What is the Federal Stimulus Bill and What Does it Mean to Clients?

Top 5 Legal Tips
Eliot Norman, Esq.
[email protected]
www.williamsmullen.com
4/11/2011
14587546 Paris April 6
1
Votre Destination
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2
This is where is all starts
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HOMELAND SECURITY IS
Still Running US Immigration
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4
LA PYRAMIDE DES VISAS AMERICAINS
GREEN CARDS
L-1A/L-1B,
E1/E2 Investors/
Treaty Traders
H-1B/O-1
B-1/ F-1/J-1/H-3, H-2B
B-1/ 90 Day
Visa Waivers
(B/2) (tourists)
4/11/2011
6693462
EB-1 Multinational Managers/Executives & EB-1
Extraordinary Ability and Outstanding Researchers;
EB2/3 Labor Certifications for professionals,
skilled/unskilled workers leading to Green Cards;;
EB2Green Cards for National Interest Waivers,
FAMILY SPONSORSHIP (marriage to U.S. Citizen or, Green
Card Holder; Diversity Lottery
EXECUTIVES, MANAGERS, Specialists and EssentialSkills Employees for U.S. Offices of International
Companies
PROFESSIONALS; Extraordinary Ability
Scholars & Scientists
TRAINEES & FOREIGN STUDENTS
Research Scholars & Specialists;
Temporary workers
BUSINESS VISITORS:
Negotiate Contracts, Consult;
Trainees, Install Equipment
if Purchased Overseas; Visa Waiver
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Smarter Visa Strategies for 2011
• E-2 France-US Treaty Investor Visas
– First choice for French investors or
employees who will work for French-owned
companies in the USA
– Accelerated E-1/E-2 Visa Program in Paris
• L-1: Parent-Subsidiary or Corporate Affiliate
Transferees
– Benefits of E-2 and L-1 for spouse
4/11/2011
• H-1Bs (Quota delays until October 1, 2011)
• Alternatives: J-1, F-1 Practical Trainees/Interns
(VIE)
• New Rules: Export Controls Certifications
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Case Illustration: L-1 Intra-Company New
Office Transfers
X&Z Cyber Security, SA
Paris, France
Managers, Executives
Software Developers
Project Managers
and Software
Specialists
Cyber Security
Software
Programmers
X&Z Systems, Ltd.
Rabat, Maroc
4/11/2011
X&Z Cyber Security, Inc.
Virginia USA
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L-1A ou L-1B
• Affiliation or control between U.S. and
Foreign company
• Employee must have worked for French
or other foreign company for 1 year
• Proof of Managerial/Executive Position
(L-1A) or
• Proof of Specialized Knowledge (L-1B)
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L-1 pour le Nouveau Bureau
•
•
Très bon choix pour une PME
4 critères
– business plan
– un bail commercial
– un an d’expérience avec
l’entreprise outre-mer comme
employé
– Une entité américaine
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Attention: Nouveaux Règlements
depuis le 21 février 2011
• Applies to companies and individuals
involved in technologies subject to
Export Controls: military applications,
advanced computers, cybersecurity,
lasers, robotics, etc.
4/11/2011
• Export Controls “Immigration
Certifications” (depuis le 21 février)
• Consequence: may lead to increased
monitoring & enforcement of “Deemed
Exports” rules in the US
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Formation de l’Entreprise
Américaine
• Corporation or Limited Liability Company?
• Why for foreign investments the LLC may not be
the way to go?
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“Flow Through” Tax Treatment
Corporation vs. LLC
• US corporations do not have "flow through" tax
treatment and must file tax returns
• LLCs have "flow-through" tax treatment and are not
required to file income tax returns
• Result: LLC’s French parent company must file income
tax returns in the United States
• Result: LLC’s French parent company is subject to
audit by U.S. IRS (Tax authorities)
• Most foreign companies do not want to file tax returns
in US; do not want to be audited
• Result: The preferred form of entity for US operations of
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foreign companies most often is the corporation
Where to Incorporate?
