[Senate Hearing 115-623]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 115-623

                                TREATIES

=======================================================================

                                HEARING

                               BEFORE THE

                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            DECEMBER 13, 2017

                               __________


       Printed for the use of the Committee on Foreign Relations


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                 COMMITTEE ON FOREIGN RELATIONS        

                BOB CORKER, Tennessee, Chairman        
JAMES E. RISCH, Idaho                BENJAMIN L. CARDIN, Maryland
MARCO RUBIO, Florida                 ROBERT MENENDEZ, New Jersey
RON JOHNSON, Wisconsin               JEANNE SHAHEEN, New Hampshire
JEFF FLAKE, Arizona                  CHRISTOPHER A. COONS, Delaware
CORY GARDNER, Colorado               TOM UDALL, New Mexico
TODD, YOUNG, Indiana                 CHRISTOPHER MURPHY, Connecticut
JOHN BARRASSO, Wyoming               TIM KAINE, Virginia
JOHNNY ISAKSON, Georgia              EDWARD J. MARKEY, Massachusetts
ROB PORTMAN, Ohio                    JEFF MERKLEY, Oregon
RAND PAUL, Kentucky                  CORY A. BOOKER, New Jersey
                  Todd Womack, Staff Director        
            Jessica Lewis, Democratic Staff Director        
                    John Dutton, Chief Clerk        



                               (ii)        

  
                            C O N T E N T S

                              ----------                              
                                                                   Page

Risch, Hon. James E., U.S. Senator from Idaho....................     1


Shaheen, Hon. Jeanne, U.S. Senator from New Hampshire............     2


Visek, Richard, Acting Legal Adviser, U.S. Department of State, 
  Washington, DC.................................................     3

    Prepared statement...........................................     5


Swartz, Bruce, Deputy Assistant Attorney General, U.S. Department 
  of Justice, Washington, DC.....................................    10

    Prepared statement...........................................    12



              Additional Material Submitted for the Record

Responses to Additional Questions for the Record Submitted to 
  Richard Visek by Senator Tim Kaine.............................    23


Correspondence in Support of the Treaties........................    25



                                (iii)        

 
                                TREATIES

                              ----------                              


                      WEDNESDAY, DECEMBER 13, 2017

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 2:32 p.m., in 
Room SD-419, Dirksen Senate Office Building, Hon. James E. 
Risch presiding.
    Present: Senators Risch [presiding], Shaheen, and Kaine.

           OPENING STATEMENT OF HON. JAMES E. RISCH, 
                    U.S. SENATOR FROM IDAHO

    Senator Risch. The committee will come to order.
    And thank you so much, all of you who are attending today. 
We are going to hear today from the State Department and the 
Department of Justice regarding five treaties that are pending 
before this committee.
    First of all, we have two extradition treaties with Serbia 
and Kosovo. These treaties update a century-old treaty with 
what was then the Kingdom of Serbia. While this earlier treaty 
continues to govern our extradition law with Serbia and Kosovo, 
it does not include the modern extradition principles the 
United States has relied on and included in its extradition 
treaties in recent years.
    For example, both treaties will be updated from so-called 
list treaties, whereby an offender may only be extradited under 
a specific list of crimes to dual criminality treaties. Dual 
criminality allows for extradition for offenses that are crimes 
in both countries.
    Another important improvement is that both of these 
treaties will now allow for the extradition of nationals. Since 
1990, the U.S. has supported the policy of allowing the 
extradition of nationals, a policy we have pursued with other 
nations in our recent extradition treaties.
    Both these modern principles, dual criminality and the 
extradition of nationals, were included in last year's 
extradition treaties with the Dominican Republic and Chile, two 
treaties approved unanimously by the Senate.
    As Mr. Swartz will discuss, these updated treaties will 
improve the ability of our Department of Justice in fighting 
terrorism and transnational crime.
    Next, we have two treaties, which, if ratified, would 
establish maritime boundaries between the Republic of Kiribati 
and the Federated States of Micronesia and the United States. 
These treaties would formalize boundaries that have been 
informally adhered to by the parties. Because of improved 
methods of calculation, the State Department expects the 
treaties will create a small net gain of continental shelf 
jurisdiction and exclusive economic zone for the United States.
    Finally, we have the U.N. Convention on the Assignment of 
Receivables. This treaty was negotiated with significant U.S. 
assistance. As our witness Mr. Visek will note, the treaty 
substantially reflects U.S. law and is strongly supported by 
the U.S. business community.
    In a letter to this committee, the Chamber of Commerce has 
noted that the convention, if ratified, will make it easier for 
U.S. small----
    Senator Shaheen. Business. [Laughter.]
    Senator Risch [continuing]. Small business, which we are 
the chairman and ranking member of, to access additional 
financing.
    For example, if ratified, the convention would provide 
these businesses with more certainty. They would be able to 
secure lending based on their sales of goods and services to 
customers located in other countries that ratify the 
convention.
    Both the ranking member and I are always focused on things 
that are helpful to small businesses.
    The convention's rules will thus facilitate access to 
asset-based financing in which their foreign receivables serve 
as collateral.
    In February, President Trump signed an executive order on 
the core principles for regulating the U.S. financial system, 
establishing principles that will enable American companies to 
be competitive with foreign forms in domestic and foreign 
markets, and advance American interests in international 
financial regulatory negotiations and meetings. By agreeing to 
this treaty, we will be able to accomplish both of those goals.
    The Senate plays a unique constitutional role in providing 
advice and consent on treaties. This hearing is part of that 
constitutional responsibility, and we always undertake our 
constitutional responsibilities soberly.
    So with that, gentlemen, do we have a volunteer to go 
first? That would be you, Mr. Visek.
    I am very sorry. I yield to the ranking member.

               STATEMENT OF HON. JEANNE SHAHEEN, 
                U.S. SENATOR FROM NEW HAMPSHIRE

    Senator Shaheen. Thank you, Mr. Chairman.
    And thank you to our witnesses for being here today.
    I am pleased that the committee is considering these five 
treaties before us. As was noted by Avril Haines at a hearing 
last week, deliberations before this committee relative to 
treaties have reached historic lows. And I think that most of 
my colleagues on the committee, both Republican and Democrat, 
are eager to reverse this trend and help enhance U.S. 
leadership in the world.
    The treaties we are deliberating today touch on a range of 
matters, from international business to maritime boundaries and 
the rule of law, as the chairman has said. They not only 
further United States' interests, but they raise standards 
across the globe. In this increasingly complex, interconnected 
world, we need the consistency and uniformity that treaties 
provide now more than ever.
    If the Senate provides its advice and consent, the treaties 
that we are considering today will raise living standards and 
improve local economies and markets worldwide and in the United 
States.
    And as Chairman Risch has said, he and I serve as chair and 
ranking member of the Small Business Committee, so it is nice 
to promote anything that is going to help small businesses in 
the United States.
    The two extradition treaties that are before us also merit 
special attention because they are a testament to the 
advancement of the rule of law in our transatlantic community. 
And 20 years after the devastating war in the Balkans and over 
a century after the first treaty between the United States and 
what was then the Kingdom of Serbia, the United States, Kosovo, 
and Serbia are finally establishing a reliable, modern, legal 
framework to help prosecute crimes and bring criminals to 
justice.
    And finally, in a world where border disputes continue to 
lead to bloodshed and war, the maritime border treaties with 
Micronesia and Kiribati demonstrate the power of diplomacy and 
dialogue.
    Now, while I continue to worry that recent threats and 
actions to withdraw the U.S. from international agreements will 
cause long-term damage to U.S. credibility and posture, I am 
encouraged by this committee's consideration of these important 
treaties today, and I look forward to hearing from our 
witnesses and participating in more treaty hearings to come.
    So thank you, Mr. Chairman.
    Senator Risch. Thank you, Senator Shaheen.
    We will turn to our panel of witnesses. First, Mr. Richard 
Visek, who is the acting legal adviser at the State Department.
    Mr. Visek?

