Arent Fox's International Trade Litigation Practice: Drawing Upon A Variety Of Talents To Serve Clients In Latin America And The World

Friday, October 1, 2004 - 01:00

Editor: Mr. Clark, please tell us about your professional experience.

Clark: I have been practicing in the customs and international trade
area since graduating from law school 21 years ago. I was first exposed to the
practice while still in law school here in Washington, DC, enjoyed it immensely,
and have stayed with it ever since. The practice is a very interesting blend of
complex legal and economic issues, and since it's a Washington-centered
practice, there are, of course, important policy and political adjuncts as well.

Editor: How did you come to Arent Fox?

Clark: I came to Arent Fox at the beginning of 2000, when our practice
group joined the firm. We were motivated to move to Arent Fox because it
presented an opportunity to take a litigation practice focussed on major cases
and move it onto a much broader platform, to a firm that had been a pioneer in
establishing international trade litigation within a large firm setting. A big
part of the attraction was Arent Fox's capabilities in important practice areas
that complimented our trade litigation practice and addressed our clients' needs
in areas such as licensing, intellectual property, and transactional and
corporate work. The Arent Fox teams in these areas are exceptional, and our
access to them has strengthened our practice to a considerable degree. Access to
these other disciplines was a key factor in convincing our group to move out of
what had been a strong, but one-dimensional, litigation setting.

Editor: Please describe your practice. I think our readers would be
particularly interested in your representation of leading industry participants
in complex antidumping and countervailing duty proceedings.

Clark: We have been very fortunate over the years to have represented
major players in the largest, most complex international trade disputes brought
under U.S. or, for that matter, international law. In those engagements we have
worked with some of the largest companies in the world, and with foreign
governments. Trade proceedings are different from the civil litigation that
companies routinely confront. Unlike the typical case pitting Company A against
Company B, trade cases are in rem proceedings, meaning that they are brought
against particular merchandise from one or more countries. As a result, the
cases draw in all of the foreign participants engaged in manufacturing that
item, big and small alike. Settlements are rare in trade cases (due primarily to
the involvement of government investigators and number of parties), but there
are opportunities for companies to proactively manage their exposure and their
liability to remedial duties. In fact, such planning is a critical piece of an
overall litigation strategy.

Editor: Since September 11th, security issues have been a major
consideration for our nation and for our trading partners. How has this affected
your practice?

Clark: The impact has been greater on the traditional customs side of our
practice than on the trade litigation aspects of the practice. As a result of
the events of September 11th, the United States and other countries have taken
important steps to increase border security and protect the integrity of the
international commercial system. By way of illustration, the U.S. Customs
Service moved from the Treasury Department to the new Department of Homeland
Security and was renamed the Bureau of Customs and Border Protection. More
substantively, CBP developed and implemented the "Customs-Trade Partnership
Against Terrorism." C-TPAT is a voluntary program under which importers can seek
and obtain approval of their cargo and shipping processes, reducing their
exposure to intervention and intensive cargo examination at ports when goods
arrive. In a just-in-time world, avoiding or reducing Customs delays is an
important part of any logistics process. The increased attention paid to
container security, cargo pre-clearance, and increased inspections are all
direct consequences of September 11th. Unfortunately events around the world
tell us that this type of vigilance is needed, and I expect close and careful
scrutiny of inbound cargoes to continue for a very long time.

Editor: Would you tell us about the resources that Arent Fox brings to
bear in the international trade arena? And with respect to Latin America

Clark: Because we have a dedicated international trade and customs
group populated with lawyers who only practice in those areas, we have the
resources and experience to handle large, complex trade litigation, including
the frequent occurrence of simultaneous investigations of producers in several
countries, and that extends to multi-national cases involving Latin American
companies. With respect to Latin America in particular, our trade capability
compliments (and is complimented by) the many other active Arent Fox practices
involved in Latin American proceedings and projects.

Editor: Is there a Latin America specific focus for some of these

Clark: There are a number of areas to which we have paid particular
attention over the years. We have a very strong presence in the intellectual
property arena in Latin America, for example. Another area is in the
establishment of investment funds with a Latin American focus. And, of course,
we have been fortunate to work on several critical trade disputes involving
Latin America. As a consequence of our long involvement in Latin America, we
have strong relationships with some of the leading firms in Brazil, Argentina,
Chile, and Venezuela, among other countries.

