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Recently, New York enacted a new law against gendered pricing that was included as a key component of the state’s Fiscal Year 2021 budget and Governor Cuomo’s 2020 Women’s Agenda. In a press release announcing the law, Governor Cuomo states, “By abolishing the pink tax, women and girls will no longer be subject to harmful and unfair price discrimination and any businesses who fail to put an end to this despicable practice will be held accountable.” Other state actors are quoted as lauding the new law and comparing the “pink tax” to gender discrimination against women.

The new law, GBS, § 391-U, which went into effect on September 30, 2020, prohibits charging different prices for goods or services that are “substantially similar” but are marketed to different genders. The law applies at all levels of the supply chain. Goods under the law are defined broadly as “any consumer product used, bought, or rendered primarily for personal, family or household purposes.” “Substantially similar” goods are defined as those that “exhibit little difference in the materials used in production, intended use, functional design and features, and brand.”

Similarly, services under the law are described as “any consumer services used, bought or rendered primarily for personal, family or household purposes.” Services that are “substantially similar” are those “that exhibit little difference in the amount of time delivering, difficulty, and cost in providing the service.” Consumers may ask those who provide services for a price list in advance.

The gendered pricing law could impact a wide range of goods and services, including but not limited to:

  • Personal care products such as razors, deodorant, toothbrushes, and body wash
  • Gendered toys and children’s clothing
  • Adult clothing of the same brand
  • Dry cleaning, tailoring, laundry services, and haircuts

The law could also potentially be read to cover sellers like car dealerships or financial service providers if they sell their products or services at different prices to women and men.

On the other hand, businesses whose pricing is based on difficulty, cost incurred, time, labor, or materials involved in manufacturing a good or offering a service, or any other gender-neutral reason for a price differential, should not be concerned about running afoul of the new law. However, these businesses should ensure they are able to document these reasons for the price difference in case they become subject to investigation.

California already has an analogous law, the Gender Tax Repeal Act, which prohibits price discrimination for similar services based on gender. However, this law is limited to services and does not cover goods. California’s law also requires certain businesses, such as hair salons, tailors, and dry cleaners, to clearly and conspicuously post pricing lists for their services, while New York’s law only recommends such disclosures and requires businesses to provide customers with pricing lists upon request.

The press release states that those who violate the gendered pricing law are subject to injunctive relief, consumer restitution, and fines of up to $250 for the first violation and up to $500 for any subsequent violation. To avoid liability under this law and becoming subject to the accompanying fines, any business which sells similar goods or services to different genders should carefully ensure that its pricing system does not violate the law against gendered pricing and that it can support pricing differences with documentation showing legitimate reasons for such variance. Additionally, businesses should be on notice that other states may follow in New York’s footsteps and enact similar laws against gendered pricing of goods and services.

The U.S. Department of Transportation (DOT) hazard class ORM-D will expire on December 31, 2020. ORM-D stands for Other Regulated Material and is a hazard class specific to the U.S. ORM-D is widely used for consumer commodities that are hazardous materials subject to the DOT Hazardous Material Regulations but that present a limited hazard during transportation due to their form, quantity and packaging. DOT defines a consumer commodity as a material that is packaged and distributed in a form intended or suitable for retail sales for consumption by individuals for purposes of personal care or household use. Common examples of ORM-D materials include hairspray, nail polish, aerosol cans of shaving cream, insect repellents, drain openers, and household cleaners.

DOT’s original rulemaking phased out the ORM-D class for air shipments by December 31, 2012 and ground shipments by December 31, 2013. After industry challenged the deadline for ground shipments, DOT extended the deadline to December 31, 2020.

DOT phased out the ORM-D classification in order to align U.S. regulations with international transportation standards, specifically the Limited Quantity exceptions. The Limited Quantity exceptions for highway shipments are very similar to the ORM-D requirements. Like ORM-D shipments, Limited Quantity shipments generally are exempt from the use of UN specification packaging when packaged in combination packagings where the inner packagings meet the specified capacity limitations and are packed in strong outer packagings. The package must be marked on one side or end with the Limited Quantity mark:

   

Limited Quantity shipments by highway are also exempt from labeling and placarding requirements, as well as from shipping paper requirements provided the materials are not hazardous wastes, hazardous substances, or marine pollutants. Shippers and carriers of Limited Quantity shipments must receive full DOT hazardous materials training.