       STATEMENT OF RICHARD VISEK, ACTING LEGAL ADVISER, 
            U.S. DEPARTMENT OF STATE, WASHINGTON, DC

    Mr. Visek. Thank you, Mr. Chairman. And thank you, Ranking 
Member Shaheen.
    Mr. Chairman, members of the committee, I am pleased to 
appear before you today to testify in support of five treaties 
being considered by the committee. Before proceeding with brief 
remarks, I would note that I did prepare a more detailed 
statement, and I would ask that that be submitted.
    Senator Risch. That will be included in the record, Mr. 
Visek.
    Mr. Visek. Thank you.
    Senator Risch. Thank you very much for doing that.
    Mr. Visek. The five treaties before the committee are the 
extradition treaties with Kosovo and Serbia, the maritime 
boundary delimitation treaties with Kiribati and the Federated 
States of Micronesia, and the United Nations Convention on the 
Assignment of Receivables in International Trade.
    The administration appreciates the committee's 
prioritization of these treaties. Individually and 
collectively, these treaties advance U.S. interests.
    The extradition treaties will enhance our ability to combat 
transborder criminal activity. The maritime boundary treaties 
will improve our ability to explore, benefit from, conserve, 
and manage the natural resources of our maritime areas. And the 
receivables convention will help U.S. businesses gain access to 
capital.
    The administration supports each of these treaties and 
urges the Senate to provide its advice and consent to their 
ratification.
    Let me say a few words about each of these treaties, and 
then I will be pleased to respond to the committee's questions.
    The two extradition treaties pending before the committee 
will update our existing treaty relationships with two law 
enforcement partners, Kosovo and Serbia. The continuing growth 
in transborder criminal activity underscores the need for 
increased international law enforcement cooperation. 
Extradition treaties are essential tools in that effort.
    The U.S. extradition relationships with Kosovo and Serbia 
are currently covered by a 1901 treaty between the United 
States and the Kingdom of Serbia. The two treaties now before 
the committee would establish modern extradition relationships 
with both countries, allowing us to engage in closer and more 
effective law enforcement cooperation.
    For example, as the chairman noted, the proposed treaties 
adopt a dual criminality approach contained in our other modern 
treaties. This allows extradition for offenses punishable in 
both states by imprisonment or deprivation of liberty for a 
period of one year or more.
    The treaties also contemplate the unrestricted extradition 
by each treaty party of its own nationals by providing that 
nationality is not a basis for denying extradition. Given that 
Kosovo and Serbia permit extradition of their nationals only 
pursuant to a treaty or international agreement, this will 
allow for each state to extradite its nationals to the United 
States. My colleague Bruce Swartz from the Department of 
Justice will address these treaties in further detail.
    The maritime boundary treaties with Kiribati and the 
Federated States of Micronesia delimit the exclusive economic 
zone, or EEZ, and continental shelf between the United States 
and these countries. Delimited boundaries provide legal 
certainty that enhances our ability to explore, benefit from, 
conserve, and manage the natural resources of our maritime 
areas, including with respect to our fisheries.
    The treaties provide for the delimitation of the boundaries 
on the basis of equidistance. With appropriate technical 
adjustments, each treaty formalizes boundaries that have been 
informally adhered to by the parties and that are very similar 
to the existing limit lines of the EEZ asserted by the United 
States for decades.
    Because of improved calculation methodologies and minor 
coastline changes, the four new maritime boundaries in these 
two treaties will result in a small net gain, primarily with 
respect to Kiribati boundaries, of the United States' EEZ and 
continental shelf area, relative to the existing limit lines of 
our EEZ.
    The form and content of the two maritime boundary treaties 
are very similar to each other and to previous maritime 
boundary treaties between the United States and other Pacific 
island countries that have entered into force after receiving 
the Senate's advice and consent. The treaties clarify the 
geographic scope of our sovereign rights and jurisdiction, and 
they reinforce other countries' recognition of the U.S. EEZ and 
continental shelf entitlements around the U.S. islands in 
question.
    The Convention on the Assignment of Receivables in 
International Trade establishes uniform international rules 
governing a form of financing widely used in the United States 
involving the assignment of receivables. Expanded access to 
receivables financing in international trade, which the 
convention would promote, will provide American businesses an 
additional source of capital at no cost to the U.S. taxpayer 
and require no material change to existing U.S laws. This 
should particularly benefit small- and medium-sized businesses 
that use receivables financing.
    The convention, which is largely based on U.S. law, 
provides modern, uniform rules for transactions in which 
businesses either sell their rights to payments from their 
customers to a bank or other financial institution or use their 
rights to these payments as collateral for a loan from a 
lender. Such transactions enable businesses to obtain greater 
access to capital and credit at lower cost.
    The negotiation of the convention was supported by the U.S. 
Uniform Law Commission and members of the American Law 
Institute, which developed the applicable provisions of the 
U.S. Uniform Commercial Code that govern receivables financing 
in each State in the United States. Members of both 
organizations participated in the U.S. delegation as the 
convention was being negotiated.
    In addition, a committee of experts, with participation by 
both organizations, recommended understandings and declarations 
to accompany U.S. ratification of the convention, aimed at 
ensuring consistency with practice under U.S. law and 
facilitating application of the convention in the United 
States. The executive branch's proposed set of understandings 
and declarations is consistent with these recommendations.
    The convention enjoys wide support in the U.S. business 
community. Leading U.S. business associations, including the 
U.S. Chamber of Commerce, have urged U.S. ratification of the 
convention.
    Thank you for the opportunity to testify in support of 
these treaties. I would be happy to respond the committee's 
questions about them.
    Thank you.
    [Mr. Visek's prepared statement follows:]


                  Prepared Statement of Richard Visek

    Mr. Chairman, members of the committee, I am pleased to appear 
before you today to testify in support of five treaties being 
considered by the committee:

   extradition treaties with Kosovo and Serbia,
   maritime boundary delimitation treaties with Kiribati and the 
        Federated States of Micronesia, and
   the United Nations Convention on the Assignment of Receivables in 
        International Trade.

    The administration appreciates the committee's prioritization of 
these treaties. Individually and collectively, these treaties advance 
U.S. interests. The extradition treaties will enhance our ability to 
combat transborder criminal activity. The maritime boundary treaties 
will improve our ability to explore, benefit from, conserve, and manage 
the natural resources of our maritime areas. And the Receivables 
Convention will help U.S. businesses gain access to capital. The 
administration supports each of these treaties, and urges the Senate to 
provide its advice and consent to their ratification. During the 
remainder of my testimony, I will discuss the five treaties in 
additional detail.
              extradition treaties with kosovo and serbia
    The two extradition treaties pending before the committee will 
update our existing treaty relationships with two important law 
enforcement partners--Kosovo and Serbia. The continuing growth in 
transborder crime, including terrorism, other forms of violent crime, 
drug trafficking, cybercrime, and the laundering of the proceeds of 
criminal activity, underscores the need for increased international law 
enforcement cooperation. Extradition treaties are essential tools in 
that effort.
    The U.S. extradition relationships with Kosovo and Serbia are 
currently governed by the Treaty Between the United States of America 
and the Kingdom of Servia for the Mutual Extradition of Fugitives from 
Justice, signed on October 25, 1901 (``the 1901 Treaty''). We have 
found that this treaty is not as effective as the modern treaties we 
have in force with other countries in ensuring that fugitives may be 
brought to justice. The two treaties now before the committee would 
establish modern extradition relationships with both countries, thereby 
allowing us to engage in closer and more effective law enforcement 
cooperation.
    Replacing outdated extradition treaties with modern ones (as well 
as negotiating extradition treaties with new partners where 
appropriate) is necessary to create a seamless web of mutual 
obligations to facilitate the prompt location, arrest and extradition 
of international fugitives. As a result, these treaties are an 
important part of the administration's efforts to ensure that those who 
commit crimes against American victims will face justice in the United 
States.
    Both new treaties contain several important provisions that will 
substantially serve our law enforcement objectives:


    First, these treaties define extraditable offenses to include 
conduct that is punishable by imprisonment or deprivation of liberty 
for a period of one year or more in both states. This is the so-called 
``dual criminality'' approach. Our older treaties, including the 1901 
Treaty, provide for extradition only for offenses appearing on a list 
contained in the instrument. The problem with this approach is that, as 
time passes, the lists grow increasingly out of date. The dual 
criminality approach eliminates the need to renegotiate treaties to 
cover new offenses in instances in which both states pass laws to 
address new types of criminal activity. By way of illustration, so 
called ``list Treaties'' from the beginning of the 20th century do not 
cover various forms of cybercrime or money laundering. The new treaties 
with Kosovo and Serbia would fix this problem.

    Second, these treaties address one of the most difficult and 
important issues in our extradition treaty negotiations--the 
extradition of nationals. As a matter of long-standing policy, the U.S. 
Government extradites United States nationals and strongly encourages 
other countries to extradite their nationals. Both of the treaties 
before the committee contemplate the unrestricted extradition of 
nationals by providing that nationality is not a basis for denying 
extradition. This provision is particularly important in the context of 
Kosovo and Serbia because of certain provisions in their domestic law. 
Kosovo's Supreme Court has ruled that its new constitution only permits 
the extradition of Kosovo nationals where required by international 
agreement. Kosovo has been clear that this provision in the treaty will 
overcome that obstacle, allowing them to extradite their nationals to 
the United States. Similarly, Serbia has domestic legislation that also 
permits extradition of nationals only pursuant to an obligation of a 
treaty to which Serbia is a party. Similarly, they have been clear that 
the provision on extradition of nationals in the new treaty overcomes 
this obstacle.

