In Episode #6, we discuss current developments in the EU with Shannon Brandao, an international politics and law specialist and American attorney based in Belgium. We cover:

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This podcast has been transcribed by an automatic transcriber.

Fred Rocafort 0:08
Global law and global business go hand in hand, but never seemed to keep pace with each other, developing and developed nations wax and wane their importance in the global stage. While consumption and interconnectedness both increase, laws and regulations change incessantly, requiring businesses to stay nimble. How do we make sense of it all? Welcome to global law and business, hosted by Harris Bricken International Business attorneys. I’m Fred Rocafort.

Jonathan Bench 0:34
And I’m Jonathan Bench. Every Thursday, we take a bite sized look at legal and economic developments and locales around the world as we try to decipher global trends in law in business with the help of our international guests. We cover continents, countries, regimes, governance, finance, legal developments, and whatever is trending on Twitter. We cover the important the seemingly unimportant, the relatively simple and the complex.

Fred Rocafort 0:58
We hope you enjoyed today’s podcast. Please connect with us via email and social media to comment and suggest future topics and guests.

Jonathan Bench 1:19
Many of us thinking of modern European history began in post World War Two terms after Europe was left in ruins and in desperate need of capital, infrastructure and hope. The Bretton Woods Conference in 1944, hosted by the United States provided a framework through which Europe could rebuild itself and its economy, and it fundamentally change the global world order. Over the next several decades with France and Germany at the helm, the European integration plan began with the establishment of the European community and its new institutions comprised of the European Commission, the Council of Ministers of Parliamentary Assembly, and a court of justice. economic integration increased by doing away with tariffs and providing for the free flow of goods and people within the European community. greater political, foreign policy, citizenship and security integration followed in the 1990s. With the establishment of the European Union. The 2002 introduction of the euro, along with the addition of many Eastern European countries in the 2000s, brought the total number of EU countries to 25 in 2004, and added economic and political complexities to Europe. Romania, Bulgaria and Croatia rounded out the number 228, which is where we are today. Europe was particularly hit hard by the fallout from the September 11 2001 terrorist attacks, dramatically increasing the flow of immigrants seeking refuge from conflicts in the Middle East and Northern Africa regions. The post 911 conflicts created the European migrant crisis that flooded Europe with millions of additional people requiring significant care, training and integration, burdening European government resources and stretching tax coffers. Recently, the divide between the economically healthier northern EU countries and the less healthy Southern EU countries intensify to the point where UK voters decided to leave the EU. Brexit is currently underway and COVID-19 has continued to decimate populations, especially in Italy and Spain. In this turbulent era, what does the future hold for the EU and the rest of Europe? Today we are joined by Shannon Brandao. Shannon is an American attorney and international politics and law specialist who helps businesses policymakers and ordinary individuals make sense of complex issues around the globe hunkered down in Leuven, Belgium, just outside Brussels. She is currently trying to maintain order and sanity after six weeks of lockdown by sectioning her two bedroom flat which she shares with her husband, and energetic terrier and two cats into designated no entry zones. Check out her latest posts on COVID-19 recovery efforts in EU and China on LinkedIn. Shannon, thank you for being with us here today.

Shannon Brandao 3:45
Thank you for having me. I’m very excited to be on your show.

Fred Rocafort 3:49
Shannon Welcome to our show. Before we get going in earnest, could you please tell us how you ended up in Europe in the first place?

Shannon Brandao 3:58
Um, it’s it’s an interesting story I never intended to be here. Um, I’ve always been passionate about international affairs. That was my major at University, where I focused on Chinese politics and I actually spent time in Hong Kong and Taiwan studying Chinese language and Chinese affairs. When I was much younger, I returned to the states and then I decided to go into law. I applied to law school in 2005. And I took every international law course including courses on the European Union, and courses on international commercial arbitration. Every course that was offered, there were a lot of courses. I went to University of Miami. I graduated in 2008 right at the time when the bottom fell out of the legal market. My intention had been to to find some area of international law you know, to practice in, but I quickly discovered that that was not going to be possible. So I did sort of an about face and on the recommendation of one of my professors, I took a class on bankruptcy law and I became a US bankruptcy attorney where I defended individuals and small businesses in court in their bankruptcy cases. for about five years, I the 2008 financial crisis was was quite harsh. And I was very, you know, young and and very gung ho and very excited and eager to to work with my clients. But I saw a lot of really difficult things in that period. It was not a I think you probably remember it was not a very nice, a nice time for anybody. I sort of burned out and I just kind of hit a wall with that. And I took time off and tried to reconnect with what I originally wanted to do. And in that time, I decided that it was either then or never I was going to make a change to actually pursue what I had originally wanted to pursue, which was the study of international law, international business international politics at a deeper level. So, about 10 years after I graduated law school, I applied for an LLM in European Business Law at Catholic University here in in Leuven, Belgium. It’s a one a, I guess it is Belgium’s top research universities. Excellent, excellent institution. I think that all of its graduate programs are in English. It’s extremely international student friendly. The whole, the entire town of Leuven is just I mean, English is essentially the language spoken you. It’s really remarkable. So I finished that degree in 2019. And I decided to stay because I enjoyed Belgium a lot. And I, adore European Union law and politics and the complexities that that come with European affairs so I don’t know, I found that to be quite an intriguing and so I’m still here. I don’t know when I will return home. My parents keep asking obviously I’m not going to be going home anytime soon under the present situation the because borders are closed and I think Americans can get home at this point but you would have to I would have to quarantine myself. So, um, but I’m staying here and My husband and I are pretty happy here and we feel pretty secure and safe. The Belgian government has done a lot in terms of keeping everybody safe. So we don’t feel like we’re in danger, really. And quite happy to be here at the moment.

