US companies need relief from BDS pressure

The 1977 Export Administration Act, which I helped author at President Jimmy Carter’s direction, prohibits American companies and individuals from participating in unsanctioned boycotts against U.S. allies, including Israel.

That law, now known as the Export Control Reform Act (ECRA), also protects U.S. companies from pressure to comply with a foreign country’s efforts to boycott U.S. allies, in conflict with U.S. foreign policy. For four decades, the law has been upheld by the courts.

{mosads}But recently, new pressing challenges have arisen, as international governmental organizations (IGOs) are attempting to use the tactics used by the Arab League in its boycott of Israel.

Once again, U.S. companies, workers and commercial interests are unfairly being placed in a vise between U.S. government foreign policy objectives that support our allies and the aggressive politics of the Boycott, Divestment and Sanctions (BDS) movement against Israel.

This time, anti-Israel interests are working through IGOs to pressure private companies, whose legal business activities bring concrete benefits.

In response, bipartisan legislation is pending in the closing days of the 115th Congress to address this new challenge, the Israel Anti-Boycott Act (IABA). Congress needs to pass the IABA as soon as possible. 

For nearly three years, the Office of the U.N. High Commissioner for Human Rights (OHCHR) has been investigating the commercial activities of hundreds of companies, including dozens of U.S. firms operating in full accordance with U.S. laws.

OHCHR is doing so because of a mandate from the U.N. Human Rights Council to create a database of companies that conduct business beyond the “green line,” including East Jerusalem and the Jewish Quarter of the Old City.

Companies in this database could be subject to “reputational, legal and financial consequences,” as described in a January 2018 interim report by the OHCHR. The process is so opaque that companies do not know who might put them on the list nor how to defend legal commercial activities when OHCHR appears to have rendered judgment.

Already, the mere possibility that a company might appear on such a list provokes public criticism and boycott threats. The OHCHR, which is under pressure from many anti-Israel member states and outside groups, may well decide to publish this list in 2019.

If this list is published, it will almost certainly lead to new, unsanctioned boycotts against Israel and other U.S. allies.

The IABA is carefully-crafted to update the 1977 legislation by extending the prohibition against complying with boycotts beyond those imposed by foreign countries to cover boycott-related activities by international governmental organizations, like the U.N. or the European Union. 

Some have raised free speech objections to the new legislation. However, like the 1977 legislation, the IABA exclusively targets commercial conduct only as described in existing law and regulations, not political speech or activities.

U.S. courts have consistently ruled that regulating these commercial activities does not violate the First Amendment. Interestingly, these kinds of First Amendment issues were not raised in 1977, when the original statute was drafted.

In fact, the newly-proposed legislation has been revised in recent months and actually is stronger in protecting First Amendment rights because it explicitly indicates that political views are protected.

Criticism of Israel, its treatment of Palestinians and its settlement policies are indeed protected by the First Amendment as free speech, and in no way does the IABA punish them for electing not to do business with or in Israel.

There has not been a single instance during the 40-year history of the underlying law in which the political beliefs of any individual have led to civil or criminal penalties nor would it under the new legislation. 

All the IABA does is follow the constitutional authority that underpinned the 1977 legislation by prohibiting U.S. individuals and companies from providing requested information to an international governmental organization to assist in its efforts to further a boycott against a country friendly to the United States.

What companies and individuals would not be able to do under this legislation is to boycott Israel or other U.S. allies at the behest of these IGOs. The courts have long supported Congress’ authority to limit international commercial conduct that it finds contrary to U.S. national interests. 

{mossecondads}The IABA protects American companies from being pressured by international governmental organizations to provide information for the purpose of prosecuting boycotts against Israel. The bill discourages IGOs from blacklisting American companies conducting legal activities in any friendly country.

At the same time, the IABA makes clear that monetary fines are the only possible penalties for violating new anti-boycott provisions and that no jail time can be imposed.

Congress took a courageous stand against the Arab League boycott against Israel 40 years ago. Today, it needs to extend current law to counter these new forms of boycott.

The bipartisan IABA is designed to protect U.S. businesses and individuals from being pressured into a discriminatory economic boycott of Israel or other friendly nations by IGOs.

The legislation is ready to move forward. Congress should promptly enact this legislation before another “blacklist” of U.S. companies becomes a reality.

Stuart E. Eizenstat was chief White House domestic policy adviser to President Jimmy Carter and a principal drafter of the 1977 anti-boycott legislation. He is the author of “President Carter: The White House Years” and co-chairs the Jewish People’s Policy Institute of Jerusalem.