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ANTI
CORRUPTION
UK Committee chaired by Richard Fenning
(Control Risks Group)
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Richard
Fenning |
The
ICC Commission on Anti-Corruption encourages
self-regulation by business when confronting
issues of extortion and bribery and
influences international organisations
that have developed international conventions
to fight corruption. It has grown out
of ICC’s Standing Group on Extortion
& Bribery and reflects the impact
of new anti-corruption legislation and
policy developments at both a national
and international level.
The UK Committee on Anti-Corruption
held its inaugural meeting in October
2002, under the chairmanship of Richard
Fenning. It will monitor and contribute
to the range of overlapping anti-corruption
initiatives underway with the UK government,
EU and UN, as well as non-governmental
initiatives from groups such as Transparency
International. Meetings in 2003 will
include an overview of the anticorruption
debate and its impact on both MNCs and
SMEs and will also address specific
issues of whistle blowing and private-private
corruption.
One of the priority Commission projects
in 2002 was to review and revise the
ICC Fighting Bribery: A Corporate Practices
Manual. The UK Committee strongly supports
this project and some excellent work
was done during the year. The revised
manual will be launched in April 2003,
to coincide with the spring Commission
meeting and an American Bar Association
/ International Bar Association Conference
on Corruption, also to be hosted by
ICC.
In addition to this, work continued
on developing a study on countering
private-sector bribery. ICC is seen
as the foremost advocate for business
on this issue and will continue to take
a leading role with the OECD. During
2002, ICC Publishing and the Max Planck
Institute worked together on producing
this book outlining national examples
and providing a comparative of supranational
measures. The publication date is also
expected to be Spring 2003.
In June 2002, the UN Ad Hoc Committee
on the Negotiation of the United Nations
Convention against Corruption had its
second meeting in Vienna to discuss
a future legal instrument against corruption,
with a third meeting in October. A key
concern for business here is the multiplicity
of documentation on this issue, as well
as a lack of international consensus.
As part of ICC UK’s input, a meeting
was arranged with Ian Richards at the
Foreign & Commonwealth Office to
discuss the UK position and the best
way for business to proceed. UK members
who attended this meeting were Sarah
Allen (BG Group), Lucy Findlay (CBI)
and Jane Hansell (Shell International).
Andrew Berkeley, ICC United Kingdom’s
Trade Policy Consultant, will continue
to coordinate this work in 2003.
Another action item for the Commission,
and for the UK Committee, was to review
the monitoring Phase 2 of the OECD Convention
on Combatting the Bribery of Foreign
Public Officials. Four countries had
been reviewed by the end of 2002 and
ICC continued to lobby for the implementation
and peer review of the Convention in
existing signatory countries, as well
as outreach programmes to encourage
ratification by additional non-OECD
member countries.
Money laundering was another obvious
issue for the Anti-Corruption Commission
in 2002, as well as for the Banking
Commission and the Financial Services
& Insurance Commission. To address
this, a dedicated ICC Task Force on
Money Laundering would be established
in 2003.
The Commission met twice in 2003, in
April and October, both times in Paris.
UK members attending Commission meetings
were John Conyngham (Control Risks Group),
Jane Hansell (Shell International),
Chris Hughes (British American Tobacco)
and Stephen Walzer (British American
Tobacco).
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BANKING
TECHNIQUE & PRACTICE
UK Committee chaired by Roger Jones
(Lloyds TSB Bank plc)
 |
Roger
Jones |
The
UK Committee on Banking Technique &
Practice held two meetings during the
year, in preparation for the biannual
meetings of the ICC Banking Commission.
In addition to the Committee meetings,
considerable additional work was undertaken
by members, principally by the BBA Committee
on Documentary Credits, for which the
UK Committee is most grateful.
Three major pieces of work were completed
by the Banking Commission during 2002:
• International Standard Banking
Practice (ISBP), which builds on ICC
Opinions to clarify various parts of
UCP 500 that have been subject to query.
However, ISBP does not change UCP 500
and, in case of doubt, UCP 500 takes
precedence.
• A substantial document on transferable
credits bringing together much existing
information into a single document.
• eUCP, the electronic supplement
to the UCP. This recognises that, for
many years, a mix of paper and electronic
documents is likely to be seen. It is
also something of a first for Banking
Commission Codes of Practice, since
it seeks to anticipate and steer practice
in an evolving area as opposed to reflecting
existing practice.
The UK Committee has made a major contribution
to all three documents, having submitted
many pages of detailed comment, much
of which has been adopted and which
has led to more professional final documents.
The UK Committee has also been involved
in the debate on whether and when to
revise UCP 500 and took a strong stance
that, while a revision in principle
is supported, it is imperative that
this is developed as part of a pre-agreed
hierarchy of documents to avoid confusion
in the market place.
Other areas where the Committee has
been active are in ensuring that the
UK’s views are put forward on
money laundering and in connection with
the New Basel Accord, often referred
to as Basel II. The latter, which is
expected to come into force in January
2007, dictates the amount of capital
banks have to hold against various types
of obligations. Unfortunately, the formulae
relating to trade finance on occasion
produce some most peculiar results.
For example, a contingent liability
may require more capital than a straight
loan. As well as an approach by the
ICC Secretary General direct to the
Basel Committee, ICC United Kingdom
has also made representations on this
subject to the Financial Services Authority.
The Banking Commission met in Paris
in April and in Rome in October. UK
members attending Commission meetings
were: Neil Chantry (HSBC), Professor
Charles Debattista (Southampton Unversity),
Cyril Eden (Bank Leumi), Roger Jones,
Anne Miglorine (LTB Bank Ltd), Ake Nilson
(Marinade), Nevill Sawyer (Barclays),
Martin Shaw (Consultant), John Turnbull
(Sumitomo Mitsui Banking Corporation)
and Michelle Walden (SITPRO).