Jonathan Bench 8:50
I think I got Brexit fatigue last year trying to track everything. Can you give us an update on where Brexit is and what the European Kind of sentiment is about the UK leaving the EU.

Shannon Brandao 9:05
Yeah, yeah. I think that a lot of people have completely forgotten about Brexit at this at this time. Yes, it was all in the news and we were all fatigued by it. But Brexit is still on as of today. Downing Street has said that it will stick to its original timetable, despite the fact that Prime Minister Boris Johnson and Michel Barnier, the two top negotiators on the Brexit deal, so, Prime Minister Boris Johnson out of the UK and and the EU chief negotiator Michel Barnier, both are recovering from the corona virus. The UK formally left the European Union on the 31st of January. We are still in a transition period that’s leading up to the 31st of December and during that time, UK is still an EU member. Britain’s government says that an EU UK trade deal must be in place by the last day of the year. But even if it’s not, Downing Street has said that it will not prolong a transition period beyond that December 31 2020 timeline. The idea behind the transition period though, was to minimize disruption caused to the business and travel between the UK and the EU. So now the implications are with COVID-19. No one seems to know how a deal between UK and the EU can be worked out to minimize any kind of disruption in Those in those areas. The US said that negotiations could be extended by a year or two. They’ve not officially but they’ve seemed open to the idea. And maybe off the record. I think they’ve said that. But apparently at this point, it’s the UK. That’s in the driver’s seat. And Boris Johnson seems to think that his timetable is is the one that he wants to pursue? Well, we don’t know. The status is that currently there’s no change in anything. The UK again remains a member of the EU. It has the same government, although a different Prime Minister. Its laws are still EU laws for the time being. And, and, but the real question is what will change watch wants negotiations do take effect. And that is a very complicated question. It’s complicated because the UK exit requires enormous change to its laws and regulations that were previously put in place as part of EU law. Many UK laws were required to be adopted to ensure harmonization of the laws with other EU member states. And so one of the challenges to wholesale revocation or this wild, you know, repealing or pull back in law is that the EU is still a very, very important trading partner for the UK. And things like data protection laws in the UK will need to align be aligned with EU data protection laws. That’s just one example in order for the UK for UK based businesses to operate within the EU. So none of the changes are gonna be immediate, the scale of the issues that need to be considered, is just so huge that it’s going to take many years for review and debate and solution to be found. And of course, everything had hinges on the negotiations that haven’t even taken place yet. What you could say though, you know, businesses are trying to make arrangements, they know that this is going forward. And so they’re they’re trying to figure out their next steps. And what we have been seeing is a number of companies establishing subsidiary offices, that the companies for example that might have been in only the UK, whether they were UK companies and they had business in the in the EU, or whether they were American companies, for example, that had business in the EU. They began To move to the to and maybe they kept their offices in the UK, but they established subsidiary offices in in an EU Member State in places like the Netherlands and Germany and in France, the Netherlands seems to be a favorite spot, it’s actively pursuing a lot of that business. And you know, everyone, well, not everyone, but most people in the Netherlands do speak English and their business laws aren’t too far removed from the UK business model. So I think it’s an easy place for for businesses to to find themselves in. But I would, I would argue you could even come to Belgium, you could come to Flanders because where I am, Flanders, it’s a Dutch speaking place but there are a lot of people are most people speak English and are very entrepreneurial, very much like the Dutch. And we have a major port in Belgium and we have the EU headquarters in Brussels and we are strategically located right in the center between France, Germany and the Netherlands. So that’s that could be one option for businesses. But again, in terms of exactly what will change as it relates to any kind of, you know, law to trade law, supply chains, anything like that, it just hasn’t been decided yet.

