May 13, 2020 - World

Scoop: Bob Dole registers as lobbyist for Chinese-owned chemical company

Mike Pence and Bob Dole at the Republican National Convention, July 18, 2016. Photo: Brett Carlsen/Getty Images

Former senator Bob Dole has registered to lobby on behalf of Wanhua Chemical (America) Co., Ltd., a Texas-based firm whose Chinese parent company is caught up in the U.S.-China trade war.

Why it matters: Lobbying by former U.S. elected officials on behalf of the Chinese government or companies it controls has raised concerns that Beijing may be able to influence the U.S. domestic political process — especially given vague disclosure rules.

What's happening: Dole, a former Senate Republican leader and presidential candidate who is now 96, works for law firm Alston & Bird and is receiving $150,000 for outreach to the U.S. House and Senate on behalf of Wanhua Chemical on "issues related to U.S. trade investment policy," according to first-quarter filings from the Senate lobbying disclosure database.

  • Alston & Bird began working with Wanhua Chemical in September 2019, according to filings.

Two key details about Wanhua:

  • Wanhua Chemical Group is the world's largest manufacturer of MDI, a compound used in insulation that has been subject to U.S. tariffs amid the trade war. The company's plan to build a $1.25 billion plant in Louisiana is also now on hold.
  • Wanhua Chemical Group's largest shareholder, holding 21.59% of its shares, is an entity owned by a Chinese municipal government, according to Wanhua's 2019 annual report.

Alston & Bird only registered its contract with Wanhua in the Senate database, not the Foreign Agents Registration Act (FARA) database under the Department of Justice, which has more stringent disclosure requirements.

  • That's because under current interpretation of the FARA law, some U.S.-based entities with foreign parent companies may be considered American companies, meaning they don't necessarily trigger the FARA registration requirement.

What they're saying: Alston & Bird does not disclose the minority stake a Chinese government-owned entity holds in Wanhua Chemical Group. But they do state the work of its lobbyists, including Dole, could potentially benefit the Chinese company directly.

  • "To the extent that Wanhua Chemical (America) Co., Ltd. realizes any benefit from legislative or executive action, so, too, would its parent company, Wanhua Chemical Group Co. Ltd," the Senate lobbying disclosure states.
  • Alston & Bird, Dole, and Wanhua Chemical did not respond to multiple requests for comment.

FARA is notoriously vague, however, and another consulting company came to a different conclusion about the need to register as a foreign agent for its work with Wanhua.

  • AUX Initiatives LLC, a DC-based government affairs consulting firm, filed a FARA registration for its contract with Wanhua Chemical US Operations LLC — which is listed alongside Wanhua Chemical (America) LLC on Wanhua Chemical Group's website — in August 2018 "out of an abundance of caution," according to documents obtained from the Department of Justice website.
  • “Principal is a domestic LLC in the chemical industry headquartered in Texas. Its ultimate parent company, Wanhua Chemical Group Co. Ltd., is traded on the Shanghai stock exchange," AUX Initiatives wrote in its FARA disclosure in August 2018. "Registrant believes that a state-owned investment holding company controlled by Chinese local government holds a minority ownership position in the parent company."

The bottom line: The current interpretation of FARA appears to have loopholes that allow companies with clear ties to the Chinese government to avoid registration — and those who lobby for them to disclose very little about those activities.

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