SCOTUS to Consider Emergency Applications to Lift Nationwide Injunctions on EO Ending Birthright Citizenship?
The Trump Administration urged the U.S. Supreme Court to limit nationwide injunctions blocking enforcement of the executive order (EO) to end birthright citizenship.
Following his inauguration on Jan. 20, 2025, President Donald Trump signed an EO directing federal agencies to refuse recognition of U.S. citizenship for children born in the United States to mothers who are in the country without authorization or on nonimmigrant visas, if the father is not a U.S. citizen or green card holder.
Judges in Maryland, Massachusetts, and Washington state have issued nationwide injunctions barring the government from implementing the EO.
President Trump appealed to the Supreme Court to limit these nationwide injunctions, arguing that they disrupt the judicial process and overreach into executive branch operations. The administration’s March 13 emergency applications asked that the court orders be limited to the specific individuals and organizations involved in the lawsuits. They contend that there is no justification for the injunctions to apply nationwide, particularly to the 18 states that support the EO.
The Supreme Court’s decision could potentially lead to a ruling that restricts district courts from issuing nationwide injunctions. The administration also argues that the injunctions improperly interfere with the executive branch’s ability to develop guidance for implementing the EO. If the justices do not agree to limit the injunctions to individuals and organizations, the administration has requested that they be restricted to the plaintiff states.
Trump Fires Two Commissioners and Solidifies Control Over FTC
On March 18, 2025, President Donald Trump removed the two remaining Democrats serving on the Federal Trade Commission (FTC), Rebecca Slaughter and Alvaro Bedoya.
Commissioners Slaughter and Bedoya, whose terms were not due to expire until September of 2029 and 2026, respectively, declared the firings illegal and vowed to sue to get their jobs back.
By statute, the FTC is headed by five Commissioners, no more than three of whom can represent the political party in power. At present, however, and with the announcement of the firing of Commissioners Slaughter and Bedoya, only two Commissioners remain, Chair Andrew Ferguson and Commissioner Melissa Holyoak, both Republicans. President Trump’s nomination of Mark Meador has been approved by the Senate Commerce Committee but awaits confirmation by the full Senate.
Although the removal of these Commissioners effectively eliminates the current deadlock at the FTC, it is unclear whether the FTC can effectively operate with only two Commissioners. Furthermore, the legality of the firings will surely be questioned, as might any actions made by the remaining Commissioners.
President Trump Fires Two Democratic FTC Commissioners
Key Takeaways
Potential Legal Battle Over Presidential Authority. President Trump’s firing of the two Democratic FTC commissioners challenges old and new U.S. Supreme Court precedent interpreting the FTC Act’s terms, which allows the president to remove FTC commissioners only for “insufficiency, neglect of duty or malfeasance in office.” Advocates of the so-called “unitary executive” theory have reportedly been seeking grounds to challenge the limit on presidential power presented by Humphrey’s Executor and Seila Law, hoping the currently constituted Supreme Court might overrule this longstanding precedent.
Impact on FTC’s Composition and Competition Enforcement Direction. With the removal of the two Democratic commissioners and the anticipated confirmation of Republican nominee Mark Meador, the FTC will have a 3–0 Republican majority. This will give these Republican appointees complete control over approving future enforcement actions and also empower them to abandon existing FTC actions that they may not support, such as defending the FTC’s noncompete rule.
Consumer Protection Focus. Despite the Commission’s composition changes, the FTC’s consumer protection mission is expected to remain largely unchanged under Chairman Ferguson. The agency will likely focus on enforcing existing laws rather than pursuing new rulemaking efforts, particularly in privacy, data security and technology. Children’s privacy will continue to be a priority.
On March 18, President Donald Trump fired the Democratic commissioners, Rebecca Slaughter and Alvaro Bedoya, from the Federal Trade Commission (FTC). This leaves two Republicans, Chairman Andrew Ferguson and Melissa Holyoak, and a Republican nominee, Mark Meador. However, the dismissal of two Democratic commissioners runs contrary to decades of precedent at the FTC and apparently tees up a battle over presidential control over so-called “independent” federal agencies that seems headed to the U.S. Supreme Court.
The FTC is an executive agency, but it is called “independent” because it is not under the oversight of a cabinet secretary. Since its inception in 1915, it has operated independently with five commissioners — by statute, no more than three from one party (i.e., the president’s party) and two from the other party. According to the FTC Act, the president may nominate the commissioners, who are then subject to Senate approval. The commissioners serve staggered terms, so they are not hired or fired simultaneously and often work across administrations. Traditionally, however, upon a change of administration, the current chair resigns to enable the president to appoint a new commissioner, giving the president’s party a majority on the Commission.
The independent agency rubric, under which the FTC has operated for many decades, has more recently come under fire for its purported insulation from presidential oversight. In other words, if the rubric is constitutional, the president may not fire commissioners absent “cause.” The president can choose to appoint other agency heads purely from their own party, but for FTC commissioners, he must maintain a split-party Commission, which functions independently.
White House to Approve Regulations from Independent Agencies
In February, President Trump issued an Executive Order to “rein in” independent agencies. The Order states that Article II of the US Constitution vests all executive power in the president, meaning that all executive branch officials and employees are subject to his supervision. Accordingly, all agencies must: (1) submit draft regulations for White House review — with no carve-out for so-called “independent agencies,” except for the monetary policy functions of the Federal Reserve; and (2) consult with the White House on their priorities and strategic plans, and the White House will set their performance standards. The Office of Management and Budget (OMB) is tasked with budget oversight, and the president and attorney general (subject to the president’s supervision and control) will provide authoritative interpretations of law for the executive branch.
Humphrey’s Executor Precedent and Presidential Oversight
The president’s attempt to fire the two Democratic commissioners appears to contravene the language of the FTC Act itself as well as old and new Supreme Court precedent interpreting its terms. The FTC Act limits the president’s ability to fire an FTC commissioner to “insufficiency, neglect of duty or malfeasance in office.” In Humphrey’s Executor v. United States, 292 U.S. 602 (1935), the Supreme Court addressed a challenge to President Franklin D. Roosevelt’s firing of FTC Commissioner William Humphrey for political reasons. The Court distinguished between the president’s authority over ordinary executive officers and what it called “quasi-legislative” or “quasi-judicial” officers. The Court held that FTC commissioners fell into that class of officers and could be removed only with procedures consistent with statutory conditions enacted by Congress.
In 2020, in Seila Law, LLC v. Consumer Financial Protection Bureau, the Supreme Court affirmed that this is one of the only remaining narrow restrictions on a president’s authority to remove officers. Humphrey’s Executor, it explained, allowed “Congress to give for-cause removal protections to a multimember body of experts, balanced along partisan lines, that performed legislative and judicial functions and was said not to exercise any executive power,” essentially limiting it to the facts of that case. 591 U.S. 197, 216 (2020).
Advocates of the so-called “unitary executive” theory have reportedly been seeking a basis to challenge the limit on presidential power embodied in Humphrey’s Executor and, more recently, Seila Law, hoping that the currently constituted Supreme Court might overrule this longstanding precedent. Indeed, Humphrey’s Executor only narrowly survived the Court’s 5–4 decision in Seila Law in 2020. Another case already in progress involves the president’s firing of National Labor Relations Board (NLRB) members, which is currently before the DC Circuit and seems to have a head start on the objective of putting Humphrey’s Executor before the Supreme Court again. A new Supreme Court ruling on this issue could have profound implications for all independent agencies — not just the FTC.
What Does this Mean for the FTC?
