Recent developments concerning foreign corruption prosecutions, taxation of multinationals, national security reviews, and criticism of U.S. trade policy as being increasingly based on national interests and power politics remind me how really diverse the field of international trade relations is today. Here are some recent developments.
…. Microsoft is under investigation for violating the foreign corruption act (FCPA) in China via its foreign subsidiary and foreign partners. This was started by a whistleblower acting under the newer provisions of the Dodd-Frank legislation of 20120. “U.S. Probes Microsoft, Partners Over Bribery Claims.” Wall Street Journal (March 20, 2013). Panasonic is also under investigation. “Panasonic Draws U.S. Bribery Probe.” Wall Street Journal (April 1, 2013) (data from DOJ — 108 cases — and SEC — 77 cases — as to FCPA litigation since 2009 resulting in over $2bn in penalties).
…. Excellent overview of problems taxing multinational corporationsand how aggressive they have become in reducing their tax burden over last 20 years. “Tax Burden Isn’t What It Used To Be.” Washington Post (March 23, 2013). This article discusses the MNC intra-group short-term loans as a primary use of offshore monies and raises the issue of repatriation. “How Firms Tap Overseas Cash.” Wall Street Journal (March 29, 2013).
….The proposed Softbank Corp – Sprint/Nextel merger is subject to a national security review as a foreign merger (in this case a Japanese firm) and is again raising the issue of Huawei and ZTE as telecom equipment suppliers. This involves WTO trade rules as far as restricting foreign imports. “China Worries Arise in Sprint Deal.” Wall Street Journal (March 28, 2013).
…. Interesting argument that power politics and national interest are back at the expense of multilateralism and the WTO. Bilateral trade arrangements are in favor and multilateralism across the board is not (from climate control, to international security interests). “Trade Deals Show Power Politics is Back.” Financial Times (April 1, 2013).