• Delaware vs. other state
• Qualifying to do business in other states
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Ultimate Decision?
Tax Driven
Additional Recent Tax Changes Favoring Corporation
• The 2009 Changes to the U.S.-French Tax Protocol. The
Protocol has added transparent entity provisions and
eliminated the withholding tax on certain cross-border direct
dividends. These will have the greatest impact on French
companies wishing to engage in M&A activity and/or direct
investment into the US.
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Les Premiers 120 Jours
• Visa
• Corporation
• Les prochaines étapes: un “checklist”
juridique
• Services juridiques “de démarrage”
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Services de conciergerie juridique
1.
2.
3.
4.
5.
6.
7.
Création de la Société Anonyme (U.S. corporation)
Visa
Les conseils à l’embauche des employés; droit du travail
Dépot de marque
Réservation d’un nom de domaine Internet
IRS Employment Identification Number (EIN). SSA Numéro
Enregistrement de la société auprès des services locaux
compétents: introduction aux incitations locales/étatiques
8. Examen du bail de votre bureau
9. Planification à l’avance en matière de responsabiité du fait
des produits(des produits défectueux)«products liability »
10. Introduction aux contrats governmentaux
11. Introduction: réglementation douanière et droit des
exportations
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12. Conseils: contrats de distribution, d’agence, de licence
Fonctionnement des Services
de Conciergerie Juridiques
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• Consultation initiale, essentielle avant le
départ aux Etats-Unis - choix de visa et
de la forme du business américain est
très critique
• Un cabinet qui offre toutes les services
de démarrage: dangers de discontinuité
• Un forfait
• Durée des premiers quatre mois
• L’importance d’un bon démarrage
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Des exemples des services
juridiques de démarrage
• Le droit du travail
• Les contrats (style américain)
• Comment vendre au gouvernement
fédéral ou aux gouvernements étatiques
• Gestion des risques: responsabilité du
fait des produits (des produits
défectueux) « products liability »
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Le Droit du Travail
• Première impression: ???
• Plus libéral ou non que le droit
français?
• Rôle fédéral
• Rôle des états
• Syndicats: “right to work” states?
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Pro-Business Employment Laws
• Employment “at will” – You can hire, fire “at will” (à
discrétion sans contrat écrit ou oral)
• However, strong federal laws prohibit discrimination: race,
disabilities, sex, age
• “Frivolous” discrimination claims are summarily dismissed
• Employee Handbooks – Imposes duties on employee
• Trade secrets are protected from misappropriation by
disloyal employees, still advisable to have written
confidentiality or NDA (non-disclosure) agreement with key
managers/technical employees
• Courts enforce non-compete, non-solicitation agreements
• Flexibility in opening/closing/moving company operations
4/11/2011 as your business grows
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Préservation de la souplesse des effectifs
(avantages juridiques americaines)
• Emploi « At will » (à discrétion) : En l'absence de contrat
de travail pour une durée déterminée, il peut être mis fin
à l'emploi au choix de l'employeur, avec ou sans motif
justifié.
• Admet des restrictions contractuelles strictes en matière
de concurrence par d'anciens employés
• 22/50 états: « Right to work laws » État avec droit au
travail : décourage les syndicats dans la mesure où
personne ne peut être contraint à payer des cotisations
syndicales ou à adhérer à un syndicat pour conserver
son emploi.
• les grèves par des employés publics sont interdites?
