Never Tariffied

In this mini-podcast series, we outline how businesses can proactively manage, or avoid, disputes stemming from tariff volatility and political uncertainty, offering insights for legal and business professionals navigating cross-border challenges.

UK vs. U.S. Investment Screening Regimes: Minding the Gap and Navigating New Rules and Risks

March 11 2026

In this installment of the Never Tariffied mini-series, hosts Tatiana Sainati and Matt Lapin sit down with UK investment security regulation expert Kate Newman to demystify the UK’s rapidly maturing investment screening framework, particularly where it diverges from the U.S. CFIUS investment screening program. They trace the UK’s seismic shift since the National Security and Investment Act took effect, how it stacks up against the U.S. CFIUS process and other screening regimes, and why global investors are suddenly finding themselves under new layers of scrutiny.

Together, they explore how shifting notions of national security, from AI and advanced materials to food and water security, are reshaping cross border deal making. Kate, Matt, and Tatiana also share their insights on pragmatic steps that businesses involved in cross-border investments can take to assess risk early, structure deals smartly, and avoid the dreaded “great unwinding" (of deals).

Sanctions, Supply Chains, and Staying Ahead of the Curve

December 17 2025

In this episode of Never Tariffied, Matt Lapin sits down with Dr. Laura Louca from BLOMSTEIN Law in Berlin to unpack the evolving landscape of economic sanctions and export controls. From the growing alignment between U.S. and EU trade policies to the ripple effects of Russia’s invasion of Ukraine and China’s tightening re-export rules, they explore how global supply chains are being reshaped, and what businesses can do to prepare.

Additionally, Matt and Laura discuss enforcement trends, reputational risk, commercial applications, and why preparation is the best defense. Listen to gain expert guidance on navigating enforcement trends, strengthening compliance strategies, and building contractual safeguards that protect your business.

Friendship and Friction: Managing New Risks in U.S.-Canada Trade

November 19, 2025

In this week’s episode of Never Tariffied, Wiley's Tatiana Sainati and Matt Lapin are joined by Jessica Horwitz, Toronto-based partner at Bennett Jones LLP, to unpack the impact of new tariffs on U.S.-Canada supply chains, why some businesses were caught off guard, and strategies for dealing with these new risks.

Together, they explore how companies are adapting through supply chain and customer diversification, smarter contracts, and risk-sharing strategies, while uncovering the silver lining: a push toward resilience and innovation in global trade. Will change continue to be the new normal for this decades-long trade partnership? Find out on the second installment of the Never Tariffied mini-series.

Transript

Tatiana Sainati: Welcome back to Never Tariffied, where we dive into international trade risks, how to deal with those risks in your commercial agreements, and what to do if things go wrong. I'm Tatiana Sainati, head of Global Disputes at Wiley Rein, and joined by my co-host Matt Lapin, special counsel in our International Trade practice. This week, we're also excited to welcome a special guest, Jessica Horwitz, a partner at Bennett Jones in Ontario. Welcome, Jessica.

Jessica Horwitz: Thank you for having me.

Matt Lapin: Great to have you, Jessica. Over the next few weeks, we're going to be bouncing around the world looking at some different types of international trade risks that are impacting global supply chains.

Tatiana: And we're particularly glad to have Jessica's insights on this episode because this time we're going to be looking at trade issues, [00:01:00] and specifically tariffs, between the U.S. and Canada and how those have impacted business relations and supply chains. Now, in some ways, it's pretty surprising that we are in a situation where we can devote a full episode to Canada and the United States. When you work with global supply chains or deal in cross-border transactions, you can always anticipate a degree of risk, and some countries and regions come with a significantly greater degree of risk and uncertainty because of geopolitical tensions or political instability. But historically, Canada hasn't been a source of a lot of those concerns. We've enjoyed a pretty stable relationship, political and otherwise, with Canada over the decades. There's been a lot of trust between the countries historically. So, Matt, I'm curious, how would you describe U.S.-Canada trade issues pre-2025?

Matt: I'll let Jessica give your perspective first.

Jessica: Sure, well, I mean there's always issues, especially with lawyers, we're very good at finding issues, there's things to talk about. But historically, no, it's been [00:02:00] a very stable and longstanding economic and trading and geopolitical relationship between Canada and the U.S. for a very long time. Largest undefended land border in the world, heavily integrated supply chains dating back decades due to longstanding trade policy and cooperation treaties between the two countries. So you have stemming back to the post-war era of the 1950s and the 1960s, we had the Auto Pact in 1965 that started the integration of the Canada-U.S. auto supply chains. So that's part of the explanation, why it's so difficult to disentangle those supply chains on short notice right now. We've had longstanding defense and national security cooperation, both fighting together in past wars. Canada is a member of NATO with the United States, Canada is a member of [00:03:00] NORAD with the United States for joint northern defense.

We're the country that has the longest-standing ITAR exemption. And of course, we've had the Canada-U.S. Free Trade Agreement since the late eighties, the NAFTA since the nineties. And so there really hasn't been very many tariffs between the two countries, and there has been less administrative burden with respect to trade between the two countries because of a customs import data sharing arrangement. That means that there's no export declarations required when you're shipping things from Canada to the US and vice versa because the customs authority share import data with each other. So it's been very smooth, right? Very low friction, very easy. And that's why we have developed supply chains that are so integrated. We have companies that are sending products temporarily across the border for some further processing and the products can cross the border multiple times before they're finished and go to an end customer. And those types of supply chains [00:04:00] are obviously heavily dependent on the fact that there are no costs associated with crossing the border every time you cross. So what we've been seeing in the last 10 months or so has been extremely disruptive to those longstanding relationships and part of the reason why Canada in particular has been shocked by the developments.