Companies should ensure that they do not offer any packages marked ORM-D for transportation after December 31st. This may require early shipping of existing stock. DOT has provided verbal guidance that any ORM-D package that is already in transit on January 1, 2021 is allowed to continue to its destination without being subject to enforcement. Shippers that plan to use a Limited Quantity exception in lieu of the ORM-D class should ensure that their packages comply with all of the Limited Quantity requirements, particularly the inner packaging capacity limits and the Limited Quantity mark.

On November 3, 2020, California voters approved California Proposition 24, also known as the California Privacy Rights Act of 2020, or CPRA. The CPRA expands protections afforded to personal information, building off of the California Consumer Privacy Act (CCPA), which took effect in January of this year. While some of the CPRA changes will take effect immediately, most will not become enforceable until July 1, 2023, and apply only to personal information collected after January 1, 2022.

Key Changes to CA Privacy Law

At 54 pages long, the CPRA makes numerous changes to the CCPA, ranging from minor revisions to the introduction of new concepts and the creation of several new consumer rights. Some of the most impactful changes are discussed below. A series of future client alerts will explore the nuances of these changes in greater detail.

Sensitive Personal Data

The CPRA establishes new rules for a category of “sensitive personal information,” which includes, for example, genetic data and religious or philosophical beliefs, and is defined as personal information that reveals:

(1)

  1. a consumer’s social security, driver’s license, state identification card, or passport number;
  2. a consumer’s account log-in, financial account, debit card, or credit card number in combination with any required security or access code, password, or credentials allowing access to an account;
  3. a consumer’s precise geolocation;
  4. a consumer’s racial or ethnic origin, religious or philosophical beliefs, or union membership;
  5. the contents of a consumer’s mail, email and text messages, unless the business is the intended recipient of the communication; and
  6. a consumer’s genetic data; and

(2)

  1.  the processing of biometric information for the purpose of uniquely identifying a consumer;
  2.  personal information collected and analyzed concerning a consumer’s health; or
  3.  personal information collected and analyzed concerning a consumer’s sex life or sexual orientation.

This definition is among the most impactful changes in the CPRA, given the breadth of data that it sweeps in, along with the creation of new disclosure and opt-out rights associated with “sensitive personal information.” These changes will likely require covered businesses to dive into their data, map it, and ensure they are compliant.

In addition, the CPRA creates a right for consumers to “limit use and disclosure of sensitive personal information.” Similar to existing CCPA opt-out rights, beginning in 2023, consumers may direct businesses that collect sensitive personal information to limit its use to that “which is necessary to perform the services or provide the goods reasonably expected by an average consumer” or to perform a small subset of specifically identified exempt services. Significantly, exemptions to the opt-out will include short-term, transient advertising, and “performing services on behalf of the business,” but not general advertising and marketing, nor long-term profiling or behavioral marketing technologies. Continue Reading CCPA 2.0? California Adopts Sweeping New Data Privacy Protections

Recalls in Review: A monthly spotlight on trending regulatory enforcement issues at the CPSC.

If you have ever owned a laptop or hoverboard self-balancing scooter, you’ve likely seen numerous headlines about the lithium-ion batteries overheating, melting, or igniting.  We recently wrote about ways in which companies can mitigate risks and execute recalls related to lithium ion batteries.  In today’s installment of “Recall’s in Review,” we look back at CPSC regulatory actions involving lithium-ion batteries.

The batteries have become a highly regulated product over the last several years.  The Commission has conducted at least 64 recalls involving lithium-ion batteries since 2006.  The number of recalls rose substantially in 2016 and 2017, many of which were related to the rechargeable lithium-ion batteries inside hoverboards and laptop computers.  The Commission took a more active role in warning consumers about the hazards posed by the batteries after two incidents of overheating lead to serious house fires in March and October of 2017.