Editor: You have written extensively on a variety of international trade
issues. What, in your opinion, are the most important issues that clients
engaged, either as importers or exporters or both, ought to be focussed on?

Clark: I think there are two categories of issues. There are systemic
issues, which are technical in nature and need to be addressed as part of any
company's compliance effort in the international trade arena. This is the area
occupied by import compliance and Customs issues, like the C-TPAT program I
mentioned earlier. The other category, although episodic, is becoming more
common and the stakes are increasing. Here I refer to the international trade
litigation side of the practice. Allegations of unfair trade practices are
increasing both as to frequency and volume, and creep increasingly into
international trade discussions and negotiations. Companies dealing in the
international arena need to analyze their risk profile for such challenges and
prepare to deal with these allegations if and when they arise. Trade proceedings
move quite fast, and they look at past pricing and competition, so planning
provides a distinct advantage to those who act in advance of an allegation.

Editor: You have indicated that the elimination of textile quotas by the
end of this year is an important development in the international trade arena.
What does this mean from the U.S. perspective? From the Latin American/Caribbean
side? From China?

Clark: The "Multifiber Arrangement", a multinational quota arrangement
on textiles, is due to expire in January 2005. As that day draws closer, there
is increasing activity on the part of various interests to preserve some of
these restrictions or adopt a phased implementation to reduce the quotas more
slowly. Some of this comes from domestic producers in the U.S., but much is from
outside the U.S. and Europe. For example, Caribbean textile producers are
concerned about being displaced in the U.S. market when big producers like China
and India are free of the constraints imposed by the existing quota regime. Of
course, those big producers look forward to the expiration of the quota regime,
as do some major retailers.

Editor: Much of your practice has a Latin American dimension. For
starters, please tell us about the effect NAFTA has had on your practice.

Clark: The biggest effect of NAFTA on my practice has been the
development of a unique system of appellate review for antidumping duty and
countervailing duty cases, the most common types of cases I handle. This was a
key element of NAFTA and a critical development in the international trade
arena. Many view the Chapter 19 process as injecting a level of fairness and
predictability into the trade litigation process that was not perceived to have
been present in the past. The experiences of Canada and the United States in
dealing with trade disputes under the predecessor Canada Free Trade Agreement
("CFTA") was one reason Mexico decided to move forward with NAFTA.

Editor: What about the concept of the entire Western Hemisphere as a free
trade bloc? Is this going to happen?

Clark: Developments over the last year make it unlikely that the
Western Hemisphere is going to become a single free trade area on the original
timeline, which called for an agreement by the end of January 2005. No progress
has been made to meet the intermediate September 30, 2004 deadline for an
agreement on goods trade. So a January 2005 overall agreement is unlikely. The
politics of the FTAA are complicated, and at present some of the players appear
skeptical, if not entirely hostile, to the concept. Brazil is a key component
for the success of the Free Trade Area of the Americas as both a leading
exporter and importer and an important destination for foreign investment.
Brazil and the U.S. have some significant areas of disagreement at the moment,
and a great deal of work must be done before Brazil will be ready to join a free
trade bloc that covers the entire hemisphere.

Editor: What about the future? Is the gradual extension of free trade
agreements across the world likely to continue?

Clark: I do think free trade agreements will continue to proliferate.
In the United States we tend to focus on the discussions to which the U.S. is a
party, but much of the free trade activity around the world does not involve the
U.S. Other countries and regions are moving aggressively to establish free trade
relationships and are doing so at a much faster pace than is the U.S. This
includes the EU, Japan, and the countries of Southeast Asia. Here again, global
businesses need to pay attention to these developments and not focus exclusively
on the U.S.

Editor: Speaking of the future, please give us your thoughts on where you
would like to see your practice group, and Arent Fox's international trade
practice in, say, five years.

Clark: We enjoy a very high quality practice now and have for a long
time. I think we are moving in the right direction to expand our practice and
increase our reach. As a result of trade proliferation, new markets and
producers are emerging and beginning to become important participants in the
international trading arena. One price of success for these new entrants will be
unwanted attention in the future from entrenched market participants who will
try to use the trade laws to limit this new competition. When that happens, I
expect Arent Fox to be well positioned to help those companies and their
customers navigate the complexities of trade litigation and day-to-day Customs
formalities. In short, I expect us to occupy an even larger share of the
practice market than we do today.

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