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BIOSOCIETY
UK Committee chaired by Dr Andrew Cockburn
(Monsanto UK Ltd)
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Andrew
Cockburn |
The
ICC United Kingdom Committee on BioSociety
was formed at the end of 2002, to reflect
the work of the new ICC Commission on
BioSociety. Several new ICC Task Forces
have also been set up on the following
specific areas: Access and Benefit Sharing;
Business Messages on Safety and Risk;
Liability and Insurance and Business
Positions on Ethics.
The inaugural meeting of the UK Committee
is due to take place in May 2003 under
the chairmanship of Dr Andrew Cockburn.
This subject has created a lot of interest
among UK members and we anticipate that
this will be a very active group.
The ICC Commission on BioSociety met
twice in 2002, in June and November,
both times in Paris. UK members attending
these meetings were Joanne Brook (Sprecher
Grier Halberstam), Robert Horsh (Monsanto),
Gillian Samuels (Pfizer) and Geraldine
Schofield (Unilever).
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BUSINESS
IN SOCIETY
UK Committee chaired by Robin Aram (Shell
International)
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Robin
Aram |
This
is a new UK Committee, set up in 2002
following the establishment in Paris
as a full Commission the former Group
on Business in Society.
The UK Committee only met once during
2002 and is at an early stage of development.
Its prime purpose is to ensure an effective
contribution to the Paris Commission
by ICC United Kingdom and to provide
a forum for UK members to monitor and
review the many corporate responsibility
initiatives currently emerging. The
Committee plans to work closely with
bodies like the CBI and the International
Business Leaders Forum to ensure there
is no unnecessary duplication in considering
such issues.
The Paris Commission, also chaired by
Robin Aram, met twice during 2002. A
major product was a booklet Business
in Society: making a positive and responsible
contribution, which sets out the ICC
position on corporate responsibility
and provides practical guidance to ICC
members thinking about developing their
own code of conduct or business principles.
The booklet was launched at a session
at the ICC World Congress in Denver.
Other issues considered by the Commission
during 2002 included progress with the
OECD Guidelines for Multinational Enterprises
(in conjunction with the Business and
Industry Advisory Committee to the OECD),
developments on corporate responsibility
in the International Standards Organisation,
the EU White Paper on corporate social
responsibility and the developing debate
and activity on socially responsible
investment and SRI indices.
Several distinguished guests were invited
to present to the Commission, including
Karina Litvack of ISIS Asset Management.
The Commission met twice in 2002, in
February and October, both times in
Paris. UK members attending Commission
meetings were Andrew van Chau (BP),
Mandy Cormack (Unilever) and Dr Bill
Kyte (Powergen).
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COMMERCIAL
LAW AND PRACTICE
UK
Committee chaired by Keith White (The
Crown Agents)
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Keith
White |
The
UK Committee on Commercial Law &
Practice met in May and November of
2002, in advance of the two annual Paris
Commission meetings.
During the year, the Committee made
a number of inputs and submissions to
the international Commission in Paris.
In particular, the Committee gave detailed
inputs to the shaping of the Force Majeure
& Hardship Clauses. Members also
provided the Commission with responses
to the UNCITRAL Questionnaire on Electronic
Contracting Practices.
At the end of October, ICC United Kingdom
held a successful seminar on Using the
URDG458 to Control Risk in Demand Guarantees.
The speakers were Dr Georges Affaki
(BNP Paribas), Professor Sir Roy Goode
(Oxford University) and Jeremy Smith
(Lloyds TSB). Keith White chaired the
event. It was both well attended and
well received and the UK Committee hopes
that there will be opportunities to
build upon it in order to focus greater
attention on the issues arising out
of the use of demand guarantees and
on promoting the use of the URDG in
appropriate circumstances.
UK Committee members attending Commission
meetings in 2002 were Professor Charles
Debattista (Southampton University)
and Andy Nemes (Institute of Export).
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COMPETITION
UK
Committee chaired by Stephen Walzer
(British American Tobacco)
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Stephen
Walzer |
The
UK Committee on Competition reflects
the work of ICC’s international
Commission on Competition, coordinated
by ICC Headquarters. The Commission’s
broader agenda involves contributing
to the work of the WTO on competition
and trade issues and facilitating international
mergers by working with the OECD and
the International Competition Network
(ICN).
In 2002, the work programme for the
UK Committee was extensive, covering
both the Commission agenda and also
issues of specific concern to UK business.
The Enterprise Bill was, of course,
towards the top of the agenda. The Bill
received Royal Assent on 7 November
and will come into effect in Spring
2003. This massive piece of legislation
substantially changes the merger regime
in the UK, in particular by removing
the element of political discretion
hitherto enjoyed by the Secretary of
State. It also imposes a new criminal
offence of cartelisation, with fines
and imprisonment. In addition, directors
may be disqualified for up to 15 years.
The Committee has noted this development
in the context of the vastly increased
activity of the Brussels Commission
and of the US authorities in the area
of international cartel enforcement.
Another issue of concern to the Committee
was criminalisation, particularly in
the context of proposed amendments to
the Australian Trade Practices Act released
in June 2002. The amendments were aimed
at introducing criminal sanctions for
companies colluding with competitors
to fix prices, rig bids, limit output
or share markets. Under the proposals,
individual executives and employees
found to have been personally involved
in a contravention would be liable to
be imprisoned, as well as a corporate
offence having been committed.
The European Community Merger Regulation
(ECMR) is under review and this also
featured on the agenda. Committee member
Samantha Mobley (Baker & McKenzie)
submitted comments to the DTI on behalf
of ICC United Kingdom on the Review
of the ECMR. Proposals for amendments
were issued in December 2002 and will
be the subject of negotiations during
the coming year. The UK Committee will
continue to monitor developments and
input as appropriate.