In the near term, the firings seem to portend the following at the FTC:
Commissioners Slaughter and Bedoya have publicly stated that they will challenge their firings in court and that, for now, they consider themselves still part of the FTC. While their immediate status is unclear, it does not seem likely that they would be able to continue in their positions without court intervention. Chairman Ferguson supported President Trump’s authority to remove them and had already referred to Slaughter and Bedoya as “former commissioners.”
Practically speaking, the firings could impact the FTC’s decisions in certain competition enforcement actions. Assuming nominee Mark Meador is confirmed and joins the Commission in the near future, the FTC will have a 3–0 Republican majority. This will give these Republican appointees complete control over approving future enforcement actions. The change may also empower the new Republican majority to abandon existing FTC actions they may not support, such as defending the FTC’s noncompete rule, currently on appeal before the Fifth Circuit and the Eleventh Circuit.
We see little change to the agency’s consumer protection mission and priorities, as articulated by Chairman Ferguson. We anticipate the agency will shift its focus to enforcing existing laws rather than pursuing rulemaking efforts related to privacy, data security and technology. However, the advocacy of the former Democratic commissioners to regulate data brokers, biometric technology and artificial intelligence (AI) may take a different shape now. Ferguson will likely focus on enforcing existing laws against AI without hindering innovation in this area. Interestingly, Ferguson has also been more aggressive, proposing to inquire into tech platforms’ alleged “censorship.” Children’s privacy continues to be a priority, and Commissioner Ferguson has already indicated that the FTC may make more changes to the recently amended Children’s Online Privacy Protection Rule.
Maine Considers Bill to Establish Maximum Levels of PFAS in Farm Products
If passed, Maine’s SB130, titled An Act to Establish the PFAS Response Program and to Modify the Fund To Address PFAS Contamination, would be the first state law to establish PFAS limits in food (PFAS limits have been established for other categories of goods).
The bill would formally establish a PFAS response program to “respond to and address PFAS contamination affecting agricultural producers in the State, to assist commercial farms affected by PFAS contamination and to safeguard public health.” We note that the bill would in part codify existing portions of Maine’s PFAS response program, which has already set an action level for PFOS (a type of PFAS) in milk of 210 ppt.
Specifically, under the proposed bill, the PFAS response program would, among other things:
Establish maximum levels for PFAS in farm products (defined as “plants and animals useful to humans” and includes, by way of example, products ranging from grains and food crops to Christmas trees).
Provide PFAS testing support to help agricultural producers understand the extend of PFAS contamination and provide technical support to assist in mitigation efforts.
Provide financial assistance to PFAS-impacted agricultural producers.
Establish baseline criteria that agricultural producers would have to adhere to in order to receive technical and financial assistance, including granting property access to conduct PFAS investigations and providing relevant information to program staff.
We will continue to monitor and report on PFAS regulation.
Kentucky Amends Consumer Privacy Law to Exempt Certain HIPAA-Covered Data
On March 15, 2025, Kentucky Governor Andy Beshear signed into law HB 473. The bill amends the Kentucky Consumer Data Protection Act (“KCDPA”) to exempt from the law’s application (1) information collected by health care providers acting as covered entities under HIPAA that maintain protected health information in accordance with HIPAA; and (2) information maintained in limited data sets by HIPAA covered entities in accordance with HIPAA’s relevant requirements. The KCDPA as amended will go into effect on January 1, 2026.
BEAD Reform Raises a Number of Policy Issues and Potentially Adds Delay
Even before taking office, incoming members of the Trump Administration and some Republican members of Congress criticized various regulatory requirements in the $42.5 billion BEAD program as being unnecessarily burdensome and contributing to a perceived slow rollout of BEAD funding. The Commerce Department and Congress have now begun efforts to streamline and reform the BEAD program. The changes raise a number of questions, and if implemented as expected, will significantly impact and may delay the program.
Commerce Department Reviewing BEAD Program Rules
Last week, newly appointed Commerce Secretary Howard Lutnick announced that he has directed NTIA to launch a “rigorous review” of the BEAD program. According to Secretary Lutnick, NTIA “is ripping out the Biden Administration’s pointless requirements” and “revamping the BEAD program to take a tech-neutral approach,” which is clearly intended to eliminate the current funding preference for end-to-end fiber optic projects and pave the way for much more of the BEAD funding going to low-earth orbit (LEO) satellite or unlicensed fixed wireless broadband. NTIA is expected to release details of such rule changes in the coming days.
House Introduces “SPEED for BEAD Act”
Also last week, Congressman Richard Hudson (R-NC), Chairman of the House Communications and Technology Subcommittee, introduced legislation to revise and expedite the deployment of the BEAD program to get “shovels into the ground as soon as possible.”[1] H.R. 1870, The Streamlining Program Efficiency and Expanding Deployment (“SPEED”) for BEAD Act would eliminate certain BEAD requirements that are viewed by the bill’s supporters as being politically driven, overly bureaucratic, and not tied to the underlying goals of deploying broadband infrastructure.
1. Certain BEAD Requirements Removed
Among other things, the SPEED for BEAD Act would prohibit NTIA and eligible entities (e.g., states) from conditioning or scoring BEAD subrecipient awards based on:
Prevailing wage laws;
Labor agreements;
Local hiring;
Climate change;
Regulation of network management practices, including data caps;
Open access; and
Diversity, equity, and inclusion.
2. Amend Definition of Reliable Broadband Service
Under the BEAD statute, funding will be made available for projects serving “unserved locations” and “underserved locations”[2] lacking access to “reliable broadband service.” The legislation would amend and broaden the definition of “reliable broadband service” to include “any broadband service that meets the applicable performance criteria without regard to the type of technology by which service is provided.” This would reverse the current NTIA requirements, which exclude locations “served exclusively by satellite, services using entirely unlicensed spectrum, or a technology not specified by the Commission for purposes of the Broadband DATA Maps.”[3] This will enable LEO and unlicensed fixed wireless providers to participate more broadly in the BEAD program as providers of “reliable broadband service,” if they meet certain performance requirements to be set by NTIA. It may also exclude from BEAD eligibility locations already served by such services.
3. Prohibition on Rate Regulation
The legislation would prohibit the imposition of rate regulation of broadband services provided over BEAD-funded network facilities. This includes prohibiting NTIA or any state or territory from regulating, setting, capping, or otherwise mandating the rates charged for broadband service by BEAD subrecipients, or the use of rates as part of an application scoring process. The Act does not remove the low-cost service option requirement from the BEAD statute, but instead prohibits eligibility entities from imposing specific low-cost service requirements.
4. Ability to Remove High Cost Locations From a Project Area
The legislation would provide a mechanism for subrecipients to remove locations from a project area that the subrecipient “determines would unreasonably increase costs or is otherwise necessary to remove.” The provision raises several questions as to how and when such determinations can be made by the subrecipient. States and territories would apparently award a separate subgrant to address such removed locations, presumably creating additional opportunities for BEAD-funded LEO service.
5. Elimination of LOC Requirement
The legislation would also eliminate the requirement for a BEAD subrecipient to provide a letter of credit (“LOC”) if the provider has commercially deployed a similar network using similar technologies and is either: (a) seeking funding that is less than 25% of the provider’s annual gross revenues; or (b) seeking to serve a number of locations that is less than 25% of the provider’s total number of existing service locations. These revisions would tend to benefit larger service providers, and would likely be of less benefit to new entrants or smaller providers, for whom LOC requirements often present a greater challenge.
Questions Raised by Impact of Reform Effort
While some stakeholders have already embraced a streamlining of the BEAD program rules, it must be noted that the proposed reforms are coming at a time when funding is about to be disbursed. NTIA has already approved Initial Proposal for all states and territories, and most of them have either already selected subrecipients, or are in the later stages of doing so. While the reform efforts at Commerce and in Congress are aimed at getting “shovels in the ground” as soon as possible, the reform initiatives – and resulting policy and legal questions – may well impose additional delay.
