Global – Page 3

European Commission Publishes Q&A on AI Literacy

On May 7, 2025, the European Commission published a Q&A addressing AI literacy obligations under the EU AI Act. The Q&A provides further detail on Article 4 of the EU AI Act, clarifying the measures that entities in scope are required to employ to ensure AI literacy.
Key Takeaways
The European Commission sets out the steps and objectives that should be achieved by an entity when developing and implementing an AI literacy compliance program, including to:

Ensure a general understanding of AI within the entity covering the following topics: What is AI? How does it work? What AI is used in the entity? What are its opportunities and dangers?
Consider the role of the entity in scope (e.g., provider or deployer of the AI systems).
Consider the risk of the AI systems provided or deployed, including the following questions: what do staff need to know when dealing with such AI systems? What are the risks they need to be aware of and do they need to be aware of mitigation?
Concretely build the AI literacy compliance program taking into account the analysis of the points above and: (1) the differences in technical knowledge, experience, education and training of the staff and other persons; and (2) the context in which the AI systems are to be used in and the persons on whom the AI systems are to be used.

With regards training, the European Commission notes that frequent and specific training will need to be part of AI literacy compliance programs; simply referring staff members to instructions that accompany AI systems will generally not be considered sufficient. The content of trainings will not be fixed, may vary based on the experience of the staff, and will have to be evaluated on a case-by-case basis. Trainings should also cover the risks that may emerge from the use of common generative AI systems when such systems are used (e.g., hallucination). If staff members from third-parties engage with the AI systems, training may be provided directly by the entity in scope and/or training requirements may be, for example, established in contracts with such third-parties.
The European Commission confirms that entities in scope should record and document the measures implemented to comply with Article 4 of the AI Act. However, external certification is not required.
Timing
Article 4 of the AI Act entered into application on February 2, 2025. Hence, the obligations relating to AI literacy already apply to in-scope entities.
However, in the Q&A, the European Commission clarifies that supervision and enforcement rules will only apply from August 3, 2026, onwards. Penalties for non-compliance with AI literacy obligations will be based on the national laws to be adopted by EU Member States by August 2, 2025. Private enforcement is already possible where an individual suffers harm and considers that this is due to an entity in scope not complying with the obligations deriving from Article 4 of the AI Act.
Read the European Commission’s AI Literacy Q&A.

Humanitarian Parole Uncertainty: SCOTUS Halts CHNV Program, While Lower Court Orders Continued for Processing for CHNV, Afghans, Ukrainians

The U.S. Supreme Court has lifted an April 14, 2025, temporary injunction blocking the Department of Homeland Security’s (DHS’s) decision to terminate humanitarian parole for individuals from Cuba, Haiti, Nicaragua, and Venezuela under the CHNV program. Noem v. Svitlana Doe, et al., No. 24A1079 (May 30, 2025).
U.S. District Court Judge Indira Talwani’s order is stayed pending the outcome of an appeal filed by DHS in the U.S. Court of Appeals for the First Circuit and a decision on a petition for writ of certiorari to the Supreme Court regarding the merits of the case, if one is ultimately sought by either side.
The CHNV program has allowed approximately 450,000 people to live and work legally in the United States.
DHS has not yet provided guidance regarding the status of CHNV parolees in light of the Supreme Court decision.
On May 28, 2025, Judge Talwani ordered DHS to resume processing of parole and reparole applications for individuals covered under the Uniting for Ukraine, Operation Allies Welcome (Afghanistan), Central American Minors Parole, Family Reunification Parole, Military Parole-In-Place, and CHNV Humanitarian Parole.
It is not clear whether DHS will continue to adjudicate parole applications for CHNV beneficiaries in light of the Supreme Court decision.

Update on DHS Efforts to Terminate TPS and Parole Status for Various Immigrant Groups

The U.S. Department of Homeland Security (DHS) has been actively working to terminate Temporary Protected Status (TPS) and Parole status for several immigrant groups, impacting their work authorization and residency status. This update aims to provide human resource professionals with the latest developments and implications for their workforce. Given the whirlwind of activity, employers must constantly monitor the news and the status of their employees on temporary work authorization so they can be sure to not employ individuals who have lost work authorization.
Temporary Protected Status (TPS)
Venezuela: The situation for Venezuelans under TPS has been complex, in part because there were multiple grants of TPS status to Venezuelan nationals at different times with different expiration dates. On May 19, 2025, the U.S. Supreme Court temporarily paused a federal court ruling that had blocked the Trump administration’s attempt to revoke TPS for Venezuelans. The current legal status for this group is murky. Venezuelans under the 2021 TPS designation can remain in the U.S. and retain their work authorization until September 10, 2025.
Afghanistan: DHS announced the termination of TPS for Afghanistan, effective July 2025. This decision affects approximately 12,000 Afghans who will lose their protection from deportation and work authorization.
Parole Programs
CHNV Parole Program: The Supreme Court recently allowed the Trump administration to terminate the CHNV Parole Program, which had provided temporary protection to over 530,000 individuals from Cuba, Haiti, Nicaragua, and Venezuela. This decision means that these individuals are now at risk of deportation and will lose their work authorization. DHS has emphasized that this move is part of a broader effort to enforce immigration laws and prioritize public safety.
Implications for Employers
These changes have significant implications for employers and HR professionals. The termination of TPS and Parole status means that affected employees will lose their work authorization, potentially leading to workforce disruptions. Employers should:

Review Form I-9s: Identify employees who may be affected by these changes and verify their current work authorization status.
Communicate with Affected Employees: Provide clear communication about the changes and determine if those individuals losing one of these immigration statuses have alternative opportunities to retain work authorization.
Plan for Workforce Adjustments: Develop contingency plans to address potential workforce shortages and maintain business continuity.
Get Legal Advice: Work with immigration attorneys to navigate the complexities of these changes and ensure compliance with the rapidly evolving status of the law.

