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The recent imposition of steep tariffs on some goods from Mexico, Canada and China by the Trump administration portends a time of destabilization for U.S. companies doing global business. The situation may not be all gloom and doom, legal experts said at a spring symposium titled “Today’s Global Trade and Tariffs Decoded: Perspectives & Solutions in Navigating Global Sanctions: Business, Compliance, and Legal Challenges Across Borders.”

The event was organized by the University of �鶹���� of Law’s Global Business Law Institute (GBLI) and hosted by GBLI Advisory Board member Kristy Harlan, Senior Vice President and General Counsel at Weyerhaeuser, in the Weyerhaeuser office March 4 in downtown Seattle on the same day President Trump’s proposed 25% taxes on Mexican and Canadian imports went into effect along with increased duties on products from China.

Canada has retaliated with a reciprocal 25% tariff on U.S. goods. China levied additional tariffs, and Mexico has said it would respond soon. The new tariffs have prompted fears of a trade war and concerns over the potential impact on supply chain, manufacturing and global business. A panel of experts — lawyers and business partners in leading U.S. companies and law firms — discussed challenges with maintaining regulatory compliance in a time of drastic change as well as with U.S. directives that either shift or are stayed by U.S. Courts. In this climate, each offered insights and solutions as to how companies can effectively navigate the complex situation fraught with uncertainty. John Pierce, partner at Kilpatrick, Townsend & Stockton, moderated the discussion.

While one of the purported motives for imposing tariffs on imports is to increase domestic manufacturing, it may not have the intended effect, said Joe Lee, vice president and deputy general counsel at Cisco. Rather, many companies maintain a diversified manufacturing strategy that already includes off and near-shoring capabilities in countries such as Vietnam. While diverting manufacturing to these countries drives some expense and disruption, moving manufacturing to a new country or facility is neither cheap nor quick. Consequently, it remains to be seen whether Vietnam and other countries in Southeast Asia will emerge as new hubs of global manufacturing and the unexpected winners of the new tariff policies.

The expert panel weighed in on other complications such as customer preference for products. Complex legal rules are used to determine the country of origin of imported goods produced with discrete components from two or more countries.

Gunjan Talati, partner at Kilpatrick, Townsend & Stockton, expressed concern that manufacturing industries may bypass trade regulations in the current volatile situation by making false claims in the country-of-origin determination or by willfully putting products in the wrong categories in tariff classification to avoid paying duties. In the past, industries have tended to respond to sanctions and tariffs by bringing agility to their supply chain strategy and looking to non-US alternatives that deliver, for example, substantial transformation of imports. President Trump’s recent executive order directing the Department of Justice to pause enforcement of the Foreign Corruption Practices Act (FCPA) may be a harbinger for how aggressively sanctions violations are investigated under past administrations and FCPA misconduct is investigated in parallel with potential U.S. sanctions violations. The panelists agreed, however, that efforts to circumvent the administration’s tariff policies are likely to draw regulatory scrutiny.

“For companies, it’s a time for a return to the basics,” said Larry Fink, chief counsel for Global Trade Controls at Boeing. This would entail clarifying core values, showing agility and flexibility, and maintaining ethical compliance with regulations. In this time of uncertainty, the panelists counseled that these core principles, combined with resisting the pressure to make quick and overly responsive decisions, will help companies navigate.

The impacts of new tariffs are yet unknown. Since the panel, the administration has enacted a baseline tariff of 10% on imports from all countries and additional tariffs of up to 50% on imported goods from specific countries. In turn, foreign governments have responded with tariffs on U.S. exports.

It is, however, an opportunity for attorneys to counsel at the highest level of the profession and make a profound impact on company strategy. It is an exciting time for lawyers giving guidance to companies on import and export and trade regulations, posited Jeff Dickerman, senior vice president and general counsel at Expeditors International. Companies are encouraged to pay close attention to global policies of trade, understand mergers and acquisitions, develop or enhance formal programs to determine compliance and violations, and, where needed, consider voluntary self-disclosures to mitigate penalties. With proper planning, companies might even benefit from the tariffs, and domestic manufacturing may increase.

“For now, it’s prudent for businesses to put the crystal ball in the closet and come up with a variety of contingency plans,” Mr. Fink said.