The European Commission’s White
Paper on the Modernisation and the question
of legal privilege also remained firmly
on the UK agenda, and the Committee
raised particular concerns on the subject
of jurisdiction, powers of investigation,
legal professional privilege, fines
and transitional provisions.
Issues on the Commission’s agenda
in 2002:
• The International Competition
Network (ICN): the first ICN conference
was held in Naples in September
• Competition and trade: the ICC
Task Force on this subject prepared
a draft submission to the WTO for finalisation
in 2003
• Intellectual property and competition:
this area emerged as one of growing
importance
The ICC Commission on Competition works
closely with intergovernmental and non-governmental
organisations involved in competition
law and policy, such as the WTO, the
European Commission, the OECD, UNCTAD
and UNICE. Members are experts on competition
law, and include legal advisers from
industrial and commercial enterprises
and lawyers in private practice. The
Commission met twice in 2002, in Paris
in February and in New York in October.
UK members attending were Christian
Ahlborn (Linklaters), Tim Cowen (BT
Ignite), Ian Rose (Watson, Farley &
Williams), Christopher Thomas (Lovells)
and Stephen Walzer, who also continued
as Rapporteur to the Commission.
In addition to the two Commission meetings,
a meeting was held between the ICC Commission
and the EC Directorate General for Competition
in Brussels in June. UK members attending
were Jane Golding (Taylor Joynson Garrett),
Diane Jackson (Taylor Joynson Garrett),
Stephen Kinsella (Herbert Smith), Fiona
Marcq (British American Tobacco), Philip
Marsden (Linklaters), Ian Rose (Watson
Farley & Williams), Gerwin Van Gerven
(Linklaters) and Stephen Walzer.
Finally, we were delighted to learn
that Stephen Walzer was appointed to
the UK Competition Commission in 2002,
a reflection of his excellent reputation
in this field.
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CUSTOMS
& TRADE REGULATIONS
UK Committee chaired by David
Wakeford (SITPRO Board)
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David
Wakeford |
This
Sub-Committee has only recently been
established to formulate the UK input
to the ICC Customs & Trade Regulations
Commission. Formerly, this work was
undertaken within the Trade & Investment
Policy Committee.
Over the years, considerable progress
has been made in simplifying, improving
and modernising the border management
of international trade and in reducing
the regulatory burden. However, in 2003
we are now faced both with significant
opportunities as well as threats to
the effective management of international
trade.
The September World Trade Organisation
meeting in Cancun will provide a unique
opportunity to establish more efficient
and predictable border management through
a trade facilitation agreement within
the WTO. A proposal is currently being
developed in ICC that commends the negotiation
of an agreement starting in Cancun.
Security issues, animal health and food
safety are issues that have escalated
in importance over the past year. The
added burdens being imposed on international
transactions to address these subjects
are becoming extremely costly. For the
first time for decades, we are now facing
a deterioration in the efficiency of
the international trade process. Whilst
the concern over these issues is fully
justified, the actions being taken to
monitor international trade in goods,
in some instances, are proving to be
counter-productive. This is an area
that needs constant attention over the
next year.
The Committee, which is in its formative
stage, has a number of key issues to
address and will need to maintain strong
links with the work programme of the
Commission in Paris.
The Commission met twice in 2002, in
June in Istanbul and in October in Brussels.
The UK Sub- Committee was represented
at these meetings by Sue Firth (Consultant),
Walter Grandpré (Clifford Chance),
Eric Jerram (KPMG), Andrea Mastromatteo
(Clifford Chance), Åke Nilson
(Marinade) and David Wakeford.
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E-COMMERCE
UK Committee chaired by Robert
Bond (Faegre Benson Hobson Audley)
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Robert
Bond |
In
2002, the E-Commerce Committee met on
a regular basis. A considerable number
of new members joined the Committee,
representing various sectors of industry
and the professions.
The main topics for discussion on the
Committee’s agenda were the ongoing
work of ICC’s international E-Business,
IT & Telecoms (EBITT) Commission,
which has grown out of the Commission
on Telecommunications & Information
Technologies and which has absorbed
the work of the Electronic Commerce
Project.
The Committee continued to monitor EU
and UK legislation on e-signatures,
e-commerce, data protection, e-money
and cross border jurisdictional issues
and action was taken when appropriate.
For example, a response was submitted
on behalf of ICC United Kingdom to the
Department of Trade and Industry in
relation to the UK implementing regulations
of the Electronic Signatures Directive.
During 2002, the UK Committee also started
a new project to develop draft guidelines
for business on e-mail and internet
policies, and also began working on
an update of the ICC United Kingdom
Guidelines on E-Commerce.
As part of a combined approach to ongoing
ICC work, joint meetings continue to
be held between the E-Commerce Committee
and the Committee on IT & Telecoms
(chaired by Heather Rowe of Lovells).
Joint meetings were held in May and
November, cochaired by Robert Bond and
Heather Rowe, and similar joint meetings
are planned for 2003.
EBITT Commission meetings took place
in Paris in February and in Brussels
in May. UK Committee members who attended
Commission meetings in 2002 were Roger
Jones (Lloyds TSB), Phil Murphy (Advertising
Association) and Heather Rowe (Lovells).
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ENVIRONMENT
& ENERGY
UK Committee chaired by Dr
Bill Kyte OBE (Powergen Ltd)
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Dr
Bill Kyte |
Following
a merger in 2001, the ICC Commissions
on Environment and on Energy met as
one body during 2002. To reflect this,
the ICC United Kingdom Committee on
Environment was re-named the Committee
on Environment & Energy. However,
the UK’s Ad Hoc Committee on Climate
Change continued to meet separately
as members feel that this is a valuable
forum in its own right. Both groups
are now chaired by Dr Bill Kyte, and
we would like to offer our sincere thanks
to Robin Aram (Shell International)
for his much appreciated work as chairman
of the Ad Hoc Committee on Climate Change
during recent years.