Introducing sweeping changes to BEAD at this stage raises thorny questions on whether some of the new rules can and should be applied mid-way through the award selection process, and after the application windows have closed. It should also be noted that despite concerns that the existing rules would result in low participation, many states are reporting strong bidder participation. Applicants around the country spent millions of dollars developing business plans, forging partnerships, locking down inventory, mapping out participation strategies, and developing detailed applications, all in reliance on the existing rules. Many other entities elected not to participate in BEAD based on the existing rules. Will they have any recourse to participate based on the new rules?
Finally, the broadband ecosystem is in a constant state of flux, with new privately funded networks coming online all of the time. Many state broadband offices, at the direction of NTIA, have been hesitant to revise their BEAD maps to remove locations after the “challenge” period. If there are now going to be additional delays in BEAD awards, what will be the impact on the existing maps? Will NTIA allow states to revise eligible locations to account for new deployments based on new updated data reported in the next Broadband Data Collection?
While targeted reforms aimed at enabling BEAD to better meet its underlying goal of providing all Americans with robust broadband connectivity make sense, care must be taken to ensure that such reforms do not themselves cause undue delays or undermine state processes that are working reasonably well.
[1] Chairman Hudson’s Opening Statement at Subcommittee on Communications and Technology Hearing on Rural Broadband
[2] Defined respectively as, a location lacking access to “reliable broadband service” of 25/3Mbps, with latency of less than 100ms, and a location lacking access to reliable broadband service of 100/20 Mbps, with latency of less than 100ms.
[3] NTIA BEAD Notice of Funding Opportunity
What Every Multinational Company Should Know About … The Current Trump Tariff Proposals
Although we are only two months into the new administration, we have seen a dizzying array of new tariffs that have been proposed, imposed, revoked, suspended, and sometimes reimposed. It can be difficult for importers to keep up with all the proposals. So, as an aid to the importing community, we have put together an “evergreen” tariff article, which contains three key items for importers:
A table of the tariff proposals, including their current status[1] and the key importer issues for each;
A list of resources for importers looking for aids to cope with tariff and international trade uncertainty; and
A list of the most common questions we are receiving from clients regarding the new tariffs and their implementation.
We will be regularly updating these resources to reflect new tariff proposals and modifications, which are in some cases being updated or changed daily.
Where Are We on the Various Tariff Announcements?
At this point, we count 12 tariff initiatives that are proposed or in play. They range from broad-based tariffs that cover all goods from a certain country (Canada, China, and Mexico), tariffs that cover certain types of goods (aluminum and steel), promises of future tariffs (automotives, semiconductor, pharmaceutical, copper, and lumber), and promised retaliatory tariffs (European wine and alcoholic beverages). Further, although we have seen more tariff announcements in the first two months of the second Trump administration than we saw in the entirety of the first one, the largest tariff shoe is yet to drop: It is likely that the announced “Fair and Reciprocal” tariff rollout will dwarf the tariffs imposed to date, with the countries at the greatest risk of increased tariffs consisting of:
Countries that impose high tariffs. Notable examples include Argentina, Bangladesh, Brazil, Egypt, India, and Pakistan.
Countries that are viewed as heavily subsidizing their manufacturers. Depending on the particular type of products, examples include China (especially) as well as Australia, Canada, and the European Union countries.
Countries that are viewed as manipulating their exchange rate. The Department of Commerce already has issued a finding that Vietnam grants subsidies by manipulating its exchange rate, in a countervailing determination involving tires from Vietnam. As part of its semiannual report to Congress, the Treasury Department maintains a “monitoring list” of exchange rate policies that arguably confer subsidies. The November 2024 list included China, Germany, Japan, Singapore, South Korea, Taiwan, and Vietnam.
Countries that have put in place import barriers aimed at high-profile, high-volume products such as automobiles. While the United States maintains tariff levels of 2.5 percent for automobile imports, most of the rest of the world starts at 10 percent or higher.
We will be updating this article as new policies are announced, including the reciprocal tariffs. The state of play for each tariff is as follows:
Where Are We on the Trump Tariffs?
Tariff Proposal
Effective Date
Likely To Stick?
Likely To Increase?
Key Issues for Importers
2018 Section 301 Tariffs 83 FR 28710; 83 FR 40823; 83 FR 47974; 84 FR 43304
In force
Yes
Probably; likely to be equalized at top level and/or raised
Review HTS classifications to ensure accuracy, particularly for List 4B products; see “New 20% China Tariffs” below
2018 Aluminum/ Steel Tariffs 83 FR 11625; 83 FR 11619
Superseded as of 3/4/2025
N/A
N/A
N/A
New 20% China Tariffs 90 FR 11426
3/4/2025
Yes
Possibly
Use of Chinese parts and components for China+1 strategies; ensure substantial transformation of all products manufactured in +1 countries
25% Canada and Mexico Tariffs 90 FR 9113; 90 FR 9117
3/4/2025- 3/6/2025
Superseded as of 3/6/25
N/A
3/6/2025 (non-USMCA-Compliant goods) 90 FR 11429 90 FR 11423
Possibly
Possibly
Verify and document compliance (e.g., rules of origin, special rules for autos and textiles) for all claims of preferential treatment under USMCA; maintaining certificates of origin at time of entry. Consider Mexico duty-saving opportunities (e.g., IMMEX)
New 25% Aluminum/ Steel Tariffs 90 FR 9807; 90 FR 9817;
3/12/2025
Yes
Yes, by adding new derivative products
Monitor for new derivative products proposed for addition to steel and aluminum derivative products; verify potential HTS matches for aluminum and steel derivatives; look for Customs instructions regarding derivative products and apply
Reciprocal Tariffs
4/2/2025 (likely roll out in stages)
Yes
Unclear
Monitor; see above for list of high-tariff countries
Broad European Tariffs
Promised
Unclear
N/A
Monitor
25% Auto, Semiconductor, Pharmaceutical Tariffs
Promised
Yes
Subject to negotiation with Europe, Korea, Japan, and Mexico
Monitor; consider front-loading inventory for critical components
New Lumber Tariffs
Under study
Yes (if issued)
N/A
Monitor; consider front-loading inventory
New Copper Tariffs
Under study
Yes (if issued)
N/A
Monitor; consider front-loading inventory
200% Retaliatory Wine Tariffs
Threatened
No (if issued)
EU
Monitor; consider front-loading inventory
Future of USMCA
2026 review
Unclear
N/A
See Canada and Mexico Tariffs; monitor for expedited negotiations
Frequently Asked Questions
After presenting at numerous seminars and webinars, and in discussions with clients, we have noticed certain recurring questions. As an aid to the importing community, we have compiled a list of these, which include the following:
General
Do the tariffs stack?
Yes, all tariffs stack. This means an entry of steel from China would incur:
the normal Chapter 1–97 tariff;
the 25-percent Section 232 steel tariff;
the original Section 301 China steel tariff (up to 25 percent); and
the new 20-percent additional China tariff.
In addition, if the product is covered by an antidumping or countervailing duty order, then those duties also would stack.
Is the stacking compounded?
No. The tariffs add up without compounding. If both a 20-percent and a 25-percent tariff apply, then this results in a 45-percent increased tariff.
Are you seeing clients pursue a China +1 strategy to cope with the new tariffs?