    Third, the treaties include a modern ``political offense'' 
exception that states that extradition shall not be granted if the 
offense for which extradition is requested is a political offense, but 
establishes a number of categories of offenses that shall not be 
considered political offenses. These categories of offenses cover a 
range of violent crimes, including murder, kidnapping and hostage 
taking, and the use of various kinds of explosive devices. These 
categories of offenses, which did not exist in earlier extradition 
treaties, constitute exceptions to the political offense exception and 
align with a major longstanding priority of the United States to ensure 
that an overbroad definition of ``political offense'' does not impede 
the extradition of terrorists.

    Fourth, unlike the 1901 Treaty, these new treaties contain a 
provision that permits the temporary surrender of a fugitive to the 
Requesting State when that person is facing prosecution for, or serving 
a sentence on, charges within the Requested State. This provision can 
be important to the Requesting State (and in some cases the fugitive) 
so that, for example: (1) charges pending against the person can be 
resolved earlier while evidence is fresh, or (2) where the person 
sought is part of a criminal enterprise, he can be made available for 
assistance in the investigation and prosecution of other participants 
in the enterprise.

    Fifth, both of these treaties incorporate a number of procedural 
improvements over the 1901 Treaty, including direct transmission of 
provisional arrest requests through Justice Department channels, waiver 
and consent to extradition, and clear statements of the required 
materials to be included in a formal extradition request.


