K Street Files: Taking on the “Scarlet F”

Posted July 3, 2008 at 4:12pm

It didn’t take long before foreign companies with U.S. subsidiaries started trying to thwart a bill that would require them to register as foreign agents.

[IMGCAP(1)]In fact, just before lawmakers headed out for the Fourth of July break, lobbyists for the Organization for International Investment and some of its member companies met with staff from the offices of Sens. Charles Schumer (D-N.Y.), who introduced the bill; Claire McCaskill (D-Mo.); and Barack Obama (D-Ill.), the presumptive Democratic presidential nominee.

“We’re really just trying to educate members about how this would have a discriminatory impact on companies and their employees who are their constituents,” said Todd Malan, president of the OFII, a trade organization representing companies such as Toyota, DaimlerChrysler, Sanofi-Aventis and Tyco International.

To that end, Malan pointed to a recent visit by Obama to the U.S. operations of a Spanish wind company, Gamesa, in Pennsylvania. If the bill passed, foreign companies that lobby would have to disclose under the Foreign Agents Registration Act that they are acting as a foreign agent, a fact that might have discouraged Obama from ever visiting the local operations, Malan said.

“There is a sort of a negative pejorative context to FARA. We think it’s not fair to put a scarlet F on our companies and their American employees,” Malan said. For example, he said, lobbyists who represent a Canadian telecom equipment company like Nortel will be on a par with lobbyists who represent Iran.

The legislation would require lobbyists to disclose and report any activities on behalf of foreign corporations to the Justice Department under FARA.

Currently, lobbyists can disclose their foreign corporation clients under the Lobbying Disclosure Act, which not only requires much less information than FARA, but also avoids the “foreign agent” moniker.

The legislation would also require lobbyists to disclose under FARA any lobbying meetings they have with U.S. officials on foreign soil, a provision Malan said he could accept.

Otherwise, he said, forcing a foreign company or subsidiary’s lobbyists to register as a ‘foreign agent’ could put members in an awkward position.

“We have 160 member companies, and we will be talking with every Senate office just to make sure they are aware that this regulation would have an impact with how they would interact with companies,” Malan said.

So far, it doesn’t appear the meeting changed staffers minds.

“All we are looking for with this bill is greater disclosure, and that is worth a little extra work by lobbyists who represent foreign interests,” Schumer spokesman Brian Fallon said. “No one wants to block them from doing the work or is passing judgment on them for doing it. We’re just saying they should make it known.”

Filing Frenzy. With less than a month to complete the new lobbying disclosure 203 reports, ethics lawyers are frantically trying to answer clients queries about how to correctly file.

The forms, due July 30, were released with little fanfare last week. The new reports require all individual lobbyists and all lobbying organizations to file forms that list ties to any political action committees, federal campaign contributions more than $200 and expenditures for events that honor top officials.

The report also will require each lobbyist to certify that they have not broken any gift rules to Members of Congress.

Despite the reams of guidance provided by the House and Senate, ethics lawyers say there have been more than a couple of glitches in the current system.

One key issue, points out Robert Kelner of Covington & Burling, is that companies, not individuals, must certify to the accuracy of the report.

“There are some things about this form that are just plain particular, which is surprising given how long the secretary and the clerk have been working on them,” Kelner said. “Although the statute requires companies that register under the LDA to certify gift compliance, in virtually every other regulatory context I can think of that means an individual has to sign a certification on behalf of the company.

“Here they have decided, apparently, not to require a particular individual to certify on behalf of the company.”

Beyond that, a few technical issues remain. For example, the online form does not have a pull-down tab for contributions lobbyists make to presidential inaugural committees. But the answer to that problem appears to be a little clearer.

“We did not include a specific tab at this stage in order to keep the 203 form relatively simple at its launching,” House Administration Committee spokesman Kyle Anderson said. “For filers with such expenses, we suggest they select ‘honorary expenses’ for the contribution type and insert a reference to the inauguration in the comment box.”

K Street Moves. Jason Britt has left the House Financial Services Committee’s Republican staff to become associate counsel at the Protective Life Insurance Company in Birmingham, Ala. Britt worked in the office of Rep. Spencer Bachus (R-Ala.) since 2005 and then moved over to the handle housing issues for the Financial Services Committee in 2007.

• The Labor Council for Latin American Advancement has brought on Hector Sanchez as director of policy and research. Sanchez joins the group representing Latino workers from the AFL-CIO and the Change to Win Federation after a stint as Mexico policy education coordinator for Global Exchange.

• Allison Remsen, vice president of media relations at US Telecom, is leaving to head up Mobile Future, a new coalition focused on wireless issues. Remsen will serve as executive director.

• The National Association of Chain Drug Stores brought on Christie Boutte as director of policy and programs. Prior to joining NACDS, Boutte served as clinical program manager for Medicare Part D administration at CIGNA HealthCare.

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