Yes. Many clients have been pursuing a strategy of adding additional capacity outside of China since the imposition of the original Section 301 duties. These efforts appear to be accelerating, as there is a growing realization that high tariffs on China are the new normal. In this regard, it is important to note the original Section 301 tariffs remained in place even under the Biden administration. Further, China is likely to see the greatest amount of increased tariffs under the reciprocal tariff proposal because it hits so many categories — it heavily subsidizes its industries, it has been tagged as a currency manipulator by the Department of Treasury for years, and there are numerous countervailing duty findings by the Department of Commerce that provide a clear roadmap to identify subsidy programs.
One caution is that when companies move production out of China, they often continue to use Chinese-origin parts and components. Companies pursuing this strategy need to do a careful analysis to ensure they are “substantially transforming” the product by doing enough work and adding enough value in the third country to create a new and different article of commerce with a new name, character, or use, thus giving it a new, non-Chinese country of origin.
Will there be exceptions for goods like medical devices in the proposed tariffs?
Unclear. But the tariffs have veered toward being universal. Further, one of the purposes of the aluminum and steel tariff announcement was to wipe out the list of accumulated product-specific exceptions that had grown over the years. These factors work against an announcement of tariff-specific exceptions.
Are there any discussions relating to potential tariff relief for certain sectors (Defense, Navy, etc.)?
So far, the only somewhat industry specific reprieve has been the lifting of tariffs on USMCA compliant goods until April 2, 2025, as a result of the U.S. auto manufacturer concerns. While this is intended to apply to a lot of automotive imports, the lifting of the tariffs on USMCA compliant items is not exclusively tied to automotive imports. If discussions regarding tariff relief for other sectors have been occurring, they have not been announced.
Will the Executive Orders on tariffs be challenged in litigation?
Almost certainly, yes. But in general, the Court of International Trade and the Court of Appeals for the Federal Circuit tend to defer to the Executive in matters of international trade policy. Also, the imposition of special tariffs in the first Trump administration were generally upheld by the trade courts.
Have you heard of any plans to change Foreign Trade Zones (FTZ) laws?
In general, no. Specific tariff announcements, however, have contained provisions relating to the FTZs, such as stating any goods that go into Foreign Trade Zones need to enter in “privileged foreign status.” This means the duty rate is fixed at the time the goods enter the zone, meaning even if the goods are further manufactured within the FTZ, the duty will be based on the original classification when they entered the FTZ.
Steel and Aluminum Tariffs
How have the Section 232 aluminum and steel tariffs changed from the original 2018 version?
The aluminum tariffs increased from 10 to 25 percent.
All negotiated tariff-rate quotas for the EU, Japan and the United Kingdom, as well as the quotas negotiated with Argentina, Brazil, and South Korea, are no longer applicable. The previous exemptions for Australia, Canada, Mexico, and Ukraine no longer apply.
All product-specific exemptions that had been granted under the original aluminum and steel program are revoked.
The “derivative articles list” is considerably expanded.
Are Chapter 72 articles still subject to 25-percent tariffs?
Yes. Certain headings in Chapter 72 that were previously subject to the original Section 232 tariffs are still covered. All exclusions that previously applied to certain Chapter 72 products are now revoked.
Are iron products covered?
Based on the description of the covered products in the Executive Orders, carbon alloy steel products, not iron, are covered by the exclusions.
How should we treat imports that fall under the “derivative articles” HTS codes but do not actually contain any aluminum or steel?
In some cases, certain HTS classifications that are on the derivative aluminum and steel HTS classifications can cover types of products that may not contain any aluminum or steel. For example, certain types of metal furniture are covered, but if these are made out of a metal other than steel then they would not be covered even though they fall within an HTS that is listed in Annex 1 of the steel proclamation. In these cases, it would be appropriate to have the foreign producer include a statement on the commercial invoice to state that the product does not contain aluminum or steel, to support why the tariffs are not due on the entry.
After the elimination of the product-specific exemptions, are there any remaining exemptions?
The only exemption remaining is for derivative articles that are manufactured from steel melted/poured in the United States or aluminum smelted/cast in the United States. For such products, the importer should request a statement on the commercial invoice stating that the product contains aluminum smelted/cast in the United States or steel that was melted/poured in the United States. In case of Customs inquiry, it would be appropriate to include copies of steel mill certificates or aluminum certificates of analysis in the 7501 Entry Summary packet.
For derivative articles, is the 25-percent tariff paid on the full value of the article?
The Executive Orders state that the 25-percent tariff is paid on the “value” of the aluminum or steel “content” of the “derivative article.” There are, however, no instructions as to how this value should be calculated. In accordance with normal Customs requirements, the value should be calculated using a reasonable method that is supportable. This could potentially be based on a calculation from the foreign supplier. Frequent importers of derivative products should monitor CSMS announcements to see if CBP issues instructions on this issue.
Is duty drawback available for the aluminum and steel tariffs?
No, the Executive Orders state that duty drawback cannot be used.
Does Chapter 98 provide relief from the 25-percent aluminum and steel tariffs?
The Executive Orders do not list any Chapter 98 exceptions for the new tariffs. This is consistent with the original Section 232 tariffs, which also did not contain any Chapter 98 exceptions.
Will there be an exclusion process?
None has been announced or established. It is unlikely that the Trump administration would wipe out all product-specific exemptions only to build them back up again.
Could the list of “derivative articles” expand?
The Executive Orders directed the Department of Commerce to establish a process by May 11, 2025, to consider requests to add additional “derivative articles.” We anticipate that U.S. aluminum and steel manufacturers will aggressively use this process to push for additional excluded derivative products.
USMCA/Canada and Mexico Tariffs
Will the reciprocal tariffs replace the Canadian and Mexican tariffs? Or will they stack?
The reciprocal tariffs have not been announced yet. But because all of the other tariffs stack, there is a high likelihood that the reciprocal tariffs also will stack on top of the existing 25-percent tariffs rather than replace them where they overlap. Also, the 25-percent tariffs were announced as being imposed due to concerns about fentanyl and unauthorized immigration, which is an entirely separate issue from the tariff equalization that is the goal of the reciprocal tariffs.
How will tariffs effect the IMMEX/Maquiladora imports from Mexico?
Because the Maquiladora, Manufacturing, and Export Services Industry (IMMEX) Program is a figure of Mexican law, we anticipate Mexico will do all that it can to protect companies that operate using the Program. Although uncertain, as per previous experiences in imposing retaliatory measures, Mexico will most likely establish tariffs on US sumptuous goods and/or finished products, and hardly to raw materials used by IMMEX/Maquiladora companies.
Will the Canada and Mexico tariffs be lifted when the USMCA review occurs?
Unclear. We do note, however, that the United States lifted the prior aluminum and steel tariffs as part of the negotiation of the USMCA under the first Trump administration. The second Trump administration, however, is taking a much harder line on tariff and international trade issues.
Reciprocal Tariffs
What are reciprocal tariffs?
“Reciprocal tariffs” are intended to equalize tariff rates, such as when a foreign country imposes a higher tariff on the United States than the United States does for the same product category. Because the United States generally has low tariffs, this means that there are a great many HTS classifications that likely will increase, with the impact varying by country. Moreover, because the announcement of the coming reciprocal tariffs states that it will take into account any form of discrimination against U.S. companies or programs that favor foreign companies, then calculated reciprocal tariffs will likely be very high. For example, most countries have Value Added Taxes that rebate any VAT payments when goods are exported; the Trump administration has indicated that this would be considered a form of subsidy that should be counteracted with reciprocal tariffs. So would subsidized electricity, currency manipulation, and so forth. Adding these concepts on top of equalizing tariffs across HTS categories leads to likely major increases in tariffs.
When will they be announced?