Fred Rocafort 15:41
You know, Shannon last year in the in the happy pre Coronavirus days as part of their annual St. Patrick’s Day rollout you know, where the Irish government sends its entire cabinet overseas to engage with both Irish communities overseas and countries around the world Generally, the I went to an event in Seattle and Brexit was was at the center of the agenda. And the minister who was present there and I forget what his specific portfolio was. But I went away with the distinct impression that although at some level he lamented the fact that the UK would would soon be out of the union that there was definitely a certain feeling of excitement that He manifested, you know, as he talked about the opportunities that Brexit might present to Ireland as the only remaining native English speaking country and and the only common law jurisdiction through to remain in the Union. That aside, right i think it’s it’s obvious that up until now, The UK has provided a key link between the US and the European Union. Obviously, it’s a it’s a country that well, you know, enjoys such a special relationship with the US. So it really can claim Well, at least when when it was still in the European Union, right, or as long as it is in the European Union, it can it can claim to be in both clubs, right and provide that key link but with the UK, out of the EU and not able to really exercise that role. What will the US EU relationship begin to look like? And perhaps you could talk, among other things about what that will mean in terms of trade. We hear of course, a lot about the US China trade war, but one thing that impacts me when I go to conferences and talk to other international trade practitioners is how much the language being used by the administration with regards to Europe is beginning to resemble the language used when talking about China, at least in when it comes to trade. So we’d love to hear your thoughts on the future of us EU relations.

Shannon Brandao 18:25
Yes, I think you make an absolutely great point. So I guess I’d start with the latest developments in the EU us relations. And on an informal level I would start with by describing the amazing efforts that are happening here on behalf of the American business community, so we’ve got a number of companies that are pitching in to help out with COVID-19 crisis. On the EU level, you may have seen in the news that Netflix and YouTube have reduced their streaming quality in Europe for at least a month. And they’re going to review that decision at the end to prevent the internet from just collapsing under the strain of unprecedented use. That is occurring during the coronavirus pandemic. Amazon did the same thing here that it did in the states it prioritized shipments of household staples and medical products and temporarily halted intake of other goods until April the fifth and then I think they are back to shipping on demand now. So on the at the EU level, this is all across the EU, these companies and others. These are just a few of the examples that I had time to talk about. But they’re all pitching in to do what they can And at the national level in each member state American companies are contributing. So in the case of Belgium, I just attended a virtual online, you know, a webinar that was sponsored by the American Chamber of Commerce in Belgium. And they were spreading the message about American business and how American businesses is helping connect different companies with hospitals, the needs of hospitals, and the health care sector here. For example, Kearney, which is an American, you know, global management consulting firm, brought companies together to make and distribute face masks and alcoholic gel to local hospitals and they provided support to raise capacity for producers of BP. Exxon, which is in Antwerp is a very large employer and important to the local economy here. Exxon focused on keeping its facilities and supplies running. And it made good use of its Baton Rouge chemical plant which is home to the world’s largest ISO propyl alcohol production unit, which produces millions of gallons gallons of stuff. That stuff you know each year. It in Belgium Exxon donated 6000 liters of that to local hospitals, and it also donated money to Belgium’s biggest research universities to help them with research against COVID-19 or on COVID-19 Excuse me. My favorite example is Belgium, Eli Ernest Young Belgium sponsored two successful COVID-19 hackathon events, one in Belgium and the other at the EU level. In order to brainstorm and develop projects to problem solve things like, you know, the logistics of mass testing for COVID-19, or how to combine artificial intelligence with crowdsourcing in the in medical and clinical part of clinical r&d, new approaches to PHP development software for home testing platforms and educational apps for students and lock downs and projects to get businesses up and running again. In Belgium, the hackathon gathered 600 solution hackers, and it yielded at least 30 viable projects just in Belgium alone at the EU level. It amassed 20,000 hackers and yielded some 2000 projects to sort of help us figure out how to beat this volunteers from it. In Belgium worked weekends to mentor and provide communications and platforms to make all these events possible. It was all on a volunteer basis. They worked, you know, overtime. So I was really proud as an American to see things like that happening. But that’s the informal level. Right. That’s the informal response to to EU relations. Officially, transatlantic ties have not been faring so well. Um, trade barriers seem to be the number one reason why. divergent national responses to the latest crisis have brought new sources of tension and complaint. And in the face of medical supply shortages, the US and Europe have both turned inward. Where Washington ordered three in order The three m company to halt its exports for taught for a little while, and then Europe responded by doing the same. And then, of course, the you know, President Trump made a unilateral transatlantic travel ban that that sparked the anger among sparked anger among European leaders. trade barriers are damaging the alliances that the US has here with individual member states as well. And I think I mentioned before that other countries like Russia and China are beginning to exploit Well, they they’ve been exploiting that since since January. So some ideas that I’ve seen tossed around to try to remedy the US and EU relationship would be to use NATO For example, to to stockpile shared medical supplies or Maybe, you know, cooperate in some sort of joint global medical surveillance program to to prevent or reduce the chances of another pandemic. In the end, we have, we should remember that we are both friends, and we are both in need, and that the trade barriers that we keep sticking up are preventing us from helping each other and preventing us from doing a whole lot about COVID-19.