Tatiana: But Canadians are nice, Matt, so I'd expect Jessica to say, yeah, everything was hunky-dory. Is that the American perspective as well?

Matt: I mean, I think broadly that is the key point that I wanted to touch on that I'm glad you raised, which is going to definitely feature in our discussion here, is that integration because the fact that there has been this longstanding, relatively frictionless environment, trade environment, from both an export and an import perspective, U.S. and Canadian side, with a few exceptions. We know there are some sectoral areas where, just like every country, we have our specific interests, whether it be steel or agriculture [00:05:00] or others, but broadly—

Jessica: Soft-wood lumber.

Matt: Lumber, the very first trade matter that I ever heard of, before I even knew what any trade matters were as a baby lawyer, that has been around forever. But despite those exceptions, because of this relatively frictionless environment, that's one of the interesting things is when you have this integrated supply chain, it does create different sorts of risks when suddenly that friction appears. And that's I think what'll be interesting to now talk about is okay, when you go on from a relatively frictionless environment, a very integrated supply chain, which again, we can't say for every other relationship around the world, what happens then when you introduce these risks, these new frictions into that environment? And that's where I think some of these questions we're now going to talk through. It's a very interesting discussion to have because sort of unique in many ways.

Tatiana: So we have an extremely stable and cordial, actually, almost sounds like a deep friendship in terms of the historical relationship between the [00:06:00] countries, but that's not where we are now. Jessica, I think the word you used was shocked. How has the relationship evolved in the past 10 months or so? Where are we now?

Matt: Well, maybe I can just start with some of the practicalities, and Jessica, obviously, your perspective as well. But what we've seen obviously is, I think one of us suggested is we use the magic word tariffs, is that now where we were in a relatively tariff free environment or very low tariff environment, that being a big element of friction, we are now in the era of tariffs and many of those tariffs are ones that either did not previously even exist. For instance, the border tariffs that were applied against Mexico and Canada specifically, no other countries had these specific tariffs applied against them with certain exceptions. We can talk about what that means practically, but that all of a sudden introduced this year, never had been even on the map before. So again, now you have a brand new friction that it never even existed. Adding on top of that targeted actions or [00:07:00] at least statements that have been made by the administration about particular sectors, bringing this into now the realm of national security and talking about border security as now an element of tariff policy and trade policy, which was never really a piece of the U.S.-Canada relationship.

And then adding on to the fact that, as we'll touch on the end, there is now this ongoing USMCA, now the subsequent agreement from NAFTA, I guess we call it a renewal or review that is going to be going on. So all of that new friction adding into that process as well. This is a whole new environment for I think a lot of U.S. and Canadian companies that are operating internationally that is essentially bespoke for the last few months. This wasn't, none of these risks were ones that were really, from my perspective, at least from a lot of my clients, even on their radar as potential issues. And now they've been thrust forefront. But I don't know, Jessica, what's your take on it?

Jessica: I think that there was not an expectation that [00:08:00] President Trump would go after Canada and Mexico first. To your point, he was very clear about tariffs being a major part of his economic policy and his international policy, but you would've thought maybe the targets would be other trading partners that were more contentious relationships. So that was surprising and I think it caught a lot of the Canadian economy, a little bit off guard. There was I think some expectation that there might be some tariffs on some of the same higher sensitivity product categories that we saw in 2018, 2019, steel and aluminum. That wasn't as much of a surprise, but I do think that it's been surprising how long it's persisted. I think Canada maybe thought that we would be able to negotiate a resolution to it, the way that we did in 2018, and that hasn't been the case. And so as opposed to focusing on trying to achieve a short-term resolution by negotiation or diplomacy, [00:09:00] I think Canadian businesses are starting to pivot and starting to think about, okay, well if these are going to be around for a while, how do we adapt to this new reality and then being forced to make some strategic decisions to go forward with the business.

Matt: That'll be an interesting point to come back to again, is the changing supply chains, right? Because, obviously from the U.S. perspective, same, if companies need to look at the current environment and if the environment appears to be now baked in, at least at minimum an uncertain tariff and trade environment, if not one that's going to have a lot more friction long-term. We do certainly have a lot of businesses that are saying, okay, well then we need to reexamine what our supply chains look like, potentially looking at new partners or even keeping similar partners, but on different terms, which I think again, that will definitely feed into our discussion about, well, what do you do if that's the business decision you're going to make?

Tatiana: Well, exactly how are your companies going about that? I mean, Jessica, you spoke about deeply integrated supply chains, historically [00:10:00] integrated supply chains. Now we've got tariffs on a lot of those goods. That's certainly increasing costs in unexpected ways. I'm sure there are other issues as well that companies are now having to think about that they didn't have to think about before when it comes to cross-border trade between Canada and the United States. So what are the biggest issues that you guys are seeing, and how are companies addressing those risks?

Matt: I'll let our guest chime in there first.