Only one civil penalty relating to lithium-ion batteries has been issued by the Commission, in early 2012. The manufacturer was fined $425,000 for failure to timely report that certain lithium-ion battery packs could overheat. Continue Reading Recalls in Review: Lithium-ion Batteries

A proposed law issued by the People’s Republic of China (PRC) on October 21, 2020, the draft Personal Information Protection Law, seeks to impose restrictions on entities and individuals, including those operating outside of China, that collect and process personal data and sensitive information on subjects in China. The proposed law also provides for penalties up to RMB 50,000,000 ($7.4 million) or up to 5 percent of the entity’s or individual’s preceding year’s revenue. The draft law marks China’s first comprehensive system for the protection of personal information and sets forth general rules for the processing and transferring of personal information across China’s borders.

The draft law, which contains eight chapters and 70 articles covering cross-border data transfers, the rights of personal information subjects, the responsibilities of personal information processors, and penalties, sets forth strict requirements for the collection and maintenance of sensitive personal information. Under the proposed law, “personal data processors” must demonstrate a specific purpose and necessity for the collection of sensitive personal information. The law also includes consent requirements. U.S. companies may be most interested in the contemplated extraterritorial jurisdiction of some provisions in the draft law, which could create additional risk for companies operating in China or providing goods and services to those in China. The proposed law would apply to companies overseas (1) that process personal data of subjects in China in order to provide products or services to them, (2) that analyze and assess the activities of subjects in China through the collection of personal information, or (3) in other circumstances as provided by Chinese laws and regulations. Companies engaging in such activities also would be required to provide a point of contact within China to government authorities.

The Standing Committee of China’s National People’s Congress is accepting comments on the proposed law until November 19, 2020. If approved, the law will complement China’s existing Cybersecurity Law, which requires that certain data are stored within China and that organizations and network operators submit to government security checks, and the draft Data Privacy Law, which would regulate data transfers, including cross-border transfers that could have China national security implications. Crowell & Moring and Crowell & Moring International (CMI) have extensive experience assisting companies navigate these laws, including:

  • Retailers and other companies that collect and analyze Chinese consumer data
  • Companies with technology hubs or development centers that rely on cross-border data transfers
  • Technology companies deploying software or applications intended to collect, store and analyze Chinese individual and corporate consumer and operational data.

We stand ready to assist any companies that elect to submit comments directly or through trade associations (please note that many trade associations request comments the week of November 3rd). Please contact any of the individuals listed below if you or your company would like to learn more about the proposed law or the process of submitting comments.

For the first time in nearly two decades, China is revamping its export control regime and issuing its first unified Export Control Law, which combines concepts from more than a dozen existing Chinese laws and related regulations. This alert summarizes the most significant changes from current Chinese export control practice, highlights what may be included in the pending Export Control Law, and comments on anticipated impact on businesses operating in China. We also provide some recommended approaches for companies with China operations (or rely on third parties in China) to consider in advance of implementation of the Export Control Law.

On August 28, 2020, China’s Ministry of Commerce (“MOFCOM”) and Ministry of Science and Technology released an Amendment to the Catalogue of Technologies Prohibited or Restricted from Export by China (“2020 Export Control Catalogue”).  The original catalogue was released along with the Regulations on the Administration of the Import and Export of Technology effective on January 1, 2002 (“Import and Export Regulations”, amended twice in 2011 and 2019).

In addition to the 2020 Export Control Catalogue, the Chinese government is also in the process of finalizing the draft of the Export Control Law. On December 28, 2019, the Standing Committee of the National People’s Congress (“NPC”) released the draft Export Control Law, a revised version of an earlier draft first published by MOFCOM on June 16, 2017. On July 3, 2020, the NPC published a further revised draft. With three rounds of draft being released, the Export Control Law will likely be finalized and published soon. This will be the first comprehensive national export control legislation in China, and China’s first step towards a unified export control regime.

