Federal anti-BDS legislation – Common sense and constitutional

Over 20 states have taken action in opposition to the anti-Israel, anti-Semitic Boycott, Divestment and Sanctions movement, designed to economically isolate the Jewish State.

Now that the federal government seems poised to join the party, the American Civil Liberties Union and other opponents have gone from fearmongering to near-hysteria in its opposition.

{mosads}Since 1977, U.S. law has permitted civil penalties against U.S. corporations that participate in boycott requests from foreign countries against U.S. allies, or that make such requests themselves. Companion bills in the House and Senate would extend that to include boycott requests from international organizations such as the UN or the European Union. Those bills have garnered broad bipartisan support, with 45 Senate co-sponsors and 240 House co-sponsors.

Sadly, early reporting has been based on false ACLU claims of free speech infringement, scaring even some staunch anti-BDS Israel supporters into opposing it.

Contrary to the ACLU, the bill would not criminalize participation in BDS. Companies and individuals would still be completely free to trade with whomever they wanted, in whatever geographic regions they wanted. Nobody is being forced to do business with Israel; they are being prevented from cooperating with entities hostile to a close ally.

The bills would extend existing civil penalties for complying with boycott requests from foreign countries. Should Qatar, for instance, request documentation of a company’s transactions to verify that it is not trading with Israel, that company is forbidden to comply with that request. Nothing in the Act requires the company to trade with Israel, or to refrain from doing business with Qatar.

The bills would extend such prohibitions to international treaty organizations. That means a U.S. company would have to refuse an EU demand for documentation that its products contain no components from the West Bank, for instance. The EU could decide if that latest cancer drug or medical device was worth the embargo.

The ACLU knows full well that these provisions survived a series of Constitutional challenges in the early 1980s, soon after the Act was passed.

The First Amendment objections misread the bill’s intent. “Support,” means actions taken with the intent of complying with a boycott.  And “request to impose any boycott by a foreign country,” refers to a request by a foreign country to impose a boycott, not to statements made by a company.  This language was included in response to a March 2016 UN Human Rights Council resolution intended to create a blacklist, but not yet a full boycott.

The first law preventing U.S. companies from explicitly participating in the Arab League boycott was the Tax Reform Act of 1976, removing certain tax benefits from participating companies. Civil penalties were added as part of the Export Authorization Act. There may also be rare criminal penalties for those who knowingly commit such violations.  Sen. Ben Cardin (D-Md.) has stated that sponsors intended only to extend civil penalties.

Far from criminalizing trade activity, it can be seen as helping to protect both U.S. sovereignty and the rights of U.S. companies to do business where and how they want without interference from foreign powers.

The other objection is that such provisions would be ineffective, with intent almost impossible to prove.  However, a 1997 the National Bureau of Economic Research study found tax penalties alone depressed boycott compliance by one-third to one-half. EAA civil penalties certainly reduce it further.

The Act has led business to pressure the League to drop the boycott altogether. One early enforcement action targeted a trademark application to Saudi Arabia. The International Trademark Association now officially opposes the boycott.

One flaw in the bill’s scope, its failure to address a long-dormant US Customs Rule – activated by Obama administration in January 2016 –requiring labeling of products from the West Bank, Golan, and eastern Jerusalem.  The EU began requiring such labeling in 2015, possibly preliminary to a potential boycott of those products.  The US government should not reinforce such a requirement.

In short, the ACLU’s complaints against the bills are at best inflated, and appear to be aimed at scaring away sponsors. Senators, representatives, and citizens should not be misled – these bills could serve as an important bulwark against the international spread of BDS.

Joshua Sharf is a Fellow with the Haym Salomon Center and head of the PERA project at the Independence Institute. Follow him @joshuasharf.

The views expressed by this author are their own and are not the views of The Hill.