The Committee on Environment & Energy
met once in 2002, in September, to coincide
with the Paris Commission meeting at
the beginning of October. The main focus
of the Commission is to develop and
promote world business positions on
major policy issues in the fields of
energy, environment and sustainable
development.
Obviously, the most important issue
of the year, for both the Commission
and UK Committee, was the World Summit
on Sustainable Development, held in
Johannesburg in August/September 2002.
As part of ICC’s input to the
Summit, we joined forces with the World
Business Council for Sustainable Development
to create Business Action for Sustainable
Development (BASD).
The aim was to threefold:
• To ensure that the voice of
business was heard in the preparations
for the World Summit on Sustainable
Development
• To identify where business can
play a constructive role in the development
and delivery of a sustainable future
• To demonstrate that business
is already actively engaged in initiatives
and partnerships to promote sustainable
development
Business input to the Summit was high
profile and positive, as a result of
unstinting efforts of ICC and the WBCSD
behind the scenes, and very importantly
because of the support of a strong business
delegation and some impressive international
business figures. Sir Philip Watts (ICC
United Kingdom’s Chairman, WBCSD’s
Chairman and Chairman of the Royal Dutch/Shell
Group of Companies), Sir Mark Moody-Stuart
(Chairman of BASD and previous Chairman
of the Royal Dutch/Shell Group of Companies)
and The Rt Hon The Lord Holme of Cheltenham
(Vice Chairman of BASD, Chairman of
the ICC Commission on Environment &
Energy and special Adviser to the Chairman
of Rio Tinto plc) were among the UK
delegation and all played a key part
in this success.
The Johannesburg Plan of Implementation
urges governments and stakeholders to
work together to address global poverty
and inequity, while at the same time
making the world more robust in addressing
the adverse impacts of climate change,
desertification and deforestation. This
and the other outcomes of the Summit
provide a framework for ICC’s
future work programme on environment
and energy and the organisation’s
vital role as the voice of world business.
Another important project for the Environment
& Energy Commission in 2002 was
the report on Business Perspectives
on Energy – the Challenge of the
21st Century. This was published on
the ICC Intranet in July as an internal
paper and will be used in preparing
future ICC papers as required.
In addition to this, the ICC Trade &
Environment Task Force finalised a policy
statement on Precaution, Science, Risk
and Trade, which gives the business
perspective on precaution and highlights
concerns about trade-restrictive measures
established under this pretext. The
policy statement has been made widely
available. Another key issue for the
Commission is, of course, climate change,
and this is reflected by the ongoing
work of ICC United Kingdom’s Ad
Hoc Committee on this subject. ICC believes
that successfully addressing the threat
of climate change will depend on a fully
engaged business response and that business
participation depends on both the international
framework and domestic implementation
of climate policies. Many companies
throughout the world have already taken
significant action towards combating
climate change and remain committed
to pursuing these actions both at national
and international levels. Achieving
greenhouse gas reductions could be costly,
with impacts on competitiveness, employment,
trade and investment. For these reasons,
the most economically feasible way to
meet the long-term challenge of climate
change is through the development and
global deployment of innovative technologies
that reduce or avoid such emissions.
Throughout 2002, ICC’s Climate
Change Task Force and the UK group continued
to address these issues, and ICC played
an active role at the UN Conference
of the Parties 8 (COP 8) in November.
The ICC Commission on Environment &
Energy met twice in 2002, in New York
in March and in Paris in October. The
UK Committee continued to make an important
contribution to ICC’s international
environmental work and we would like
to thank all Committee members for their
efforts during the year. UK Committee
members attending international meetings
were Chris Anastasi (British Energy
plc), Dr Jonathan Cobb (BNFL), Dr Bill
Kyte and David Home (Shell International).
Finally, we were delighted to learn
that Dr Kyte was awarded an OBE in the
New Years Honours List in 2003.
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FINANCIAL
SERVICES & INSURANCE
UK Committee co-chaired by
John Moloney (Lloyd’s Underwriters’
Association) and John Thirlwell (British
Bankers’ Association)
 |
John
Moloney |
In
a recent presentation to the Insurance
Institute of London, a leading underwriter
referred to the fact that September
11 2001 had “not been the straw
that broke the camel’s back but
the haystack”. This The world
business organisation horrific tragedy
has produced the largest ever loss to
the insurance industry; final estimates
of the claims are still wavering but
estimates are something in the order
40-50 billion US Dollars.
Coming as it did at the end of an extremely
soft underwriting cycle, the impact
of this claim has been huge, not only
on specialist classes such as terrorism
cover, but on more general risks as
well.
Much of the work of the Financial Services
& Insurance Commission was, during
the course of last year, devoted to
discussing the enormous impact that
this loss had, particularly in the area
of coverage for certain lines such as
terrorism. Two round table discussions
were organised to coincide with Commission
meetings and these were well-attended,
particularly by European risk management
and broking communities. The dynamics
of the insurance market place at the
time these round table discussions were
held might have meant that the atmosphere
at the meetings became adversarial very
quickly. For their part, the risk managers
were emphatic in their view that the
insurance market place had overreacted
to 9/11, both in terms of general price
increases and lack of availability of
coverage.
Insurers and their representatives were
quick to point out that the hardening
in rates that was currently being experienced
was an inevitable consequence of the
extremely poor trading environment in
which insurers had been operating and
that 9/11 had served as a final catalyst
in this process. It was also pointed
out that, shortly after the tragedy
in New York, a commercial market for
terrorism risk insurance had started
to develop and that, certainly by the
time the discussions took place, availability
of capacity had eased very significantly
on many lines of business, though it
was acknowledged that difficulties were
still being experienced with some non-marine
property risks. As it happened, the
atmosphere during the discussions was
productive and the first of the meetings
concluded with a statement being agreed
acknowledging that governments should
act as “insurers of last resort”
to confront significant insurance capacity
shortages that might exist.
