Despite protest and all efforts to find a diplomatic solution, the US government has introduced punitive duties on steel (25%) and aluminium (10%) imported by European, Canadian and Mexican companies on Friday, 1 June 2018. The same day, the EU responded promptly and submitted a request to the World Trade Organization (WTO) for consultations under a dispute settlement procedure. Canada, the largest steel supplier to the US, has also initiated proceedings at the WTO. The Canadian Foreign Minister has announced to closely cooperate with the EU. Mexico has also expressed its intention to take action against the US.

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During Germany’s Foreign Minister Maas’ recent visit to Washington, D.C., President Trump announced that the US government would consider punitive tariffs on automobiles and automotive parts. This statement is just another step towards the US government’s efforts to isolate the US economy.

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Excise duty expert Hardy Bublitz joined BLOMSTEIN as independent Senior Excise and Trade Advisor in February 2018. Hardy Bublitz, 58 years old, is a renowned expert in excise duties, especially with regard to energy and electricity taxes. He began his career in 1982 in the Federal Customs Administration, where he worked inter alia as an auditor in the mineral oil industry. In 1985, Hardy Bublitz joined Shell, where he held various executive positions until the end of 2017 – most recently as Head of Indirect Tax Advocacy & Litigation DACH (Germany, Austria and Switzerland). Hardy specialises in European and national customs law and excise duty law as well as indirect tax compliance. He is a distinguished speaker at events and trade conferences, and an esteemed lecturer in excise duty trainings and in-house seminars.

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The European Court of Justice (ECJ) delivered a judgement with potentially far-reaching consequences for companies’ liabilities in public international law. On 27 February 2018 (Case C-266/16Western Sahara Campaign UK v Commissioners for Her Majesty’s Revenue and Customs and Secretary of State for Environment, Food and Rural Affairs), the ECJ ruled on the validity of the Fisheries Partnership Agreement between the EU and Morocco (the Fisheries Partnership Agreement or the Agreement). The Court concluded that the Fisheries Partnership Agreement was not applicable to Western Sahara and its adjoining waters. Although the underlying circumstances are rather specific, the case deals with general issues of public international law. Companies engaging in commercial activities in this region or other disputed territories should, therefore, carefully examine the judgement’s impact on their businesses. The case is a vivid reminder that trade and investment in disputed areas bear significant political and legal risks.

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The ECJ is about to clarify how excise duties on beer are calculated and whether there is a specific tax duty on flavoured beer. In a request for a preliminary ruling, a Polish court asked for clarification whether substances added after fermentation (e.g. sugar, flavours) may be taken into consideration in the overall calculation of the beer tax. The Advocate General took the position that this should not be the case and that substances added after fermentation should not increase excise duties.

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On 11 December 2017, a Council Decision finally established the Permanent Structured Cooperation (PESCO) in defence. The Council Decision was ultimately approved by 25 Member States, less than a month after a joint notification by the ministers of 23 Member States on their intention to participate. Along with the Council Decision, the participating Member States published an initial list of collaborative PESCO projects. These include research, procurement and upgrade projects regarding a variety of sectors, including prototypes for infantry vehicles, autonomous maritime surveillance systems and mine countermeasures, cyber security, radio and indirect fire support solutions, logistic hubs, operational support, military mobility measures and the establishment of a European Medical HQ, as well as training centres.

The pending implementation of PESCO for European defence projects raises a number of questions. We will focus on the effects on future defence procurement.

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On 13 October 2017, President Trump refused to “recertify” the international nuclear understanding with Iran (Joint Comprehensive Plan of Action, JCPOA).

On 31 October 2017, 41 individuals and entities associated with the Islamic Revolutionary Guard Corps (IRGC) have been designated under US terrorism sanctions. These new designations are part of a growing trend towards unilateral US sanctions imposed without prior consultation or coordination at an international level.

In the following, we give an overview of this trend, taking the recent US developments regarding the JCPOA and the US sanctions on Russia as examples. We examine the potential repercussions of these US sanctions for EU companies and potential reactions by the EU.

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The control of foreign investments has become increasingly important in the last few years. In Germany, the Foreign Trade and Payments Ordinance (Außenwirtschaftsverordnung – AWV) has recently been amended. Moreover, for the first time, foreign investments in Germany were prohibited. In the USA, prohibitions have increasingly been issued by CFIUS and extremely long durations of proceedings are being reported. On the initiative of Germany, France and Italy, the European Commission (Commission) has now also taken up the issue: On 13 September 2017, the Commission submitted a Proposal for a Regulation Establishing a Framework for Screening of Foreign Direct Investments into the European Union (Regulation Proposal).

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At this year’s Colloquium on Suspension and Debarment, hosted by The World Bank in Washington, D.C. on 14 September 2017, recent developments in suspension and debarment issues worldwide and their various uses in the context of procurement and anti-corruption were examined.

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The failure of the Doha Round and other multilateral efforts to liberalise trade has led to international trade policy occurring mainly on a bilateral level. The EU in particular has followed an active commercial policy in recent years. The aim of the resulting so-called “new generation” Free Trade Agreements is not only to facilitate cross-border trade of products, but also to develop international supply chains, to create mechanisms for the implementation and the enforcement of the law and to open the market as a whole. Hence, Free Trade Agreements include a wide range of regulations, which go beyond classic regulations to reduce tariff and non-tariff trade barriers.

The comprehensive regulatory content of bilateral trade agreements raises the question: does the EU have the competence to conclude such trade agreements? This question was the subject of the request for an opinion by the European Commission before the Court of Justice of the European Union (CJEU). The proceeding concerned the Free Trade Agreement with Singapore. The court published its highly anticipated opinion on 16 May 2017 (C-2/15 – the Opinion).

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