What are the major changes under the 2020 Export Control Catalogue?

A total of 53 categories of technologies have been deleted, revised, or added to the 2020 Export Control Catalogue. Major changes include:

  • Removing 4 items from prohibited list, including 1) microbial fertilizer technology, 2) caffeine production technology, 3) riboflavin (VB2) production process, and 4) vitamin production.
  • Removing 5 items from restricted list, including 1) new city epidemic vaccine technology, 2) natural pharmaceutical production technology, 3) bioactive functional polymer material preparation and processing technologies, 4) chemical synthesis and semi-synthetic drug production technology, and 5) information security firewall software technology.
  • Adding 23 items to restricted list. Among others, several here captured attention, including “computer service” and “software industry”. For instance, technologies relating to AI are listed, including speech synthesis, voice recognition, interactive understanding technology, print scanning and identification, handwriting photographing and identification, and “personalized information push service technology based on data analysis”. These items, particularly the last one, could have potential impact for multinational clients seeking to leverage the Chinese consumer base. For example, e-commerce or app based business models that rely on data analytics could be covered by the restricted list. This might include international push marketing tools that use market intelligence from Chinese consumers to suggest products for purchase. Similarly, cloud or app-based tools that multinational companies use to analyze marketing and sales data as part of determining the right product mix to sell to Chinese companies could be impacted. In addition, technologies relating to cybersecurity, including cryptographic chips design, implementation technology, quantum cryptography technology have also been added and are now subject to restriction.

What is new under the upcoming China Export Control Law?

Based on the latest draft released on July 3, 2020, the highlights include:

  • Scope of controlled items
    This will cover tangible goods (such as dual-use items, military products, nuclear) and key related technologies and services.
  • Blacklist management system for national security purposes
    For the purpose of “national security interests”, this will include authorization to prohibit export of certain controlled items to any specific destination, country, region, or to any specific entities or individuals. This covers authorization on an ongoing basis to assess destinations, determine the level of risk, and what corresponding control measures are appropriate.
  • Internal Compliance Review System
    This will encourage exporters to establish an internal compliance review system, which once adopted can support the success of their license applications for controlled items.
  • Exporter’s social credit record
    China has imposed a “social credit” system on individuals that grades their contribution to Chinese society. It has extended this concept to companies operating in China across multiple Chinese government agencies. The social credit system helps the Chinese government determine how compliant any given company is to Chinese government regulation, perhaps in a more coordinated manner when compared to other governments. The Export Control Law establishes that companies operating in China will be examined and graded according it its level of compliance or “social credit record.” It authorizes reliance by the export control authorities on “relevant credit records of the exporter”.  A company’s rating can determine, among other things, the level and intensity of the need for government oversight and scrutiny. In this case, it is expected that the export control authorities will also consider the social credit records of the license applicant available in the Chinese social rating systems of other agencies, such as China Customs, foreign exchange, tax and market/competition.
  • Extraterritorial jurisdiction enforcement
    In cases that endanger national security and interests, this will authorize extraterritorial jurisdiction and enforcement. Additional guidance will be needed to answer critical strategic questions, such as how China intends to enforce activity in other countries, such as the United States or UK and EU.

What kinds of activities will be defined as technology export?

According to the Import and Export Regulations, the term “technology export” refers to the transfer of technology from China abroad, through trade, investment, or economic and technical cooperation, including patent assignment, transfer of patent application rights, patent licensing, transfer of trade secrets, technical services, and “other forms of technology transfer”.

The Import and Export Regulations define “technology export” broadly and indicate that the examples of technology export provided above are illustrative and are not meant to be exclusive. We note that the catch-all nature of the definition, (i.e., “other forms of technology transfer”) is vague and provides the Chinese authorities with broad discretion to determine if any given activity would be regulated. Theoretically, the catch-all definition could include disclosing and disseminating technical information to any individuals or organization in any form overseas. Furthermore, it is not clear currently how far China’s jurisdiction will reach. For example, it is not clear how the definition of “technology export” (and exceptions thereto) impacts transfers between and among non-China affiliates or subsidiaries. Similarly, the definition’s impact on the transfer of technology to non-Chinese individuals, whether in China or abroad remains subject to further clarification.

