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The International Law Section Gazette
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Meet the ILS Executive Board 2019-2020
Chair
Clarissa A. Rodriguez, Esq.
Reich Rodriguez, P.A.
9999 NE 2nd Ave., Suite 204
Miami, FL 33138
clarissa@reichrodriguez.com
Chair-Elect
Robert J. Becerra, Esq.
Becerra Law, P.A.
1001 Brickell Bay Dr., Suite 1200
Miami, FL 33131
rbecerra@rjbecerralaw.com
Secretary
James M. Meyer, Esq.
Harper Meyer Perez Hagen Albert Dribin & DeLuca LLP
201 S. Biscayne Blvd., Suite 800
Miami, FL 33131
jmeyer@harpermeyer.com
Treasurer
Rafael R. Ribeiro, Esq.
Hogan Lovells LLP
600 Brickell Ave., Suite 2700
Miami, FL 33131
rafael.ribeiro@hoganlovells.com
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International Law Section - Call for Committee Members
 The International Law Section Foreign Legal Consultants Committee and Legislative Committee call for all Members to join their ranks for the 2019-2020 bar year.
Join Today!
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Save the Date - ILS Audio Webcasts 2019-2020
Save the date for the following ILS webcasts:
September 11, 2019: (3564) The Venezuela Sanctions: Staying Clear of Uncharted Mines (audio webcast) 12:00 p.m. - 1:00 p.m. by Aleksandar Dukic, Richard Montes De Oca, and Jacqueline Arango.
September 18, 2019: (3565) The RFE Dilemma: How to Strategize Your Response to RFEs for L and H Visas (audio webcast) 12:00 PM - 1:00 PM by Larry Rifkin, Elaine Weiss, Juan Carlos Freyre.
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During the Spring, the Florida Bar International Law Section proudly offered CLE webinars on a wide variety of topics, including H-1B Processing, Key Changes in EU General Data Protection Regulations, and FIFA Transfer Rules and the Court of Arbitration for Sports. All past programs have a link to register for on demand and downloadable podcasts for the next 18 months.
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International Law Section - Call for Member News
The Executive Board of the International Law Section calls for all Members to share news about their professional achievements, endeavors, and successes to be published in the Gazette and on the International Law Section website.
To share your professional achievements with the ILS Network, please submit all relevant information to
Davide Macelloni, Editor of the ILS Gazette.
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Join the International Law Section
If you are reading the Gazette, chances are that you are a practitioner or a student with an interest in International Law
, one of the most wide-ranging, exciting and challenging legal specialties. Everyone in our field knows how crucial it is to stay on top of diverse and evolving national legal regimes, and at the same time, the difficulty of keeping meticulously up-to-date on developments around the world.
The International Law Section (ILS) of The Florida Bar is here to help you, the practitioner, navigate both the everyday and big-picture challenges of our field. Our Section is your forum to share knowledge and best practices, and to meet and mingle with peers in professional collaborations that can only enhance your grasp of the specialty and your standing among clients and peers.
Let ILS membership assist you in developing a thriving international practice through peer network development that includes important shared learnings and reciprocal referrals of clients and casework.
If your practice transcends borders, join us in making this the authoritative, go-to forum for Florida and the gateway to the region for anyone practicing International Law.
Our Section is open to lawyers from other states and countries, full-time faculty at U.S. law schools, and full-time U.S. law students
, all of whom may participate as associate members. For more information regarding membership with the ILS, click HERE.
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Diane Nobile Awarded for Her Years of Service with Big Brothers Big Sisters Miami
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MIAMI, Fla. - June 25, 2019 -
Diane Nobile, founding partner of a Miami-based international law firm, is pleased to have been awarded with a Certificate of Service from Big Brothers Big Sisters (BBBS) in recognition for over 5 years of outstanding service to the organization and its mission to ignite, empower, and defend the potential of youth in Miami.
Diane is a proud Big Sister and has been volunteering with BBBS of Miami as a mentor for almost 7 years. Diane counts her work with the organization as one of the most rewarding experiences in her 21 years of active community involvement.
"Being recognized by Big Brothers Big Sisters is a true honor," says Nobile. "My work with this organization, and with my Little Sister, is incredibly rewarding. I look forward to continuing my mentorship for many more years to come."
Big Brothers Big Sisters of Miami
is the premier nonprofit mentoring organization in South Florida. The organization champions hope, transformation, and social good, defending the potential of children who most need it.
In her law practice, Ms. Nobile specializes in working with international investors on pre-immigration tax planning, estate tax planning, international investors seeking to purchase or invest in US real estate, and business law.
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Peter Quinter Hikes the Appalachian Trail
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Peter Quinter, Chair of GrayRobinson's U.S. Customs and International Trade Practice and ILS Past Chair, recently hiked the New York and Connecticut sections of the Appalachian Trail during his eighth backpacking excursion on the AT.