    For all these reasons, U.S. ratification of the extradition 
treaties with Kosovo and Serbia will help us and our colleagues at the 
Justice Department further develop two important law enforcement 
relationships and advance our objective of combatting transnational 
crime.
             maritime boundary treaties with kiribati and 
                   the federated states of micronesia
    In an area where more than one country has maritime entitlements 
under international law, maritime boundaries are needed to clarify 
where each country may exercise its sovereignty, sovereign rights, and 
jurisdiction as a coastal State. In this connection, it is often noted 
that ``good fences make good neighbors.'' Delimited boundaries also 
provide legal certainty that enhances our ability to explore, benefit 
from, conserve, and manage the natural resources of our maritime areas, 
including with respect to our fisheries. Resolving the outstanding 
maritime boundaries of the United States around the world remains an 
ongoing project, with about a dozen such boundaries yet to be fully 
agreed with our neighbors.
    These two treaties delimit the exclusive economic zone (or ``EEZ'') 
and continental shelf between the United States and Kiribati, and 
between the United States and the Federated States of Micronesia (FSM), 
on the basis of equidistance. (Every point on an equidistance line is 
equal in distance from the nearest point on the coastline of each 
country.) This approach is wholly in line with international law and 
practice, and moreover serves to formalize the longstanding status quo 
regarding each side's asserted rights and jurisdiction in these 
maritime areas. Accordingly, with appropriate technical adjustments, 
each treaty formalizes boundaries that have been informally adhered to 
by the Parties, and that are very similar to the existing limit lines 
of the EEZ asserted by the United States for decades and published in 
the Federal Register. Because of improved calculation methodologies and 
minor coastline changes, the four new maritime boundaries in these two 
treaties will result in a small net gain, primarily with respect to the 
Kiribati boundaries, of United States EEZ and continental shelf area 
relative to the existing limit lines of our EEZ.
    The treaty with FSM establishes a single maritime boundary between 
Guam and several FSM islands. The boundary is approximately 447 
nautical miles with 16 turning and terminal points. The treaty with 
Kiribati establishes three maritime boundaries in the Pacific with 
respect to the EEZ and continental shelf generated by various Kiribati 
islands and by each of the U.S. islands of Palmyra Atoll, Kingman Reef, 
Jarvis Island, and Baker Island. Specifically, the treaty with Kiribati 
defines three distinct boundary lines: for the boundary line between 
the United States' Baker Island and the Kiribati Phoenix Islands group, 
six points are connected by geodesic lines that measure 332 nautical 
miles in total; for the boundary line between the United States' Jarvis 
Island and the Kiribati Line Islands group, ten points are connected by 
geodesic lines that measure 548 nautical miles in total; and for the 
boundary line between the U.S. islands of Palmyra Atoll and Kingman 
Reef and the Kiribati Line Islands group, five points are connected by 
geodesic lines that measure 383 nautical miles in total.
    The form and content of the two treaties are very similar to each 
other, and to previous maritime boundary treaties between the United 
States and other Pacific island countries that have entered into force 
after receiving the Senate's advice and consent. Each of the two 
treaties consists of seven articles, which set out the purpose of each 
treaty; the technical parameters; the geographic location of the 
boundary lines; standard language indicating the agreement of the 
Parties that, on the opposite side of each maritime boundary, each 
Party will not ``claim or exercise for any purpose sovereignty, 
sovereign rights, or jurisdiction with respect to the waters or seabed 
or subsoil''; a clause that the establishment of the boundaries will 
not affect or prejudice either side's position with respect to the 
rules of international law relating to the law of the sea; a provision 
for dispute settlement by negotiation or other peaceful means agreed 
upon by the Parties; and a provision that entry into force would follow 
an exchange of notes indicating that each side has completed its 
internal procedures. For the purpose of illustration only, the 
boundaries are depicted on maps attached to the treaties.
    The treaties do not limit how we may choose to manage, conserve, 
explore, or develop the U.S. EEZ and continental shelf consistent with 
international law; they merely clarify the geographic scope of our 
sovereign rights and jurisdiction consistent with international law and 
with longstanding unilateral U.S. practice, and they reinforce other 
countries' recognition of the U.S. EEZ and continental shelf 
entitlements around the U.S. islands in question.
            united nations convention on the assignment of 
                   receivables in international trade
    The United Nations Convention on the Assignment of Receivables in 
International Trade establishes uniform international rules governing a 
form of financing widely used in the United States involving the 
assignment of receivables. Expanded access to receivables financing in 
international trade, which the Convention would promote, will provide 
American businesses an additional source of capital at no cost to the 
U.S. taxpayer and require no material change to existing U.S. laws. 
This should particularly benefit small and medium-sized businesses that 
use receivables financing.
    The Convention, which is largely based on U.S. law, provides 
modern, uniform rules for transactions in which businesses either sell 
their rights to payments from their customers (known as 
``receivables'') to a bank or other financial institution, or use their 
rights to these payments as collateral for a loan from a lender (the 
businesses selling or using their receivables as collateral are 
referred to as ``assignors'' and buyers and lenders are referred to as 
``assignees''). Such transactions enable businesses to obtain greater 
access to credit at lower cost and thereby expand their operations.
    These so-called ``assignments of receivables'' transactions are 
well established in the United States as a method of obtaining low-cost 
credit, and are governed by Article 9 of the Uniform Commercial Code 
(UCC), which has been adopted by all U.S. States and the District of 
Columbia, Puerto Rico, and the Virgin Islands. The Convention provides 
economically-useful rules for cross-border transactions involving 
receivables typically generated in the exchange of goods or services 
for payment and from other commercial transactions.
    The assignment of these types of receivables is common and 
relatively easy to effect in the United States when only domestic 
assignors and domestic receivables are involved. When these 
transactions cross international boundaries, however, determining 
whether U.S. law or the law of another country applies is fraught with 
uncertainty--not only as to which country's laws apply but also the 
nature of those laws. In addition, even if one can determine which 
country's laws apply and what those laws say, those laws may not be 
very helpful for receivables financing. As The Convention addresses 
both aspects of these problems--the conflict of laws problem and 
substantive legal rules problem.
1. The Key Conflict of Laws Provision
    The Convention governs assignments of receivables that have an 
international dimension. In particular, the Convention applies both to 
assignments of receivables when the assignor and the debtor on the 
receivables (``account debtor'' for U.S. law purposes) are located in 
different countries and to the assignment of receivables when the 
assignor and the assignee of the receivables are located in different 
countries. In either case, without the benefit of the Convention, the 
fact that the transaction involves more than one country creates 
uncertainty as to which country's substantive law governs because the 
conflict of laws rules that would determine the answer vary 
significantly from one country to another. Even after determining which 
country's law governs, one must determine what that law is and how it 
applies to the transaction. This uncertainty adds significant risk to 
these international transactions, making credit based on them harder to 
obtain and more costly.
    One of the most important aspects of the Convention is Article 22, 
which sets forth a clear rule as to which country's substantive law 
governs the priority of an assignee's interest in receivables as 
against competing claimants. Competing claimants may include other 
assignees of the same receivable, creditors of the assignor who have 
obtained rights in the receivable, or a bankruptcy trustee of the 
assignor. Article 22 provides that the law of the country in which the 
assignor of the receivable is located governs the priority of the 
assignment against competing claimants. This is critically important 
because assignees are unlikely to enter into receivables financing 
transactions on favorable credit terms if there is uncertainty as to 
the priority of their claim to the receivables.
2. Substantive Rules Governing the Assignment of Receivables
    In addition to the conflict of laws rule, the Convention also 
provides a set of clear substantive rules governing important aspects 
of receivables financing, including practices that facilitate 
receivables financing and provide for a predictable resolution of 
issues that follows the general approach of UCC Article 9. Those 
Convention rules would override limitations in effect in many countries 
that restrict the usefulness of receivables financing (but not United 
States law under UCC Article 9, because the Convention rules are 
largely consistent with UCC Article 9). For example, Article 8 of the 
Convention, consistent with UCC Article 9, makes effective (1) the 
assignment of existing and future receivables to secure current and 
future advances, (2) the bulk assignment of receivables, and (3) the 
assignment of partial and undivided interests in receivables even if a 
country's internal law (unlike the United States) would otherwise 
restrict these transactions. It also reduces the need for excessive 
formality and documentation costs by permitting the receivables that 
are assigned to be described generally in the contract of assignment, 
which is consistent with UCC Article 9.
    For assignments within the scope of the Convention, Article 9 of 
the Convention, like Article 9 of the UCC, overrides certain 
contractual limitations on assignments of trade receivables. Consistent 
with UCC Article 9, the treaty provides that the assignment of such a 
receivable is effective notwithstanding any agreement between the 
account debtor (i.e. the debtor on the receivable) and the assignor 
(i.e. the account debtor's creditor) limiting the assignor's right to 
assign that receivable. This provision is particularly useful in 
transactions in which a business assigns a large number of its 
receivables created under a number of transactions because it avoids 
the otherwise hefty costs of the lender examining each contract 
creating a receivable to see if the contract limits assignment of the 
receivable.
    The Convention also sets out certain rights and obligations of the 
assignor and assignee that flow from the assignment of the receivables. 
For example, under Article 13, the assignee may notify the debtor and 
request payment. Article 14 sets out the assignee's right as against 
the assignor to proceeds of receivables (such as cash payments when the 
receivable has been collected).
    Because the Convention contains rules reflecting modern receivables 
financing practices consistent with those in UCC Article 9, widespread 
ratification of the Convention will help countries outside the United 
States modernize their receivables financing laws and enable this type 
of access to credit for companies engaged in cross-border trade without 
causing disruption to businesses in the United States that rely on, and 
have mastered, the rules in UCC Article 9.
3. Relationship to U.S. Law
    There is a strong correspondence between the Convention and U.S. 
law. Negotiation of the Convention was supported by the leadership of 
the Uniform Law Commission (ULC) and members of the American Law 
Institute (ALI) (the ULC's partner in developing the UCC). Members of 
both organizations participated in the U.S. delegation to the United 
Nations Commission on International Trade (UNCITRAL) as the Convention 
was being negotiated. In fact, the timing of the Convention coincided 
with the domestic revision of UCC Article 9, and many of the 
participants in the U.S. law reform project also participated in the 
preparation of the Convention.
    After the Convention was adopted, a ULC Committee, along with 
experts from the ALI, reviewed the Convention for the purpose of 
determining its suitability for ratification by the United States. They 
issued a committee report, which was approved by the ULC, proposing 
formulations for declarations and understandings, aimed at assuring 
consistency with practice under UCC Article 9 and facilitating 
application of the Convention in the United States. As reflected in the 
treaty transmittal package, the executive branch has proposed 
declarations and understandings to accompany the Senate's advice and 
consent to the Convention. These proposed declarations and 
understandings are consistent with the recommendations of the ULC and 
ALI committee of experts. They would provide additional clarity about 
how the United States will implement the Convention domestically and 
facilitate its application in a manner consistent with existing 
practice in the United States under UCC Article 9. Proposed 
understandings address the scope of the Convention (including its 
inapplicability to securities and to rights other than contractual 
rights to payment under intellectual property licenses), the ability of 
states to provide additional rights to an assignee with respect to the 
proceeds of a receivable beyond the minimum level of rights required by 
the Convention, and the meanings of certain terms used in the 
Convention. Proposed declarations address how the Convention will apply 
in the context of certain insolvency proceedings, how it will apply to 
certain contracts entered into by governmental entities or other 
entities constituted for a public purpose, and rules for determining 
which U.S. state laws will apply in circumstances where the Convention 
requires reference to applicable U.S. law. In addition, a proposed 
declaration provides that the United States will not be bound by 
optional provisions of the Convention addressing choice of law rules. 
These proposed understandings and declarations are discussed in detail 
in the treaty transmittal package.
    The treaty would be self-executing, which is consistent with the 
recommendation of the ULC Committee. There is no need for federal or 
state implementing legislation. Ratification of the Convention would 
not change U.S. practice in this area in any material respect. The 
Convention's rules are largely based on U.S. law and will produce 
substantially the same results as those under the UCC Article 9.
4. Benefits of U.S. Ratification
    Widespread ratification of the Convention would help businesses in 
the United States gain access to capital to conduct international 
trade. The importance of these benefits is underscored by the support 
the Convention has received from the U.S. business community. Industry 
associations that have written to the committee to express their 
support for the Convention include the Financial Services Roundtable, 
the U.S. Chamber of Commerce, the Bankers Association for Trade and 
Finance, the Commercial Finance Association, the Equipment Leasing and 
Finance Association, and the U.S. Council for International Business. 
The American Bar Association and the Uniform Law Commission have also 
expressed their support for the Convention.
    Because the Convention is based on U.S. law, and because of the 
leading role the United States has played in receivables financing, 
other countries will be less likely to join the Convention if the 
United States declines to ratify it. Currently, one country--Liberia--
has ratified the Convention. Five countries must ratify it in order for 
it to enter into force. U.S. ratification could have a particularly 
important leadership impact in this regard. There are currently a 
number of regional initiatives underway focused on reforming the law of 
secured transactions, including in Latin America, Africa, and the Asia-
Pacific region. Expanded ratification of the Convention in the near 
term has the potential to influence these initiatives and to expand the 
acceptance and use of the Convention's framework for receivables 
financing in these regions. In addition, the European Union (EU) is 
currently involved in an effort to develop an internal legal framework 
concerning the law applicable to third party effects of the assignment 
of receivables. While there is significant support in the EU for the 
approach taken in the Convention (and thus under U.S. law), there is 
also some support for alternative choice of law rules in some cases 
that would be inconsistent with the Convention and would thus introduce 
uncertainty into receivables financing governed by the alternative 
rules. U.S. ratification could helpfully influence the EU process to 
ensure that the framework adopted is consistent with the Convention 
(and therefore U.S. law).
    In summary, ratification of the Convention is an important step to 
providing American businesses a significant additional source of 
capital at no cost to the U.S. taxpayer and no material change to 
existing U.S. laws. These benefits will be particularly important for 
small and medium sized businesses that use receivables financing. 
Widespread ratification of the Convention would give American 
businesses an additional advantage in international transactions as the 
Convention mirrors American law and practices.
    The administration urges the Senate to provide advice and consent 
to their ratification.


    Senator Risch. Thank you very much, Mr. Visek.
    We are now going to hear from Bruce Swartz, who is Deputy 
Assistant Attorney General and Counselor for International 
Affairs.
    Mr. Swartz?