The reciprocal tariff announcement is expected for April 2, 2025. The Trump Administration also announced that it would proceed to consider countries with major trade deficits with the United States first, so it is possible that April 2nd will be the start of a rolling set of reciprocal tariff announcements.
Force Majeure and Surcharges FAQs
The Foley Supply Chain team also has published a set of FAQs regarding contractual issues, which we are repeating here for convenience.
What are the key doctrines to excuse performance under a contract?
There are three primary defenses to performance under a contract. Importantly, these defenses do not provide a direct mechanism for obtaining price increases. Rather, these defenses (if successful) excuse the invoking party from the obligation to perform under a contract. Nevertheless, these defenses can be used as leverage during negotiations.
Force Majeure
Force majeure is a defense to performance that is created by contract. As a result, each scenario must be analyzed on a case-by-case basis, depending on the language of the applicable force majeure provision. Nevertheless, the basic structure generally remains the same: (a) a listed event occurs; (b) the event was not within the reasonable control of the party invoking force majeure; and (c) the event prevented performance.
Commercial Impracticability (Goods)
For goods, commercial impracticability is codified under UCC § 2-615 (which governs the sale of goods and has been adopted in some form by almost every state). UCC § 2-615 excuses performance when: (a) delay in delivery or non-delivery was the result of the occurrence of a contingency, of which non-occurrence was a basic assumption of the contract; and (b) the party invoking commercial impracticability provided seasonable notice. Common law (applied to non-goods, e.g., services) has a similar concept known as the doctrine of impossibility or impracticability that has a higher bar to clear. Under the UCC and common law, the burden is quite high. Unprofitability or even serious economic loss is typically insufficient to prove impracticability, absent other factors.
Frustration of Purpose
Under common law, performance under a contract may be excused when there is a material change in circumstances that is so fundamental and essential to the contract that the parties would never have entered into the transaction if they had known such change would occur. To establish frustration of purpose, a party must prove: (a) the event or combination of events was unforeseeable at the time the contract was entered into; (b) the circumstances have created a fundamental and essential change; and (c) the parties would not have entered into the agreement under the current terms had they known the circumstance(s) would occur.
Can we rely on force majeure (including if the provision includes change in laws), commercial impracticability, or frustration of purpose to get out of performing under a contract?
In court, most likely not. These doctrines are meant to apply to circumstances that prevent performance. Also, courts typically view cost increases as foreseeable risks. Official comment of Section 2-615 on commercial impracticability under UCC Article 2, which governs the sale of goods in most states, says:
“Increased cost alone does not excuse performance unless the rise in cost is due to some unforeseen contingency which alters the essential nature of the performance. Neither is a rise or a collapse in the market in itself a justification, for that is exactly the type of business risk which business contracts made at fixed prices are intended to cover. But a severe shortage of raw materials or of supplies due to a contingency such as war, embargo, local crop failure, unforeseen shutdown of major sources of supply or the like, which either causes a marked increase in cost or altogether prevents the seller from securing supplies necessary to his performance, is within the contemplation of this section. (See Ford & Sons, Ltd., v. Henry Leetham & Sons, Ltd., 21 Com. Cas. 55 (1915, K.B.D.).)” (emphasis added).
That said, during COVID and Trump Tariffs 1.0, we did see companies use force majeure/commercial impracticability doctrines as a way to bring the other party to the negotiating table to share costs.
May we increase price as a result of force majeure?
No, force majeure typically does not allow for price increases. Force majeure only applies in circumstances where performance is prevented by specified events. Force majeure is an excuse for performance, not a justification to pass along the burden of cost increases. Nevertheless, the assertion of force majeure can be used as leverage in negotiations.
Is a tariff a tax?
Yes, a tariff is a tax.
Is a surcharge a price increase?
Yes, a surcharge is a price increase. If you have a fixed-price contract, applying a surcharge is a breach of the agreement.
That said, during COVID and Trump Tariffs 1.0, we saw many companies do it anyway. Customers typically paid the surcharges under protest. We expected a big wave of litigation by those customers afterward, but we never saw it, suggesting either the disputes were resolved commercially or the customers just ate the surcharges and moved on.
Can I pass along the cost of the tariffs to the customer?
To determine if you can pass on the cost, the analysis needs to be conducted on a contract-by-contract basis.
If you increase the price without a contractual justification, what are customers’ options?
The customer has five primary options:
1. Accept the price increase:
An unequivocal acceptance of the price increase is rare but the best outcome from the seller’s perspective.
2. Accept the price increase under protest (reservation of rights):
The customer will agree to make payments under protest and with a reservation of rights. This allows the customer to seek to recover the excess amount paid at a later date. Ideally, the parties continue to conduct business and the customer never seeks recovery prior to the expiration of the statute of limitations (typically six years, depending on the governing law).
3. Reject the price increase:
The customer will reject the price increase. Note that customers may initially reject the price increase but agree to pay after further discussion. In the event a customer stands firm on rejecting the price increase, the supplier can then decide whether it wants to take more aggressive action (e.g., threaten to stop shipping) after carefully weighing the potential damages against the benefits.
4. Seek a declaratory judgment and/or injunction:
The customer can seek a declaratory judgment and/or injunction requiring the seller to ship/perform at the current price.
5. Terminate the contract:
The customer may terminate part or all of the contract, depending on contractual terms.
[1] Please note that the implementation of the various tariff programs remains in flux, and thus the status of these program should be monitored closely. The included table is current as of the date of publication of this article.
Significant Workforce Reductions at the U.S. Department of Education and Their Potential Implications
On March 11, 2025, the U.S. Department of Education announced that it would initiate a reduction in force (RIF), affecting nearly 50 percent of its workforce. Staff are being placed on administrative leave starting March 21, 2025, with an expectation that the entire workforce will be reduced from 4,133 workers to roughly 2,183. The RIF is part of President Donald Trump’s Workforce Optimization Initiative.
Quick Hits
The Department of Education announced a RIF for nearly 50 percent of its workforce.
Impacted staff will be placed on administrative leave starting March 21, 2025.
Affected employees will receive full pay and benefits until June 9, 2025.
Employees are not expected to work during the deferred resignation, voluntary buyout, or RIF periods.
The impact of the RIF on the overall operations and responsibilities of the department is unclear and potentially far-reaching.
The Department of Education was established in 1979 with the primary responsibility for administering federal elementary, secondary, and postsecondary education programs. The RIF will impact employees across all divisions within the department, including those in formula funding, student loans, Pell Grants, funding for special needs students, and competitive grantmaking.
The department has pledged to fulfill its obligations under all statutory programs despite an anticipated 50 percent reduction in personnel by early June 2025. It is not known how the RIF will affect the department’s overall operations and responsibilities including compliance with the Clery Act, Title IX of the Education Amendments of 1972, Campus SaVE, and other student safety measures such as the Bipartisan Safer Communities Act and the Emergency Management for Higher Education grant program.
The RIF impact is similarly unclear with regard to the Office of Safe and Drug-Free Schools, the Readiness and Emergency Management for Schools Technical Assistance Center, the Family Policy Compliance Office—which oversees student and parental privacy rights and protections under the Family Educational Rights and Privacy Act (FERPA)—and the Protection of Pupil Rights Amendment (PPRA), which allows parents to limit collection of student data, including data about religious practices or beliefs, political affiliation, and the student’s or family members’ mental or psychological problems. The department has committed to continue all statutory programs that fall under its purview, such as formula funding, student loans, Pell Grants, funding for special needs students, and competitive grantmaking.