Jessica: Sure. Well, I think the biggest risk is just the lack of certainty and the unknown because businesses hate uncertainty. Businesses like predictability, reliability, clear-cut rules because that allows businesses to make informed strategic, long-term investment decisions and operational decisions. And when you don't know what the landscape and the circumstances are going to look like 24 hours from now, much less six months or several years [00:11:00] from now, it's really challenging to plan. But I don't think that's a risk that businesses are unaware of. So that's really the challenge, it's how do you remain nimble? How do you diversify to insulate yourself from those shocks and from the vulnerability that comes with heavy integration and heavy dependence on just one supplier or just one customer or a very small group of them.

Matt: And that's one thing I touched on it before and I'll come back to it, thank you for teeing it up perfectly for me again, which is this question of diversification because I certainly have plenty of clients who are in this space of, they may not be ready to move on from obviously a very substantial market right next door, they're going to continue working either on the customer facing side or as suppliers with their Canadian colleagues, not going to go away. Many times, what we would see is we've had the same supplier for 30 years, we've had for one part, and they're the only ones that we use. We've only ever used [00:12:00] them, and that's going to be our supply or our major customer. They're 60% of our business and we really haven't spent a lot of time on diversifying our customer base for this one product line because we've got that customer and they're based in Canada, no issues, fine.

Now, we're not maybe in that environment, where they are now looking at, okay, if we now need to start thinking more nimbly, what does that practically mean? What does it mean in terms of qualifying new suppliers, conducting due diligence on them, establishing terms on maybe a supply agreement that nobody's looked at for 30 years, because it was "kumbaya era" and we had our supply agreement that had terms that were good in 1985, and they're fine now. Same thing on the customer side. So that's I think one of the risks that I think people aren't appreciating in terms of needing to think about is the "inertia risk" as I call it, is that they've been able to have a certain amount of inertia in their risk management, whether that be in just the relationship building they have with their suppliers or their customers or in the actual, getting to the boring legal stuff for them, the [00:13:00] contractual terms that they may be working under where they just haven't had to really think about it and now they're being put into a position of having to now think about it and bring these things up to date for the current environment.

So I think that's a risk they're not thinking about necessarily.

Jessica: Yeah, absolutely. And from Canada's perspective, there has been a lot of complacency with respect to the dependence of our economy on the United States. Canada, we're a relatively small country. We are heavily dependent on exports to support our GDP. We're dependent on foreign direct investment for investment in large infrastructure projects. And 75% of our exports historically have gone to the United States. I saw a statistic that the trade with the United States supports one in six jobs in Canada, and it represents about 20% of Canada's GDP. So that's a huge impact on the economy if that relationship is threatened, as it is now. And we were comfortable with that dependence [00:14:00] because we trusted the U.S. We had such a good track record of partnership that it really was not considered to be a very high risk, which obviously was not the right assumption to make. And so I think that if there is a silver lining in this period in history, it is showing Canadian businesses and Canadian policymakers that there is value in going beyond the low-hanging fruit of the huge, profitable, wealthy U.S. customer market and trying to actually grow the trade relationship with other partners.

So just to give you an idea, the U.S. is about 75% of exports, the next largest export market, I believe is China at about 4%. And then beyond that, it's just really diversified. A lot of trading partners with very small, less than a percent share of Canada's exports. So the U.S. is going to be difficult to replace, but it will be to the benefit of the Canadian [00:15:00] economy to do that, but also with diversification. So, to your point, Matt, about multiple suppliers, using one supplier that's highly specialized, using one customer that relies on you in the same way, with diversification is going to be a loss of efficiency. So there are going to be additional costs associated with that across supply chains because the whole principle underpinning globalization is this idea of competitive advantage, the economic principle that if countries can specialize in producing the goods or the services that they are best suited to produce the most efficiently, and then they outsource the economic activities that they're less efficient at to other countries that are more efficient at it, you grow the pie for everybody.

You grow the pie internationally, everybody becomes more efficient, everybody reduces costs, and you can create more economic wealth. And so if you pull back on that specialization, there is going [00:16:00] to be some loss, right? There's going to be some additional costs and just reduced efficiency because you have to engage in more types of economic activities than maybe you did in the past. Or in the supplier context, you'll have to maintain relationships with multiple suppliers. And so maybe you're buying only one container of goods from a particular supplier instead of three, and then maybe you're paying a slightly higher cost to each supplier because you don't get the same bulk discounts that you were getting before, because you had that huge volume that was concentrated. So adjusting to the cost-benefit analysis to build in an accommodation for increased costs, for decreased risks, is going to be something that businesses will contend with on inventory, too.

A lot of companies, especially in Canada, use just-in-time delivery models for sourcing materials and merchandise. When we need [00:17:00] shipments, we're running out of our supplies, let's just order it from our supplier in the United States, right across the border in Michigan, and it'll be there the next day, right? You put it on a truck, it's there the next day. You don't have to hold inventory; you don't have the costs associated with having to stockpile a certain number of months of materials because you know that it's available. And in an environment where you can't rely on that certainty, the cost will go up as well.

Tatiana: Well, Matt, you alluded to this a little, and I think it gets to some of what you were saying earlier on, Jessica. For a long time, this was just a stable relationship that you could depend on their efficiencies that go along with that. But there's also maybe a little bit of complacency that goes along with that too. And whether it's tariffs or we saw several years ago, COVID, something that's outside of everyone's control, there are always going to be risks, and what are the best ways that we can manage those risks? I think [00:18:00] some of them, again, Matt alluding to contract dispute resolution mechanisms in your contracts, like to what extent, when you're either revisiting your existing relationships or looking at what are these new relationships going to be? To what extent can you create in those inter-party relationships stability that maybe is lacking or elusive right now, given everything that is changing in the global world order? And that's something that we'll get into in more detail in later episodes. But that leads me to another question for both of you, which is this the new normal? Or are we going to see things continue to change?

