or the last three years, we have reported on legislative efforts to ban noncompetes in Massachusetts. You can see a sample of those reports here and here. Thus far none of those efforts have been successful. Here again in 2016, legislative efforts to ban noncompetes promise to continue in Massachusetts, with one commentator declaring, “This is the year.”
Our job as business lawyers is to advise clients on how widely varying state laws affect their ability to use noncompetes, then they can make their business decisions from there. Different businesses take very different views on noncompetes, as those seeking to ban them in Massachusetts have learned. Therefore, our job does not drive any particular policy position on noncompetes. However, I have observed that opponents seem quick to share stories about stories about seeming extreme noncompetes (certainly they exist but good luck enforcing them) and/or declare noncompetes’ ongoing decline (they’re not) and/or say they have a negative impact on the economy (I’m still waiting for proof of what the impact may be, pro or con) – none of those things always supported by facts and data.
The above-linked commentator has “heard” that noncompetes have prevented 19 year olds from switching employment at summer camps. I have not seen that, directly or indirectly, and it seems that it would be difficult even in a pro-enforcement state like Ohio to enforce such a noncompete. But it certainly makes a nice story, even if it may jeopardize the support of the summer camp trade association for the legislation.
The commentator also talks about the “stifling effect” noncompetes have on the Massachusetts economy, though I do not see any data supporting that conclusion. I am no economist either, but my first result in a Google search lists Massachusetts as the 6th best economy among states in the last quarter of 2015. Just think how highly the state would be ranked if its economy were not stifled.
Maybe this is the year for Massachusetts; we will see. In any event, we will continue to watch developments by state, some of which will be pro-enforcement and some of which will not, and keep you posted on how it affects your businesses.
© 2016 BARNES & THORNBURG LLP
Following up on the historic changes in 2014 and 2015 to the five-decade U.S. trade embargo on Cuba, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the Department of Commerce’s Bureau of Industry and Security (BIS) have announced new amendments to the Cuban Assets Control Regulations (CACR) and Export Administration Regulations (EAR), effective January 27, 2016.
What U.S. Companies Need to Know About the Easing of Restrictions
Payment Terms for Authorized Exports to Cuba No Longer Restricted
OFAC restrictions have been lifted on payment and financing terms for authorized exports and reexports to Cuba, except for agricultural commodities and items. U.S. banks will be authorized to provide financing by third-country or U.S. financial institutions (e.g., letters of credit, payment of cash in advance, sales on an open account). Payment for agricultural exports will still be limited to cash in advance or financing by third-country banks only. “Authorized exports and reexports” include those authorized under a BIS license exception (e.g., products and materials exported to private sector entrepreneurs under License Exception “SCP” – Support for the Cuban People), as well as export transactions permitted by BIS under a specific license.
Most Cuban Embargo Restrictions Remain in Place
Although the amendments to the CACR and EAR signify further relaxing of Cuba sanctions, the U.S. embargo on Cuba remains largely in place; most transactions between the U.S. and Cuba continue to be prohibited.
In addition, a general policy of denial will still apply to exports and reexports of items for use by state-owned enterprises, agencies, or other organizations of the Cuban government that primarily generate revenue for the state. Additionally, applications to export or reexport items destined to the Cuban military, police, intelligence and security services remain subject to a general policy of denial.
More Favorable Licensing Policies for Certain Exports and Reexports
The following transactions still require a license application, but the chances of approval for such licenses have improved:
Exports to Cuban Government Agencies Meeting the Needs of the People: BIS is now considering, on a “case-by-case” basis, license applications for exports and reexports to Cuban state-owned enterprises and government agencies that provide services and goods to meet the needs of the Cuban people. Previously, such license applications were subject to a policy of denial. The new case-by-case policy applies to items for construction of facilities for public water treatment, electricity or other energy; sports and recreation; agricultural production; food processing; disaster preparedness, relief and response; public health and sanitation; residential construction and renovation; public transportation; wholesale and retail distribution for domestic consumption by the Cuban people; and artistic endeavors.
New Policy of Approval for Certain Exports and Reexports: License applications for the following exports and reexports are now subject to a “general policy of approval,” an upgrade from “case-by-case” consideration:
Environmental protection items: U.S. and international air quality, water, or coastline
Telecommunications items: To improve communications to, from, and among the Cuban people.
Civil aviation and commercial aircraft safety items: Those necessary to ensure the safety of civil aviation and safe operation of commercial aircraft engaged in international air transportation, including the export or reexport of civil aircraft leased to state-owned enterprises.
Agricultural items: Such as insecticides, pesticides, and herbicides, as well as other agricultural commodities (e.g., tractors and other farm equipment) not eligible for License Exception AGR
Commodities and software: To human rights organizations or to individuals and non-governmental organizations that promote independent activity intended to strengthen civil society in Cuba; also to U.S. news bureaus in Cuba whose primary purpose is the gathering and dissemination of news to the general public.
4. Travel Authorized for Additional Purposes Including Film Making
U.S. persons are still prohibited from traveling to Cuba for tourism, but OFAC now permits travel to Cuba for additional purposes as highlighted below.