The RIF is the result of several directives issued by President Trump during the first week of his administration. According to a March 11, 2025, press release, the department will place 1,550 impacted staff on administrative leave beginning March 21, 2025, providing them with full pay and benefits until June 9, 2025, and severance pay or retirement benefits ranging from $10,000 to $25,000 based on their length of service. Earlier rounds offered voluntary separation options under the federal government’s Voluntary Separation Incentive Payment (VSIP) and Voluntary Early Retirement Authority (VERA) programs. These programs are authorized by the Office of Personnel Management (OPM) and the Office of Management and Budget (OMB) and allow agencies to offer lump-sum payments or early retirement to employees who are in surplus positions or have skills that are no longer needed in the workforce. The programs are intended to minimize or avoid involuntary separations through the use of RIFs.
The department offered VSIP and VERA opportunities to its employees between January 28 and March 7, 2025, allowing employees to retain all pay and benefits regardless of their daily workload and to be exempted from in-person work requirements (and working) until September 30, 2025, or earlier if they chose to accelerate their resignation. According to frequently asked questions (FAQs) guidance regarding the RIF, employees are not expected to work during the deferred resignation period. They are allowed to get a second job in the private sector and are even encouraged to do so. The FAQs read in part, “We encourage you to find a job in the private sector as soon as you would like to do so. The way to greater American prosperity is encouraging people to move from lower productivity jobs in the public sector to higher productivity jobs in the private sector.” Additionally, the FAQs state that employees are welcome to take an extended vacation while on administrative leave, reading, “You are most welcome to stay at home and relax or to travel to your dream destination. Whatever you would like.” According to its March 11, 2025, press release, nearly 600 of the department’s employees accepted voluntary resignation opportunities and retirement, including:
259 employees who accepted the Deferred Resignation Program
313 employees who accepted the Voluntary Separation Incentive Payment
The employees affected by the RIF come from various departments and units, including those involved in policy-making, senior career executives, and other positions identified for reduction.
The remaining employees impacted by the RIF will be notified by March 18, 2025, and will be placed on administrative leave until their separation date. The department has committed to provide counseling, information, and assistance on their rights and benefits, as well as resources for finding alternative employment or training opportunities.
Key Takeaways
The RIF impact on the department’s ability to deliver on statutory programs, including formula funding, student loans, Pell Grants, special needs student funding, and competitive grantmaking are areas to watch. How the elimination and reorganization of divisions within the department affect services to students, parents, educators, and taxpayers, and other outcomes and challenges will be evaluated and a comprehensive report including the results of the president’s Workforce Optimization Initiative is scheduled to be submitted to the White House on October 8, 2025. This will include workforce reductions, hiring ratios, and large-scale RIFs across various agencies.
In addition, on March 13, 2025, twenty states and the District of Columbia sued the Department of Education and its officials for implementing the RIF. The plaintiffs allege constitutional, statutory, and regulatory violations, in addition to violations of established precedent. They argue that the reductions undermine the department’s ability to fulfill its statutory responsibilities. They also allege that reducing the department’s workforce by half violates separation of powers and the Administrative Procedure Act (APA). The plaintiffs allege that the RIF is part of an unlawful attempt to dismantle the department and override statutes that create and govern the department’s functions. The complaint seeks declaratory and injunctive relief against the actions taken by the department and its leadership, including an injunction preliminarily and permanently enjoining the defendants from implementing the president’s directive, including the reduction in force.
New York State Senate Bill S1514 Raises Specter of Stop-Work Orders for Employee Misclassification
On March 4, 2025, the New York State Senate passed S1514, which would empower the commissioner of labor to issue stop-work orders against employers that misclassify employees as independent contractors or provide false, incomplete, or misleading information to insurance companies regarding the number of employees.
The bill, which represents a significant legislative move to protect workers’ rights and ensure fair labor practices, has a companion bill, A6664, currently under review by the New York State Assembly’s Labor Committee.
Quick Hits
Stop-Work Orders for Misclassification: New York Senate Bill S1514 would allow the commissioner of labor to issue stop-work orders if an employer is found to have knowingly misclassified employees or provided false information to insurance companies.
Notification and Compliance: Employers would receive written notice of the intention to issue a stop-work order and have seventy-two hours to address the violations before the order is enforced.
Employee Rights and Penalties: Employees affected by stop-work orders would be entitled to their regular pay for up to ten days, and employers face significant penalties for noncompliance.
Issuance of Stop-Work Orders
S1514 stipulates that if the commissioner of labor determines, after an investigation, that an employer has knowingly misclassified employees as independent contractors or provided false information to insurance companies, the commissioner will notify the employer in writing of the intention to issue a stop-work order. The notice must include:
the manner of service consistent with section 308 of the civil practice law and rules;
notification of the employer’s right to a hearing;
a seventy-two-hour period for the employer to address the violations before the stop-work order is issued; and
the factual basis for the decision and instructions for compliance.
Enforcement and Compliance
If the employer fails to comply within the seventy-two-hour period, the commissioner would be authorized to issue a stop-work order requiring the cessation of all business operations at the site of the violation. The order would take effect upon service and remain in effect until the employer complies and pays any assessed penalties. Employers would have the right to contest the order within ten days of issuance.
Penalties and Employee Rights
Noncompliance with a stop-work order would result in penalties ranging from $1,000 to $5,000 per day. Employees affected by the order would be entitled to their regular pay for the duration of the order or up to ten days, whichever is less. The bill also includes provisions to prevent retaliation against employees who initiate complaints.
Challenges for Employers
The bill does not clearly define the criteria for determining whether misclassification was intentional. This ambiguity could lead to disputes and challenges in enforcement, as employers may argue that any alleged misclassification was unintentional.
The seventy-two-hour compliance window may be insufficient for employers to address complex misclassification issues, especially if they need to reclassify numerous workers or make significant changes to their business practices. This tight timeframe could result in rushed decisions and further complications.
Stop-work orders can cause significant business disruptions and financial losses. Employers may face operational shutdowns, loss of revenue, and additional costs associated with compliance and penalties. The impact on employees, who may face uncertainty and loss of income, also needs to be considered.
Conclusion
Senate Bill S1514 passed the Senate in a previous legislative session but died in the Labor Committee. However, its reintroduction and potential for significant consequences means that employers should closely monitor the bill’s progress. Employers may also want to review their current independent contractor relationships to ensure compliance and to be prepared for potential investigations if the bill becomes law.
Trump 2.0, First Two Months in Review: A Summary of Immigration-Related Actions
The first two months of the Trump administration introduced significant immigration-related executive orders and agency directives. These directives will have broad impacts on employers and foreign nationals living and working in the United States. The far-reaching executive orders direct and authorize federal agencies to take various subsequent administrative actions. Here is a review of the key provisions and the potential impacts of the federal actions that have been issued since the new administration took office.
Quick Hits
Multiple executive orders and other presidential directives call for reports to assess current policy, agreements, and related guidance. Following the submission of these reports, subsequent actions could be seen, such as travel bans or restrictions, changes to eligibility for certain employment-based visa categories, or heightened scrutiny at U.S. consulates and ports of entry.
DHS has reviewed and made important changes to temporary protected status (TPS) designations for Venezuela and Haiti. As country conditions and U.S. national interest are reviewed, more changes to existing TPS programs may follow.
DHS has rescinded existing and long-standing policy related to prohibiting Immigration enforcement actions in sensitive locations.
January 20, 2025Executive Order 14159: ‘Protecting the American People Against Invasion’
Executive Order (EO) 14159, titled, “Protecting the American People Against Invasion,” focuses on efforts to address the illegal entry and unlawful presence of foreign nationals inside the United States. The order authorizes the establishment of the Homeland Security Taskforces (HSTF). The HSTF is charged with addressing a broad spectrum of issues, including criminal cartels, foreign gangs and transnational criminal organizations, and cross-border human smuggling and trafficking networks, with a particular focus on offenses involving children. The HSTF is charged with ensuring the use of all available law enforcement tools to faithfully execute the immigration laws of the United States.