 STATEMENT OF BRUCE SWARTZ, DEPUTY ASSISTANT ATTORNEY GENERAL, 
           U.S. DEPARTMENT OF JUSTICE, WASHINGTON, DC

    Mr. Swartz. Thank you. Mr. Chairman, members of the 
committee, the two modern extradition treaties with Kosovo and 
Serbia that are before the committee today directly advanced 
the interests of the United States in fighting international 
terrorism and transnational crime.
    Mr. Chairman, as you noted, both these treaties update and 
replace the 1901 treaty between the United States and the 
Kingdom of Serbia. As was typical at the time of the 1901 
treaty, these were list treaties at that period. That is, they 
set out a series of offenses, a rather narrow set of offenses, 
subject to extradition. Those treaties at the time also did not 
require the extradition of nationals.
    The modern extradition treaties before you, in contrast, 
update and deal with both of these defects, and, in so doing, 
protect American citizens and advance our law enforcement 
interests.
    The treaties accomplish this in four different respects.
    First, as has been noted, it deals with the issue of 
nationality as a bar to extradition, and that has practical 
consequences for U.S. law enforcement. Under the new treaties, 
nationality will no longer serve as an obstacle to extradition. 
But under the existing treaties, we have encountered, both with 
regard to Kosovo and Serbia, what happens when nationality can 
be a bar.
    So, for instance, with respect to Kosovo, the United States 
sought but was unable to obtain the extradition of a Kosovar 
national who committed murder and then fled back to Kosovo. 
Similarly, with regard to Serbia, nationality served as a bar 
to the extradition of a Serbian national, who while a student 
in the United States committed a brutal assault on a fellow 
American and then fled back to Serbia.
    Neither of those results will follow under the new, modern 
extradition treaties with Kosovo and Serbia.
    Senator Risch. Will the new treaties allow us to reach back 
or not?
    Mr. Swartz. Mr. Chairman, they will. In the case of the 
treaty with Serbia, we can reach back as far as 2005. That is, 
with offenses from 2005 forward, nationality will not be a bar. 
Prior to that time, it will be discretionary. But we believe 
that will reach most of the offenses, particularly given the 
passage of time under the statute of limitations.
    But that also leads, Mr. Chairman, to the second respect in 
which we have a significant advance in these treaties, and that 
is the substitution of dual criminality, as it is referred to, 
for an approach that just lists a particular set of crimes. By 
taking out the perspective that only crimes listed in the 
treaty are the ones subject to extradition, we now have an 
approach that deals with the evolution of crime.
    So, for instance, the original treaty, the 1901 treaty, did 
not contemplate such crimes as cybercrime or particular forms 
of terrorism. Now, however, under the approach of dual 
criminality--in which an offense that is punishable by more 
than 1 year of imprisonment in both countries serves as a basis 
for extradition--we will be able to reach modern forms of 
criminality, and we will have treaties that evolve as crime 
evolves. There will be no need to change a list that exists.
    The third respect in which these treaties are a significant 
advance is their reach to extraterritorial offenses. Here, too, 
we have seen the practical bar that can exist under the 1901 
treaty.
    For instance, in the case of Kosovo, the United States 
sought the extradition of an individual who was engaging in 
material support of terrorism by using his computer in Kosovo 
to facilitate the travel of foreign terrorist fighters to Iraq 
and Afghanistan. Because the 1901 treaty does not reach 
offenses of that nature, extraterritorial offenses, because it 
only covers offenses that take place within the country seeking 
extradition, extradition was denied as to that individual. But 
again, under the modern treaty, extraterritorial offenses will 
be covered. And that is particularly important for offenses 
such as terrorism and narcotics trafficking.
    And then in the fourth respect, the treaty has a number of 
provisions that expand and speed extradition. Those include 
provisions that make clear that, when the United States seeks 
extradition from Kosovo or Serbia, it will be our statute of 
limitations that controls, not those of the requested state.
    Similarly, it streamlines provisional arrest, which is the 
ability to arrest a fugitive before a full extradition package 
is submitted. And it also allows for temporary surrender, which 
means that we can seek the extradition of someone being held in 
prison in Kosovo or Serbia for immediate trial in the United 
States, and then return to have him or her serve out the 
remainder of their sentence in those countries.
    So in all four of these respects, we are overcoming not 
just theoretical obstacles but practical obstacles that we have 
encountered with respect to our extradition relationship with 
Kosovo and Serbia. These represent significant advances, and 
they are consistent with the approach we have taken in 
modernizing our extradition treaties and extending the network 
of extradition treaties.
    We are very grateful for the support we have had from this 
committee for that process. We believe that, together, we have 
been able to ensure that fugitives have fewer safe havens 
around the world. And we, therefore, are very happy to have 
this opportunity to advance these treaties.
    We would request, respectfully, favorable consideration by 
committee. And I look forward to answering any questions you 
might have.
    Thank you, Mr. Chairman.
    [Mr. Swartz's prepared statement follows:]


                   Prepared Statement of Bruce Swartz

    Mr. Chairman and members of the committee, I am pleased to appear 
before you today to present the views of the Department of Justice on 
extradition treaties between the United States and the Republics of 
Kosovo and Serbia. These historic treaties directly advance the 
interests of the United States in fighting terrorism and transnational 
crime.
    At the outset, I wish to note that the decision to proceed with the 
negotiation of law enforcement treaties such as these is made jointly 
by the Departments of State and Justice, after careful consideration of 
our international law enforcement priorities. The Departments of 
Justice and State also participated together in the negotiation of each 
of these treaties. Accordingly, we join the Department of State today 
in urging the committee to report favorably to the Senate and recommend 
its advice and consent to ratification.
    The Departments of Justice and State have prepared and submitted to 
the committee detailed analyses of the extradition treaties in the 
Letter of Submittal. In my testimony today, I will concentrate on why 
these updated extradition treaties are important instruments for United 
States law enforcement agencies engaged in investigating and 
prosecuting terrorism and other serious criminal offenses.
           the u.s.-republic of kosovo extradition agreement
    At the outset, I must note for this committee that the United 
States and Kosovo currently operate under the 1901 extradition treaty 
between the United States and the Kingdom of Servia. Kosovo is treated 
as a successor state under that instrument. The ``list'' treaty is 
antiquated and limited, and is not suitable for meeting 21st Century 
law enforcement challenges. I will further elaborate on this point 
later in my testimony.
    Pursuant to a June 1999 United Nations Security Council resolution, 
the U.N. established an international civil and security presence in 
Kosovo, the U.N. Interim Administrative Mission in Kosovo (UNMIK), 
which still exists today. In September 2012, international supervision 
ended, and Kosovo became responsible for its own governance. While an 
UNMIK team had been handling prosecutions in Kosovo, the Kosovars have 
now assumed most of this responsibility.Despite being relatively new, 
Kosovar prosecutors are competent, establishing fair jurisprudence, and 
observing fundamental due process.
    To fully empower both Kosovar and U.S. law enforcement officials 
with the tools that they need to combat global crime, a new extradition 
treaty is necessary. The Extradition Treaty before this committee 
includes both substantive and procedural ``improvements'' from the 1901 
treaty. Allow me now to highlight a few of these critical improvements.
Substantive Improvements
    The Extradition Treaty before this committee contains new 
substantive provisions that did not exist in the 1901 extradition 
treaty. Perhaps most importantly, the new Extradition Treaty 
accommodates the requirements of the Kosovar constitution to permit 
extradition of nationals. The Kosovo Supreme Court has ruled that 
citizens of Kosovo cannot be extradited under the language of the 1901 
treaty, because the treaty provides that neither country is bound to 
extradite its nationals, and the Kosovo constitution prohibits the 
extradition of nationals in the absence of a bilateral extradition 
treaty requiring such extraditions. As a consequence, in recent years, 
Kosovo denied a U.S. extradition request where the U.S. sought a 
fugitive for murder. The denial was premised on the fugitive's Kosovo 
citizenship. Under the new Extradition Treaty, extradition can no 
longer be refused solely on the basis of the nationality of the person 
sought.
    Moreover, the new Extradition Treaty not only allows for the 
extradition of nationals, but expands the types of crimes for which 
extradition can be sought. While the existing 1901 extradition treaty 
defines extraditable offenses by reference to a list of crimes 
enumerated in the treaty itself, the treaty before this committee 
reflects the reality that crimes have become increasingly complex over 
the last century. A ``list treaty'' may present limits to extradition 
for newly emerging forms of criminality that the United States has a 
strong interest in pursuing, such as cybercrime and environmental 
offenses. The new Extradition Treaty will replace the old list of 
offenses with a modern ``dual criminality'' provision. This means that 
the obligation to extradite applies to all offenses that are punishable 
in both countries by a minimum term of imprisonment of more than one 
year. This is a critical improvement, since extradition will be 
possible in the future with respect to the broadest possible range of 
serious offenses, without the need to repeatedly update treaties as new 
forms of criminality are recognized.
    This expansive provision is material to our extradition requests 
for extraterritorial offenses. For the United States, extraterritorial 
jurisdiction is important in two areas of particular concern: drug 
trafficking and terrorism. Under the 1901 treaty, Kosovo recently 
denied our extradition request for a fugitive wanted for prosecution on 
charges of providing material support for terrorism--having facilitated 
the travel of foreign fighters--although communicating from Kosovo with 
other facilitators via the Internet. The Supreme Court of Kosovo held 
that the language of the 1901 extradition treaty did not provide for 
extradition of a person for a crime committed in the requested state. 
Under the new Extradition Treaty, Kosovo will no longer be able to deny 
our extradition requests on the sole basis that a criminal act occurred 
in Kosovo, not in the United States.
    Furthermore, the new Extradition Treaty ensures that the only 
applicable statute of limitations is that of the country making the 
extradition request. Accordingly, this provision ensures that the U.S. 
prosecutors will maintain procedural control over the viability of 
their cases, rather than being at the mercy of foreign statutes of 
limitations.
Procedural Improvements
    In addition to the substantive improvements, the Extradition Treaty 
before this committee includes procedural enhancements, which 
streamline the extradition process. For example, the Treaty contains a 
``temporary surrender'' provision, which allows a person found 
extraditable, but already in custody abroad for another criminal 
charge, to be temporarily surrendered for purposes of trial. Absent 
temporary surrender provisions, we face the problem of delaying the 
fugitive's surrender, sometimes for many years, while the fugitive 
serves out a sentence in another country. As a result, during this 
time, the U.S. case against the fugitive becomes stale, and the victims 
are delayed justice for the crimes committed against them.
    Further, the Extradition Treaty also allows the fugitive to waive 
extradition, or otherwise agree to immediate surrender, thereby 
substantially speeding up the fugitive's return in uncontested cases. 
The Treaty also streamlines the channels for seeking ``provisional 
arrest''--the process by which a fugitive can be immediately detained 
while documents in support of extradition are prepared, translated, and 
submitted through the diplomatic channel--and the procedures for 
supplementing an extradition request that already has been presented to 
the requested country.
    Together, the procedural and substantive improvements to the 
Extradition Treaty will ensure that U.S. prosecutors and law 
enforcement officials are better positioned to combat crime in an ever 
globally integrated and interdependent world.
           the u.s.-republic of serbia extradition agreement
    The United States and Serbia also operate pursuant to the same 1901 
extradition treaty between the United States and the Kingdom of Servia.
    However, unlike Kosovo, as applied to Serbia, the 1901 treaty is 
augmented by the extradition provisions applicable under multilateral 
conventions to which Serbia and the United States are parties. As a 
practical matter, this permits both countries to extradite fugitives 
for a broader scope of conduct apart from the enumerated list of crimes 
in the 1901 treaty. For example, both countries are party to the United 
Nations Transnational Organized Crime Convention, the U.N. Convention 
against Corruption, and the 1988 Vienna Drug Convention, all of which 
serve to augment the provisions in existing bilateral extradition 
treaties.
    Nevertheless, none of these multilateral treaties addresses one of 
the most important aspects of modern extradition practice: allowing for 
the extradition of nationals. In contrast, much like the proposed U.S.-
Kosovo Extradition Treaty, the U.S.-Serbia Extradition Treaty before 
this committee, allows for the extradition of nationals.
    Furthermore, unless the U.S. and Serbia become parties to an 
exhaustive list of multilateral conventions that cover every possible 
crime, we leave ourselves vulnerable to the possibility of gaps. The 
U.S.-Serbia Extradition Treaty before this committee minimizes the 
possibility of these gaps. As is found in the proposed U.S.-Kosovo 
Extradition Treaty, the U.S.-Serbia Treaty under consideration includes 
a ``dual criminality'' provision, which allows extradition with regards 
to all offenses that are punishable in both countries by a minimum term 
of imprisonment of more than one year.
    In addition to the provision which allows extradition of nationals, 
and the inclusion of the critical ``dual criminality'' method, the 
U.S.-Serbia Extradition Treaty before this committee includes all of 
the substantive and procedural improvements as contained in the 
proposed U.S.- Kosovo Extradition Treaty.
                               conclusion
    In conclusion, Mr. Chairman, we appreciate the committee's support 
in our efforts to strengthen the framework of treaties that assist us 
in combatting international crime. For the Department of Justice, 
modern extradition treaties are particularly critical law enforcement 
tools. To the extent that we can update our existing agreements in a 
way that enables cooperation to be more efficient and effective, we are 
advancing the protection of our citizens. Accordingly, we join the 
State Department in urging the prompt and favorable consideration of 
these law enforcement treaties. I would be pleased to respond to any 
questions the committee may have.


