American-israel Chamber of Commerce Finds Loopholes in Pending Anti-boy Cott Legislation

The American-Israel Chamber of Commerce (AICC) has stated its support for legislation pending in Congress to combat the Arab boycott of Israel insofar as it affects American firms and businesses. But in testimony before the International Finance Subcommittee of the Senate Committee on Banking,Housing and Urban Affairs, Max Ratner, national chairman of the AICC. noted certain features and loophoies that could operate contrary to the intent of the Congress if not corrected.

Ratner also stated that his organization was itself a specific injured party of the Arab secondary boycott. He cited an Arab League memorandum stating that a joint Israel-foreign chamber of commerce affiliation would be cause for investigation with a view toward banning firms which enhance Israel’s economy. If the secondary boycott is successful, the Chamber will be restricted in its activity to further promote trade and good will between Israel and the U.S., Ratner said.

He described the AICC as a national trade association of non-sectarian and non-political character which has among its members some of the largest and best known American industries, banks and commercial houses.

Ratner appeared before the Senate subcommittee in the course of its hearings on the Williams-Proxmire Bill (S.92) and the Stevenson-Moynihan Bill (S.69). They are sponsored, respectively, by Sens. Harrison Williams (D.NJ), William Proxmire (D.Wisc.), Adlai Stevenson (D.III.) and Daniel Moynihan (D.NY).

IMPLICATIONS OF PROVISIONS

Ratner said the Chamber supports the provisions of S. 92 with respect to certificates of origin requested by a foreign customer of an American firm. The bill requires such certificates to be formulated in positive terms, i.e., to state in which country the goods in question have been produced. Ratner pointed out that this is a traditional requirement in international trade.

Bill S. 69 would allow American firms to file any kind of certificate of origin, including the Arab demand of certification that the goods were not produced in Israel. According to Ratner, the implication would be psychological pressure on American firms because any time they file a certificate, even an innocuous one for goods of American origin, they will have in mind that doing business with Israel endangers their status with the Arab countries.

Ratner also wants the legislators to close a loophole in both bills whereby American firms could circumvent anti-boycott legislation by doing business with Arab countries through foreign subsidiaries located in third countries. Ratner said that such transfer might frustrate the goals of the anti-boycott legislation and adversely affect the exports of the United States by reducing them for the benefit of foreign countries.

The AICC chairman found fault with permission given by Bill S.69 to American individuals to comply with any immigration and passport requirements of a boycotting country. He called such a provision a stamp of approval of foreign bigotry because, if enacted, it would enable a boycotting country to legally extract from U.S. citizens asking to enter that country information regarding the ethnic origin of the U.S. principals of their firm or the fact that the firm did business with a boycotted country.

FINDS TECHNICAL DRAFTING ERROR

Finally, Ratner said the AICC discovered a technical drafting error in both bills. At present they permit a boycotting country to require an American firm to stop imports from a boycotted country. The intention of the legislators, as interpreted by the Chamber, has been to allow the boycotting country to forbid imports from the boycotted country to the boycotting country via the United States, Ratner said.

But, he pointed out, this is not what is written presently into the presently into the official text of the bills and the provision could amount to a license to boycott the imports from Israel due for use in or consumption within the U.S.

In general, Ratner said. “We welcome and support the proposed bills before this subcommittee…The Senators who have sponsored these bills have done a great service to the American people. We are also encouraged by the readiness of Secretary of State Cyrus Vance to outlaw secondary boycotts in the United States.” Vance testified before the subcommittee earlier this month.