Dear IPC Members:
We have reached week five of widespread quarantines and social distancing, and I hope everyone reading this is staying healthy and coping well.
In IPC’s ongoing efforts to help members cope with COVID-19, this week we held another Executive Forum to compare notes on what companies are experiencing and how the industry can respond collectively; as well as a special webinar on protecting worker health. IPC’s COVID-19 Resources page is updated regularly. And let us know how the pandemic is affecting your operations so we can best advocate for you.
Meanwhile, the U.S. Congress is on the verge of enacting a “Phase Four” relief package including billions more for the Paycheck Protection Program (PPP), hospitals, and other urgent needs. Thank you to the IPC members who reached out to your members of Congress and called for additional PPP funds! Prime Policy Group has the further details here.
If you haven't done so already, please check out IPC’s Roadmap for Economic Recovery and visit our Advocacy Center to send it to your elected officials.
There’s also big news on the international trade front, where the Trump administration is rolling out proposals for Section 301 tariff relief and USMCA implementation. See “TRADE AND SUPPLY CHAIN” below.
In Europe, there is a tug of war emerging between businesses that want to slow down the pace of new environmental regulations, and those that want to promote a green path out of the crisis. See “EUROPEAN UNION” below.
As always, please let us know if you have any questions or suggestions for IPC advocacy.
All the best,
Chris Mitchell
Vice President, Global Government Relations
TOP OF THE WEEK
IPC Urges North American Manufacturing Initiative: Last week, IPC called upon U.S. President Trump, Mexican President López Obrador and Canadian Prime Minister Trudeau to launch a trilateral initiative to mobilize the North American industrial base for COVID-19 response as well as the longer-term economic recovery. Our members tell us that conflicting restrictions in each country, cross-border delays, and unclear demand signals are hindering production. The initiative would be led by senior leaders of government and business and would focus on coordinating pandemic response and strengthening the region’s manufacturing competitiveness. IPC believes this crisis is an opportunity to think more broadly about how to come out of this downturn stronger and with a heightened appreciation for regional sourcing. IPC Contact: Chris Mitchell.
IPC ADVOCACY AND YOU
2020 Election: Crisis or no crisis, there is still a major election coming up in the United States, and the IPC Political Action Committee (PAC) serves as the collective voice of the industry. The IPC PAC pools contributions and supports pro-manufacturing federal candidates in both major parties. IPC invites you to learn more by visiting the IPC PAC website and filling out a prior authorization form. This form does not obligate you or your employees to support the IPC PAC; it simply enables us to provide more information. Please note that a company can only authorize one association PAC per year; and the form must be signed by someone with the authority to do so, generally the CEO or another C-level executive. IPC Contact: Ken Schramko.
DEFENSE AND SECURITY
Pentagon Expecting Acquisition Delays Due to COVID-19: The U.S. Defense Department anticipates a three-month delay in meeting key milestones for major acquisition programs due to the coronavirus, Politico reports. The virus has affected workflow in shipyards, in the aviation sector, and in the small space launch industry. The delays will likely impact both U.S. and foreign defense contractors that have contracts with the Pentagon. IPC is monitoring developments regarding the defense industrial base; please let us know about the U.S. defense programs of greatest interest to you. IPC Contact: Chris Mitchell.
ENVIRONMENT, HEALTH AND SAFETY
How Is Your Company Affected by EPA Action on High-Priority Substances? On April 17, the U.S. Environmental Protection Agency (EPA) released another seven “scoping documents” for its upcoming reviews of high-priority chemical substances under the Toxic Substances Control Act (TSCA), on top of 13 documents released on April 6. Several of the substances are relevant to electronics manufacturing – flame retardants, phthalates, solvents, and formaldehyde – and IPC needs your input to ensure a thorough review of the draft scoping documents. The comment period is currently open and runs through June. Delve into the details in an IPC blog post here. IPC Contact: Kelly Scanlon.
U.S. EPA to Ease TSCA Fees: As advocated for by IPC, on March 25, the U.S. EPA confirmed it is exploring potential exemptions to the Toxic Substances Control Act (TSCA) Fees Rule to ease the implementation burden. The agency plans to consider exemptions for manufacturers that import articles containing high-priority substances or those who produce them as impurities or byproducts. The EPA is also providing a “no action assurance” for such manufacturers, meaning it will not pursue enforcement action regarding violations of the self-identification obligations. However, companies that were already identified by the EPA on their preliminary list of fee payers should still plan to certify in the EPA’s Chemical Data Exchange (CDX) system. The EPA has modified the CDX to facilitate new responses; you can read the instructions for reporting here. The deadline to certify is May 27. IPC Contact: Kelly Scanlon.
EPA Implements Temporary Enforcement Discretion Due to COVID-19: On March 26, the U.S. EPA announced a new temporary enforcement discretion policy regarding civil violations during the coronavirus pandemic. While the EPA does not expect to seek penalties for noncompliance with routine monitoring and reporting obligations, it does expect regulated facilities to continue complying with regulatory requirements where reasonably practicable, and if not, to return to compliance as quickly as possible. Do not change your normal routine of meeting or exceeding regulatory requirements and using best practices. To be eligible for enforcement discretion, the policy requires facilities to document decisions made to prevent or mitigate noncompliance and demonstrate how the noncompliance was caused by the COVID-19 pandemic. IPC Contact: Kelly Scanlon.