For anyone interested in backpacking, contact Peter at (954) 270-1864.
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Update in EIN Procedures: Make Sure Your Responsible Party Has an ITIN or SSN
By Alexis I. Marrero Koratich*
On March 27, 2019 the IRS announced a revision to its EIN application process which went into effect on May 13, 2019 (see announcement
here
). An EIN is an employer identification number, which is also known as a Federal Tax Identification Number, and is used to identify a business entity. Businesses need an EIN for a number of reasons, including to open bank accounts, obtain licenses, file income tax returns, etc.
Obtaining an EIN is a relatively simple process if the responsible party has a social security number. This begs the question, "who is a responsible party"? Prior to May 13, 2019, a responsible party was defined as:
"[T]he person who has a level of control over, or entitlement to, the funds or assets in the entity that, as a practical matter, enables the individual, directly or indirectly, to control, manage or direct the entity and the disposition of its funds and assets. The ability to fund the entity or the entitlement to the property of the entity alone, however, without any corresponding authority to control, manage, or direct the entity (such as in the case of a minor child beneficiary), does not cause the individual to be a responsible party."
In layman's terms, prior to May 13, 2019, a responsible party of a limited liability company was any member (or owner) of the limited liability company - even if the owner was another company; and for corporations, the responsible party was generally an officer of the company, such as a President or Vice President.
Furthermore, prior to May 13, 2019, the IRS would accept applications for an EIN even if a responsible party did not have either an EIN, SSN, or ITIN, so long as the application was made by fax by submitting a Form SS-4 and Form 2848.
However, effective as of May 13, 2019, the IRS revised its EIN application procedures as follows:
"All EIN applications (mail, fax, electronic) must disclose the name and Taxpayer Identification Number (SSN, ITIN, or EIN) of the true principal officer, general partner, grantor, owner or trustor. This individual or entity, which the IRS will call the "responsible party,"
controls, manages, or directs the applicant entity and the disposition of its funds and assets
[emphasis added]. Unless the applicant is a government entity, the responsible party must be an individual (i.e., a natural person), not an entity. If there is more than one responsible party, the entity may list whichever party the entity wants the IRS to recognize as the responsible party." (see
here
for the exact IRS requirements).
The most significant change to the EIN application process stems from the new requirement that the responsible party have either an ITIN or SSN
. This will have a significant impact on non-U.S. individuals or owners of limited liability companies who do not have an ITIN or SSN. If a non-U.S. owner of a limited liability company needs to obtain an EIN, they will first have to apply for an ITIN, which can be a complex and time consuming process and the IRS has limited the circumstances under which an individual is eligible to apply for an ITIN. Moreover, it is important to note that while the IRS has imposed the requirement that a responsible party have an SSN or ITIN prior to applying for an EIN, the IRS has not revised the rules to the ITIN application to include the need for an ITIN in order to apply for an EIN as a permissible basis for applying for the ITIN. Therefore, those advising the individual applicant for ITIN will need to carefully evaluate the rules for the Form W-7 (ITIN application - see instructions
here
) in order to determine the appropriate basis for applying for the number.
Furthermore, the IRS will no longer allow an entity (such as a corporation or limited liability company) to be a responsible party on the EIN application. This process formerly worked as a "back door" to obtain an EIN quickly online.
Speaking of back doors, most tax practitioners are aware that the IRS discontinued its practice of granting EINs over the phone a number of years ago. As a result of the discontinuing the practice of granting EINs over the phones, EINs could only be obtained online so long as the responsible party (as previously defined) had an SSN (not ITIN), or by submitting a fax application if the responsible party only had an ITIN or if the responsible party had neither an ITIN or SSN. Unbeknownst to some practitioners, EINs for foreign entities can still (even today) be obtained over the phone relatively quickly. The IRS is available to provide the EIN from 6:00 AM EST - 11:00 PM EST (this author has personally received an EIN at 11:00 PM from a parking lot at the EPCOT center) - the "back door."
Anecdotally, this author called the IRS in June to obtain an EIN for a foreign entity with a responsible party (under the new definition) who did not have either an ITIN or SSN and was able to obtain an EIN for the foreign entity over the phone, notwithstanding the recent announced enforcement of the rule requiring that the responsible party have an EIN. Was it an oversight by the IRS? Probably. Practitioners should not count on this oversight in the future. Practitioners should be prepared to account for the increased difficulty and time for obtaining EINs for non-U.S. people who do not have an ITIN or SSN.
*Alexis I. Marrero Koratich is an associate at Geoffrey M. Wayne, P.A., a boutique law firm located in Coral Gables focusing on individual and corporate issues related to international taxation.