Matt: I mean, what is normal, but who knows? But no, in all seriousness, I mean, again, I'll give my perspective, love to hear Jessica's as well. My take on this and what I've been sort of preaching to clients is probably very similar to what you actually were just talking about, Jessica, is that, [00:19:00] to the extent that you had a period of time where things were extremely stable, we do appear to be entering a different era. And we have been creeping that way for a long time. Maybe we've just hit the accelerator on that right now. But we seem to have been creeping in this direction for some time, of less stability, less sort of frictionless global interactions, whether they be on physical trade, digital trade, whatever it may be. We seem to be moving to a more fragmented environment. So with that in mind then, if that's what people should be envisioning that the past 30 or 40 years that maybe they set these relationships up with the prior era and this new era of instability, there are just certain basic things that again, may have been more common for say, a really strange trade relationship they might've had with some small supplier in Vietnam or Angola or wherever it may be, for some specific item where, well, that was very unique, and then we're [00:20:00] going to take a higher risk approach.

We're going to do some special things for that relationship. But everywhere else in the world, we're just going to kind of go about our business as we always had. We may be shifting now. So my advice is those things that you were doing in those one-off relationships that you thought were uniquely high risk for some reason, whether that be supply constraints or geopolitical risk or corruption risk or whatever it may be, start thinking about those and bringing those into your broader set of supply chain commercial agreements, whether supplier side or commercial side, because those were reflecting risk and now that risk that you thought was just off on the margins may now be part of just your day-to-day business. So that's kind of how I've been preaching to the client base. But I'm curious, what's been your take on that?

Jessica: Well, expect the unexpected, I think is the theme that everyone's taking away from this. After the pandemic, you started to see global pandemic sneak its way into force majeure clauses, boilerplate force majeure [00:21:00] clauses, in contract. So, whereas before it would've said Act of God, natural disaster, war, global pandemic is—

Matt: And sanctions. You see sanctions in there now, too.

Jessica: Or sanctions in there now, that makes the performance of the contract impossible. That wasn't something that people really thought was likely before. And so suddenly, now that's in there as boilerplate. And I think what we're going to start seeing is a boilerplate on tariffs and more intentional distribution of the risk, the financial risk associated with changes in tariffs, whether it's one party accepting with their eyes open, the full brunt of that risk, or if it's some kind of a price adjustment clause where either the vendor pushes that increased cost back on its customer. If there was some kind of material change in tariff rates or tax rates between the time of the purchase order being placed and the time of the delivery of the goods, or maybe it's a cost sharing arrangement where the vendor and the [00:22:00] purchaser agree to split the cost or apportion it in some fair way or rights of termination, that if it turns out that the sale's not going to be profitable after all because you have an extra 25% tariff that you have to pay on the product, do you have a right to terminate it? Right? And navigating with both parties with their eyes open, what those eventualities will look like. People actually opening up the Incoterms book and looking at what the Incoterms actually mean that they're agreeing to when they put a DDP or an FOB or a CIF in their purchase order, what does that actually mean?

Matt: For the true trade nerds listening to this podcast, you'll love that.

Tatiana: And for those who aren't—Incoterms are the shipping terms?

Matt: Yes, shipment terms.

Tatiana: Nailed it!

Matt: Globally agreed to shipment terms that are generally agreed to by parties around the world that have certain meanings in terms of where risk-of-loss is borne, who pays for certain portions of the shipment process, who's responsible for clearance, all which are very relevant to trade risk related to [00:23:00] tariffs potentially. And again, to the point of risk-sharing, cost-sharing allocation, it's a point that for years people would just kind of see whatever we've used for the last 30 years, that's the Incoterm, it's fine, we're not going to worry about it. And now we're actually seeing many more clients, and to the extent they're not, they should be inquiring and having real discussions both with their commercial parties or with their council about, okay, what should we be using? What makes sense given where we're at in terms of our trade relationship, given the risk and the uncertainty. So yeah, I think that's a perfect example of something to take another look at.

Jessica: And just awareness of the fact that Incoterms are not simply a specification of where the goods are delivered, because that's a commonly held misperception, is that, if I say FOB, it just means you're going to pick it up at my port of export or at my factory. But it's more than that, right? As you said, it's the apportionment of risk. It's who has to buy insurance for the goods at various different legs. It's who has to pay the customs duties on the import, who has to manage those clearances? So it's a whole suite [00:24:00] of terms that is incorporated by reference into the sale agreement. And I think it's a good thing that companies are paying more attention to the specifics of what that means, because again, it goes to the going into a contract with your eyes open and knowing what you're agreeing to.

Tatiana: Well, so it sounds like change may be the new normal, but that there are some ways to address the risks that come with uncertainty or at least to appraise those risks with eyes wide open and figure out how you want to deal with them. What about rewards? Are you guys seeing any opportunities in all of this flux?