In similar situations, we generally encourage clients to seek additional guidance and determine the relevant Chinese authority’s posture on any given activity. For example, technology that is public, widely-known or of non-Chinese origin could fall under the catch-all definition. It would be prudent in such circumstances to seek input from the relevant Chinese authorities to determine if the Import and Export Regulations would apply.

What are the export control procedures for technology transfer?

Technology is classified into three categories under the draft Import and Export Regulations and each category is subject to different levels of scrutiny.

  • Permitted (free export) Technology
    Permitted technology is eligible for export, subject only to the exporter’s contract registration with the Foreign Economic and Trade Department of China’s State Council (“FETD”). After completing the registration, the exporter may proceed with relevant foreign exchange, banking, tax, and China Customs procedures to effectuate an underlying export transaction by presenting a technology export contract registration certificate issued by FETD. Such registration, however, is not a prerequisite for the exporter to enter into any underlying contract with a non-Chinese buyer.
  • Restricted Technology
    Restricted technology (pursuant to the existing 2020 Export Control Catalogue) cannot be exported before obtaining approval through an application to FETD in what is a two-part process. If the application is approved, the exporter will receive a letter of licensing intent for technology export contract (“LOI”). The exporter may not undertake substantive negotiation or enter into any technology export contract with any overseas party before receiving a LOI. Once a technology export contract has been signed, the exporter must submit an application for a Technology Export License. The technology export contract will become effective when FETD grants the corresponding Technology Export License.
  • Prohibited Technology
    Prohibited Technology (pursuant to the 2020 Export Control Catalogue) is strictly prohibited from export in any way. Violations are subject to warning, confiscation of illegal gains, monetary fines, revocation of foreign trade permit, and even criminal liability.

How should multinational corporations prepare for compliance with the new law?

Given the newly released 2020 Export Control Catalogue which is now in force, and the upcoming Export Control Law, our recommendations for companies with operations in China:

  • Closely monitor ongoing developments in the export control catalogue and implementation rules or industrial guidelines that might be released by the Chinese government;
  • Consider establishing an internal export control review program with an appropriate compliance officer;
  • In the event a company has an affiliate or subsidiary in China contemplating a technology export transaction
    • Establish or strengthen established risk assessment and identification processes for your current products and technology, and classify them into categories of permitted, restricted, and prohibited items;
    • Seek informal opinions or clarifications from Chinese export control authorities during the transaction planning process when any forms of technology transfer are involved;
    • Go through contract registration with FETD for permitted technology even though it is not a prerequisite for an underlying technology export contract to take effect, as the actual enforcement of export control measures might differ from the literal meaning of the law;
    • Provide export control training to employees and add export control related clauses to template export contracts, user terms, and other relevant legal documents as needed.

Over recent years, the use of lithium ion batteries has become widespread in consumer products such as laptops, smartphone, hoverboards, electric scooters and bicycles, and power banks.  Unfortunately, many companies have been forced to recall their products over thermal events involving those products’ lithium ion batteries.

Manufacturers can mitigate their risks of fire hazards with lithium batteries by carefully choosing the right supplier, ensuring that batteries meet expected global industry standards and care is taken to ensure that the batteries are properly integrated into the products with appropriate battery management systems to mitigate the risk of thermal runaway.  The latest revision of UL 2272 (Standard for Electrical Systems for Personal E-Mobility Devices) provides a good example of attention not just to the manufacturing and design of the battery but all aspects of the product and the manner in which the battery and motor operate together in the product.  Emphasizing the effectiveness of UL 2272, the CPSC stated in its April 2020 report that despite numerous fires in products that were not compliant with UL 2272, including two fatalities, it was not aware of known substantial fires associated with products certified to the voluntary standard.