This order also authorizes the U.S. Department of Homeland Security (DHS) to limit humanitarian parole and to evaluate existing temporary protected status (TPS) programs to determine whether TPS designations for foreign nationals remain necessary to fulfill the intended purpose. The order also directs DHS to announce and ensure that all previously unregistered noncitizens who meet certain criteria to register their status and to provide law enforcement with the information necessary to fulfill immigration status verification.
Since the issuance of EO 14159, there have been several immigration-related waterfall actions from DHS and U.S. Citizenship and Immigration Services (USCIS). These include:
On February 5, 2025, DHS formally ended the 2023 Temporary Protected Status (TPS) designation for Venezuela. TPS and its related benefits, including work authorization, will end on April 7, 2025, for Venezuelans under the 2023 designation. Importantly, the employment authorization documents (EADs) issued under this designation will expire April 2, 2025. Venezuela has two TPS designations: one from 2021 and a second from 2023. Immigration and work authorization benefits for persons from the 2021 designation will end on September 10, 2025. The DHS must decide by July 12, 2025, whether to extend or end the 2021 designation.
On February 20, 2025, DHS partially vacated the 2024 TPS designation for Haiti. TPS for Haiti was previously extended for eighteen months, through February 3, 2026, under the Biden administration. The February 20, 2025, DHS action now limits the TPS designation for Haiti to twelve months. TPS and its related benefits, including work authorization, will end on August 3, 2025, for individuals under the Haiti designation. TPS holders under this designation may already EAD cards with a validity date of February 3, 2026. The DHS directs employers to update their records to note that the validity of the EAD is valid through August 3, 2025.
On February 25, 2025, USCIS issued guidance that all foreign nationals fourteen years of age or older who were not fingerprinted or registered when applying for a U.S. visa and who remain in the United States for thirty days or longer, must comply with registration and fingerprinting requirements. The guidance directs those who are required to register to create a USCIS online account to prepare for next steps and ensure they are registered. Failure to comply will result in civil fines and potentially criminal misdemeanor charges. DHS plans to announce the process of registration in the coming weeks, but once an individual has been registered, they will be expected to always carry evidence of registration, if eighteen years of age or older.
January 20, 2025Executive Order 14160: ‘Protecting the Meaning and Value of American Citizenship’
Executive Order 14160, “Protecting the Meaning and Value of American Citizenship,” calls for the end of birthright citizenship for certain infants born in the United States. Specifically, the order applies to children born in the United States on or after February 19, 2025, where at least one of a child’s parents was not a lawful permanent resident (i.e., green card holder) or a U.S. citizen. The executive order presented a departure from the longstanding interpretation of the Fourteenth Amendment of the U.S. Constitution and more than one hundred years of Supreme Court of the United States precedent that individuals born in the United States are citizens at birth. The executive order was immediately challenged in court as unconstitutional. On February 5, 2025, a federal judge issued a nationwide preliminary injunction of the order while the lawsuit proceeds. The injunction currently remains in place.
January 20, 2025Executive Order 14161: ‘Protecting the United States From Foreign Terrorists and Other National Security and Public Safety Threats’
This executive order calls for enhanced screening and vetting of noncitizens. The order calls for a review and assessment of countries of concern to the security of the United States and a review of visa programs for additional security measures or possible entry bans. The order calls for a detailed report to identify specific countries deemed deficient in vetting to warrant suspension of admission of those nationals and increased enforcement action for those nationals in the United States. The report is due to the administration on March 21, 2025. A partial or full travel ban could be ordered for nationals of countries identified as having deficient screening. Foreign nationals are likely to experience increased administrative visa processing and higher levels of scrutiny at U.S. embassies and consulates abroad and ports of entry.
January 20, 2025Presidential Memorandum: ‘America First Trade Policy’
The “America First Trade Policy” memorandum focuses on “establishing a robust and reinvigorated trade policy that promotes investment and productivity, enhances our Nation’s industrial and technological advantages, defends our economic and national security, and—above all—benefits American workers, manufacturers, farmers, ranchers, entrepreneurs, and businesses.” The memorandum calls for a review of the United States-Mexico-Canada Agreement (USMCA) and other existing trade agreements, which could lead to potential impacts or changes to treaty-based nonimmigrant work authorizations falling under existing trade agreements, including the TN, H-1B1, and E-3 visas.
January 20, 2025Presidential Proclamation 10886: ‘Declaring a National Emergency at the Southern Border of the United States’
Proclamation 10886 declares a national emergency at the southern border and directs the U.S. military to assist DHS in securing the border. DHS will submit reports on the conditions of the southern border which may result in redirecting funds, border barrier construction, and increased U.S. military presence at the southern border. The enhanced enforcement at the southern border may cause potential delays and heightened scrutiny for foreign nationals entering the United States from Mexico.
January 20, 2025Executive Order 14169: Reevaluating and Realigning United States Foreign Aid
This executive order mandated a ninety-day pause on new obligations and disbursements of U.S. foreign development assistance to allow for a comprehensive review of these programs, to ensure that the foreign aid industry and bureaucracy are aligned with U.S. interests. On February 25, 2025, a federal judge ordered the Trump administration to release millions of dollars of funding for the U.S. Agency for International Development (USAID), and this decision was upheld by the Supreme Court on March 5, 2025. Due to USAID’s collaboration with U.S. embassies in Guatemala, Honduras, and El Salvador, the issuance of H-2 visas in those countries could be delayed.
January 20, 2025DHS Directive Rescinding of ‘Sensitive Locations’ Policy
On January 20, 2025, DHS rescinded the Biden administration’s “protected areas” policy. The “protected areas” policy previously prohibited immigration enforcement action in sensitive areas such as schools, hospitals, and places of worship. In rescinding this policy, the DHS memo stated that “bright line rules” will not be followed in terms of where immigration enforcement can take place. Instead, DHS may issue new guidance to officers regarding “exercising appropriate enforcement discretion.” As a result, organizations and previously protected sensitive locations may want to consider their protocols in the event of worksite enforcement actions.
January 22, 2025DHS Directive: COVID-19 Vaccine Waived for AOS Applications
Effective January 22, 2025, USCIS is waiving the COVID-19 vaccination as a required vaccine on green card applicants’ medical exams. The medical exam form, Form I-693, still lists the COVID-19 vaccine. A new form edition may be released to capture this change. The U.S. Department of State for consular processing abroad has not yet changed its vaccine requirements for immigrant visa processing.
January 23, 2025Executive Order 14179: ‘Removing Barriers to American Leadership in Artificial Intelligence’
The “Removing Barriers to American Leadership in Artificial Intelligence” executive order directs the review of all policies, directives, regulations, orders, and other actions taken pursuant to President Joe Biden’s Executive Order 14110 regarding the development and use of artificial intelligence (AI) (issued on October 30, 2023; revoked on January 20, 2025). Executive Order 14110 included provisions to streamline the processing of visa petitions for noncitizens working in AI or other critical and emerging technologies. EO 14179 requests an action plan to enhance America’s “global AI dominance.” The directives in this order may result in changes to USCIS policy for employees working in AI and applying for O-1, EB-1, or EB-2 National Interest Waiver (NIW) classifications and USCIS policy as it relates to entrepreneur parole.