    Senator Risch. Thank you very much. Thank you to both of 
you.
    We are going to do a round of questions here. Before I do, 
I am going to include two pieces of correspondence the 
committee has received. One is from the Uniform Law Commission, 
the National Conference of Commissioners on Uniform State Laws, 
supporting these. And then also I am going to include a letter 
signed by a number of primarily financial institutions, and it 
is also in support of the treaties. And the U.S. Chamber of 
Commerce is also a signatory to those.


    [The information referred to above is located at the end of 
this hearing transcript.]


    Senator Risch. So with that, we are going to do some brief 
questions, and then we are going to submit some questions for 
the record for you.
    The first one I have, I do not know which one of you wants 
to take a swing at this, but can you talk a little bit about 
the impact that any of these treaties would have as far as 
small business is concerned, and gauge the importance of these 
treaties for small businesses here in America?
    Mr. Visek, you look like you want to volunteer.
    Mr. Visek. That is just my nature. Thank you, Mr. Chair.
    I think the benefits for small- and mid-sized businesses 
will obviously be most prevalent with respect to the U.N. 
Convention on the Assignment of Receivables in International 
Trade.
    I think the challenge for small businesses and mid-sized 
businesses is oftentimes obtaining sufficient cash flow and 
working capital. And currently, U.S. companies can be hampered 
in their ability to increase their exports because they have 
difficulty obtaining working capital financing based on 
receivables arising from the sale of exported goods.
    These companies could obtain financing by offering the 
receivables as collateral for loans from U.S. banks and other 
lenders. However, these lenders often are unwilling to make 
loans secured by receivables owed by customers in other 
countries whose laws are inconsistent with modern commercial 
finance practice. They may also be deterred by the fact that 
they have to be concerned about perfecting their claims in 
multiple countries because the choice of law rules may not be 
clear.
    Widespread ratification of the convention would go a long 
way towards remedying this situation. It is hoped that, if the 
United States were to ratify the convention, which in large 
measure dovetails with and is based on Article 9 of the Uniform 
Commercial Code, it would serve as a catalyst and prompt other 
nations to follow suit.
    In turn, that would create greater uniformity and reduce 
the legal risks associated with cross-border transactions 
involving those countries, and it would provide uniform rules 
that would go a long way, if you will, toward making it easier 
to obtain not only capital but also financing for export 
receivables.
    In turn, this, hopefully, would enable small, mid-size, and 
large companies to enhance the growth of their exports by U.S. 
companies, because they would be able to obtain the financing. 
And in turn that would presumably help U.S. companies compete 
in the global marketplace and create new jobs in the United 
States.
    Thank you.
    Senator Risch. Mr. Swartz?
    Mr. Swartz. And, Mr. Chairman, if I might add, extradition 
treaties also, although they are not oftentimes seen in this 
respect, serve as a benefit to U.S. companies both large and 
small. Among other things, it makes possible the return of 
fugitives who have sought to defraud U.S. companies, and that 
is important for certainty that punishment will be extended to 
those who acted against U.S. companies.
    And it is particularly important under these modern 
treaties that cybercrime is now covered as well, since we know 
that through business email compromise and other types of fraud 
schemes using the internet, American companies have been taken 
advantage of.
    So we fully expect these treaties will be at the interests 
of not only the U.S. citizens but U.S. companies as well.
    Thank you.
    Senator Risch. Thank you very much.
    Mr. Visek, you made reference to Article 9 of the UCC. When 
I was in law school, I wrote a treatise regarding that, and I 
am going to spare you the niceties of going into the details of 
that, at the risk of putting my colleagues to sleep.
    One last question. This committee has, at times over the 
years, considered what we call the Law of the Sea Treaty. It is 
actually the U.N. Convention on the Law of the Sea. The one 
treaty we have discussed here between the Republic of Kiribati, 
the Federated States of Micronesia, and the United States, does 
it have any connection, any effect, have anything to do with 
the Convention on the Law of the Sea Treaty?
    Mr. Visek. The short answer is that the accession to the 
Law of the Sea Convention is a separate issue from the 
Federated States of Micronesia and Kiribati maritime boundary 
treaties. The boundary treaties are treaties between the United 
States and those respective nations, and they establish EEZ 
limits that in many ways resemble the existing EEZ limits that 
all the parties informally recognize currently. What it would 
do is, in effect, codify those in the form of a treaty and, in 
doing so, would provide greater support for them. But they are 
independent of what is known as the U.N. Convention on the Law 
of the Sea.
    And with respect to the Law of the Sea Convention, I think 
Secretary Tillerson, during his confirmation process, said that 
he will examine the Law of the Sea Convention to determine 
whether it is in the continued best interests of the United 
States to become a party. And if I recall correctly, the chair 
of the committee, Senator Corker, sent a letter to the State 
Department asking about our treaty priorities, and we are in 
the process of consulting interagency and conducting that 
review.
    Senator Risch. I appreciate that.
    Back to the ones in front of us, does the text of it make 
any reference to or suggestion about the Law of Sea Treaty or 
convention?
    Mr. Visek. Senator, without having an encyclopedic memory, 
it is my understanding that it does not.
    Senator Risch. Would you double-check that and confirm that 
in writing?
    Mr. Visek. Yes, we will.
    Senator Risch. Thank you.
    Mr. Swartz, do you have anything to add to this?
    Mr. Swartz. No, Senator, I do not.
    Senator Risch. Okay, thank you very much.
    Senator Shaheen?
    Senator Shaheen. Thank you, Mr. Chairman.
    Mr. Visek, currently, only one country, Liberia, has 
ratified the U.N. Convention on the Assignment of Receivables, 
and five countries have to ratify the treaty.
    Can you tell us which countries after the United States, 
should we ratify, are most likely to file a suit?
    Mr. Visek. Thank you, Senator.
    Unfortunately, I do not have crystal ball. I can tell you 
that other states that have signed are Madagascar and 
Luxemburg, in addition to the United States.
    I think, though, what makes this convention particularly 
ripe at this point is that there is increased interest in 
receivables financing globally, as the global economy develops, 
both in Asia and Latin America. And the EU itself is looking at 
the issue of receivables financing.
    The convention was, in large measure, based on U.S. law. I 
am reminded of when I studied the Uniform Commercial Code, 
which was in 1985, and I felt somewhat emboldened at that 
point, only to find out that Article 9 had been amended in the 
late 1990s. But it was also about that time, shortly 
thereafter, that the convention was being negotiated. So it was 
very much informed by UCC Article 9.
    I think the way we look at this is, if the United States 
has not ratified the convention that is based on its own 
Uniform Commercial Code and is consistent with the laws of all 
50 States, that sends a negative signal. If we do ratify, and 
given the nature of our law, we obviously think we should, 
given the importance of the United States to the economic 
global environment, I think that would serve as a powerful 
catalyst for other nations to follow suit.
    It would also influence discussions and consideration in 
various nations and within the EU, for example, on how to 
approach the financing of receivables.
    I hope that answers your question.
    Senator Shaheen. That is helpful.
    Senator Risch has already talked about the potential impact 
on small and medium-sized businesses in the U.S., which I just 
want to reiterate that I think is also very important. And as I 
understand, one of the benefits of this treaty is that it would 
allow business to use international trade deals that they have 
already negotiated as collateral for borrowing.
    Am I interpreting that correctly?
    Mr. Visek. That is correct.
    Senator Shaheen. Thank you. So I think it would have a real 
benefit in that respect to many of our small and medium-sized 
businesses.
    Mr. Swartz, I understand that most extradition treaties bar 
extradition for political offenses, but the two extradition 
treaties before us today, as I understand, limit the scope of 
that exemption.
    Can you describe how the exemption has been narrowed? And 
is this a common feature among extradition treaties?
    Mr. Swartz. Thank you, Senator.
    Yes, we have sought to ensure that the political offense 
exception is not misused to apply to offenses that we consider 
to be crimes, such as murder, terrorist offenses, or other 
similar acts.
    So it has been the policy of the United States, and in the 
prior treaties to which this committee and the Senate have 
given advice and consent, to have a list of offenses that are 
not covered by the political offense exception. So that covers 
multilateral offenses, so the offenses under our various 
terrorism conventions. It covers murder, kidnapping, assault, 
and similar offenses.
    This treaty, the treaty with Kosovo, and similarly the 
treaty with Serbia, both add to the offenses, offenses 
involving chemical, biological, or radiological weapons, a 
further advance that we wanted to solidify in these conventions 
to make clear that individuals using such weapons cannot claim 
that they did so on a political basis and, therefore, should 
not be subject to extradition.
    It also has a number of other provisions that make clear 
that conspiracy or attempt to engage in such activity is also 
not a basis for refusing extradition.
    Senator Shaheen. Thank you.
    So how does our Department of Justice account for different 
perceptions and standards of evidence among the different 
nations when we are looking at extradition treaties?
    Mr. Swartz. Senator, thank you for that question, because 
it does touch on an important point.
    When we receive an extradition request, which first is 