ICC has traditionally resisted government
intervention in commerce, but the circumstances
we currently face with terrorism risks
are unique and call for unique solutions.
Many European governments have now introduced
schemes to provide terrorism insurance
to domestic insureds and these include
the UK, where Pool Re has had its operation
expanded to cover a far wider range
of losses stemming from terrorism action.
Of most note, however, is the passing
on 26 November last, of the United States
Terrorism Risk Insurance Act of 2002.
This mandates that all regulated insurers,
whether they be US domiciled or not,
must offer terrorism coverage in respect
of assets in the United States and,
furthermore, the statute voids terrorism
exclusion clauses that are currently
contained in relevant policies. As a
quid pro quo, the US Federal Government
has provided a reinsurance backstop
to pick up a significant percentage
of each loss which exceeds each insurer’s
deductible calculated as a percentage
of their United States Property and
Casualty Premium income.
 |
John
Thirlwell |
Corporate
governance was also high on the agenda
for the Financial Services & Insurance
Commission, as it is for many other
ICC Commissions, and particularly the
development of the ICC corporate governance
website, which provides guidance to
companies on how to assess and improve
their governance practices. Work is
continuing on gathering experience from
companies that have recently undertaken
governance measures and case studies
are now appearing on the site. A further
important project for the Commission
in 2002 was the preparation of a draft
paper on the the relationship between
taxation and accounting rules, which
aims to clarify the relationship between
commercial, financial and tax accounting
in different countries. One other major
issue was the situation surrounding
the BIS Capital Adequacy Requirements;
developments in the EU and US are now
pointing to final implementation of
the Basle Accords by 1 January 2007,
which could have a profound effect on
bank financing and support for international
trade. ICC’s work is ongoing in
this area, spearheaded by John Thirlwell.
The 2003 programme of action for ICC
as a whole establishes a mandate for
the Financial Services & Insurance
Commission of ensuring that ICC policy
statements on the liberisation of trade
in financial services and in insurance
have an impact on the Doha round of
WTO negotiations. The deadline for offers
relating to trade and services, including
Financial Services & Insurance,
is the end of March 2003. The Commission
hopes that ICC National Committees will
put pressure on their domestic governments
to make offers during these negotiations,
particularly in those cases where the
local insurance market has not been
liberalised.
There were two Commission meetings during
the year, in Paris in April and in Beijing
in October. John Moloney represented
the UK Committee at the Spring meeting.
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INTELLECTUAL
PROPERTY
UK Committee chaired by Dr
Dick Fawcett (Bird & Bird)
 |
Dr
Dick Fawcett |
During
2002, the UK Committee on Intellectual
Property met twice, on 4 April and 3
September, just before the corresponding
Commission meetings held in Paris on
10 April and 12 September.
Dick Fawcett, the UK Committee Chairman,
is now a Vice Chairman of the Commission
and UK Committee member Tim Roberts
(Consultant) is now a Commission rapporteur.
Tim Roberts chairs the Commission’s
Task Force on the Interface between
Intellectual Property, Development &
Protection of the Environment. This
Task Force drafted the ICC Policy Statement
with the following title: Should patent
applicants disclose the origin of biological
materials on which they file patents?
Should they demonstrate Prior Informed
Consent (PIC) for their use? Dick Fawcett
chairs the Commission’s new Task
Force on WIPO’s Substantive Patent
Law Treaty.
UK Committee members were also involved
in work of other Commission Task Forces.
The Task Force (chaired by Ron Myrick
of General Electric in the USA) on Software
& Business Method Patents drafted
ICC Comments on the European Commission’s
proposed Directive on the patentability
of computer-implemented inventions.
The Task Force (chaired by Thomas Pletscher
of the Swiss Business Federation) on
Future Intellectual Property Issues
for Business updated its Roadmap for
business and policy makers on this topic.
The Task Force (chaired by Ivan Hjertman
from Sweden) on TRIPS drafted two papers
on the TRIPS Agreement issues resulting
from Doha ministerial meeting in November
2001 which launched a new trade Round.
Key topics discussed at Commission and
UK Committee meetings during 2002 included:
• The TRIPS Agreement and the
issues arising from Doha especially
the still unsolved compulsory licensing
and access to medicines problem, and
the issues relating to the protection
of traditional knowledge and to geographical
indications
• The future of the European patent
system, particularly the Regulation
establishing a Community Patent system;
the computer-implemented inventions
patentability Directive; the attempts
to improve obtaining, validating and
litigating European Patents and the
work of the two working parties appointed
by the Paris Intergovernmental Conference
in 1999 to consider these subjects
• WIPO’s Substantive Patent
Law Treaty seeking to harmonise substantive
patent laws worldwide
• Deviation by governments to
other programmes of registration fees
paid by users to patent and trademark
offices
• The Convention on Biological
Diversity and its compatibility (or
otherwise) with the TRIPS Agreement
• Access and benefit sharing in
relation to genetic resources
• Competiton and intellectual
property law and policy in a knowledge-based
economy
• International exhaustion of
intellectual property rights
• Intellectual property aspects
of the current negotiation to revise
the Hague Convention on Jurisdiction
and foreign judgements in civil and
commercial matters.
UK Committee members attending Commission
meetings during 2002 were Joanna Brook
(Sprecher Grier Halberstam), Dick Fawcett,
Tim Frain (Nokia), Dr Mike Jewess (BAE
Systems), David Lewis (Babcock) and
Tim Roberts.
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IT
& TELECOMS
UK Committee chaired by Heather
Rowe (Lovells)
 |
Heather
Rowe |
Electronic
information is now the currency of international
trade, finance and industry. ICC believes
that business should be able to access
and exchange information freely and
securely if the world economy is to
function efficiently. IT can best serve
world trade if government constraints
are kept to a minimum.