DHS’s efforts to terminate TPS and Parole status for various immigrant groups are creating significant challenges for both the affected individuals and their employers. The legal landscape is literally changing daily. Staying informed and proactive in addressing these changes will be crucial for employers in managing their workforce effectively.

Puerto Rico High Court Confirms Employers Need to Check NLRA Preemption of Local Employment Law Claims

Takeaways

Puerto Rico courts lack jurisdiction over claims involving conduct “arguably” protected or prohibited by the NLRA, even if framed under local laws.
The NLRB has exclusive authority to adjudicate unfair labor practice claims covered by the NLRA — state or local courts must defer unless the NLRB declines jurisdiction.
Employers facing claims related to union activity or retaliation should evaluate NLRA preemption early and coordinate with labor counsel to assert defenses or direct claims to the NLRB.

How Important Is It to Document Directors’ Decisions and Keep Contemporaneous Evidence? (UK)

The recent High Court case of Stacks Living Limited & Ors v Shergill & Ors (“Stacks Decision”) has further highlighted the importance of taking advice and documenting decisions following the much-publicised decision of Wright v Chappell (the “BHS Case”).
By way of reminder (see our previous blog here), the BHS Case introduced the concept of misfeasance trading and found that a director can be liable for misfeasance trading if they continue trading in breach of their duties when the company should have gone into administration or insolvent liquidation. Notably, this claim could arise much earlier than a wrongful trading claim, bringing into sharper focus the need for directors to be very mindful of their duties.
The BHS Case provided useful lessons about steps directors ought to take, to reduce the chance of a claim against them for misfeasance trading (and therefore personal liability) including holding regular, fully documented board meetings and taking (and applying) appropriate professional advice. The Stacks Decision expands further on the importance of contemporaneous documentation and proper record keeping when approaching insolvency.
Background
The case concerned applications by the joint liquidators of two companies, Stacks Living Limited (“Stacks”) and Staffs Furnishing Limited (“Staffs”), which entered compulsory liquidation following a failure of the companies to pay national non-domestic rates tax to the Council. The companies were wholly-owned by Mr Balvinder Shergill who also acted as director. For a limited period, Miss Miranda Smith, Mr Shergill’s partner, was appointed as director of Staffs, although Miss Smith admitted to having no involvement at all in the affairs and business of Staffs.
The liquidators brought claims: i) for fraudulent trading; ii) for wrongful trading; and iii) misfeasance against both Mr Shergill and Miss Smith in respect of allegedly unexplained and/or otherwise improper or unjustified payments by the companies. The claims were opposed and Mr Shergill and Miss Smith sought to rely on s 1157 of the Companies Act 2006 (“CA 2006”) to claim relief from liability, which was rejected.
The findings against the directors
Fraudulent trading
The Court found Mr Shergill liable for fraudulent trading, due to “no real or honest belief that those debts would be discharged and no real expectation of a reduction or discount”.
The judge criticised Mr Shergill for an intention to trade through a series of phoenix companies and incurring, but not paying, the rates liability and HMRC debts.
Wrongful trading
The Court found both directors liable for wrongful trading (albeit Miss Smith for Staffs only during the period of her directorship), notwithstanding Miss Smith had no actual knowledge of the prospect of insolvent liquidation – in her capacity as a director Miss Smith ought to have enquired into the company’s financial position.
Crucially the Court found that the company could not evidence how it could pay the monies owed. In addition, despite suggestions that there was a hope of trading through difficulties, the Court noted that there was:

no evidence of any advice to support a believe of any genuine prospect of doing so, particularly where Staffs took over from the business of Stacks with no discernible shift in business plan;
no business plan, management accounts or other detailed financial or management records and no foundation on which to conclude that the business could survive; and
no evidence to support Mr Shergill’s assertions that he was acting on a genuine belief that relief was available.

Misfeasance
Company directors owe several duties to the company, including a fiduciary duty to apply the company’s assets for the proper purposes of the company and to account for their use. In this case, the liquidators identified:

several payments to Mr Shergill personally (which were labelled as “wages”, but Mr Shergill provided inconsistent oral evidence to argue that this was to pay supplies);
cash withdrawals; and
payments to certain organisations (e.g. Sky), which did not appear to be legitimate business expenditure.

