Overview
In collaboration with the Association of Corporate Counsel Northeast Chapter, Brian Bunn, Robert Cohen, Joan-Elise Carpentier, Joseph Evans, Raymond Jacobsen, Byron Kalogerou, and General Counsel of Divert, Kathleen Patton, previewed practical implications of the upcoming US federal election for attendees and their companies.
From antitrust enforcement, legal immigration, and the quest for skilled workers, to the availability of capital and the regulation of cryptocurrency, this cross-practice panel offered their perspectives on how the outcome of the election may impact businesses.
Top takeaways from each discussion topic included:
Antitrust Enforcement: Irrespective of who leads the administration, the outlook for its antitrust agenda is a positive one. For example, despite promulgation of the new Federal Trade Commission rules governing the premerger notification filing process, a Trump administration may dispose of the rules before they go into effect in January 2025.
That said, due to the increased burden associated with submitting the requisite filings under the rules, companies should begin to look at internal, ordinary planning documents, which could well be produceable during the filing. Documents relating to potential areas of competition in the services and products underlying the transaction will also need to be retained and reported. With this in mind, personnel involved in ordinary-course-of-business reporting to executives should pay close attention to any draft documents that may be subject to agency review.
It is likely that either administration will continue the monopolization parade against Big Tech. Since many companies are concerned about the power of Big Tech, and enforcement actions are politically supported, Big Tech should be prepared to face further scrutiny under either administration.
Despite these similarities, it is possible that either administration may take on different focuses in their enforcement efforts. Vice President Harris, for instance, has said publicly that she is against price gouging in food and grocery products. Former President Trump’s prior term saw the Google case. Investigations in these areas are expected to continue.
Capital Markets: The economic climate is still uncertain and has deterred private investments, both US to foreign. US Securities and Exchange Commission (SEC) Chairman Gary Gensler likewise faces an uncertain future irrespective of the next administration in power.
Venture capital may benefit regardless of the election outcome. A Trump administration could lead to lower taxes and relaxed regulations, potentially boosting the economy and private investment and reviving the sluggish venture capital market. Due to Harris’s background and ties to San Francisco, she is friendly towards the venture capital world. Her administration can encourage more investment activities despite the fluctuations in market realities.
The Committee on Foreign Investment in the United States will likely continue to block foreign investments in US companies that control critical technologies, such as defense, ports, and intelligence. Investments from China and Russia, in particular, have been subject to heightened scrutiny. In these areas, venture capital investments may also ebb and flow depending on whether the target industries receive advantageous treatment, tax or otherwise.
Immigration: US immigration policy has failed to bring needed foreign talent to the US workforce. The current immigration and visa systems are riddled with inefficiencies, creating significant challenges for tech industries relying on foreign talent to fill specialized roles.
The H-1B visa system is crucial for filling tech jobs with foreign specialized workers, but it is broken due to a capped number of visas and a lottery system with very low success rates. Simultaneously, processing times for visas and green cards are getting longer while fees are increasing, which pose additional challenges for employers relying on foreign workers.
There is hope that the next administration, whether led by Harris or Trump, will address the tech industry’s need for foreign workers. Previously, the Trump administration removed a deference policy on certain visas, resulting in more requests, but President Biden reinstated the policy. In any case, businesses seeking to attract and retain foreign workers should start visa renewal applications and relevant processes early to ensure they are in the pipeline.
Regulation of Cryptocurrency and Blockchain: During the Biden administration, unprecedented aggression in the form of enforcement actions has confronted the crypto industry. Many investors have opted out of the US market in the face of uncertain regulations and fear of Chairman Gensler, as the dogfight between the SEC and the industry continues to escalate.
Trump has indicated that he is a big proponent of the crypto industry and that he wants to domesticate all of bitcoin. If Trump is elected, it is likely that Chairman Gensler may no longer be in the chair position, which will possibly be filled by someone less aggressive towards the industry. The same goes for Harris, which means less enforcement aggression no matter which candidate takes the presidential seat. Of course, exactly who may take the SEC chair position is at the top of everyone’s mind in the crypto industry.
The Financial Innovation and Technology for the 21st Century Act (FIT21) seeks to define who should regulate tokens. Some are considered securities and, thus, restricted digital assets that SEC should handle; others are considered commodities, which should be handled by the Commodity Futures Trading Commission. FIT21 has garnered sufficient support to be passed under either administration, with more support expected by the Trump administration.
In summary, businesses engaging in crypto transactions can expect to see more room to act and less aggressive regulatory actions aimed at the industry during the term of whichever administration comes next.