The ICC Commission on E-Business, IT
& Telecoms (EBITT) brings together
a cross-section of senior-level corporate
telecommunications users, equipment
manufacturers and competitive service
providers. Observers include representatives
from the International Telecommunications
Users’ Group (INTUG), the UN Economic
Commission for Europe (UNECE), the OECD
and the Business and Industry Advisory
Committee to the OECD (BIAC). The Commission
also consults widely with other industry
bodies such as the Union of Industrial
& Employers’ Confederations
in Europe (UNICE).
The main objectives of the Commission
and UK Committee, are:
• To promote free and fair competition
within information markets
• To remove obstacles to the free
flow of information
• To draw up self-regulatory guidelines
on IT
• To bring business concerns to
the attention of regulatory bodies such
as the International Telecommunications
Union (ITU), the WTO, the International
Organisation for Standardisation (ISO),
the OECD and the European Commission
During 2002, the key priorities were
fourfold. Firstly, to work closely with
the WTO and governments that signed
the 1996 WTO Agreement on Basic Telecommunications
with a view to achieving open, competitive
basic telecommunications markets. This
work is important, particularly now
that China (a vast potential market)
has also signed up. Secondly, to put
forward recommendations reflecting the
business community’s most fundamental
and urgent needs with the aim of encouraging
competition, which in turn should accelerate
the development of a solid global information
infrastructure. Thirdly, to promote
global IT security policy framework
that protects nations against crime
and espionage while ensuring the free,
secure flow of information. Fourthly,
to remove obstacles to the free flow
of information across borders created
by certain data protection laws. The
UK Committee has had an input in all
these areas.
As part of this, the EBITT Commission
produced position papers in relation
to, for example, draft European Directives
in the electronic communications area,
cybercrime matters and the review of
the general EU data protection directive.
Heather Rowe, the UK Committee Chairman,
continued to chair ICC’s international
Working Party on Data Protection &
Privacy and is a Vice-Chairman of the
Commission. The Data Protection Working
Party (now the Data Protection Task
Force) has developed ICC Model Clauses
for Transborder Data Flows and there
were ongoing efforts throughout the
year to obtain EU approval for the clauses,
now in conjunction with several other
industry bodies such as the CBI. The
European Commission has produced a similar
set of model clauses, albeit that they
appeared to have drawn on the ICC’s
work.
The European Commission’s model
contract for transfers of personal data
from data controllers within the EU
to data controllers in other countries
outside the EU (where the European Commission
perceived there was not an adequate
level of protection) was approved in
summer 2001 but is not widely used.
ICC, still working jointly with the
other industry bodies, produced further
versions of such a contract during 2002.
The contract was resubmitted to the
European Commission for approval in
January 2002 and it was hoped that the
model would gain approval in 2002. The
model clauses are still being discussed
with the relevant bodies at EU level
and there may be developments during
the first half of 2003. It is strongly
felt that this document is much more
user friendly (yet tough) than the EU’s
model and more workable for the business
community - so ICC continues to support
its promotion.
During 2002, the Committee discussed
future projects such as “best
practice” recommendations for
ICC members in their use of technology.
The first output from this project was
draft guidelines for companies regarding
what is acceptable use of e-mail and
the Internet by their employees - and
whether it is acceptable to monitor
such use. These will hopefully be finalised
in Spring 2003 and published thereafter.
ICC United Kingdom has two Committees
active in the E-Commerce and IT field:
the E-Commerce Committee and the Committee
on IT & Telecoms. These two Committees
will continue separately but the fact
that they come together, jointly, for
some of their meetings (often with guest
speakers of interest to both Committees)
indicates the close collaboration between
the two.
The Commission met twice in 2002, in
Paris in February and Brussels in May.
UK members attending Commission meetings
were Roger Jones (Lloyds TSB), Phil
Murphy (Advertising Association) and
Heather Rowe.
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MARKETING
AND ADVERTISING
UK Committee chaired by Malcolm
Earnshaw (ISBA)
 |
Malcolm
Earnshaw |
The
UK Committee on Marketing & Advertising
met twice in 2002. Despite the very
active agenda of industry players during
2002 on various aspects of advertising
self-regulation, attendance was low
at both meetings and efforts will be
made in the coming year to encourage
greater participation. National advertising
associations, SROs and governments worldwide
recognise ICC’s self-regulatory
codes of ethical conduct for marketing
and advertising as a basic framework
when drafting or updating their own
national codes.
Indeed, the World Federation of Advertisers
believes that fundamentally, in the
world of today, there is a need for
global codes (ICC) and local codes,
reflecting local law and issues of taste
and decency (local SROs). Through co-operation
with European SROs in the new EASA,
the European Advertising Standards Alliance,
the WFA is working to drive consistency
in all aspects of selfregulation across
Europe. EASA has produced a statement
of Common Principles and Best Practice
which underpins action programmes and
has been complimented by the European
Commission. It is hoped that this will
accelerate the convergence of core areas
of national codes and reinforce the
principles of country of origin and
mutual recognition. Given the increasing
threats to advertising freedoms in certain
sectors and the continued refining by
DG SANCO of their ‘Consumer Protection’
proposals, the UK Committee believes
it is vital that the various bodies,
including ICC, work closely together
and with SROs and EASA.
With respect to the DG SANCO proposals,
all industry bodies, including the ICC
Commission, continue to express their
concern about the need for proportionality
and workability of their proposals.
Nevertheless, encouraging meetings have
been held with Commissioner Byrne and
members of his team, with SANCO increasingly
seeing best practice advertising self-regulation
as “part of the solution”.
Members of the UK Committee have also
been very active during the year on
UK local self regulatory matters. Both
the ITC Broadcast Advertising Code and
the CAP Non-Broadcast Code of Advertising,
Sales Promotion and Direct Marketing
have been revised with our full involvement.