The court noted that once a liquidator identifies a payment has been made, the burden of proving the payment was made for proper purposes falls upon the respondents. The directors ought to be able to rely on contemporaneous documentation to prove the origins of any payment. The Court was very critical of the quality of Mr Shergill’s oral evidence and was therefore reluctant to place much reliance on his submissions, in the absence of any documentary evidence to demonstrate that such payments were for the company’s benefit.
The court noted that non-production of documentation may be conspicuous by its absence, if it is likely that it would exist, and that the court may draw inferences from its absence.
Therefore, as Mr Shergill was unable to provide credible evidence that the withdrawals/payments were for a proper purpose, owing to a failure to keep proper records (e.g. receipts and/or contracts), the court ordered the directors to compensate the respective companies for the unexplained payments.
The Importance of Contemporaneous Evidence
In this case, the respondents adduced little to no documentary evidence to support their assertions, and the judge was heavily critical of Mr Shergill’s oral evidence, noting that it was “fundamentally inconsistent with known facts and documents”.
The Court referred to various “observations” made in previous cases regarding the importance of contemporaneous evidence, namely:

memory is “especially unreliable” when it comes to recalling past beliefs, which are revised to make them “more consistent” with present beliefs
the best approach is to place “little if any reliance” on recollections of conversations and to base factual findings on documentary evidence and known/probable facts
the importance of contemporary documentation to ascertain the motivation and state of mind of those concerned (particularly internal documents)
the value to be placed on contemporaneous evidence for credibility – it was noted in particular that lacking contemporaneous evidence may be conspicuous and lead a judge to draw negative inferences from its absence
the “fallibility” of human memory and the need for memory to be assessed alongside contemporaneous documentary evidence

Crucially, the council (a creditor in respect of the rates liabilities) had records of telephone conversations and emails, providing contemporaneous evidence in which the company acknowledged that it could not pay the rates liabilities – contrary to Mr Shergill’s version of events.
Concluding Thoughts
The case highlights the importance of contemporaneous documentation and proper record keeping by directors who may later be required to provide an explanation for past events. As noted “recollections” of conversations and “memory” are not as credible as written documentation.
We cannot comment on whether the existence of such would have changed the outcome for the respondents in this particular case, but the case does demonstrate that without contemporaneous paperwork directors will find it much harder to convince the court of the reasons for their actions.
Abigail Harcombe also contributed to this article.

Turbo-Zertifikate im Visier – BaFin plant neue Produktintervention

Die Bundesanstalt für Finanzdienstleistungsaufsicht hat bekannt gegeben, dass sie den Handel mit sog. „Turbo-Zertifikaten“, also MiFID-Schuldverschreibungen, die die Wertentwicklung eines Basiswerts gehebelt abbilden und bei Erreichen einer festgelegten Knock-Out-Schwelle unmittelbar verfallen, im Wege einer Produktintervention einschränken möchte.
Hintergrund dessen ist der Verbraucherschutz, für den die BaFin im vorliegenden Fall gleich „erhebliche Bedenken“ ausgemacht hat. Dabei stützt sie sich auf eine von ihr selbst erstellte Untersuchung (der aufsichtsrechtlichen Pflichtmeldungen) des zugehörigen Markts für den Zeitraum 2019 bis 2023. Demnach würden ca. 75 Prozent der Kleinanleger beim Erwerb von Turbo-Zertifikaten Verluste erleiden, die sich durchschnittlich auf ca. EUR 6.300,- pro Anleger verteilten und für den beobachteten Zeitraum insgesamt ca. EUR 3,4 Mrd. betragen hätten. Die Wertpapieraufsicht der BaFin sieht den Handel mit Turbo-Zertifikaten allein dadurch bereits „näher am Glücksspiel als an langfristiger Vermögensanlage“ (Thorsten Pötzsch, BaFin).
Um dem entgegenzutreten, hat die BaFin drei konkrete Maßnahmen im Entwurf einer Allgemeinverfügung vorgesehen:

Standardisierte Risikowarnung

Jede Mitteilung zu Vermarktung/Vertrieb/Verkauf von Turbo-Zertifikaten soll zukünftig eine standardisierte Risikowarnung enthalten, die explizit darauf hinweist, dass sieben von zehn Kleinanlegern bei einer Anlage in Turbo-Zertifikate Verluste erleiden.

Keine Vorteile

Es sollen zukünftig weder monetäre noch nicht-monetäre Vorteile (insbesondere keine Reduzierung von Gebühren, kein Neukundenbonus, keine Geschenke) als Anreiz für eine Anlage in Turbo-Zertifikaten angeboten werden.

