Now it’s time to take a swim in the trade channel, the means by which the merchandise travels from manufacturer to end user. A manufacturer who uses a middleman who resells to the consumer is paddling around in a three-level channel of distribution. The middleman can be a merchant who purchases the goods and then resells them, or they can be an agent who acts as a broker but doesn’t take title to the stuff.

Who your fellow swimmers are will depend on how you configure your trade channel, but for now, let’s just get acquainted with the group:

Manufacturer’s representative. This is a salesperson who specializes in a type of product or line of complementary products, such as home electronics. He often provides addi­tional product assistance, such as warehousing and technical service.

Distributor or wholesale distributor. A company that buys the product you’ve imported and sells it to a retailer or other agent for further distribution until it gets to the end user.

Representative. A salesperson who pitches your product to wholesale or retail buyers, then passes the sale on to you; differs from the manufacturer’s rep in that they don’t necessarily specialize in a particular product or group of products.

Retailer. This is the tail end of the trade channel where the merchandise smacks into the consumer. As yet another variation on a theme, if the end user is not Joan Q. Public but an original equipment manufacturer (OEM), you don’t need to worry about the retailer because the OEM becomes your end of the line. (Think Dell purchasing a software program to pass along to its personal computer buyer as part of the goodie package.)

Here is 2016 Top Ten Worst Entrepreneurs

All entrepreneurs fail. That’s not necessarily a bad thing, but when their misdeeds take investors, employees and customers down with them, that is. In terms of dysfunctional screw-ups and negative stakeholder impact, here is this year’s list of the worst entrepreneurs of private companies, counting down from ...

10. Matt Harrigan, founder and former CEO, PacketSled

On election day, Harrigan threatened to get a sniper rifle and kill Donald Trump. The Facebook post blew up social media, including Twitter and Reddit. The cybersecurity entrepreneur says he was drinking and joking, but the U.S. Secret Service and his board didn’t think it was funny. He has since stepped down as CEO. Talk about dumb and irresponsible. He's not the only one who suffered, mind you; his stakeholders lost a good CEO.

9. Shani Higgins, CEO, Technorati

Technorati was famous for tracking and rating blog sites. A high-ranking Authority score meant your blog had arrived. Then came Higgins, who pivoted to an ad platform. When she became CEO in 2011, Technorati was reportedly profitable, growing and ranked by ComScore as the nation’s 14th largest media company. But in February 2016, it was sold for just $3 million after having raised $38 million in venture funding. What happened? I don’t know, but it’s on Higgins. A sad ending for a once-storied brand.

8. Dave McClure, founder, 500 Startups

In a childish, expletive-laden temper tantrum, the Silicon Valley angel investor melted down on stage at a Web Summit conference in Lisbon. Why? McClure’s candidate for president, Hillary Clinton, lost the election. The thing is, nobody attended that conference to hear a political rant. That is not how a business leader is supposed to behave; certainly not a public figure who influences so many entrepreneurs. It’s an embarrassment and sets a terrible example for up-and-comers.  

7. Jessica Alba and Chris Gavigan, cofounders, the Honest Company

What’s more dishonest than using a toxic ingredient (SLS) you “guarantee” your products don’t contain, then denying it and calling the Wall Street Journal’s investigative reporting “junk science?” Calling yourself the Honest Company. Once reportedly valued at $1.7 billion and close to an IPO, Honest, which has raised more than $200 million in venture funding, now faces several consumer lawsuits and a potential down exit.    

6. Shervin Pishevar and Brogan BamBrogan, cofounders, HyperLoop One

In a wacky feud, BamBrogan and three executive coconspirators attempted a coup and were ousted from the startup. The insurgents then sued Pishevar and HyperLoop One, alleging breach of contract, wrongful termination, defamation, cronyism, nepotism and a death threat involving a hangman’s noose. You just can’t make this stuff up. The suit was later settled.   

5. Dinesh Lathi, former CEO, One Kings Lane

After raising more than $200 million at a most recent valuation of $800 million under then-CEO Doug Mack, who left to run Fanatics, Dinesh Lathi took over the company in 2014 and apparently ran the flash retailer into the ground. Bed Bath & Beyond acquired the home furnishings site in June for just under $12 million.

4. Gurbaksh Chahal, founder and CEO, Gravity4

Despite pleading guilty to two counts of battery against his former girlfriend, using political clout to attempt (unsuccessfully) to make the charges go away, getting ousted as CEO of RadiumOne, a workplace harassment and retaliation lawsuit, a new assault arrest against yet another girlfriend, the revocation of his probation and a one-year jail sentence, Chahal is still running what’s left of Gravity4. Crazy.