Most importantly, ISBA and AA members
have been very active with government,
policy advisors and Lord Puttnam’s
Joint Scrutiny Committee with respect
to the draft UK Communications Bill.
They have succeeded in persuading the
drafters to amend the proposed Bill
to facilitate the transfer of broadcast
advertising to a self/co-regulatory
system to operate under delegated authority
from OFCOM, the new super-regulator
for broadcasting and telecommunications.
An industry working party, including
representatives from all broadcasters
and new media, is working on a detailed
recommendation to lay before OFCOM by
Easter.
In May 2002, the Commission released
a new edition of the ICC International
Code of Sales Promotion, following the
well-established policy of ICC of promoting
high standards of ethics in marketing
via self-regulatory codes intended to
complement the existing framework of
national and international law. This
Code is an expression of the business
community recognition of its social
responsibilities in respect of commercial
activities and communications. It is
designed primarily as an instrument
for self-regulation but is also intended
for use by legal or administrative bodies
as a reference document within the framework
of applicable laws.
Later in the year, the ICC Commission
issued a policy statement on the important
role of the advertising services sector
for businesses and consumers. It highlighted
the contribution of advertising on economic
growth and asked for more market opening
commitments from all countries regarding
advertising and related services in
order to increase market access. UK
Committee members who attended Commission
meetings were Malcolm Earnshaw and Phil
Murphy (Advertising Assocation).
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TAXATION
UK Committee chaired by Gordon
Slater (Cadbury Schweppes)
 |
Gordon
Slater |
For
yet a further year, the reform of business
taxation remained high on the UK Government’s
agenda. A particular feature of the
year, however, was the way in which
UK tax issues overlapped with topics
of international concern, demonstrating
the value of an international body such
as ICC in promoting better co-ordination
of tax policies to minimise friction
for business.
In the UK, legislation was duly passed
to exempt from tax capital gains on
the disposal of substantial shareholdings
in trading companies or groups. Several
last-minute meetings of representative
bodies were necessary to secure the
redrafting of an anti-avoidance clause
which threatened to undermine the new
relief, but the finished product is
a major step forward.
The taxation of intellectual property
and financial instruments also underwent
major reforms, to which the UK Taxation
Committee contributed its views. In
July, a further consultation document
was issued canvassing views on further
changes to bring taxable income more
into line with accounting profits. ICC’s
international Commission on Taxation
is pursuing a similar topic. The UK
consensus among business seems to be
that, although it may be a good idea
in theory, the development of accounting
standards is threatening to make accounting
profits more volatile and therefore
less useful as a base for taxation.
Another topic of common interest is
the ever-expanding scope of anti-avoidance
rules aimed at “controlled foreign
companies”. In the UK, we have
joined other bodies in pressing for
a fundamental review of the policy aims
and compliance costs of this very burdensome
regime, and internationally we are concerned
about the possibility of multiple taxation.
Another issue where international coordination
is badly needed is the taxation of employee
stock options. ICC in Paris finalised
a statement on this subject in the spring,
which was passed on to the Treasury.
Finally, it is disturbing to note the
re-emergence of a trend towards global
apportionment of profits by some countries,
in opposition to the OECD arm’s
length principle. Of particular concern
to UK business is the US proposal to
restrict interest relief by reference
to a global debt/equity ratio, and the
parallel UK approach to the taxation
of UK branches of foreign companies.
This topic may well occupy the Committee
further in 2003.
We were very sorry to lose the services
of John Fairley, who as an international
tax partner at Ernst & Young had
been a tower of strength on the Committee
for many years. Gordon Slater would
like to record his personal gratitude
to John for all his hard work. Others
who ably contributed to the Committee
were Patrick Ellingsworth (Shell International),
James MacLachlan (Baker & Mackenzie),
Jeremy Maynes (KPMG), Peter Nias (McDermott
Will & Emery), and Eric Tomsett
(Deloitte & Touche). Without such
support the Committee would not be able
to function.
The Commission met twice in 2002, in
April and October, both times in Paris.
Patrick Ellingsworth and Gordon Slater
represented the UK Committee at these
meetings.
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TRADE
& INVESTMENT POLICY
UK Committee chaired by Donald
Anderson (International Trade &
Economic Affairs Consultant)
 |
Donald
Anderson |
The
UK Committee on Trade & Investment
Policy is responsible for evolving ICC
United Kingdom’s policy on international
trade and investment and for representing
it to ICC Headquarters through the equivalent
Commission. Its objective is to ensure
that the UK’s interests are properly
reflected in ICC policy in this field.
Membership embraces a majority of the
sectors that have an interest in this
area, ranging from banking, financial
services and shipping to both knowledge-intensive
and capital-intensive manufacturing,
and includes independent experts. Its
delegation to the Commission meetings
in Paris is one of the more active of
the participating countries and is reinforced
by regular written submissions. Representation
at the Commission is by country: there
is no EU level representation.
In 2002, the work of the Committee concentrated
heavily on the implications for business
of the work programme agreed at the
World Trade Organisation’s Ministerial
Conference in Doha, in November 2001.
Following the failure of the previous
meeting in Seattle in 1999, the successful
conclusion to the Doha meeting has been
crucial both to the future of the world
trading system and to the credibility
of the WTO itself.
Initially, significant progress was
made in a number of key areas. Agriculture
- one of ICC’s priorities and
a major stumbling block to progress
elsewhere - was included properly for
the first time. Partly as a result of
this, the objectives of the developing
countries were explicitly acknowledged
and their participation is to be assisted
through capacity building. In a related
area, solutions were proposed for the
difficulties over intellectual property
and health issues, albeit in a political
context. Other subjects whose inclusion
was agreed included anti dumping, subsidies
and countervailing measures; the Dispute
Settlement Undertaking; trade and environment;
and tariffs.