Erweiterte Angemessenheitsprüfung

Kleinanleger, die Turbo-Zertifikate erwerben möchten, sollen zukünftig eine erweiterte Angemessenheitsprüfung durchführen müssen, die ihnen einerseits wesentliche Eigenschaften der Turbo-Zertifikate vermittelt und andererseits mindestens sechs zutreffend zu beantwortende Fragen zu Turbo-Zertifikaten vorsieht. Dieser Test soll alle sechs Monate wiederholt werden müssen.
Die BaFin will damit insgesamt ein angemessenes und einheitliches Schutzniveau für alle Kleinanleger herstellen.
Es ist erfreulich, dass man hier nicht gleich zum Äußersten greift und (noch) kein Verbot des Erwerbs von Turbo-Zertifikaten durch Kleinanleger erlassen hat bzw. dies beabsichtigt. Überraschend ist, dass die BaFin diese Produkte grundsätzlich in die Nähe von „Glücksspiel“ stellt. Dass Turbo-Zertifikate zur kontrollierten Absicherung eines Gesamtdepots tatsächlich der langfristigen Vermögensanlage nützen können, findet im Entwurf keine angemessene Berücksichtigung. Je nach Marktlage lassen sich durch verhältnismäßig günstige Turbo-Zertifikate auch sorgsam aufgebaute Altersvorsorge-Depots gezielt und risikobewusst absichern. Die BaFin kommt hingegen in ihrer eigenen Untersuchung zu dem Schluss, dass es keine Hinweise auf eine Nutzung von Turbo-Zertifikaten als Absicherungsinstrument von Kleinanlegern geben würde. Dies scheint vor allem darauf zu fußen, dass mehr long- als short-Positionen identifiziert wurden.
Der Erfolg der beabsichtigten Maßnahmen ist noch unklar. Nachdem die BaFin früher bereits (und dort noch invasiver) in Bezug auf etwa Contracts-For-Difference (CFDs) vorgegangen ist, wäre eine Untersuchung dahingehend, inwiefern die dort bereits ergriffenen Maßnahmen einen verbraucherschützenden Effekt erzielt haben, wünschenswert. Daraus ließen sich besonders Rückschlüsse auf die Erfolgsaussichten der neuen Produktintervention betreffend Turbo-Zertifikate ziehen.
Wer wirklich Turbo-Zertifikate erwerben möchte, wird sich weder von Hinweisen auf Verlustrisiken noch vom neu geschaffenen, zusätzlichen bürokratischen Aufwand abbringen lassen. Dann wären die
Maßnahmen letztlich eine unnötige Belastung – insbesondere der adressierten Intermediäre, Emittenten und Anbieter, aber eben auch der Kleinanleger.
Die Anhörung der BaFin zur Produktintervention ist hier auf der Website der BaFin zugänglich.
Die BaFin-Studie zum Vertrieb von Turbo-Zertifikaten an deutsche Kleinanlegerinnen und Kleinanleger ist hier auf der Website der BaFin abrufbar.

EU Pay Transparency Directive: ‘Equal Pay for Equal Work or Work of Equal Value’

The European Union’s pay transparency directive (Directive (EU) 2023/970) introduced the principle of “equal pay for equal work or work of equal value,” aiming to eliminate pay discrimination under the obligation that job roles of equal worth receive equal pay, regardless of gender.

Quick Hits

In the EU, pay transparency has been identified as a key obstacle to closing the gender pay gap. Directive (EU) 2023/970 aims to close the gender pay gap and promote fair pay practices by increasing transparency and accountability between employers and employees.
The principle of “equal value” will require employers to undertake an evaluation exercise to determine where equivalence of the respective value of roles may exist across their organisations. Employers may want to consider preparing for this now.
EU member states have a deadline of 7 June 2026 to transpose the directive into national law. Each member state has the autonomy to transpose the directive in its own way, provided the directive’s minimum requirements are met.

What Does ‘Equal Work or Work of Equal Value’ Mean?
Directive (EU) 2023/970 defines equal pay not only for identical roles but also for jobs that contribute comparably to an organisation’s success. Employers must assess job roles using objective, gender-neutral criteria. Each EU member state may derive its own methodology for determining whether two roles are of equal value, but minimum factors to consider for each role should include:

Skills—The experience, knowledge, and qualifications required.
Effort—The mental or physical exertion needed for a role.
Responsibility—The level of accountability and decision-making involved.
Working Conditions—The risks associated with the job.

New Employer Obligations Under Directive (EU) 2023/970
Under the directive, employees (and/or their representatives) have the right to request and receive information on their pay level and the average pay levels of their organisation, broken down by gender, for employees performing the same work as them or work of equal value. Within two months of a written request, employers will need to provide an employee with the requisite information.
In the first stage of the directive’s implementation, employers with 150 or more employees are required to report on the average gender pay gap (1) across the company as a whole and (2) within each category of workers who do the same work or work of equal value.
If a pay difference of 5 percent or more is uncovered, without objective justification, and is left unresolved for more than six months from the date it is reported, the organisation will be subject to a joint pay assessment (i.e., a detailed equal pay audit) which can be costly and damaging.
Next Steps
Employers may want to consider the objective criteria used to consider how categories of employees are determined, and which roles are of equal value. All employers must ensure that they are consistent and nondiscriminatory in their application of pay criteria and be prepared to demonstrate how this operates in practice. Transparency and fairness necessitate detailed records of salary structures and clear strategies to address possible pay disparities.
The directive requires greater accountability from employers to ensure fair pay practices. Maintaining compliance may require establishing job evaluation systems, transparent pay structures, and data reporting. The concept of “equal value” is complex and employers may want to prepare for this new requirement now.