Matt: Well, I think Jessica mentioned silver lining. Obviously, there's challenges that businesses are facing right now that aren't going to go away, and that's I think going to be a consistent theme of uncertainty and having to change your business model. But in some ways it's facilitated some interesting discussions, which I think they're hard discussions in some cases, particularly for companies that have been, as you say, very kind of static or been not very, I would say creative necessarily [00:25:00] in evaluating their supply chains or their customer base. But it has driven, I think we've seen a lot of companies rather than simply abandon international supply chains, really just thinking more critically about their business there and maybe being a bit better about targeting where they want to work, where they don't want to work, diversification across their supply chains. So not necessarily moving away from operating internationally, which I think was one of the fears that, I mean many of us had when we were moving into this uncertain market.

Does this just mean that the walls go up and nobody's trading with anybody anymore? I don't think that's what we're going to see. It's certainly not what I'm seeing. What I'm seeing is more thoughtful and quite honestly heartening for myself as a trade nerd is to see the elevation of supply chain professionals, the elevation of trade professionals, the elevation of people who may have always had a little bit of a say in the business world, but now have been really put front and center as people who really do understand the way this works on the ground day to day, moving [00:26:00] things tens of thousands of miles around the world, and having that and the knowledge of those people be front and center in terms of business relationships. I think that's actually really a positive that I hope is retained even if we move out of a cycle of current uncertainty. So that's my silver lining and opportunity that I see.

Jessica: Wait, you're preaching to the choir, Matt, because you and I are both compliance counsel that have been proselytizing to our clients for years about the importance of reviewing your tariff classification, reviewing your origin, make sure your declarations board or your certifications of origin are actually consistent with the rules of origin that apply to that product. Suddenly, members of C-Suite know what the terms tariff classification and rules of origin mean, which might not have been the case last year. So the fact that companies are more receptive to the importance of trade compliance and understand the importance of investing in that area as opposed to treating it as [00:27:00] an afterthought. I absolutely would agree with you. In Canada, I would also say that towards the diversification initiative, which generally I agree with you, is hopefully a silver lining, although we don't want to diversify too much because you run into that inefficiency issue that I mentioned before.

But we are seeing political will in Canada to invest in some major infrastructure projects that are really long overdue, that will help Canada to diversify and to get its products to other markets. So things like new oil and gas pipelines, new ports, marine ports, just better transportation infrastructure. These are really important things that have been constraints to Canada's ability to profitably and efficiently export the goods that it has to places other than the United States because the U.S. is right there. The U.S. is the only country that we can deliver to over land, the rest is marine or air. [00:28:00] And so there's different complications associated with that. So developing out that infrastructure that makes those things easier, I think will be helpful in the long term. And you're absolutely right that the walls are not going to go up because the reality is that very few countries in the world have everything that they need domestically. Canada might be actually one of the best positioned ones because we do have a lot of what the world wants domestically. You can't just have a “Castle United States” or “Castle Canada” in isolation. And so it's really about, from a trade policy perspective, how the politicians are going to navigate the different sensitivities and come to an agreement that's at least sustainable, if not one that makes everybody perfectly happy. And then for businesses, how do we just navigate this new playing field responsibly, balancing compliance and due diligence with efficiency and cost reduction?

Tatiana: Well, so it sounds like a shakeup in a [00:29:00] historically steady relationship did send some shockwaves, but is leading to greater sophistication and approaches to supply chains and diligence and hopefully to greater resilience for businesses, specifically individually, but also maybe for markets overall. And that's thanks in part to the expert guidance and advice of professionals like both of you to your clients.

Matt: Excellent plug there. Appreciate that.

Tatiana: Very subtle, right? So thank you all for joining us and we hope you'll listen in again next month when we'll have another special guest to understand the risks and rewards of changing trade dynamics from an EU perspective. And Jessica, thank you so much again for joining us.

Matt: Yeah, great having you on.

Jessica: It was great fun. Thank you. Despite what's going on, I still consider us to be friends.

Tatiana: Same.

Matt: Yep. Even with the World Series loss, sorry.

Jessica: We're still hurting a little bit over that. Too soon.

Tatiana: I don't sports.

Matt: It's probably for the best. Thanks again, Jessica. Appreciate it.

Jessica: Thank you.

Trade Disputes Unpacked

September 12, 2025

In the premiere episode of Never Tariffied, Wiley partner Tatiana Sainati and special counsel Matt Lapin tackle the trillion-dollar question: what can businesses actually do to help navigate the current unpredictable international trade environment?

From shifting tariffs and regulatory shakeups to disrupted supply chains, they unpack how recent policy changes are part of broader global trends, why uncertainty has become the new normal, and how this new environment is impacting international business. Join the discussion to discover practical strategies for spotting and mitigating risks in commercial agreements and how to keep your business ready to tackle potential issues with international suppliers and customers.

Transcript

Matt Lapin: It's April 2nd, 2025. You're the Chief Legal Officer for a growing precision electronic components manufacturer. Your company's been through some tough business cycles over the past few years. COVID supply chain breakdowns, big tariffs on your imports from China, and general geopolitical chaos have all created some major challenges in your supply of printed circuit boards that you need for your products. But after some restructuring of its operations, your long-term supplier in China successfully stood up a Vietnamese manufacturing operation. Things have been running pretty smoothly of late with no supply interruptions and consistent pricing. Business has been ticking up and your head of sales recently made a presentation on a new opportunity with a luxury auto manufacturer. And then the emails begin hitting your inbox. Sales: Did you see the new tariffs? [00:01:00] Procurement: 46% for Vietnam? Your CEO: What are these tariffs going to mean for us? From your prospective automotive industry customer: Do you see any issues with your ability to meet our production forecasts? Then, later that night, the coup de grâce from your supplier: We would like to discuss the current terms of our supply agreement. So now what?