3. Josh Tetrick, founder and CEO, Hampton Creek

In August and September, Bloomberg broke several stories alleging that Tetrick was buying up his own Just Mayo to inflate sales figures and potentially defraud investors. Tetrick claims that a recent $100 million funding round valued the startup at $750 million, but the vegan reportedly has a habit of stretching the truth. Now the feds are investigating. So far, investors have his back, but for how long? It doesn’t look good.

2. Parker Conrad, founder and former CEO, Zenefits

As CEO of high-flying HR software startup Zenefits, Conrad promoted an aggressive sales culture. That’s fine, but not circumventing state regulations by enabling unlicensed salespeople to sell health insurance to small businesses. The scandal led to Conrad’s resignation and a $2.5 billion decline in the company’s private valuation.

1. Elizabeth Holmes, founder and CEO, Theranos

I took a lot of flak for naming Holmes the worst entrepreneur of 2015, but the last 12 months has shown the world what some off us saw from the beginning: that the self-promoting founder and her purported breakthrough technology that would transform the lab testing industry were frauds. Once valued at $9 billion, Theranos has abandoned its much-touted blood testing service and faces lawsuits from Walgreens, investors and customers. This will not end well for Holmes and company.

Donald Trump is Avoiding Conflict of Interest By Selling All His Stocks Including Apple and Google

Amid concerns that the president-elect’s holdings are a conflict of interest.

Donald Trump has ditched his stakes in Apple, Google, J.P. Morgan Chase, Nike, and Microsoft, a spokesperson for the president-elect said Tuesday.

The investment moves, which included selling shares of not only those companies, but all of his public traded shares, appear to be part of the president-elect’s effort to remove some of the many conflicts of interest Trump will have to tackle as president.

Trump transition spokesperson Jason Miller told reporters that the real estate mogul made the stock sales in June. The disclosure came on a call with reporters after one asked about Trump’s stake in Boeing—a company that Trump criticized on Twitter Tuesday.

Critics have argued that Trump’s stock holdings could be a conflict of interest for the president-elect after he steps in to the White House on Jan. 20. The president-elect held an interest in several financial institutions including Goldman Sachs and J.P. Morgan, as well as energy companies such as Halliburton and ExxonMobil. Those holdings have worried onlookers, who say that it could skew the president-elect’s stance of Wall Street regulation and climate change. Trump had already gotten criticism for owning a stake in Energy Transfer Partners, the company trying to develop the Dakota Access Pipeline.

It’s unclear when exactly Trump sold out of those holdings, though the S&P 500 was up roughly 2% at the beginning of June, before falling following the U.K.’s vote to leave the European Union on June 24.

Granted, Trump had a relatively small fraction of his overall wealth in the stock market, according to May filings with the Federal Election Commission. Roughly $40 million of his estimated $4 billion net worth was invested in the stock market, many of which were large-cap, value stocks, which generally do better than others when the market drops. But it also means that he hasn’t benefitted from the so-called Trump Bump. The stock market is up over 3% since Trump was elected president.

The bulk of Trump’s wealth is still tied up in his real estate development company, which will continue to create conflicts for the president-elect, and be an issue for critics.

Here were Trump’s 14 biggest stock holdings, according to the May filing, including shares of companies that Trump criticized on the campaign trail. (Campaign finance disclosure laws only require candidates give a range of value for their investments.)

14. Alphabet: $100,000 to $200,000

13. Caterpillar: $100,000 to $200,000

12. Phillips 66: $100,000 to $200,000

11. Celgene: $100,000 to $250,000

10. Gilead Sciences: $100,000 to $250,000

9. Visa: $100,000 to $251,000

8. General Electric: $100,000 to $250,000

7. Johnson and Johnson: $100,000 to $250,000

6. Nike: $100,000 to $250,000

5. McKesson: $100,000 to $250,000

4. J.P. Morgan Chase: $100,000 to $251,000

3. PepsiCo: $150,000 to $350,000

2. Microsoft: $300,000 to $600,000

1. Apple: $600,000 to $1.251 million

Trump is also expected to discuss his business holdings, as well as plans for the Trump Organization, at a Dec. 15 news conference. Trump has said he plans to turn over operations of his company to his adult children, though he has not given details on that transition.

Barack Obama and Donald Trump Fights Over Free Trade at Asia-Pacific Summit

US President Barack Obama on Sunday defended free trade as fellow Asia-Pacific leaders vowed to fight protectionism after Donald Trump's shock election victory sparked fears for the future of global commerce.