The Tariff Roller Coaster: US Court of International Trade Invalidates Tariffs Imposed Under IEEPA, Only to Be Stayed by the Federal Circuit Court of Appeals

What Happened
On May 28, 2025, the US Court of International Trade (“CIT”) issued a major decision in V.O.S. Selections, Inc. v. United States invalidating two sweeping tariff programs imposed under the International Emergency Economic Powers Act (“IEEPA”) earlier this year. The decision strikes down the legal basis for key executive orders imposing tariffs on China, Canada, Mexico and dozens of other trading partners, reshaping the legal framework for future emergency-based trade actions. The court granted summary judgment in favor of both private-sector plaintiffs and a coalition of state governments, concluding that the tariff actions exceeded statutory authority under IEEPA and intruded upon Congress’s exclusive constitutional role in regulating trade.
However, less than 24 hours later, the Federal Circuit Court of Appeals issued an order administratively staying the CIT injunction while it considered an appeal on the case. Thus, notwithstanding the CIT order, the IEEPA tariffs remain in effect.
Background
IEEPA is a federal law that grants the President broad powers to regulate international commerce after declaring a national emergency in response to an unusual and extraordinary threat to the national security, foreign policy or economy of the United States. Typically, IEEPA has been used to impose sanctions on foreign states or individuals, control assets or restrict financial transactions in response to specific foreign threats. IEEPA’s authority traditionally has not been used to impose broad tariffs simply based on general economic concerns.
Since taking office in January 2025, President Trump has implemented a series of tariffs under IEEPA rather than by using traditional trade enforcement statutes such as Section 301 or Section 232 of the Trade Expansion Act of 1962.
These IEEPA tariffs include:

Trafficking tariffs: A 25 percent ad valorem duty on goods from Mexico and Canada and a 20 percent duty on goods from China, justified on grounds of transnational criminal threats and border security (see previous alert here).
Worldwide and retaliatory tariffs: A 10 percent baseline duty on all imports, with increased rates up to 50 percent for certain US trading partners, based on allegations of non-reciprocal trade policies and structural global imbalances (see previous alerts here and here).

Both types of tariffs were implemented via executive orders invoking national emergency declarations under IEEPA.
Key Legal Holdings
The CIT ruled that:

IEEPA does not authorize boundless tariff authority. The court narrowly interpreted IEEPA’s grant of power to “regulate . . . importation,” holding that it does not encompass the imposition of broad, discretionary tariffs absent a defined emergency directly tied to foreign threats.
The tariffs were ultra vires. The court found that the President’s actions exceeded the legal authority granted by Congress under IEEPA, effectively encroaching upon powers specifically reserved for Congress under Article I of the US Constitution to regulate trade.
IEEPA requires a foreign emergency nexus. The court concluded that generalized economic concerns—such as trade deficits, wage suppression abroad or retaliatory trade practices—do not meet IEEPA’s strict requirement of an “unusual and extraordinary threat” arising, outside the United States. This holding significantly narrows the executive’s discretion in declaring emergencies for trade purposes, emphasizing that the threat must be directly tied to foreign actions impacting national security or foreign policy, not merely economic competition.
Private and state plaintiffs had standing. The court recognized downstream economic harm (e.g., increased procurement costs, disrupted supply chains) as sufficient to establish standing, even for non-importers.

Impact and Effective Scope of the Ruling
The CIT’s judgment is nationwide in scope and normally would be immediately effective. Because the CIT invalidated the relevant executive orders and related Harmonized Tariff Schedule of the United States (HTSUS) modifications, the ruling would have had the practical effect of nullifying the challenged tariffs as a matter of law. However, the Federal Circuit’s administrative stay of the CIT injunction means that:

The tariffs remain in effect for now, pending further action by the appellate court.
The administrative stay is temporary and does not decide the appeal itself, but it preserves the status quo while the court considers the government’s full motion for a stay pending appeal.
Plaintiffs must respond to the government’s stay motion by June 5, 2025, with a reply due June 9, 2025.
Parties have been instructed to notify the Federal Circuit of any ruling on the parallel stay motion still pending before the CIT.

Unless and until the Federal Circuit denies the government’s stay request or the CIT separately lifts the stay, businesses should treat the tariffs as still in force.
Importantly, neither the CIT nor the Federal Circuit order affect product-specific tariffs imposed under other authorities, such as Section 232 of the Trade Expansion Act of 1962. Tariffs on imports of aluminum, steel and certain automotive goods remain in force and are unaffected by these rulings.
Issues Potentially to Be Raised on Appeal
The government is widely expected to appeal the CIT’s decision to the Federal Circuit. Key legal questions likely to be raised on appeal include:

Scope of IEEPA authority: Whether the phrase “regulate . . . importation” authorizes tariff actions, particularly considering precedent under the Trading with the Enemy Act. The government is likely to argue that “regulate . . . importation” within IEEPA is a broad grant of power that includes the imposition of tariffs, citing historical precedent under the Trading with the Enemy Act (e.g., United States v. Yoshida Int’l, Inc., 526 F.2d 560 (C.C.P.A. 1975)) to support a more expansive view of presidential authority during emergencies.
Use of constitutional avoidance: Whether the CIT erred by interpreting IEEPA narrowly based on the nondelegation and major questions doctrines, rather than on plain statutory text.
Justiciability of emergency declarations: Whether the judiciary may review the President’s determination that a national emergency exists for IEEPA purposes. The government may contend that the President’s determination of a national emergency for IEEPA purposes is a political question and thus generally not subject to judicial review, arguing that the CIT overstepped its bounds in scrutinizing this executive determination.
APA applicability: Whether the CIT improperly imported Administrative Procedure Act (APA) standards in reviewing executive action not subject to the APA.
Standing of non-importers: Whether downstream purchasers without direct duty liability can challenge tariff actions under 28 U.S.C. § 1581(i).

