British Move Vs. U.S. Boycott Laws

The British government has launched a surprise attack on United States anti-boycott legislation because of its possible impact on U.S.-controlled companies in this country. Edmund Dell, the Trade Secretary, has issued a toughly worded statement saying that U.S. regulations infringed the jurisdiction of the United Kingdom and could have an adverse effect on United Kingdom trade and employment. He advised British companies to contact the department as soon as possible if they thought they might be affected.

The government has also issued a lengthy note to major companies explaining the working of the American regulations and is to send a two-man fact-finding mission to Washington. Officials here stress that they are critical only of the extra-territorial aspects of the U.S. Export Administration Law’s 1977 amendment and do not contest the right of foreign governments to regulate activities of companies in their own countries.

The announcement was made now because an important part of the American regulations comes into effect Aug. 1. This requires companies to report to the U.S. government receipt of all boycott questionnaires. It applies to foreign companies in which 25 percent or more of the equity is in the hands of American shareholders.

The statement also coincides with attempts to introduce British legislation on the lines of the American anti-boycott measures. The government does not support the Foreign Boycotts Bill, still in committee stage. However, it denies that Thursday’s move was intended to weaken it.

Supporters of the bill have, nonetheless, bitterly compared the government’s strong reaction to the American legislation with its traditional timidity toward the Arab boycott itself. If the government is so sensitive about the extra-territoriality of U.S. legislation, they say, why did it not show similar concern about the extra-territorial influence of Arab legislation regarding trade with Israel?