Washington lawyers and accountants are bracing for a fortune in fees as companies prepare for tariffs, export controls and the possibility of trade wars under Donald Trump.
In his first term, Trump catapulted the international community trade policy from a dry economic backwater to one of the most high-profile jobs in Washington as he hit America’s trading partners with high tariffs and forced companies to reorganize global supply chains.
Four years later, people are ready for more of the same.
“I told my colleagues – we’re bringing sexiness back into the store,” said Nicole Bivens Collinson, managing director of the law firm Sandler, Travis & Rosenberg.
Bivens Collinson said the company is looking at international expansion. “We get a lot of new clients, a lot of new people approach us,” she said.
Trump won a landslide election victory last month after campaigning on a promise to impose tariffs of up to 20 percent on all imports and 60 percent on imports from China. Since then he has been threatening punches Mexico and Canada with levies of 25 percent.
In recent weeks, Canadian Prime Minister Justin Trudeau traveled to Trump’s Mar-a-Lago resort in Florida and the President of Mexico Claudia Sheinbaum spoke to Trump on the phone. Across Washington, foreign diplomats were plotting strategies to contain the colorful president’s threats as companies searched for new advisers.
“It’s been busy since 2016, but I can already tell you it blew up overnight,” said one commercial lawyer at a major firm, who did not want to be named. “There’s a lot of interest in a lawsuit against the Trump administration, everybody in town is preparing a lawsuit.”
The lawyer said that the company they worked for wanted to hire more people to deal with the Trump years, and that trade was becoming an increasingly attractive specialty.
After Trump’s victory, lawyers say companies are seeking help navigating the thicket of national security laws, tariff exemptions and product classifications that make the difference between a company avoiding punitive tariffs or being taxed out of the lucrative U.S. market.
Some companies are exploring ways to circumvent potential tariffs. Under the last Trump administration, companies were offered the opportunity to apply for an “opt-out” of tariffs on their imports from China.
Between 2018 and December 2020, the US Trade Representative’s office processed 53,000 requests from companies seeking to avoid tariffs on imported Chinese goods, although an audit of the process found that nearly 90 percent of those requests were denied.
Bivens Collinson said some companies are exploring “tariff engineering” to see if they can reclassify their product into something subject to a lower tariff rate.
“You may have classified your product as a router for 25 years, but it may now do a lot of other things – is it even a router or can we classify it as something else?”
Accounting firms also provided advice to clients on how to navigate the new landscape. Those groups typically have advisers who can help companies deal with customs officials and warn clients that they should be ready to act quickly because backlogs piled up when Trump imposed targeted tariffs in his first administration.
“The customs and trade teams are not the biggest part of the firm, obviously, but this is an opportune time for those practices, including ours,” said Mark Ludwig, head of national trade advisory services at RSM US, the largest US accounting firm outside the Big Four.
RSM led clients to use what Ludwig called “underappreciated” rate minimization mechanisms. These include bonded warehouses, secure facilities where imports can be stored before duties are triggered, or duty drawback programs, through which duties can eventually be refunded if the goods are subsequently exported.
“For most of my career, the average tariff rate was very low,” he said, but now experts in these mechanisms can help companies save much larger amounts.
Companies are also focused on reorganizing their supply chains to avoid the imposition of country-targeted tariffs.
Steve Orava, a partner in international trade at the Washington law firm King & Spalding, said the firm’s practice, which focuses on domestic production, was in “high demand.” The company is home to Trump’s nominee for US Trade Representative, Jamieson Greer. “We get a lot of additional calls from various industries, companies and trade associations,” Orava said.
At Akin Gump, one of Washington’s largest legal and lobbying groups, Stephen Kho, a partner in international trade policy, said the teams within the firm are “getting bigger” and expanding beyond the rule of law.
“To serve a client now, you don’t just need lawyers, you need good political sense, politicians and ex-politicians and a dash of psychology,” Kho said. “I think it’s a much more complex practice and that means we need more people.”
Kho said that under Trump, political instinct was more decisive than under President Joe Biden.
“The political part has been so apparent under Trump, and it looks like it’s going to be even more so now.”