The Federal Circuit’s treatment of these issues could have long-term effects on the balance of power between Congress and the executive branch in trade law and emergency economic policy.
Next Steps for Businesses
Businesses affected by the invalidated tariffs should:

Monitor for further court action, including whether the CIT grants or denies the pending stay motion, and any orders from the Federal Circuit on the full stay request.
Adjust forward-looking import planning to reflect the possibility of the tariffs being rolled back if the stay is lifted or the appeal is denied.
Monitor CBP implementation guidance. Companies should pay close attention to forthcoming communications from US Customs and Border Protection (CBP), particularly via Cargo Systems Messaging Service (CSMS) announcements, which are typically published on the CBP website. CBP has used CSMS in the past to communicate implementation steps in response to major litigation.
Importers should proactively review their Automated Commercial Environment (ACE) accounts and coordinate closely with their customs brokers to identify affected entries, assess potential refund claims and remain responsive to any agency developments or requests for information.

The Swiss Federal Supreme Court Bans References to Animals in Plant-based Foods

On May 2, 2025, the Swiss Federal Supreme Court ruled that designations referring to animal species are not allowed to label plant-based meat substitutes (here is the official press release, in French, 2C_26/2023). The full judgment is not yet available, so we cannot provide a more in-depth analysis of the arguments of Switzerland’s supreme judges, and the information below is based solely on the press release.
In 2021, the Zurich Cantonal Laboratory banned a company from labelling its pea protein meat substitutes with names referring to animal species; the company appealed this ban, and the Administrative Court of the Canton of Zurich decided in its favor in 2022, allowing the use of references to animal meat in its products. However, in its judgment of May 2, 2025, the Federal Supreme Court upheld the appeal filed by the Federal Department of Home Affairs, annulling the first instance decision of the Zurich Administrative Court and thus ruling against the company.
According to the press release, food products destined for consumers made exclusively with vegetable proteins (i.e., those usually defined as ‘plant-based meat’) cannot be designated by names of animal species, even if these are accompanied by an indication specifying the vegetable origin of the product, such as ‘planted chicken,’ ‘chicken-like,’ ‘pork-like,’ ‘vegan pork,’ or ‘vegan chicken.’ In fact, the term ‘chicken’ refers to poultry; therefore, it cannot be used for products that do not contain a meat component, as it would be misleading for consumers. In other words, plant-based products alternative to meat must be labelled in such a way as to enable the consumer to recognize the type of foodstuff and to differentiate it from products that they aim to substitute.

China’s Supreme People’s Court Designates Generative AI Case as Typical

On May 26, 2025, China’s Supreme People’s Court (SPC) released the “Typical cases on the fifth anniversary of the promulgation of the Civil Code” (民法典颁布五周年典型案例) including one generative AI case in which the Beijing Internet Court held that an AI-generated voice infringed a dubber’s personality rights. Note that while China is not a common law country, designating a case as a Guiding Case or Typical Case is somewhat analogous to a U.S. Court marking a case as precedential in that the SPC is indicating to lower courts to adjudicate future cases in accordance with this decision.
As explained by the SPC:
IV. Protecting voice rights according to law and promoting the development of artificial intelligence for good – Yin v. Beijing smart technology company and others’ infringement of personality rights case
1. Basic Facts of the Case
The plaintiff, Yin XX, is a dubbing artist. He found that the works produced by others using his dubbing were widely circulated in many well-known apps. After tracing the source, the sound in the above works came from the text-to-speech product on the platform operated by the defendant, a Beijing intelligent technology company. Users can convert text into speech by entering text and adjusting parameters. The plaintiff was commissioned by the defendant, a Beijing cultural media company, to record a sound recording, and the defendant was the copyright owner of the sound recording. Later, the defendant provided the audio of the sound recording recorded by the plaintiff to another defendant, a software company, and allowed the defendant to use, copy, and modify the data for commercial or non-commercial purposes for its products and services. The other defendant only used the sound recording recorded by the plaintiff as the material for AI processing, generated the text-to-speech product involved in the case, and sold it on the cloud service platform operated by yet another defendant, a Shanghai network technology company. The defendant, the Beijing intelligent technology company, signed an online service sales contract with the defendant, a Beijing technology development company, and another defendant placed an order with the defendant, which included the text-to-speech product involved in the case. The defendant, a Beijing intelligent technology company, adopted the form of an application program interface, and directly retrieved and generated the text-to-speech product for use on its platform without technical processing. Yin filed a lawsuit in court, requesting that defendant one, a Beijing intelligent technology company, and defendant three, a software company, immediately stop infringing and apologize, and that the five defendants compensate Yin for economic and mental losses.
(II) Judgment Result
The effective judgment holds that the voice right is a personal interest and concerns the personal dignity of natural persons. For the voice processed by artificial intelligence technology, as long as the general public or the public within a certain range can identify a specific natural person based on the timbre, intonation and pronunciation style, the voice right of the natural person can extend to the AI voice. The above five defendants all used the plaintiff’s voice without the plaintiff’s permission and committed acts that infringed the plaintiff’s voice rights, constituting an infringement of the plaintiff’s voice rights. Because the infringing products involved in the case have been removed, the five defendants will no longer be ordered to bear the tort liability of stopping the infringement. Instead, based on the plaintiff’s request, the subjective fault of each defendant and other factors, the court ruled that the first defendant, a Beijing intelligent technology company, and the third defendant, a software company, apologize to the plaintiff, and the second defendant, a Beijing cultural media company, and the third defendant, a software company, compensated the plaintiff for losses.
(III) Typical significance
General Secretary Xi Jinping emphasized: “We must strengthen the research and prevention of potential risks in the development of artificial intelligence, safeguard the interests of the people and national security, and ensure that artificial intelligence is safe, reliable and controllable.” With the rapid development of artificial intelligence technology, voice forgery and imitation are becoming increasingly common, and disputes involving infringement of personality rights caused by related technologies are also increasing. my country has written “voice” protection into the Personality Rights Code of the Civil Code in the form of legislation, reflecting respect for the rights and interests of natural persons’ voices, as well as a positive response to technological development and social needs. In this case, the People’s Court determined in accordance with the law that voice, as a kind of personal right, is person-specific. Unauthorized use or permission for others to use the voice in a recording without the permission of the right holder constitutes infringement, which sets the boundaries of behavior for the application of new formats and new technologies, and helps to regulate and guide the development of artificial intelligence technology in the direction of serving the people and doing good.
(IV) Guidance on the provisions of the Civil Code
Article 1018
A natural person enjoys the right to likeness and is entitled to make, use, publicize, or authorize others to use his image in accordance with law.
The likeness is an external image of a specific natural person reflected in video recordings, sculptures, drawings, or on other media by which the person can be identified.
Article 1019
No organization or individual may infringe upon other’s rights to likeness by vilifying or defacing the image thereof, or through other ways such as falsifying other’s image by utilizing information technology. Unless otherwise provided by law, no one may make, use, or publicize the image of the right holder without his consent.
Without the consent of the person holding the right to likeness, a person holding a right in the works of the image of the former person may not use or publicize the said image by ways such as publishing, duplicating, distributing, leasing, or exhibiting it.
Article 1023
For an authorized use of another person’s name or the like, the relevant provisions on the authorized use of other’s images shall be applied mutatis mutandis.
For the protection of a natural person’s voice, the relevant provisions on the protection of the right to likeness shall be applied mutatis mutandis.