Welcome to Never Tariffied, where we'll talk international trade risks, how to deal with those risks in your commercial agreements, and what to do if things go wrong anyway.

Tatiana Sainati: I'm Tatiana Sainati, a partner in Wiley's Global Disputes practice.

Matt: And I'm Matt Lapin, [00:02:00] special counsel in our International Trade practice.

Tatiana: So Matt, I think you guys have been pretty busy recently because of some policy shifts or changes in terms of how we're approaching our trade agreements and how we're thinking about free trade more generally. What's going on?

Matt: Well, that's the million-dollar question, or perhaps the trillion-dollar question, that we're all going to be dealing with for the near future. Yes, big shifts are happening and have been happening. That's one thing I think it's important for everybody to think about is that what we're seeing now with the US and around the world is part of a broader trend. This isn't brand new. Going back to 2016, and even before, we started to see some changes to the "everything is globalized, the supply chains are global" model. That was a great model. It worked well for everyone, I think, in business for many years at least. That was the perception. But then, over time, we started to see some cracks in that, and those cracks have been getting bigger. [00:03:00] And then I think certainly with the first Trump Administration and pretty consistently even through the Biden Administration and now into this second Trump Administration, those cracks have become canyons. And that's where we're at now. Trade risks are everywhere. Tariffs, export controls, supply chain restrictions, you name it, businesses are facing it. And now we're all trying to understand what comes next.

Tatiana: And part of the context right now really does seem like there's just uncertainty almost baked in. Is that something that you're hearing from any clients? Or any concerns about, we just don't know what's going to happen next? We get the sense that things are shifting from that kumbaya, everything-is-global, everything-is-free-and-fair-trade-all-the-time. But what is the new normal?

Matt: I think that is exactly right. We all wake up in the morning and decide to open our browsers, look at our phones, and figure out what's happening today. Because [00:04:00] that is the reality is that it is an uncertain environment. Again, not just because of what US policy is, because more broadly, countries around the world have decided that they are reexamining their policies and their regulations, and businesses themselves are reexamining their supply chains. That means real-time changes, that means day-to-day changes in how goods are being moved, how they're being regulated, how they're being brought in and out of countries. And that breeds, as you said, baked-in uncertainty.

Tatiana: Are there any trends that you are seeing or any certainties that can be found or predictions that you think are safe to make? Or is it really just we're in a moment where it's all kind of up in the air?

Matt: I mean, I have my magic eight ball. I keep it on my desk. Sometimes we shake it, sometimes we don't. But if we're not using the magic eight ball and we're trying to identify actual trends, and I hesitate to call them predictions, but forecasts for what we might see, [00:05:00] I think what we definitely do see is more regional trading blocks, meaning we're seeing more regional, whether bilateral, even, as the US is definitely trying to negotiate lots of different bilateral trade deals with individual countries. Other countries are looking beyond that to maybe cut their own deals in their own regional groups. So that's one trend that we're seeing that's going to have some real-world impact on supply chains. It does mean that you're going to see more differentiation, differentiation in pricing, differentiation in regulation, differentiation in just how your goods are being treated as they're moving through a global supply chain from one country to another. That trend has already started before the current U.S. administration. It's now being accelerated. We don't see that going anywhere, anytime soon. So that's a big one.

Tatiana: Interesting. And so that sounds like, for our hypothetical in-house council that you introduced in the monologue at the very beginning of our episode, part of his or her job now involves just staying on top of a [00:06:00] lot more information than it used to.

Matt: Yeah, it's a different job than you probably had a few years ago, certainly back when I was in-house counsel 10 years ago. Now it's not just digesting the latest information from your internal team, who's telling you things about sales forecasts, talking about supply agreements, but it's now understanding it in the context of geopolitical risk, understanding it in the context of changing regulations every day, every week, et cetera. And what that means is for that job, day-to-day, it means being able to one, digest all that information. But two, and this is what we're going to spend some time talking about, is break that down into what the real risks for your business are because they're going to be different for different industries, different supply chains, depending on what countries they move through, and ultimately, for what your risk tolerance is. So that's going to be a big new chunk of work for a lot of legal officers, executives, and just line folks working in a business that they previously didn't have to spend that much time on.

Tatiana: [00:07:00] It seems like right now a lot of what is happening in various companies, organizations, policy arenas, is just trying to wrap our collective arms around the situation and what this new normal is, where it is heading, what tariffs are here to stay, what countries are going to be safe ones to include in our supply chain, which tariffs are just negotiating tools, which countries are going to be kicked back out of a supply chain. Are you seeing any writing on the wall that we're heading towards situations where there's just going to be disputes, commercial disputes, that those are just coming? Or do you think that's still kind of far off in the future?

Matt: No, I think what we see is the coming tide because many of these things, disputes of this nature, take time to evolve, right? Most times, companies do try to work out their commercial relationships. They may have pricing changes, they may have sourcing changes, they [00:08:00] may have various things that just are the normal course, even outside of our current scenario we're talking about. And they're used to working on those, particularly when they have long-term agreements. But there are breaking points in any arrangement. There are breaking points, particularly where your agreements that you may have signed with your customers or your suppliers go back 5, 10, 15, 20 years, when this was a different landscape. Like you said, kumbaya, you drafted that contract under the "kumbaya conditions." We're not in those conditions anymore. So what we are seeing is this slow move and this slow-moving tide of more disputes that are at least being raised, attempts to work them out.