Jonathan Bench 25:38
Shannon, I know that you are a China wonk and Fred and I are as well we we all speak Mandarin. We’ve all been studying China for quite a few years, and keeping track on how China is interacting with the greater world. Can you talk for a little bit about what China is doing I know China’s working closely with Russia. They like to sow discord, as you mentioned, and they’re trying To get a win, you know, allies in any country in the world, it doesn’t matter where it is, right? Any country that China can get to lean in its direction and away from the US is a victory for China. So can you talk a little bit about what China is doing in the EU and how its actions are perceived there?

Shannon Brandao 26:19
Well, interestingly, when I first got here, so I came, you know, for my graduate program. And I learned so much about the EU. And I learned so much about the EU’s policy towards Russia, which was still developing. And China never came up. And I kept thinking to myself, why is China not an issue? There’s there is the same problem. You know, the EU has the same problem with China than it does with Russia. And I guess it’s just they have a longer history of acknowledging the difficulties Russia presents and maybe a shorter one with China. I’m not sure what the explanation is for that. But I was really taken aback that, that a lot of my you know, a lot of the articles that I read a lot of the research, a lot of the foreign policy information out there on EU External Relations didn’t have much to do with China and it really surprised me. Um, but a lot of that is beginning to change, especially with the COVID-19 crisis. China lately has been heavily criticized here for both its disinformation campaign and going around Brussels and attempts to weaken the EU and support Member States separately with for example, a mask discipline diplomacy, where it’s just donating You know, it steps in wherever it sees that the EU is not stepping in it steps in and fills the gap with free masks and other supplies for countries hospitals, um, those efforts were working for a little while. But the reason that most European governments were happy with what China was was giving them is because they weren’t receiving communication from the EU on on how the EU was working to support them as well. And that’s been changing also. The EU is in an early stages of developing a coherent strategy as a block towards China and the end Russia. where it really hadn’t done before. One of its major developments is a new foreign direct investment screening regulation, which is similar to the US, maybe saying this wrong, I think it says cepheus passed in February 2019 entered into force in April 11 2019 and a subsequent European Commission communication that gives guidance on how to screen investors to protect member state industries. The Commission came out with this communication to identify an increased risk of attempts by non EU acquirers to obtain control over suppliers of essential products and in particular the healthcare sector products. For the most part, this communication was a direct response to Chinese takeovers or at least fears of Chinese takeovers throughout the EU. They the commission was pressured by Germany it was pressured by the UK it was pressured by Netherlands and even France to respond in a stronger way than it had before to to safeguard European companies. And so what they did was they decided to lighten up a little bit on competition law in terms of the rules for state aid. So they’re going to allow member states to help if not produce European champions, at least keep their companies from becoming Chinese champions, so to speak. So that’s what’s been happening here. There has been a lot of effort to it was a rushed effort, but it was a lot of money. effort to protect European businesses and industry on the ground. But then you had what was just reported in the New York Times where the commission censored its own reports at China’s request to remove objective and accurate facts on disinformation by its government. So the strategy is evolving, and it’s not always clear and coherent. But at least it’s there where I really didn’t see a strong one before.

Fred Rocafort 31:38
Shannon, this has been a very interesting conversation and I think we will need to have you back on to talk about Hong Kong and China, which obviously are topics that everyone here enjoys. before we let you go, I’d like to ask you, what have you been reading watching or listening to lately?