Compréhension des principales lois en
matière de travail
• Bon sommaire: « S’Implanter aux Etats-Unis »
• Salaire minimum et heures supplémentaires (FLSA)
• Congé familial (congé sans solde dans le cadre de la
législation FMLA)
• Lois en matière de lutte contre la discrimination (Title
VII, ADEA, ADA)
• Exigences de discrimination positive pour les
fournisseurs et sous-traitants du gouvernement
(EO11246)
• Pratiques déloyales de travail (NLRA)
• Prestations sociales des employés (ERISA)
Considérations clés en matière d'emploi
Un conseiller juridique peut vous aider à :
• Préparer des contrats d'emploi, des règles de travail,
des manuels et des programmes de discrimination
positive
• Former la direction pour faire en sorte que le lieu de
travail reste sans présence syndicale et conforme à la
législation
• Faciliter le maintien de la conformité aux lois en
matière d'emploi et de prestations sociales
• Vous défendre dans le cadre des recours en vertu du
droit du travail
Les Contrats
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Americanize your Contracts
• Advice on important contracts under
U.S. law
– software and other license agreements
– distribution and agency agreements
– sales contracts
– financing agreements
– disputes resolution and remedies
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Gestion des risques : Responsabilité du fait
des produits
• Titre à sensation : des jurés
américains accordent des dommages
punitifs de plusieurs millions de
dollars dans le cadre d'actions
collectives.
• La realité juridique est différente
Gestion des risques : Responsabilité du
fait des produits (des produits défectueux)
• Adoptez les mêmes démarches de bon
sens que celles que vous suivez
maintenant pour vendre dans le monde
entier
• Assurance
• Médiation/Arbitrage
• les décisions judicaires sont prises
rapidement par des tribunaux favorables
aux entreprises
• les lois américains protègent les entreprises
contre les procès frivoles
Gestion des risques : Responsabilité
des produits défectueux
• Résultat : Les EtatsUnis est un pays où l'on
peut gérer ces risques
avec bon sens
• En quoi nous pouvons
aider : planification à
l'avance avec un
conseiller en matière de
responsabilité du fait
des produits pour «
amortir les chocs »
Qualifying to do business with
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"Règles de jeu équitables”
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Doing Business with U.S.
Government
• Can you sell to this customer?
• Buy America
• Recovery Act and other Incentives
• Additional government customers:
– State Government Contracts and
– Incentives (renewable energy)
Case Study: UK Smart Card Software
Company= Smart use of Buy America
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How to Play in the Game?
• Know the players and who keeps score
• Who is going to
– Chase the deal ?
– Negotiate and close ?
– Negotiate changes ?
– Perform the work ?
– Enforce the agreement and get Paid?
Solution ???
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Conseil Juridique (legal tip)
• Do not try initially to sell directly
• Use
– Subcontracts
– Teaming Agreements
– Joint Ventures
– M&A
• Look for the “Clusters” to find the Players
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Example of Cluster: Market Value $22 billion
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366 Entreprises Etrangeres
English
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Subcontracting Opportunities
• Small business “set-asides”
• Need for niche technologies by
the systems integrators and other
large defense contractors
• Result: large percentage of
federal business going to foreign
companies
• Case Example
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Cyber-Security: Big Business: 10% to 20%
“set-aside”
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Teaming Agreements
• Teaming Agreement: Defined
• Major Elements and Protections
for French Company as Teaming Partner
& subcontractor: exclusivity, scope of
work, data exchange subject to NDA,
pricing within prime contractor’s target
ranges, easy termination.