But as these tariffs, as these export controls, as these import restrictions, as these various regulations and policies become more firmed up, because we're still in this little bit of an age of figuring it out, then those are going to become set. And as those become set, the disputes then become more likely to not be able to be worked out. [00:09:00] So that's what we are starting to see, and we are starting to see it in certain sectors. Obviously, the sectors that have been hit hardest, fastest, and certain supply chains, China, Southeast Asia is good examples where you are starting to see these disputes become real more quickly versus things that can be worked out.

Tatiana: What are some of the sectors that you are seeing are hardest hit? Are they all the ones we'd imagine or are there any that are somewhat surprising?

Matt: I mean, I think some of the ones that have been more surprising have been ones where it's multiple layers downstream. So, for instance, like in the electronics sector, it's not a surprise that given the relationships now that have become very challenging with the major electronics supply chain of the world, which is China and Southeast Asia. But what we often have forgotten, I think we're all getting our arms around now, is there's chips in everything. There are electronics in everything. As you move 1, 2, 3, 4, 5 layers down the chain, [00:10:00] things from bowling alleys to sporting goods to washing machines, to obviously your phones, computers, they all contain those chips. And you're starting to see disputes issues amongst suppliers, customers, and ultimately downstream end users starting to pop up in areas that you wouldn't have expected because a sector such as chips has become so important and targeted that it's impacted this much broader set of companies than I think any of us would've thought about and anticipated five years ago.

Tatiana: That's really interesting. Now we're calling our podcast Never Tariffied, which, if I may say so, is a very clever name.

Matt: We love our puns, and we're going to ride them into the ground if we have to.

Tatiana: Yes, we absolutely are. If we have to, we should. But this isn't just about tariffs, right? There's a lot more regulatory uncertainty and just global uncertainty. Can you talk a little bit about some of those [00:11:00] things beyond tariffs?

Matt: Absolutely. Tariffs are obviously the word of the day, the word of the month, the word of the administration. But as we all know, if we're working in this space, and really if you talk to anybody who works in international business, as I said, this has been a slow-moving change to the way the international environment worked 10, 20 years ago, where national security is economic security. That's one of the other buzzwords you hear. And what that oftentimes means is that regulations that were not previously used for national security, economic security purposes, or were pretty well confined again to certain industries, such as I mentioned, export controls, import restrictions on certain types of technology, have now blown up into much larger regulatory spaces, touching way more industries and being used in ways that I think previously folks in legal profession and folks in business just hadn't really experienced.

So now you're seeing this whole suite of measures, tariffs, export controls, [00:12:00] sanctions, technology restrictions across the board being used together. Now, the U.S. is certainly, I think, leading the charge in many of these areas, but other jurisdictions, particularly large influential jurisdictions, whether it's China, the EU, are also looking at similar policy choices because again, they're viewing their economic policy as part of their national security policy. And that opens it up to a whole new set of regulations, a whole new set of risks that I think businesses, again, have not thought about or had to think about as broadly as they do now, which now of course brings us to why we're here.

Tatiana: Exactly. Well, and yet another reminder that for our in-house friends, this is not just about keeping an eye on or your finger on the pulse of multiple different negotiations and restructurings of relationships in terms of bilateral, multilateral treaties and trade agreements and all of that good stuff, but also [00:13:00] on the pulse of all different industries and sectors that may not initially have seemed like ones that you needed to stay abreast of what's going on with those areas. I'm curious, we talked a little bit about chips, for example, and the downstream effect that something like a chip can have on all of these industries, even layers kind of down the supply chain. Are you seeing anything in terms of the countries where the raw materials come from? Are we going to run into any issues, either with tariffs or export controls or anything else, in some of the regions where we're actually mining for extracting the raw goods that go into this stuff?

Matt: Absolutely. That is, I think in some ways the logical extension of a lot of these policies is we are now seeing a pretty consistent view, again, from the U.S., but I will give an example of China as well, that's a good one, where the view is that, well, if we [00:14:00] are originating these items, then we have the ability to control the supply chain. And there are many examples of this. I mean, we can certainly look at this on the tariff side in terms of steel and aluminum and how U.S. tariffs on steel aluminum, which are a constituent material for a lot of stuff all the way downstream have been used as an important policy tool by this administration, both to support the U.S. steel industry and U.S. metals industry, but also as a policy tool for, I would say some trade leverage over countries that are consumers of that.

So there's certainly that example. The China example I gave is a great one because it is the most direct one I think we can see right now, where in response to a lot of the tariff measures that the US has taken recently, China took a very strong step in cutting off—or at least significantly regulating, is the way they would put it—exports of critical minerals and rare earth minerals and materials [00:15:00] that are essential to make all kinds of stuff, including chips. And those are both examples of very upfront efforts to regulate supply of essentially raw materials, constituent materials. But there are others. The U.S. has also taken a very strong stance on forced labor recently, along with a lot of other countries in the last few years. Part of that has been looking all the way down into supply chains to constituent materials like silica, like cotton, that have been viewed as potential sources or vectors of forced labor.