The original text, including five other Civil Code Typical Cases, can be found here (Chinese only).

Stay on Alert: CFTC Staff Reminds Registered Exchanges and Clearinghouses to Evaluate and Calibrate Their Volatility Control Mechanisms

The Commodity Futures Training Commission’s (“CFTC”) Division of Market Oversight and Division of Clearing and Risk issued an advisory (the “Staff Advisory”) reminding designated contract markets (“DCMs”) and derivatives clearing organizations (“DCOs”) of their regulatory obligations under the Commodity Exchange Act (“CEA”) and CFTC regulations to implement and consistently evaluate the efficacy of their controls designed to address market volatility. These controls—referred to as volatility control mechanisms (“VCMs”) by the Committee on Payments and Market Infrastructure and the International Organization of Securities Commissions—are especially important in today’s environment, where global events such as pandemics, wars, sanctions, political instability, and abrupt policy changes can drive extreme volatility.
The May 22 Staff Advisory reflects the most recent development in the industry related to VCMs. In September 2023, the Futures Industry Association (“FIA”) published a paper supporting VCMs, noting their effectiveness in preserving market integrity by mitigating disruptions from sudden price swings, erroneous orders, and feedback loops under stress (“FIA Best Practices”). FIA also advocated for a principles-based approach to VCM design to ensure adaptability across asset classes and changing market conditions.
The FIA Best Practices recommended that DCMs implement robust, flexible controls such as circuit breakers, price bands, and pre-trade risk checks that are tailored to their specific markets and trading conditions. For DCOs, the Staff Advisory underscores the potential impact of VCMs on clearing functions, particularly around variation margin and settlement pricing during volatile periods. DCOs must exercise discretion in ensuring settlement prices reflect market reality when normal pricing methods are disrupted, and should transparently communicate such deviations to clearing members and end-users.
In November 2023, the CFTC’s Global Markets Advisory Committee (“GMAC”), chaired by Acting Chairman Caroline Pham, played a pivotal role in advancing these best practices. Composed of a broad cross-section of market infrastructures, participants, end-users, and regulators, GMAC recommended that the CFTC leverage the FIA Best Practices to deepen its understanding of exchange-level risk controls and as a foundation for engagement with global regulators and international standard setters.
In line with this recommendation, the Staff Advisory reinforces that DCMs and DCOs are expected to fulfill their existing responsibilities and incorporate best practices to maintain fair, orderly, and resilient markets during times of elevated volatility.
The Staff Advisory is available here. FIA’s Best Practices is available here.