Despite best efforts, thermal issues do arise with lithium batteries.  Proper storage and handling practices can also mitigate the likelihood of thermal events.  There is no mandated regulation for lithium ion battery storage; just guidance and recommended best practices from various agencies.  The following guidelines for battery storage were derived based on numerous sources, including but not limited to, guidance from the Occupational Safety and Health Administration  and the National Fire Protection Association:

  • When storing, remove the battery from the equipment.
  • Batteries should be segregated from other materials in a warehouse and stored in a non-combustible, well-ventilated structure with sufficient clearance between the walls and the battery stacks. There should be clearance between the batteries to allow air to circulate.
  • Avoid extreme heat and freezing temperatures; avoid storage under direct sunlight or in front of a heating system, stove or other heat source.
  • Keep lithium-ion batteries cool and dry during storage. Be sure not to expose the battery to condensation, excessive humidity or water.
  • Lithium-ion must be stored in a charged state, ideally at 40 percent and between 30% and 50%.
  • Batteries should be stacked in a manner as to prevent short circuits; avoid storing the batteries in the places exposed to static electricity.
  • Batteries should not be opened, destroyed nor incinerated since they may leak or rupture and release in the environment the ingredients they contain.

Executing an effective product recall requires meticulous planning and navigating a plethora of thorny issues, including, but not limited to, reverse logistics.  This is especially so when either the recalled or replacement product involves a product with a lithium ion battery.

The transportation of recalled defective lithium batteries presents a challenge, not only under CPSC’s regulations, but also under the U.S. Department of Transportation (DOT) regulations.  In fact, the CPSC typically informs companies recalling products with these batteries that “a recall cannot be considered acceptable to CPSC staff if it does not comply with DOT regulations regarding transportation of hazardous materials.”  Therefore, some alignment of CPSC expectations and DOT requirements, specifically the Pipeline and Hazardous Materials Safety Administration (PHSMA), is typically necessary to ensure that all rules are followed and necessary permits are procured.

The following is high-level overview of the issues that companies recalling products with lithium ion batteries will face.

Lithium ion batteries and lithium metal batteries are regulated as hazardous materials under U.S. and international transportation regulations and standards, whether shipped alone, packed with equipment, or contained in equipment.  Defective lithium batteries are more likely to ignite during transportation, and may go into thermal runaway, generating intense heat.  Accordingly, DOT prohibits air shipment of lithium batteries identified as defective for safety reasons, as do international air transportation standards.

While DOT does authorize ground shipments of defective batteries, additional packaging requirements apply.  In addition, such batteries do not qualify for the partial regulatory relief available for shipments of small and medium lithium batteries[1], and must be shipped as fully regulated hazardous materials. This means, among other things, that persons preparing shipments of defective small or medium lithium batteries for transportation or transporting such shipments must have received hazardous material transportation training.  Also, many carriers charge a hazardous materials surcharge for fully regulated shipments.  Other carriers, such as FedEx Ground, state that they will not accept defective batteries that pose a safety risk.

In order to eliminate some of these difficulties, several companies have developed special packaging specifically for the transportation of defective lithium batteries and have obtained special permits from DOT for this packaging.  The special permits provide relief from some regulations for any shipment in these packagings.  Companies will find however that these packagings are expensive and can contain no more than a small number of lithium batteries. A company may also develop its own packaging and obtain a special permit from DOT for its use.

The transportation of lithium batteries continues to garner significant attention and regulations are unlikely to become more lenient. Companies facing a recall of defective lithium batteries need to consider transportation issues at the outset when developing a recall strategy. Attention also needs to be given to the plan for destruction of recalled batteries, which must be shared and approved by the CPSC when the recall falls within their jurisdiction, and may even be witnessed by agency personnel.  Best practices for lithium battery destruction include:

  • Dispose in accordance with the applicable regulations in country and state.
  • Disposal should be performed by permitted, professional disposal firms knowledgeable in federal, state or local requirements of hazardous waste treatment and hazardous waste transportation.
  • Incineration should never be performed by battery users, but eventually by trained professional in authorized facility with proper gas and fume treatment.
  • Battery recycling should be done in authorized facility.