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Walmart to Pay $282 Million for FCPA Violations
By Richard Montes De Oca*
On June 20, 2019, Walmart Inc. agreed to pay $282 million to settle a long-lasting probe for violation of the Foreign Corrupt Practices Act (FCPA) by failing to ensure its subsidiaries in Brazil, China, India and Mexico had adequate anti-corruption programs. The probe started by investigating a reported bribery scheme involving Walmart's subsidiaries in Mexico.
Walmart has been under extensive investigation by the U.S. Department of Justice (DOJ), the U.S. Securities and Exchange Commission (SEC) and Mexican authorities since 2011 for violations of the FCPA taking place for over 10 years, from 2000 to 2011. In Mexico, Walmart's employees paid alleged bribes to government officials in order to obtain permits to build Walmart stores. Walmart was informed about the possible misconduct in Mexico by a special investigator and internal audit employees; however, the company refused to follow their recommendations.
In addition to the violations in Mexico, Walmart was also charged for bribes allegedly paid by the company's subsidiaries to government officials in Brazil, China and India.
It is important to highlight that the main charge by the DOJ and the SEC concerns Walmart's failure to have adequate anti-corruption controls in place, while its employees, including high level executives, allegedly knew about the bribes. Accordingly, the probe also pointed to Walmart's hiring of a contractor in Brazil despite clear "red flags", something that could have been avoided with an effective compliance program. The payment to the Brazilian contractor, who worked as an intermediary to obtain permits more quickly, was also falsely recorded as a payment to construction companies, further violating the FCPA's books and records provisions. It was not until 2011 that Walmart started to bolster its compliance program.
Since the commencement of the investigation, Walmart has fired its General Counsel in Mexico and spent over $870 million dollars in legal fees and global compliance upgrades.
During the probe, the DOJ did not officially comment on the penalty sought against Walmart, which first prompted some experts to estimate that the fine would be in the range of $600 million to $1 billion. However, Walmart disclosed in its SEC filings in 2018 that it would probably reach a settlement for approximately $283 million as a result of the various remedial measures taken by the company. Some of the remedial measures taken into account by the federal authorities were (i) the enhancement of Walmart's anti-corruption compliance program and internal accounting controls; (ii) hiring of global and local Compliance Officers; and (iii) according to the Non-Prosecution Agreement between the DOJ and Walmart, "conducting, across each of Walmart's markets, enhanced monthly and quarterly anti-corruption monitoring by dedicated Company Financial Controls and Continuous Improvement Teams (who monitor at store-level), with results tracked in a centralized, real-time automated monitoring system."
DOJ Criminal Division Chief Brian Benczkowski said in a statement, "In numerous instances, senior Walmart employees knew of failures of its anti-corruption-related internal controls involving foreign subsidiaries, and yet Walmart failed for years to implement sufficient controls comporting with U.S. criminal laws. As today's resolution shows, even the largest of U.S. companies operating abroad are bound by U.S. laws, and the Department of Justice will continue to aggressively investigate and prosecute foreign corruption."
With increasingly aggressive enforcement efforts and record-setting fines by the DOJ and SEC, MDO Partners encourages companies to establish strong Anti-Corruption Compliance Programs to mitigate the risk of FCPA violations. In fact, recent reports reflect that nearly 500 enforcement actions were initiated and $4 billion in fines were levied by the DOJ and SEC in 2018, boosted in large part by foreign corruption cases. MDO Partners advises companies on global compliance programs; our attorneys and advisors have extensive experience advising clients on the FCPA and effective Anti-Corruption Compliance Programs in over 30 countries.
*Richard Montes De Oca is Managing Partner at MDO Partners, a boutique law firm that focuses on Corporate, International, and Real Estate Law, as well as Global Compliance and Business Ethics.
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July 8-11, 2019
 Please join the
Illustre Collegi de l'Advocacia de Barcelona (ICAB) for its 2019 Summer Law course. The 4-day program will include, among others, panels on Information Technology Law and Tax and Compliance Law. For additional information and registration, please
click here. For the complete program,
click here.
September 3-7, 2019
T
he 57th International Young Lawyers' Congress of the
Association Internationale des Jeunes Avocats - International Association of Young Lawyers
will take place in Rome, Italy. The event will be an opportunity to network and learn with a focus on "Sustainability and the Law. Planet. People. Future." For more information or to register, please
refer to the
event's website
.
September 22-27, 2019
The
International Bar Association
invites all members to attend its 2019 annual conference, which will be held in
Seoul, South Korea
, a thriving metropolis that mixes the traditional with the modern - from skyscrapers, high-tech subways, K-pop culture and K-beauty to Buddhist temples, palaces and street markets and a history going back 5,000 years. For more information or to register, please refer to the
event's website
.
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International Law Quarterly: Winter 2019
The new issue of the
International Law Quarterly - Focus on International Human Rights is now available.
Click on the image below to download.
For all previous issues of the International Law Quarterly, please
click here.
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