Syria-ous Changes for Middle East Business? The United States, UK, and Europe Relax Sanctions on Syria

In a significant shift in international policy, the United States, European Union, and United Kingdom have each taken steps to ease sanctions on Syria, aiming to support the country’s reconstruction and political transition following the fall of the Assad regime.
United States Actions
On May 23, 2025, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued General License No. 25 (GL 25), authorizing certain transactions otherwise prohibited under the Syrian Sanctions Regulations (31 C.F.R. Part 542). That move represents a major policy shift aimed at facilitating reconstruction and humanitarian efforts in Syria.[1] In parallel, the U.S. Department of State issued a waiver of sanctions under the Caesar Syria Civilian Protection Act. Together, those developments signal a coordinated effort to promote economic stabilization while maintaining leverage over the Syrian government’s conduct.
Scope of Authorized Transactions
GL 25 authorizes U.S. persons to engage in a broad range of transactions involving Syria that were previously prohibited. Specifically, the license allows transactions that involve the Government of Syria and certain blocked persons, including individuals and entities named in the annex to GL 25, as well as entities that are owned 50 percent or more by such persons. The license covers services, investment, and dealings involving Syrian-origin petroleum and petroleum products, among other activities. Notably, this license lifts longstanding restrictions on financial transactions and investment, which could enable U.S. companies to reenter the Syrian market under certain conditions.
Concurrently Issued Measures
The easing of OFAC sanctions is part of a wider package of measures. In coordination with GL 25, the U.S. Department of State issued a 180-day waiver of certain sanctions under the Caesar Act, providing additional relief intended to stimulate activity in key sectors such as infrastructure, agriculture, and healthcare.
The Financial Crimes Enforcement Network (FinCEN) issued guidance relaxing restrictions under Section 311 of the USA PATRIOT Act, allowing U.S. financial institutions to maintain correspondent accounts for the Commercial Bank of Syria. These measures are designed to operate in tandem and provide meaningful openings for financial and commercial reengagement, subject to oversight and compliance measures.
Limitations and Conditions
Despite the breadth of the new authorizations, the relief measures are not unconditional. The U.S. government has emphasized that continued implementation of GL 25 and related actions will depend on the Syrian government’s conduct going forward. Specifically, the U.S. has tied future sanctions relief to Syria’s demonstrated commitment to protecting ethnic and religious minorities and ceasing support to designated terrorist organizations. The U.S. intends to monitor these commitments closely, and the status of GL 25 may be revisited if conditions on the ground deteriorate or if the Syrian government fails to uphold its obligations.
Export Control Considerations
Importantly, while GL 25 eases certain economic sanctions, it does not affect the application of U.S. export control restrictions over the country. Items subject to the Export Administration Regulations (EAR) generally remain prohibited for export or reexport to Syria, unless specifically authorized by the U.S. Department of Commerce’s Bureau of Industry and Security (BIS). This includes both items classified under specific Export Control Classification Numbers (ECCNs) and those designated as EAR99. Likewise, exports of U.S. Munitions List items and related defense services remain subject to the International Traffic in Arms Regulations (ITAR), administered by the U.S. Department of State’s Directorate of Defense Trade Controls (DDTC). Companies considering transactions involving Syria should therefore make sure that they obtain appropriate licenses from those agencies before exporting to Syria.
European Union Measures
On May 28, 2025, the Council of the European Union adopted a series of legal acts lifting all economic restrictive measures on Syria, with the exception of those based on security grounds.[2] This move formalizes the political decision announced on May 20, 2025, and aims to support the Syrian people in rebuilding a new, inclusive, pluralistic, and peaceful Syria.[3] As part of this approach, the Council removed 24 entities from the EU list of those subject to the freezing of funds and economic resources, including banks such as the Central Bank of Syria and companies operating in key sectors for Syria’s economic recovery. However, the EU has extended the listings of individuals and entities linked to the Assad regime until June 1, 2026, and introduced new restrictive measures under the EU Global Human Rights Sanctions Regime, targeting individuals and entities responsible for serious human rights abuses.
United Kingdom Developments
On April 24, 2025, the UK government published the Syria (Sanctions) (EU Exit) (Amendment) Regulations 2025,[4] which took effect on April 25, 2025. These regulations partially suspend a number of significant sanctions that have been in place for over a decade, reflecting developments in the political situation in Syria following the fall of the Assad regime in December 2024. The UK has lifted sanctions on several Syrian government agencies, including the Ministry of the Interior, the Ministry of Defense, and the General Intelligence Service, as well as the police, air force, military, and state-run media. Additionally, the UK has pledged up to £160 million in support for Syria in 2025, providing lifesaving assistance and supporting agriculture, livelihoods, and education programs to help Syrians rebuild their lives. The United Kingdom is expected to adopt additional legal measures to ease Syrian sanctions, mirroring recent actions by the U.S. and EU.
Implications for U.S. and International Businesses
These coordinated actions by the U.S., EU, and UK signal a new phase in international engagement with Syria, potentially opening avenues for businesses and investors. However, companies considering entry into the Syrian market would be well advised to exercise caution and conduct thorough due diligence to ensure compliance with the remaining sanctions and export control laws. Despite the easing of certain sanctions, stringent export control restrictions remain in place, and the relief measures are contingent upon the Syrian government’s commitment to safeguarding human rights and not providing safe harbor to terrorist organizations.
FOOTNOTES
[1] See OFAC’s press release available here.
[2] See Council’s Press Release, available here.
[3] See Council’s Press Release, available here.
[4] Available here.
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