Trump's triumph in this month's US presidential poll has raised concerns that years of rolling back trade barriers could be reversed after the populist billionaire vowed to tear up a series of key deals.

His victory overshadowed a summit of the Asia-Pacific Economic Cooperation (APEC) group held in Peru this week where leaders, including Obama, China's Xi Jinping and Russia's Vladimir Putin, found themselves under fierce pressure to defend free trade.

Globalization and trade deals have been increasingly blamed in Europe and America for sending jobs abroad and eroding living standards, concerns reflected in both the election of Trump and Britain's "Brexit" vote in June to leave the European Union.

At the APEC gathering there was particular concern about the future of a major US-backed accord -- the Trans-Pacific Partnership (TPP), which Trump has vowed to kill off -- and that China was positioning itself to forge ahead with its own trade deals and fill a vacuum left by any American withdrawal.

But after the summit closed on Sunday, Obama said that the 12-nation trans-Pacific deal, a key part of his much-vaunted "pivot" to Asia, was far from dead and those involved still wanted to move forward with the United States.

The president also insisted trade was positive as long as it was carried out in the right way and sought to answer rising concerns about globalization, conceding that "historic gains in prosperity" had not been evenly distributed.

"That can reverberate through our politics," he said.

"That's why I firmly believe one of our greatest challenges in the years ahead across our nations and within them will be to make sure that the benefits of the global economy are shared by more people."

And he sent a message to a world that is increasingly wary of globalization: "The answer is to do trade right."

- 'Fight protectionism' -

Obama's concerns about growing inequality were echoed by other leaders at the gathering, with Singaporean Prime Minister Lee Hsien Loong saying steps must be taken to ensure that "no groups in society are left behind."

"Only then can we push ahead with trade and economic cooperation," he said.

APEC's 21 members from either side of the Pacific offered their own staunch defense of free trade as the annual summit ended, pledging to "fight against all forms of protectionism."

In addition the group vowed to refrain from competitive devaluation of their currencies, after Trump repeatedly accused China of keeping the yuan undervalued to boost exports and threatened to declare Beijing a currency manipulator.

But analysts were not convinced by the APEC statement, with senior analyst Jeffrey Halley at forex broker Oanda saying it sounded like "empty rhetoric."

"Most participants have very different definitions of what constitutes open markets and protectionism," he said.

While Obama sought to be upbeat about the TPP's prospects, some experts say Trump's attacks on the agreement -- which he called a "terrible deal" -- and his Republican allies' control of Congress mean it is dead in the water.

Other observers have suggested that the deal-making real estate mogul may seek to negotiate changes to the agreement once he takes office in January, and then claim a victory if a new version is passed.

A failure of the TPP would likely be welcomed by China, which was excluded from the deal and saw it as an attempt by the US to increase its clout in Beijing's backyard.

As the summit concluded Sunday, Chinese foreign ministry official Tan Jian took a veiled swipe at America, saying that countries "should not politicize free trade arrangements."

Trump's victory and the potential demise of the TPP means that even longtime US allies may soon be turning to Beijing in a region hungry for trade.

President Xi set himself up as the anti-Trump at this week's summit, defending open markets and pushing two rival agreements -- an APEC-wide deal and a 16-member accord that excludes the US.

Report Says Apple Mull Is Moving The Production of iPhone To The US

Could Apple start making iPhones in the United States? According to a report from the Nikkei Asian Review, the Cupertino-based company requested that Foxconn and the other iPhone manufacturer explore moving their smartphone production stateside.

"Apple asked both Foxconn and Pegatron, the two iPhone assemblers, in June to look into making iPhones in the U.S.," a source told Nikkei. "Foxconn complied, while Pegatron declined to formulate such a plan due to cost concerns."






But the change wouldn’t come cheaply, according to the report.

"Making iPhones in the U.S. means the cost will more than double," Nikkei’s source said.

President-elect Donald Trump has said that he wants Apple to move manufacturing to the United States, and he has also called China a “currency manipulator” and said he would impose tough trade tariffs on their exports. A Chinese publication, the Global Times, recently warned that a trade war between the two countries would, among other things, harm iPhone sales in China.


“US auto and iPhone sales in China will suffer a setback, and US soybean and maize imports will be halted,” should there be a 45 percent tariff on Chinese exports to America, the Global Times said. “China can also limit the number of Chinese students studying in the US.”

Apple declined to comment on the Nikkei story.

“Apple is responsible for creating more than 2 million jobs across the United States, from engineers, retail and call center employees to operations and delivery drivers," an Apple spokesman said in an email to Foxnews.com. "We work with over 8,000 suppliers from coast to coast and are investing heavily in American jobs and innovation.”