EU Chemicals Strategy for Sustainability Likely to be Postponed: The European Commission was set to present a new chemicals strategy for sustainability this June; however, due to the COVID-19 pandemic, the strategy may now be delayed until October. Meanwhile, the European Parliament’s Committee on Environment, Public Health and Food Safety has been working on a draft position on the proposed chemical strategy, requesting that the commission close all regulatory gaps in the current EU chemical legislation and pursue a “one substance-one hazard” approach, among other highlights. The resolution is expected to be voted upon at a plenary session in July. IPC Contact: Alison James.
EUROPEAN UNION
European Business Lobby Asks EU to Postpone New Initiatives Amid COVID-19: The coronavirus pandemic has raised questions about the planned implementation of the European Green Deal. On April 10, the Confederation of European Business (BusinessEurope) urged the European Commission to “extend certain deadlines to implement EU legislation,” and to put on hold “all nonessential environment and climate-related consultations for stakeholder engagement.” Meanwhile, on April 21, a coalition of government, business, and nonprofit leaders formed a European Alliance for a Green Recovery and committed themselves to “massive” post-crisis investment plans prioritizing climate and biodiversity goals. IPC Contact: Alison James.
EU Plans Road to Economic Recovery From COVID-19: The European Union recently published a “roadmap” providing guidance for Member States considering lifting coronavirus containment measures. On April 23, EU leaders met to discuss an overall strategy and recovery plan to restart the European economy “through high-quality job creation and reforms to strengthen resilience and competitiveness.” The European Commission is expected by the end of the month to release a revised proposal for a seven-year EU financial framework and a temporary recovery fund. Meanwhile, on April 21, IPC sent its Roadmap for Economic Recovery to the presidents of the EU institutions, urging policymakers to take account of the specific needs of the electronics manufacturing industry. IPC Contact: Alison James.
Second Round of Post-Brexit Talks Begin: A second round of negotiations on post-Brexit relations between the United Kingdom and the European Union began on April 20 and continued through the week. The agenda covered many topics including trade in goods, competition policy, and transportation. Both sides say the post-Brexit process will continue despite the coronavirus pandemic, with U.K leadership insisting the transition period will end on December 31. The two sides are set to hold a high-level conference in June to take stock of their progress and will decide by July 1 whether to extend the transition. IPC Contact: Alison James.
TRADE AND SUPPLY CHAIN
U.S. Extends Border Restrictions with Mexico and Canada: On April 20, the U.S. Department of Homeland Security announced they are extending restrictions on nonessential travel between the U.S., Mexico, and Canada for another 30 days amid the coronavirus pandemic. Homeland Security Acting Secretary Chad Wolf said in a statement that the decision was made "in close collaboration" with the two countries. Notably, the border restrictions “do not target the crossing of merchandise.” IPC contact: Chris Mitchell.
USMCA Implementation Date in Question: Although the Trump administration is committed to the U.S.-Mexico-Canada Agreement (USMCA) coming into force on July 1, some industries are expressing concerns about their ability to meet deadlines and adjust to new procedures and requirements. At a minimum, the three countries are expected to delay implementation of the pact’s auto-related rules. Meanwhile, on April 20, U.S. Customs and Border Protection released Interim Implementing Instructions, providing "guidance with respect to preferential tariff claims under the USMCA" and other issues. Get the full update from Prime Policy Group here. IPC will continue to monitor the USMCA’s situation and provide updates. IPC contact: Chris Mitchell.
Industry Eyes Changes to U.S. Export Controls: IPC is working to learn more about reports that the U.S. government has agreed internally on changes to export control regulations to prevent China from obtaining advanced U.S. commercial technologies and diverting them to military uses. Any such changes could have significant impacts on the electronics manufacturing industry and its global supply chain. Last week, IPC sent a letter to U.S. Commerce Secretary Wilbur Ross requesting that any changes to U.S. export controls that apply to printed circuit boards (PCBs), printed circuit board assemblies (PCBAs), and electronic components be made through the usual rulemaking process, allowing for public comments and changes before becoming effective. Another nine industry groups sent a similar letter this week. IPC will continue to keep an eye on this for you; please be prepared to help us with advocacy. IPC Contact: Ken Schramko.
Is Your Company Looking to Source Inputs from New Countries? Over the last year, electronics manufacturers have been adjusting their supply chains due to COVID-19, trade tensions, and the worry that higher tariffs may become permanent. If your company is thinking about sourcing from new countries, we would be interested in hearing from you as part of our research and monitoring efforts. IPC Contact: Shawn DuBravac.
UPCOMING EVENTS
Critical Environmental Requirements for Electronics: June 9, 2020. IPC and the Information Technology Industry Council (ITI) are teaming up for our annual event to help you stay ahead of current and emerging environmental requirements. Join us for a four-hour virtual event, complete with a stellar line-up of experts and professionals who will help you stay current on global environmental regulations and issues such as RoHS, TSCA, eco-design, European Green Deal, and more. Sponsorship opportunities are available. IPC Contact: Kelly Scanlon.
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