Advance planning and communication with the right regulatory bodies should smooth some of the potential pitfalls when conducting such a recall.

[1] Small lithium metal batteries have a lithium content of ≤ 1 gram (g) of lithium content per cell and ≤ 2 g per battery, and small lithium ion batteries have a Watt-hour (Wh) rating of ≤ 20 Wh per cell and ≤ 100 Wh per battery. For medium batteries, these limits increase to 5 g lithium content per cell and 25 g per battery and 60 Wh per cell and 300 Wh per battery respectively.

Global Trade Talks is a podcast that shares brief perspectives on key global issues on international trade, current events, business, law and public policy as they impact our lives.

In the latest episode, hosts Nicole Simonian and Ambassador Robert Holleyman interview Fred Hochberg, former Chairman and President of the Export-Import Bank of the United States. In addition to his roles in government service and academia, he spent nearly two decades as an executive at the Lillian Vernon Corporation earlier in his career.  They discuss his recent book, Trade is Not a Four-Letter Word, as well as his perspectives on trade now and where it might be going.  To listen to the episode, click here.

U.S.-China trade relations and economic policy are highly politicized within the United States, and are key issues in the campaigns of both President Donald Trump and the Democratic nominee, former Vice President Joe Biden. A theme has emerged in the campaign messaging battles, with neither candidate ceding any ground on their “tough on China” bona fides. But as divergent as Trump and Biden are on many policy issues, when it comes to China and trade, there is some overlap between Trump’s executive actions and Biden’s campaign agenda.

Aggressive U.S. policymaking to call-out and sanction interests within China has strong bipartisan support among Washington officials. The expansion of national security laws in Hong Kong, the treatment of the Uyghurs in Xinjiang, China’s trade practices and industrial policies, the COVID-19 pandemic, and South China Sea have all converged to put China into the spotlight of the U.S. elections, even more so than in 2016. It can be expected that a challenging U.S.-China relationship will continue regardless of who wins the White House in November. For global businesses, these growing geopolitical and regulatory challenges do not present a static ‘new normal’ to adjust to, but rather an increasingly dynamic environment, requiring more nimble and proactive strategic planning, sourcing, policy, and compliance efforts.

Continue Reading Election 2020: U.S.-China Tensions Will Remain Regardless of Who Wins the White House

This article was originally published in Automotive World.

The future of the mobility is dependent on AI, but without greater understanding among consumers, trust could be hard to build.

The mobility sector is keen to realise the full benefits of artificial intelligence (AI), not least to open up the revenues which data-driven connected services could offer. But moving forward, it must balance these opportunities with the rights of drivers, passengers and pedestrians. A number of concerns have already surfaced, all of which will become more pressing as the technology is further embedded into vehicles, mobility services and infrastructure.

Privacy and liability are two of the major challenges. As Christian Theissen, Partner, White & Case explains, mobility has become inherently connected to consumer habits and behavioural patterns, much like the e-commerce and social media industries. “The access, ownership, storage and transmission of personal data, such as driving patterns, must be taken into consideration by both lawmakers and companies gathering and using data,” he says. Meanwhile, in a world of AI-powered self-driving, at what point do regulators start blaming the machine when something goes wrong?

Automakers must build knowledge

Part of the challenge in considering these issues is that as things stand, there is limited understanding among consumers around what rights there are. “Consumers appreciate AI,” says Cheri Falvey, Partner, Crowell & Moring, “and in particular the ease with which navigational apps help guide them to their destination. Whether they appreciate how their data is accumulating and developing a record of their mobility patterns, and what their rights are in respect to that data, is another question.”

There is often little precedent for regulators to rely on when making new policy in this arena, so it’s a good time to create a proactive regulatory strategy that invites discussion and collaboration from the start

This is in part because it is not always clear when AI is at work. A driver may register when a car’s navigation system learns the way home, but won’t necessarily realise that data on how a car is driven is being collected for predictive maintenance purposes, or that their data is being fed into infrastructure networks to manage traffic flow.

Continue Reading Automakers and Regulators Must Educate Consumers on Mobility AI