Climate change

President-Elect Biden will assume office in just over 70 days with “what has, correctly, been called a transformational plan” to curb climate change and its unavoidable consequences, Baker McKenzie global head of climate change Ilonar Millar said in conversation with Lawyers Weekly.

“The cornerstone of his policy – officially called the Biden Plan for a Clean Energy Revolution and Environmental Justice – is to recommit the United States to the Paris Agreement on climate change, and to set a target for the US to achieve net-zero carbon emissions by 2050,” she outlined.

“That target is generally accepted as being in line with the goals of the Paris Agreement on climate change which seeks to limit global climate heating to well below two degrees Celsius above pre-industrial levels, and ideally, to keep it closer to 1.5 degrees.”

The impact of the world’s largest economy pivoting to this new policy “cannot be understated”, Ms Millar stressed, particularly given movements by China, Japan, South Korea, the European Union and UK towards net-zero emissions.

“Upon President Elect Biden’s inauguration in January, the United States of America will join the ranks of jurisdictions that have a firm target. These countries comprise some two-thirds of global GDP, and include Australia’s top trading partners,” she said.

These developments present a “host of opportunities and risks for Australia, and for Australian businesses operating in, or with, the United States”, Ms Millar espoused.

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“For instance, Australia is positioning itself to be a global leader in relation to the development of green hydrogen. There is scope for Australian businesses to benefit from increased collaboration with, and investment from, the US for the development of this industry. We also have one of the most mature renewable energy markets in the world, and there are potential opportunities for Australian businesses as the US seeks to invest in, and expand, its use of renewables,” she detailed.

“On the risk side of the ledger, if the US makes it mandatory to report on climate risks, some Australian companies may find themselves either unprepared or with uncomfortable stories to tell. Preparation for this possibility should commence now.”

There is also a chance, Ms Millar continued, that the Biden administration could enact border adjustment taxes that could account for the emissions produced by particular suppliers of goods.

This, she warned, could pose a risk to the competitiveness of some Australian products.

“It is difficult to predict the precise ways these measures could impact Australia in general, and specific companies in particular, but it is important to note that these measures are all now under active consideration by major economies and trading partners,” she said.

“The debate in Australia is often over whether we will meet our targets (a reduction of 26-28 percent of emissions below 2005 levels, by 2030). We are, to some extent, still viewing climate action within a framework of sacrifice, that is, the old notion that reducing emissions must come at the expense of economic growth.”

Ultimately, the new political landscape “makes it clear that the debate has changed”, Ms Millar surmised.

“Now, the conversation occurring globally – in both the public and private sectors – is over long-terms targets, whether they are sufficient to contain emissions to meet the goals of the Paris Agreement, and the best ways to achieve those goals, with an emphasis on opportunities for economic growth and development,” she said.

“Key industry groups have recently come forward to support a 2050 target in Australia and some have indicated their support for the Climate Change National Framework Bill introduced into Parliament by Independent MP Zali Steggall. The absence of a long-term target in Australia means that we are now out of line with comparable nations.

“Biden has also committed to a green recovery from the economic damage caused by the pandemic, pledging US$1.7 trillion in infrastructure spending alone. Australia has not yet integrated our fiscal and policy response to COVID-19, with a green response, but there remains an opportunity to do so.”

Data privacy

It was surprising to see “little mention” of data privacy as a key policy platform of the Biden-Harris ticket, especially in light of established Russian interference in the US electoral process, Dentons partner Ben Allen told Lawyers Weekly.

This being said, while the President-elect has not yet outlined it as an imperative, privacy legislation will “no doubt be of key concern to his administration in the first years of his presidency”, he added.

“To that end, I expect that Vice-President-elect (Kamala) Harris will take the reins in this regard, given her much more robust and proven track record with data privacy as attorney general of California, where she set up the Privacy Enforcement and Protection Unit,” Mr Allen surmised.

“That Unit helped the state become a national leader in regulating consumer privacy and I expect that Harris will also bring that expertise to negotiations with tech companies, who Biden has indicated he wishes to see broken up to some extent, at the same time bringing the US privacy laws into line with those in the EU and around the world, including Australia’s Privacy Act.”

Capital markets

Australian-based practitioners have “no reason to expect significant changes” to the regulatory framework from the incoming Biden administration, Allen & Overy partner Mark Leemen explained.

“The Trump Administration did little in the securities area, and it was largely business as usual at the U.S Securities and Exchange Commission. President-elect Biden has not foreshadowed major changes in securities regulation either, and the initial impact of the incoming Administration will primarily be felt through executive branch appointments and agency priorities, both of which I’d expect to look a lot like those of the Obama Administration,” he mused.

“This is likely to include a focus on consumer protection and the return to government of a number of the architects of the post-GFC regulation of large financial institutions.”

Some of the more ambitious plans floated by certain Democrats, including expanding the Supreme Court, Mr Leemen continued, have “likely been torpedoed by their failure to retake the Senate (subject to the Georgia runoff election in January)”, he said.

“That said, 20 January 2021 will see the end of one persistent source of capital markets volatility, others remain, including negotiations for a new economic stimulus between the incoming Administration and the (likely) divided Congress,” he proclaimed.

“Further down the track, July 2021 will see the end of the current suspension of the US federal government debt ceiling, which the GOP repeatedly used to create hostage crises during the Obama Administration, and may well again.”

Broader legal considerations

Norton Rose Fulbright legal services executive Donald Betts Jr – a former member of the Kansas State Senate and Kansas House of Representatives and the first African American to study a juris doctor at Monash University – opined that diversity and inclusion, and its nexus to the rule of law, will be prominent in how the Biden administration approaches policy, which could have ripple effects for the legal profession in Australia.

Mr Betts – who earlier this year appeared on The Lawyers Weekly Show to discuss systemic racism in the US and Australia, and detailed his own personal journey of not wanting to become another statistic for the African-American community – said that the 2020 presidential election saw a “woman wave”, as opposed to the oft-referenced red waves or blue waves.

“Of the estimated 131 women elected and re-elected to Congress, roughly one third are lawyers. The most prized possession being Madam Vice President-Elect Kamala Harris, who has risen higher in national politics than any woman before her,” he said.

“Her words will be etched in the history books forever: ‘While I may be the first woman in this office, I will not be the last. Because every little girl watching tonight sees that this is a country of possibilities’. President-Elect Biden was audacious enough to select a woman who will certainly hold his feet to the flames when setting policy initiatives that will likely shape the world.

“Whilst the new administration contends with its [burgeoning] debacle of civil unrest, division, racial inequality, health, and the faltering economy, the perceived notion of diversity will be at the forefront of this administration’s expectations when dealing with other nations, in both public and private sectors.

“Lawyers should advise their clients to be diversity ready, especially when the MVP graces Australian shores and asks, ‘Who, where and how many?’. President-Elect Biden will expect leaders to be able to marshal the forces of fairness. If anything can be gleaned from what to expect from the 46th president based on his example thus far, it would be diversity, inclusion, and the rule of law.”