February 12, 2025Executive Order 14211: One Voice for America’s Foreign Relations
Executive Order 14211 reasserts the secretary of state’s authority over foreign services, including personnel-related areas, implementation of policy, and revision of the Foreign Affairs Manual and any other procedural documents that guide the operations of the foreign service. The order directs the secretary of state to identify necessary reforms for the implementation of the President’s agenda. As a result, visa processing may be affected by the potential changes to personnel procedures of the foreign services, as well as any changes to the Foreign Affairs Manual, which currently serves as the primary authority for procedures and guidance on consular and visa processing.
February 18, 2025State Department Update: Interview Waiver Eligibility
On February 18, 2025, the State Department updated the eligibility criteria for the interview waiver program to applicants who are seeking a visa renewal at a U.S. embassy or consulate outside of the United States. Under the updated criteria, interview waiver is now only available for persons seeking a visa renewal in the same category and only if the most recent visa expired less than twelve months (previously forty-eight months) preceding the new application. The updated criteria also removes interview waiver eligibility for first time H-2 visa applicants; but extends eligibility to applicants applying for an A-1, A-2, C-3 (except attendants, servants, or personal employees of accredited officials), G-1, G-2, G-3, G-4, NATO-1 through NATO-6, or E-1 visas; and applicants for diplomatic or official type visas. This change to interview waiver eligibility will potentially increase visa application wait times worldwide, as many more applicants will be required to attend in-person interviews.
Anticipated Changes on the Horizon
The detailed report summarizing potential security risks and areas of deficient vetting mandated by EO 14161, “Protecting the United States From Foreign Terrorists and Other National Security and Public Safety Threats,” is due to the administration on March 21, 2025. Additional further travel restrictions or bans may follow the review of this report.
The “America First Trade Policy” executive order could result in changes or limitations to treaty-based visa options, including the TN, H-1B1, and E visas.
The “Protecting the American People Against Invasion” executive order may lead to rollbacks or ending additional TPS country designations.
Given recent changes to the State Department drop box and interview waiver policy, it is likely that there will be increased wait times and scrutiny for visa processing at U.S. consulates abroad.
Increased enforcement actions are likely given the administration’s objectives and recent policy shifts. Employers may want to consider their preparedness for increased worksite enforcement actions.
San Francisco Further Incentivizes Residential Conversion Projects by Waiving Development Impact Fees
In a further effort to revitalize and reimagine its downtown core, San Francisco’s Board of Supervisors has passed and the Mayor has signed legislation exempting certain residential conversion projects from development impact fees, including the City’s substantial inclusionary housing fee. The legislation exempts projects that replace non-residential uses with residential uses from development impact fees and affordable housing requirements and removes the deadline to apply to the City’s Commercial to Residential Adaptive Reuse Program.
Background
Policymakers at City Hall have steadily ramped up incentives to convert underutilized commercial space to housing. In July 2023, the City adopted the Residential Adaptive Reuse Program (“Program”), which is designed to facilitate new residential projects in the downtown core by exempting certain projects from a range of Planning Code standards and requirements, including rear yard, open space, streetscape improvements, dwelling unit exposure, bike parking, transportation demand management, and dwelling unit mix requirements. As originally adopted, the Program required that conversion projects submit applications by December 31, 2028.
In March 2024, San Francisco voters approved Proposition C, which waived the City’s real estate transfer tax for first-time transfers on non-residential properties converted to residential use, so long as the property owner receives approvals to convert the property before January 1, 2030. Despite these incentives, residential conversion projects have remained relatively rare.
The Waiver
The new legislation is the City’s latest attempt to chip away at a major challenge for conversion projects in the bay area: high costs. The legislation takes aim at this challenge by waiving development fees and development impact requirements imposed by Chapter 4 of the City’s Planning Code on any net new gross floor area of non-residential use that is converted to residential use, in an amount up to 110% of the gross floor area of the converted uses. Development fees and programs eligible for this waiver include the Transit Impact Development Fee and the Inclusionary Housing Fee.
Eligibility
To be eligible for the waiver, projects must be located in a C-3 zoning district, or a C-2 zoning district east of or fronting Franklin Street/13th Street and north of Townsend Street.
Additionally, projects must replace gross floor area of an existing non-residential use (other than a hotel) with gross floor area of a residential use. This can occur by a change of existing gross floor area or demolition of existing gross floor area and construction of new residential gross floor area. Mixed-use structures are also eligible for the waiver.
The waiver only applies to the first 7,000,000 square feet of gross floor area that replaces non-residential uses, and eligible projects must receive a building or site permit within five years of final entitlement approvals.
The new legislation will be effective on April 6.
New Trump 2.0 Travel Ban Expected to Target 40+ Countries: What You Need to Know
The Trump Administration is reportedly finalizing a new travel ban that will prohibit or severely limit the citizens of more than 40 countries from entering the United States.
On Jan. 20, 2025, President Donald Trump signed an executive order (EO) aimed at enhancing vetting procedures. This EO directed the secretary of state, the attorney general, the secretary of homeland security, and the director of national intelligence to jointly submit a recommendation to the president for suspending entry of migrants from “countries of particular concern” within 60 days. The recommendation is expected to be submitted to President Trump soon.
President Trump reportedly is considering implementing a new travel ban that could affect citizens from up to 43 countries. This proposed ban, often referred to as “Trump 2.0 Travel Ban,” is an expansion of the original travel ban from 2017, which primarily targeted seven Muslim-majority countries: Iran, Iraq, Libya, Somalia, Sudan, Syria, and Yemen.
Historical Context
Trump’s 2017 travel ban (Executive Order 13769) targeted Muslim-majority nations and faced significant legal challenges before being upheld by the U.S. Supreme Court in 2018.
Current Developments
An internal administration memo reportedly suggests the inclusion of more countries in the new travel ban. The new ban appears to be a continuation of Trump’s immigration policies aimed at protecting national security and public safety.
While the White House has yet to publicly comment on the reported memo, the proposed new travel ban is expected to have significant implications for global mobility, international collaboration, and U.S. companies. Here are some of the main points:
Affected Countries
The proposed ban includes a tiered system with three categories: Red, Orange, and Yellow.
Citizens of countries listed in the “RED” category would be completely barred from entering the United States: Afghanistan, Cuba, Iran, Libya, North Korea, Somalia, Sudan, Syria, Venezuela, and Yemen.
Citizens of countries listed in the “ORANGE” category would face higher scrutiny and would be subjected to “Mandatory in-person interviews” in order to receive a visa: Eritrea, Haiti, Laos, Myanmar, and South Sudan.
Countries listed in the “YELLOW” category would be given 60 days to address concerns from the administration or risk being moved to the other categories: Angola, Antigua and Barbuda, Belarus, Benin, Bhutan, Burkina Faso, Cabo Verde, Cambodia, Cameroon, Chad, Democratic Republic of the Congo, Dominica, Equatorial Guinea, Gambia, Liberia, Malawi, Mauritania, Pakistan, Republic of the Congo, Saint Kitts and Nevis, Saint Lucia, Sao Tome and Principe, Sierra Leone, East Timor, Turkmenistan, and Vanuatu.
Impact on Employers and Employees
The ban is expected to affect many employers and their employees’ global mobility. Nationals of the restricted or banned countries who are outside the United States when the ban is announced may be unable to return, even with a valid visa stamp. Employees or business visitors from highly restricted countries will face rigorous visa application processes. Additionally, U.S. companies may need to restructure their global workforce, potentially losing international talent and facing higher business costs.
Legal and Implementation Challenges
The proposed ban includes different levels of restrictions, which appear to be calculated to deal with expected legal challenges or implementation challenges, including those related to the Equal Protection Clause of the 14th Amendment, due process, and discrimination, as seen with the 2017 travel ban.
As the administration finalizes the details, it is crucial to stay informed about the potential impacts and legal challenges that may arise.