transmitted through diplomatic channels to the State Department 
and assessed at the State Department for consistency with the 
treaty before it is sent to the Department of Justice, we at 
the Department of Justice, at our Office of International 
Affairs, consider in the first instance whether, as 
prosecutors, we believe that the evidence submitted establishes 
the legal standard required in the United States for 
extradition, and that is probable cause. It is not a hearing or 
a full trial on the merits, but it is probable cause.
    And so the evidence submitted to the Department of Justice, 
through the State Department from the foreign country, has to 
be sufficient in our perspective to submit to the court. And 
then, significantly, the court has to find that probable cause 
exists on the evidence provided.
    So regardless of the standards of evidence in other 
countries, we consistently apply the same standard to our 
extradition requests here.
    Senator Shaheen. Thank you.
    Thank you, Mr. Chairman.
    Senator Risch. Senator Kaine?
    Senator Kaine. Thank you, Mr. Chairman.
    And thanks to the witnesses for you work and for being here 
today. I find each of these treaties unobjectionable and look 
forward to supporting them, unless I end up with an odd 
question or two, in which case I will reach back out to you.
    I actually wanted to ask you, as a way of sort of fleshing 
out philosophy on these matters, we had a hearing recently in 
this committee about sort of the role of the administration and 
the Congress on treaties, on things less than treaties, 
executive agreements. And one that troubled me recently was the 
decision of the United States to withdraw from the Global 
Compact on Migration, known as the New York Compact, that the 
administration announced 2 weeks ago.
    Now, I would like you to correct me if I state this wrong. 
My understanding is the New York Compact was a nonbinding 
agreement done in the U.N. General Assembly in September 2016 
that essentially acknowledged the increasing severity of the 
global migrant and refugee crisis, and asked nations to commit 
to participating in a dialog about sort of new best practices 
for dealing with this.
    This is something that the President has spoken about, 
about the problems of migrants and refugees. And I think the 
President is right. I may have some different ideas from the 
President about how to deal with it. We would all have 
different ideas. But I do not think you can turn a blind eye to 
the fact that the specter of global refugees not just driven by 
war or violence but now weather emergencies and droughts and 
other significant issues are turning refugees and migrants from 
sort of an episodic emergency management challenge to sort of a 
permanent reality, which they may well have been throughout 
time. But I think the world is coming to grips with that.
    The compact involved a meeting in Puerto Vallarta last 
week. And shortly before the meeting, the administration 
announced it was going to pull out of the compact and not 
attend this meeting to discuss best practices.
    As an editorial opinion, I do not see how the world deals 
with this problem as effectively as the world could deal with 
it without the U.S. at the table.
    And the administration's asserted rationale for pulling out 
was that this nonbinding compact would intrude upon U.S. 
sovereignty.
    Now, in each of these instances, the four treaties before 
you, there could be sovereignty issues that would be raised, 
and we hashed them out. And it looks like, over time, we have 
gotten to a good point. But I could not understand why a 
nonbinding compact would raise sovereignty concerns.
    And I wanted to ask either of you whether your offices were 
involved either in the original work on the New York Compact in 
September 2016 or the decision or advice around the decision 
that led this administration to withdraw from the compact and 
withdraw from the meeting in Mexico.
    Mr. Visek. Senator Kaine, I certainly appreciate your 
concerns. However, this is an issue that I am not well-versed 
in. I apologize for not being more so. And what I would commit, 
though, is if we could take that question back and provide you 
with a written answer.
    Senator Kaine. That would be fine. And I will ask a 
specific one for a written answer, but can I just ask--the only 
question I really asked was whether your office was involved in 
either the discussions around the New York Compact in September 
2016 or the decision to remove. I had not asked a substantive 
question yet, just was this in the province or jurisdiction of 
your office within the Department of State?
    Mr. Visek. I understand that we were consulted. I do not 
know the extent of those consultations. But certainly, we could 
address your question in writing.
    Senator Kaine. Then I will ask that specifically for the 
record.
    Mr. Swartz?
    Mr. Swartz. Thank you, Senator.
    From the law enforcement perspective, my office was not 
involved in this matter, but I will also go back to my 
colleagues at the Department of Justice and respond more 
generally.
    Senator Kaine. That would be helpful, because I think this 
is a law enforcement matter. I mean, migrants and refugees are 
a humanitarian crisis and disaster, but one of the reasons the 
President often talks about this, correctly, is that, within 
migrant or refugee flows, cunning people can hide or spirit 
people across borders to try to undertake acts of terrorism, to 
try to involve in poaching, human trafficking. The migrant and 
refugee problem can often be a mask for real law enforcement 
concerns.
    And I think the idea, as I understood it, for the Puerto 
Vallarta meeting was to talk about all of those aspects of 
migrants and refugees. So I am asking a question that has a 
humanitarian and a national security and a law enforcement 
perspective.
    So we will craft particular questions for the record about 
this and would look forward to your responses.
    Thank you.
    Senator Risch. Thank you, Senator Kaine.
    With that, we want to thank you both.
    Senator Shaheen. I have more questions.
    Senator Risch. Another round, Senator?
    Senator Shaheen. Yes, please.
    Senator Risch. All right. Senator Shaheen has a little bit 
more for you.
    Senator Shaheen. I guess this is for you, Mr. Swartz. I 
know that we have a lot of extradition requests with countries. 
Are all our extradition treaties with the United States more or 
less the same? Are there exceptions?
    Mr. Swartz. Senator, thank you for that question as well. 
It does go to the heart of the program we have underway to 
modernize our treaties. And the answer is no, they are not all 
the same because they extend back into the 19th century, in 
some cases, and as you know from this hearing, to 1901, with 
regard to these two countries before the committee today.
    So we have sought in recent times to ensure consistency and 
uniformity in the new extradition treaties we negotiate. There 
are some differences, depending on particular countries.
    But by and large, we have sought, as, Mr. Chairman, you 
noted, from the 1990s forward to ensure the extradition of 
nationals, to eliminate the list treaty approach and go forward 
with dual criminality. So we seek, in that respect, to try and 
have a modern approach across all of our treaties.
    And if I might ask, Mr. Chairman, if my testimony, which 
also touches on this question, if my written testimony could be 
submitted for the record as well, I would be grateful.
    Senator Risch. We would be happy to have that.
    Senator Shaheen. And just to go back to my other question 
about the standards of evidence, are there other countries 
where we have extradition treaties that actually have higher 
standards of evidence than the United States? Do you know the 
answer to that?
    Mr. Swartz. Largely, extradition treaties do have similar 
standards for both sides. Sometimes, there are issues about 
exactly how each country interprets the approach. But in 
virtually all of our experience, the approach is one that looks 
to see whether or not some form of probable cause or 
reasonableness exists for the extradition.
    Some countries require a fuller production of evidence than 
would be required in the United States and vice versa. But 
again, largely across the broad range of our treaties, the 
approach is similar.
    Senator Shaheen. Thank you. And this final question is 
really for both of you.
    How do we handle terrorists or armed insurgents under 
extradition treaties? Do we have any guidance that is different 
from other potential people that we are trying to extradite?
    Mr. Swartz. Senator, one of the key aspects of updating our 
treaty is to reach terrorist offenses, in particular. We have a 
strong commitment to pursuing terrorists worldwide, to ensure 
that they do not have safe havens. So we have brought a number 
of cases from countries around the world where we have 
extradition treaties, seeking terrorists or others who have 
committed terrorist acts. And we have brought a number of those 
individuals back and successfully prosecuted them here in the 
United States.
    Senator Shaheen. And do we have any countries who have not 
been willing to give up terrorists, or people who we would 
determine to be terrorists and who they have refused to 
extradite to the United Sates?
    Mr. Swartz. Senator, it is an unfortunate fact that we do 
not win all our extradition cases. Of course, that is always 
our goal.
    With our key and trusted partners, we have had a large 
degree of success with this. If we have denials of extradition, 
it is usually not based on the individual being a terrorist or 
otherwise. There is oftentimes consideration such as whether 
the individual has been prosecuted previously or other factors 
that may lead a country to deny extradition.
    Senator Shaheen. Thank you.
    Thank you, Mr. Chairman.
    Senator Risch. Thank you very much, Senator Shaheen. That 
is an excellent question.
    And we have also had the unfortunate circumstance that some 
countries do this informally by simply hiding the individual. 
That does not happen often, but we all wish that it was a 
perfect world, but it is not, and particularly with 
governments.
    So with that, again, thank you to both of you for 
participating.
    We are going to keep the record open until the close of 
business on Friday, and there will be some questions for the 
record that will be submitted.
    Gentlemen, if you would get your answers back as promptly 
as possible, we will be able to complete this matter.
    Senator Risch. And so with that, the hearing will be 
adjourned.
    [Whereupon, at 3:14 p.m., the hearing was adjourned.]