Shannon Brandao 32:02
Well, I I’ve sort of put my books away I’m obsessed with trying to figure out how we’re going to get out of the mess that we’re currently in with our lockdowns and and the coronavirus pandemic. So I didn’t consume the news as much before this as I do now I’m tied to the news or at least articles and research all the time. Things I’m following right now. For example, are I I’ve been watching very closely the coverage of the Washington Post’s reports on the State Department’s release of cables morning about lab safety in Wu Han. Those cables haven’t been released yet, as far as I know, and The Washington Post is suing under the Freedom of Information Act to get them released. And they’re being even though they’ve requested expediting processing, the State Department’s holding on to them and saying oh, they’re not that urgent, you don’t need them. So I’m kind of waiting on that. this past Tuesday, Senator Murphy out of Connecticut and Senator Markey out of Massachusetts sent a letter to the Secretary of State Mike Pompeo requesting information about the two cables. That was reported. Also in the in the Washington Post. They specifically asked about the actions that were taken in regards to the warning. For me, I’m watching this closely. Not because I do or don’t agree with the theory of a lab accident and ohan I don’t I don’t know. I’m like everyone else. I wasn’t there. I don’t know what to think. But I would like to see those cables. Because I believe they have huge implications not only for China, but also for the US. And, and science at those people and labs. So that’s fascinating to me. I’m following that very closely. Another thing I’m doing is I’m getting really, really great links on the latest COVID-19 scientific research. From Chora of all places. They’ve got an excellent Coronavirus thread, where researchers like Mitchell Tsai, who was a former virus researcher at Harvard shares articles and updates and he decided he helps us understand, you know, he puts it in lay terms if we can’t understand the actual research. So that’s been extraordinarily enlightening and it’s exciting to see how fast the science is moving and and this global effort to be extremely moving to see how this global effort at trying to to come up with a vaccine as quickly as possible. And on that note I’m of course following the development of the Oxford vaccine. There’s a story about it in the New York Times. It’s a remarkable story of of how the the researchers at Oxford actually had a head start accidentally because they were already testing a vaccine for another coronavirus. The MERS virus right when COVID-19 started so they already had infrastructure in place they already had volunteers and willing participants they had already tested a vaccine for MERS on humans and and had determined that it was safe. So they’ve got a huge jump a huge advantage on on the other teams that are competing for for the vaccine. They believe that they can have a vaccine as early as September but you know, no guarantees there. China has said that it believes it will have a vaccine as early as September. So I don’t know why I’m watching that. I think everyone’s, of course hinging their hopes on the vaccine. And we all have to remember that, you know, there are some things that you just can’t get a vaccine for. And it’s not a 100% Sure thing. But everyone’s working really, really hard on it. And so it’s very inspiring and very moving. And and I think we’re all pretty hopeful that it’s going to come through.

Fred Rocafort 36:35
Jonathan, what about you? What are you reading?

Jonathan Bench 36:37
I think the thing I enjoyed most this last little while was an Atlantic article is this month’s Atlantic article from HR McMaster and he gives a really a lucid summary of a US government military. You know, I think people who are in the know about China and very much watching China a lucid background for the title the article is how China sees the world and how we should see China. And I always like to check my understanding and my guts against those who are have access to a little more information than I do, and get, you know, get grounded again in history as to how China understands the world and how we should understand what China is doing right now and that it’s been a great read, not not too long, but a very well written,very lucid article. What about you, Fred?

Fred Rocafort 37:33
So in keeping with the theme of rediscovering books that we’ve left behind this, we move around the world. I recently picked up a book that I’ve owned for a long time, so it’s not a current book, but the topic is nonetheless very relevant. The name of the book is Treasure Island’s Tax Havens and the Men Who Stole the World by Nicholas Shaxson s-h-a-x-s-o-n And it’s basically about the offshore industry. I had a brief stint myself working in that industry. So a lot of what is described there really resonates with with what I observed in that industry. But the author really does a wonderful job of explaining how this very corrupt parallel world operates and why it matters. So highly recommend that book. I know that there’s other books on the subject that have have come out since and of course there is that Netflix movie, the name of which escapes me at the moment, but it’s a topic that is being picked up on more these days. But this book is one of the first works to really come out about a topic, so encourage everyone to, to to take a look at treasure islands.

Jonathan Bench 39:05

Shannon, thank you for being with us today on our podcast. It’s been fascinating to get your viewpoint. You’re extremely well read, well spoken and we look forward to talking more with you, especially about China as we as we look ahead and checking in again on you matters as well. So thanks for being with us, and we look forward to tracking your work.

Shannon Brandao 39:25
Thank you. I’ve really enjoyed it. It’s been a lot of fun. Thanks for inviting me to your show.

Jonathan Bench 39:33
We hope you enjoyed this week’s episode. We look forward to connecting with you on social media to continue to discuss developments in global law and business. and tune in next week for another episode. We’ll see you then.

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