• Sample Teaming Agreement Checklist:
PDF from [email protected]
• Substantial advantages over typical prime
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contractor-subcontractor relationships
Joint Venture
• Definition
• Use of LLC (Limited Liability Company)
• Key Elements and Issues:
–
–
–
–
–
–
–
–
–
4/11/2011
Protection of Technologies and Trade Secrets
Intellectual Property considerations
Clearly defined business objectives
Each Venture should bring something different to the table
that the other does not have
What percentage participation and management roles of
each joint venture
Contributions of capital and ownership rights to IP
Division of profits and Indemnification
Termination/liquidation of the JV and any buy-out
provisions
Confidentiality and non-compete that survives
Indemnification
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Joint Venture
• CASE EXAMPLE: French Food Manufacturer
– Division of profits;
– Liability: one venturer binds the other
– Resolution of disputes
– What acts can be undertaken
independent of and outside the JV
– Termination and grounds for withdrawal
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Exception: Vente Directe:
Patrouilleur selon le “Schedule
GSA”
•
27' Extreme Patrol/SAR Aluminum-Hull Rigid Inflatable Boat (A-RIB) with a
42oz polyurethane collar or Foam Hybrid Collar. Set-up for inboard(s) or
outboard(s) machinery package. Select center console or full cabin
configuration. See option Manufacturer: NORTHWIND MARINE
INC.Contractor: NORTHWIND MARINE, INC. [GS-07F-0416N] (s)
$113,622.00 EA
120 days delivered ARO
• BUY AMERICA ACT: facile a manipuler
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Nos Prestations
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Les dispositions de la loi « Acheter
Américain » concernant les projets
publics de construction du Recovery
Act n’empêchent pas une société
française d’être prestataire ou
fournisseur lorsque :
L’application des dispositions de
la loi « Acheter américain » contredit
les engagements américains par
rapport aux accords internationaux ;
Les États-Unis et la plupart des pays
européens, y compris la France, sont
signataires de l’ OMC (Organisation
Mondiale du Commerce) AMP
4/11/2011
L’OMC interdit l’application de la loi
ACHETER AMÉRICAIN aux passations
de marchés réalisés en vertu du
Recovery Act par les Agences
fédérales, et par 37 autorités d’État ou
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gouvernementales
Nouvelles Opportunities
• Pour le marche étatique
• d’autres conseils juridiques exigés
• Exemple: l’Energie Renouvelable
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RPS Policies
WA: 15% x 2020*
www.dsireusa.orgMN: 25% x 2025
(Xcel: 30% x 2020)
MT: 15% x 2015
OR: 25% x 2025
SD: 10% x 2015 WI: Varies by utility;
10% x 2015 statewide
IA: 105 MW
CO: 30% by 2020
UT: 20% by 2025*
MA: 22.1% x 2020
New RE: 15% x 2020
(+1% annually thereafter)
KS: 20% x 2020
RI: 16% x 2020
NY: 29% x 2015
CT: 23% x 2020
OH: 25% x 2025†
(IOUs)
10% by 2020 (co-ops & large munis)*
CA: 33% x 2020
NH: 23.8% x 2025
x 2015*
5% - 10% x 2025 (smaller utilities)
NV: 25% x 2025*
New RE: 10% x 2017
MI: 10% + 1,100 MW
ND: 10% x 2015
(large utilities)*
ME: 30% x 2000
VT: (1) RE meets any increase
in retail sales x 2012;
(2) 20% RE & CHP x 2017
IL: 25% x 2025
PA: ~18% x 2021†
WV: 25% x 2025*†
NJ: 22.5% x 2021
VA: 15% x 2025*
MD: 20% x 2022
MO: 15% x 2021
AZ: 15% x 2025
OK: 15% x 2015
NM: 20% x 2020 (IOUs)
DE: 25% x 2026*
NC: 12.5% x 2021
(IOUs)
10% x 2018 (co-ops & munis)
DC
DC: 20% x 2020
10% x 2020 (co-ops)
TX: 5,880 MW x 2015
PR: 20% x 2035
HI: 40% x 2030
29 states +
Renewable portfolio standard
Renewable portfolio goal
Solar water heating eligible
Minimum solar or customer-sited requirement
*†
Extra credit for solar or customer-sited renewables
Includes non-renewable alternative resources
DC and PR have
an RPS
(7 states have goals)
CCAM: Rolls Royce et d’autres
Sociétés Etrangères
•
•
•
•
•
•
•
4/11/2011 •
Different type of STATE INCENTIVE.
Other companies in addition to Rolls-Royce that have joined CCAM as
founding members are:
Newport News Shipbuilding, the Newport News-based division of
Huntington Ingalls Industries which designs, builds and maintains
ships for the U.S. Navy and Coast Guard.
Canon Virginia Inc., a Newport News-based division of Japan-based
Canon that repairs and refurbishes Canon cameras, video recorders
and office products.
Chromalloy Gas Turbine Corp., an Orangeburg, N.Y.-based company
that provides parts, repairs, maintenance and overhauls of gas
turbines used in aviation and in land-based applications.