Well, that now impacts the ability to import those goods. Even if you're going five, six layers down the chain of transformation into a shirt or into a solar wafer that is being imported, the import of that good is now going to be restricted potentially because of the involvement of forced labor downstream. So again, another example of how those materials, all the way down to the picking of cotton, to the mining of ore, [00:16:00] to pulling other materials out of the earth, those all potentially have the ability to impact your supply chain and therefore create new risks.

Tatiana: Well, one thing is clear. This is a period of unprecedented change and uncertainty, and it's helpful in periods of unprecedented change and uncertainty to feel a sense, an ability to control as much as you possibly can. And so I want to foreshadow maybe a little bit what we'll be discussing in future episodes of this podcast, but Matt, do you think it's right that our clients don't need to be terrified that there are ways through?

Matt: Exactly. And see, I knew the pun would work its way back around. Exactly. Never terrified, because there are ways to manage your risk, right? That's what we're always preaching to our clients, right? This is part of the job, but this is also [00:17:00] part of the risk calculus that I think businesses are used to taking every day, in that they're looking at what their risks are for their industry sector, for their business, and for their specific supply chains. And the way they manage that very often is through the agreements themselves, and then also how they then manage the relationships through those agreements. So this is not a new concept for businesses. And again, I think in every industry there are certain benchmarks for how they tend to structure agreements, how they tend to structure their customer relationships, their supply relationships. So that's all something that they have a good baseline for.

We would definitely, I think, regularly talk to our clients where they have a good starting point. So it's not a question of creating things from whole cloth, saying we don't know how to manage any of this. That does happen every now and then, in which case we offer them as much help as we can. But oftentimes it's a question of looking at what you've got, assessing where you're at in terms of that "kumbaya-era" [00:18:00] contract that you signed with a supplier or a customer, and then gauging it against the risks that are specific to your industry, to your supply chain, to where you operate, to the geopolitics, whatever it may be that's impacting your supply chain, your customer relationship. And then truing this up, what does your contract look like versus what it maybe could look like if it was addressing risks, A, B, C, D?

Tatiana: So assuming you've done that, Matt, what comes next?

Matt: Assuming we've done the work, either you've done the work or we've helped you do the work of identifying what those risks that are real for your business are, and that you've either addressed in part or in full, what are the gaps? And if we've got those gaps, we've identified them, what comes next? I really view it as kind of a two-step process. One is we're going to help you try and fill those gaps, obviously, whether it's through contractual language, whether it's through actual negotiation, further [00:19:00] negotiation with your suppliers or your customers, whether it's training your internal staff on how to spot changes to risks, what they should be looking for, what issues they should be trying to identify when, who to involve at what time. So that's one piece of it. But then I think the other piece of it, which is definitely where I think you're going to get to shine in particular, is, well, what happens if none of that saves the day? To already have a bit of a plan, to already have a little bit of an idea of how you would address a relationship that simply cannot be solved through the contract, and what comes next.

And I think having a plan and already thinking about that upfront, as part of your broader relook at your commercial relationships, is always the way to go, because then you're going to be much less terrified.

Tatiana: Which is why, if I may, it's so important, and I'm so grateful to have such good, collaborative relationship with people like you [00:20:00] in our trade team, because I think that we can work together extremely closely and extremely well to share that kind of expertise on the, well, what is happening in the trade sphere? What is happening with export controls? Where are these gaps? What are our clients worried about? And then we can come in and have a proactive plan for, okay, from a global disputes perspective, when we see these things coming to fruition, how are we going to take what we've done in the past to resolve these issues successfully for our clients in this new era and have that plan in place?

Matt: I think that's definitely the way to think about it. And maybe one more plug for my beleaguered in-house counsel colleagues and former brethren is doing the same thing internally with your internal teams. So again, bringing in folks from your supply chain team, bringing in folks from your legal team, bringing in folks from your finance teams as early as possible to look at these risks. These aren't just legal risks, obviously. These are commercial risks, legal risks, political risks. They're all tied together. And having [00:21:00] a cross-functional team that is already stood up and already looking at these, which I know a lot of our clients have done a great job with, but if you haven't yet, now's the time to do it.

Tatiana: To sum up, we are living through a sea change in terms of how, not just the United States, but countries and economic blocks internationally are thinking about trade or thinking about the intersections between economic policies and national security. And that's having a ripple effect across industries, but it's not entirely unprecedented. There have been periods of great change and uncertainty in the past, and we can draw on the lessons from the past, draw on our expertise in terms of these various trade policies and trade remedies, and dealing with supply chain disturbances and disputes, to create ways to fill gaps, identify risks, and have a strong plan in place so that our clients don't need to be terrified. [00:22:00] And then we'll stop. So I hope everyone who is listening will stay tuned for our upcoming episodes when we discuss key trade policy risks, how they are manifesting in international agreements, and what can happen if you fail to identify and account for them upfront; how to close the gaps created by geopolitical uncertainty by creating your own set of rules; sticking points in cross border negotiations and how to cut through them; and when tariff disputes give rise to treaty claims, how to preserve your rights, and how to structure your investments to take advantage of treaty protections.

And Matt, I'm pretty excited. I think we'll be having some interesting guests from colleagues and friends overseas to get a truly international perspective on how some of this might shake out and how our clients can be best prepared.

Matt: Definitely. I look forward to getting to listen to other people talk.

Tatiana: I enjoy hearing you talk, and it's really been interesting to chat with you about this today.

Matt: Great—look forward to it.

Tatiana: All right. Until then, we hope to see you all next time.