                              ----------                              


              Additional Material Submitted for the Record

     Responses to Additional Questions for the Record Submitted to 
                   Richard Visek by Senator Tim Kaine

    Question 1. Was the Legal (L) bureau at the State Department or the 
DOJ involved in negotiating the New York Declaration on Refugees and 
Migration in 2016? Did you play a role or were you consulted on our 
withdrawal?

    Answer. The Office of the Legal Adviser at the Department of State 
was consulted and provided input throughout the process of negotiating 
the New York Declaration on Refugees and Migrants in 2016, as were 
relevant agencies. I am not in a position to speak specifically to the 
role of DOJ.
    Relevant agencies including the Department of State were also 
consulted before the decision was made to end U.S. participation in the 
UN process to develop a global compact on migration. The Office of the 
Legal Adviser provided advice to Department of State officials as part 
of that process.

    Question 2. Did legal experts in the State Department or DOJ 
determine the New York Declaration was inconsistent with U.S. domestic 
law? In what areas? By negotiating as part of this process, could the 
standards have been elevated to be consistent with U.S. law as in other 
negotiations on multilateral agreements?

    Answer. In all multilateral negotiations in which the United States 
participates, U.S. negotiators endeavor to ensure that any obligations 
or commitments that the United States would assume through the 
instrument are consistent with U.S. domestic law and existing 
international obligations. The Office of the Legal Adviser supports the 
Department in this process. To the extent these efforts do not fully 
succeed, the Department may recommend, for example, reservations or 
understandings to multilateral treaties or agreements, or explanations 
of position with regard to instruments that are not legally binding. 
The Department may also recommend that the United States not become a 
party to or sign or support a particular instrument. Due to 
professional obligations of attorneys providing advice to clients, I am 
not in a position to disclose the legal advice the Office of the Legal 
Adviser provided to the Department, nor am I in a position to speak to 
DOJ's conclusions.

    Question 3. Do you see any utility in the U.S. withdrawing from 
this process prior to a final agreement? Could the legal professionals 
in your offices have helped shaped a compact on migration to be 
consistent with U.S. law as in the United Nations Convention on the 
Assignment of Receivables in International Trade?

    Answer. As noted above, the State Department and other relevant 
agencies were consulted before the decision was made to end U.S. 
participation in the UN process to develop a global compact on 
migration. Where a policy decision is made to participate in 
multilateral negotiations, U.S. negotiators, with support from the 
Office of the Legal Adviser, endeavor to ensure that any obligations or 
commitments that the United States would assume through the instrument 
are consistent with U.S. domestic law and existing international 
obligations. Ultimately the question whether to participate in a 
multilateral negotiation is a policy judgment, informed by legal 
advice. Due to professional obligations of attorneys providing advice 
to clients, I am not in a position to comment on the advice the Office 
of the Legal Adviser provided on this issue.

    Question 4. In negotiations of treaties, international agreements 
other than treaties, and instruments containing non-legally binding 
political commitments, in which the Department of State participates, 
Department negotiators endeavor to ensure that any obligations or 
commitments that the United States would assume through the instrument 
are consistent with U.S. domestic law and existing international 
obligations. The Office of the Legal Adviser supports the Department in 
this process.

   Can you detail how your offices generally ensure that any 
        international agreement, accord or treaty comply with U.S. law?

    Answer. When the Department of State is considering whether the 
United States (or an agency thereof) should become party to a treaty or 
an international agreement other than a treaty, or should sign or 
support adoption of an international instrument containing non-legally 
binding political commitments, the Department, including the Office of 
the Legal Adviser, reviews the instrument to ensure that it is 
consistent with U.S. law and existing international legal obligations 
of the United States. As appropriate, other agencies of the U.S. 
Government are consulted as a part of this review. For some 
instruments, we also consult with any domestic stakeholders who may be 
affected. As a result of the review, the Department may recommend, for 
example, reservations or understandings to multilateral treaties or 
agreements, or explanations of position with regard to instruments that 
are not legally binding, to ensure that the United States does not take 
on obligations or commitments that would be inconsistent with U.S. law 
or existing international obligations.

    Question 5. Do you believe non-binding compacts that include 
voluntary commitments impinge on U.S. sovereignty?

    Answer. The Office of the Legal Adviser is responsible for advising 
on legal issues associated with treaties, international agreements 
other than treaties, and international instruments that are not legally 
binding when they are being considered by the Department of State. 
Whether particular instruments are consistent with U.S. interests is a 
question that is typically considered by relevant policy officials; the 
Office of the Legal Adviser provides legal advice and legal policy 
views as appropriate.

               Correspondence in Support of the Treaties

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