Travel related to information and informational materials now includes travel for the filming of movies and TV programs, music recordings, and artwork creation.
Organization of professional meetings, public performances, clinics, workshops, and athletic and other competitions and exhibitions in Cuba, in addition to the previously authorized attendance at such events.
5. Air Carrier Services Expanded to Permit Code-Sharing and Leasing
U.S. companies can now enter into blocked space, code-sharing, and leasing arrangements to facilitate the provision of carrier services by air, in connection with travel or transportation between the U.S. and Cuba, including such arrangements with a Cuban national.
© 2016 BARNES & THORNBURG LLP
From proposals to slash the H-1B cap to overhauling the EB-5 investor program, 2016 is already proving to be an interesting year for business immigration. In a series of posts, we will provide an overview of the cases, legislation, and regulations to look out for in the new year. In our first post we will discuss the H-1B visa and proposed reforms.
A new wave of bills on Capitol Hill may lead to greater scrutiny of the H-1B program for high-skilled temporary workers in 2016. Since November, senators on both sides of the aisle have introduced legislation related to the visa category. One comes from Republican presidential candidate and Senator Ted Cruz (R-TX), who hopes to reform the program by creating a “layoff cool-off period” under which employers could not hire any H-1B workers within two years of layoffs, furloughs, or employee strikes. The “American Jobs First Act of 2015” would also end the Optional Practical Training program, which allows certain foreign students or graduates to temporarily work in the United States. Bill co-sponsor Senator Jeff Sessions, (R-AL), said the H-1B program has become a “backdoor method for replacing American workers.”
Senator Sessions, known as an immigration hardliner, also co-sponsored the “Protecting American Jobs Act” with Senator Bill Nelson (D-FL) to reduce the annual cap on H-1B visas from 65,000 to 50,000. If more than 50,000 petitions are filed within a fiscal year, the bill would require DHS to prioritize workers with the highest wages. “This bill directly targets outsourcing companies that rely on lower-wage foreign workers to replace equally qualified U.S. workers,” stated Senator Nelson. His legislation directly opposes fellow Florida Senator and Republican presidential candidate Marco Rubio’s earlier 2015 bill that would triple the H-1B cap to between 115,000 and 195,000 visas.
Another bipartisan effort comes from Senate Judiciary Committee Chairman Chuck Grassley (R-IA) and Senate Minority Whip Dick Durbin (D-IL), who recently introduced legislation that would greatly reform and increase enforcement of the H-1B program. Their bill would prohibit companies from hiring H-1B workers if they have more than 50 employees and over half are H-1B and L-1 visa holders.
Whether any of these bills will actually pass remains the biggest question for H-1Bs in 2016, particularly as certain bills—and legislators—oppose one another, both in the Senate and in presidential campaigns.
Parnia Zahedi assisted with this post.
Congress’s complex relationship with prescription drugs was on display today in the House of Representatives. In the House Committee on Oversight and Government Reform (OGR), Martin Shkreli pleaded the 5th at a hearing investigating drug pricing. Meanwhile, the Energy and Commerce Committee (E&C) held a hearing regarding implementation of biosimilars. While all the attention will be on the former, the latter was more important, especially for participants in the biosimilar space.
First, the OGR Committee was a media show built around the flamboyant Shkreli. Shkreli took the 5th when given the opportunity to testify and later tweeted – after being excused from the hearing for refusing to answer any of the Members questions – that the Committee Members were ‘imbeciles’. The tone of the hearing was very aggressive towards drug pricing and what were described as unsavory business practices. Members were also critical of the FDA generic drug programs. However, Member interest in strengthening the program to bring competition to the marketplace was clear. Dr. Janet Woodcock, Director of the Center for Drug Evaluation and Research at the FDA, stated that funds collected as a result of the Generic Drug User Free Amendments (GDUFA) helped expedite the review process and that by October there will be a 10-month review process on all new applications. The Senate HELP Committee held a hearing last week on reauthorization of GDUFA, which will expire next year, and this bipartisan interest, coupled with the prescription drug cost crisis, could lead to increased resources for the FDA review process. Beyond some public shaming of specific drug companies, there was little suggestion of substantive action on drug pricing.
Second, the E&C Committee was less about drug pricing, but more so about the ability of manufacturers to get new biosimilar products to the market. Notably, Committee Members on BOTH sides of the aisle were critical of CMS for trying to price biosimilars more like generic drugs and categorize different products under a single billing code. They said the CMS ruling undermines the intent of the Biologics Price Competition and Innovation Act of 2010 (BPCIA) by removing incentives for a robust marketplace. Biologics make up a $200 billion market, so the consequences of policy decisions are significant. Members were also critical of delays in approving more biosimilars and issuing guidance on product labeling. Rep. Frank Pallone (D-NJ) asked if additional appropriations would address these problems, to which Dr. Woodcock replied that she’s more concerned the FDA will be unprepared for a rapid expansion of the biosimilar market.
While 2016 may be devoted to campaigning against drug prices, the Committees responsible for the regulatory regimes for drugs are still very focused on preserving the ability of manufacturers to successfully bring drugs to the market. That is a much bigger deal than the plethora of Martin Shkreli smirks you will be subjected to in the media.
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