Other aspects were less satisfactory,
notably the treatment of e-commerce,
which effectively extended the status
quo until the next Ministerial, in Cancun
in 2003. Similarly, the postponement
of agreement on the inclusion of trade
facilitation, government procurement,
and trade and investment and trade and
competition, also until the next Ministerial
in 2003, was unwelcome. Their inclusion
thereafter will be subject to the “explicit
consensus” (a term for which there
is no accepted definition) of all WTO
members. The Cancun Ministerial will
be the first overseen by the new Director
General of the WTO, Supachai Panitchpakdi,
who succeeded Michael Moore in September.
The Committee’s work since Doha
has concentrated on ensuring that UK
interests will be reflected in the position
papers being prepared by the Commission
ahead of the Cancun Ministerial, notably
in agriculture, investment, competition,
anti-dumping and dispute settlement.
It is also taking a leading role in
the preparation of a position on market
access for non-agricultural products,
and actively supporting the proposals
put forward by one of its members, SITPRO,
for a new regime in trade facilitation.
During the year, the latter subject
acquired a Commission in its own right;
this has been reflected in the UK by
the creation of a Sub-Committee on Customs
& Trade Regulations, pending such
time as a full Committee is felt to
be advantageous.
Against a difficult economic and political
background, and continued transatlantic
tensions over trade issues, the forthcoming
Ministerial in Cancun is likely to be
particularly sensitive. The timetable
for its preparation is extremely tight,
and the workload in consequence intense.
A successful outcome is far from certain.
ICC is working on the issues involved
with appropriate urgency.
In support of its activities, the Committee
met twice in 2002, as did the Commission.
The UK team played a prominent part
in the Commission discussions. For some
years, the Commission has benefited
from the distinguished chairmanship
of Arthur Dunkel, the former Director-General
of GATT. Mr Dunkel retired in the summer
of 2002 and was succeeded by Lars Arnell,
from Sweden. Mr Arnell has continued
his predecessor’s approach of
probing the issues and the member delegations’
positions thereon, in impressive depth.
The Commission meetings were attended
by Andrew Harper (BP Amoco), Philippe
Ruttley (Clyde & Co), Steve Orava
(King & Spalding) and David Wakeford
(SITPRO).
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TRANSPORT
& LOGISTICS
UK Committee chaired by Patrick
Farrell (Norton Rose)
 |
Patrick
Farrell |
The
objective of the ICC Transport &
Logistics Commission is to promote intermodal
transport and competitive, efficient
transport services worldwide. Current
priorities are to:
• Develop world business positions
on initiatives to enhance supply chain
security
• Make recommendations for the
liberalisation of all transport modes
to governments and intergovernmental
organisations, including the WTO
• Promote initiatives to modernise
maritime and multimodal transport regimes
• Address the issue of insurance
cover for the transport industry post
9/11
• Interact with other organisations
on the use of IT for the facilitation
of transport
• Promote trade and customs facilitation
• Address documentary credit issues
relating to transport documents
• Develop recommendations for
sustainable transport
Two international Committees work under
the remit of the ICC Transport &
Logistics Commission, on Air Transport
and on Maritime Transport, both dealing
with more in-depth issues facing each
sector. During 2002, the Air Transport
Committee had an understandably strong
focus on security issues. In May 2002,
the ICAO Council adopted the Aviation
Security Plan of Action, which provides
for the auditing of aviation security
in contracting states. The objective
is to enhance aviation security by assessing
standards, identifying potential deficiencies
and giving recommendations for improvement.
Other issues under scrutiny by the Air
Transport Committee during the year
were: air transport liberalisation;
aircraft noise standards; competition;
the environment; ratification of a global
draft convention for aircraft financing
and leasing; and the use of IT in airway
bills.
The aim of the international Maritime
Transport Committee is to bring together
shippers, carriers, intermediaries and
ports to develop global business positions
on issues such as liberalisation, competition
and the environment. ICC believes that
shipping can best serve world trade
if allowed to operate on a commercial
basis, in a competitive market free
from protectionism and other forms of
market-distorting government support.
In 2002, the Maritime Transport Committee’s
work programme covered:
initiatives to modernise maritime and
multimodal transport regimes; market
access; and competition issues. The
Committee also continued to coordinate
the ICC Bill of Lading Review Committee,
which issues decisions on the conformity
of transport documents with the UNCTAD/ICC
Rules for Multimodal Transport Documents.
The ICC Transport & Logistics Commission
met twice in 2002, in June and October,
both times in Paris. UK members attending
Commission meetings were John Davies
(Freshfields Bruckhaus Deringer), Tim
Linott (Freshfields Bruckhaus Deringer),
Philippe Ruttley (Clyde & Co) and
Andrew Trail (Freight Transport Association).
The inaugural meeting of the UK Transport
& Logistics Committee took place
in July, under the chairmanship of Patrick
Farrell. A further Committee meeting
took place in October. The work programme
largely focused on the Commission agenda,
and particularly on security issues.
One major concern raised at the autumn
meeting was the proposal to ban the
use of the “said to contain”
clause in cargo transport, as this could
impose an unworkable level of responsibility
on forwarders and carriers.
The UK Committee believes that this
and other new proposals in the wake
of 9/11 could have serious implications
for world trade. On the other side of
the coin, fast and efficient trade facilitation
procedures could help improve security.
Tony Lucking (London Chamber of Commerce
& Industry) continued to monitor
closely air transport issues at the
UK and EU level. At the Autumn Committee
meeting, he raised specific concerns
on EU proposals that trains should be
substituted for planes on routes of
up to 500km, commenting that this seemed
to indicate a lack of understanding
by policy-makers that the rail-versus
air argument had been turned on its
head since the advent of low-cost airlines
in Europe. He subsequently sent a letter
to HMG on this subject on behalf of
the UK Committee, and we would like
to thank him for his continuing efforts
on our behalf.
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