05/12/16 | By Vicki Needham
Power players in the financial services industry are threatening to sit out the push for President Obama’s Pacific Rim trade deal unless the administration addresses one of their main objections to the pact.
Banks, insurance companies and other financial companies oppose a provision in the 12-nation Trans-Pacific Partnership (TPP) that would give foreign governments the ability to require that U.S. businesses maintain data servers within their borders, fearing it could create high costs and security risks.
The Securities Industry and Financial Markets Association (SIFMA) and the Financial Services Roundtable (FSR) say that while they are prepared to devote substantial resources to lobbying Congress in support of the TPP, the Obama administration must first rework the data provision to guarantee that their electronic data can move freely across borders.
Francis Creighton, executive vice president of government affairs at the FSR, praised the trade deal but said group won’t begin lobbying Congress for it until the data flow issue is resolved.
“We can’t actively go up to Capitol Hill and push for it even though we want to get this done,” Creighton said.
“That’s how serious this is. We would rather see nothing happen than pass TPP with this provision.”
The financial groups have been working for months with the Obama administration to fix the issue. U.S. Trade Representative Michael Froman has reported progress, but a resolution has not yet been reached.
Treasury said that conversations are continuing with movement toward a solution.
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