Sandvik Coromant, a Swedish company that makes tools for turning,
milling and drilling, and
Siemens, a German industrial engineering company that provides
software and other tools to improve manufacturing processes.
Aerojet, a California-based provider of rocket propulsion systems, 47
joined CCAM last month as a tier-two member.
Conseils Juridiques
• Focus is now on the States,
– ex. secteur de l’energie renovelable
4/11/2011
• Negotiation of state and local incentive
packages
• Evaluation of the “deals”
• Requires multidisciplinary approach
• [il faut trouver des cabinets
expérimentés dans le domaine du droit
du développement économique]
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Dernière Stratégie juridique qui
aide l’entrée dans les marchés:
Les Acquisitions
• Marchés publics
• Marchés privés
• Facteurs juridiques qui favorisent
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Number of Deals (Foreign Acquisitions of U.S.
Companies) by Primary Sector
(2005 – 2010 YTD)
4/11/2011
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(Acquisitions rather than M&A)
• IT sectors leads the statistics
• Market Entry Strategy
• Can solve security clearance and export controls
issues
– May require FOCI Mitigation, NID and CFIUS (Comm.
on For. Inv. in the US) approval
• Cobham PLC recent purchase of Argotek, Inc.
for $36.2 million
• will continue to be operated as separate
corporation, 70 employees, all with U.S. security
clearances
• Key contract with: CNIC (Comprehensive National
Cyber Initiative)
4/11/2011
.
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M&A Legal Considerations
1.
2.
3.
4.
5.
6.
7.
8.
4/11/2011
Do the Tax Planning early; domestic & international
Due Diligence, Negotiations Style in the U.S.
The Stock/Asset Purchase Agreement: Reps and
Warranties
Financing the M&A Deal
Closing the Deal
Post-Acquisition Operations/Risk Management
Post-Acquisition: U.S. Immigration: recruiting/retaining
global talent post-acquisition.
SSA/Proxy Agreement to access Classified Federal
Markets or deal with Export Controls (ITAR, EAR)
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Conclusion: Le “Top 5” for your
Legal Checklist
1.
2.
3.
4.
5.
4/11/2011
Your Visa Choices impact your transfer of key
personnel and technology
Form initially a U.S. corporation
Establish and use a “Legal checklist” ou “services
cles de démarrage” during the first 120 days;
Recognize the advantages of U.S. employment
laws, Americanize your contracts, and Adoptez les
mêmes démarches de bon sens que vous suivez
maintenant concernant la Responsabilité des
produits défectueux;
Use Subcontracts, Teaming Agreements, Joint
Ventures, & Acquisitions for market entry and
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expansion in public and private markets.
Final Thoughts
• There are any of 50 states where you
can set up to do business
• Each has their own distinct legal system
at the State Level
• What are the legal criteria that you
should be looking for?
4/11/2011
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The Legal Criteria for International Businesses
•
•
•
•
•
•
•
•
A soft landing and
•
rapid expansion for
your French
•
company
4/11/2011
Value of State and Local Incentive Packages?
State Ranking by the U.S. Chamber of Commerce’s
2010 study for having the “Best Legal System”?
Strong protections of trade secrets, enforcement of
non-competition and confidentiality agreements?
“Rocket Docket” or smooth functioning court
systems: good forum for resolution of IP and patent
disputes?
Conservative, pro-business, products liability,
intellectual property, and other state laws?
“Right-to-work” laws if unions are an issue?
Pro-management or pro-investor incorporation
statutes?
Efficient regulatory systems, including environmental
and corporate permits and registrations?
Well-managed corporate state tax systems; AAA bond
rating
Result can be…
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Questions?
Eliot Norman, Esq.
[email protected]
001.804.420.6482
Williams Mullen
1666 K St. Suite 1200
Washington, DC 20006
www.williamsmullen.com/immigration
References: S’implanter aux Etats-Unis: Ubifrance 2009
Guide for Foreign Companies Establishing Operations in
the United States: http://tinyurl.com/guideUSA2010
4/11/2011
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