Have Risk, Will Travel: Compliance Issues In International ...€¦ · SCCE Higher Education...

SCCE Higher Education Compliance Conference

1

Have Risk, Will Travel:

Compliance Issues In

International Programs

Presented by: Seth F. Gilbertson, Associate Counsel, SUNY Office of General Counsel

2015 Higher Education

Compliance Conference

June 2, 2015

Part 1 - Business Risks

• Foreign employment issues

• Foreign property leasing and acquisition

• Structuring financial transactions in support of international activity

• Establishing relationships with partners and providers

• Insurance basics

• Export controls basics

• Essential policies for overseas operations


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Jacques files for his pension

The French Department has used Jacques for 15 years as its local coordinator in Provence. He works out of his home making travel, sightseeing, and accommodations arrangements in Southern France and Paris for groups of students from your campus. The Department considers him to be an "independent contractor."

La pensionné

• Jacques informs your university that he intends on retiring (at 52). Soon after, the Ministère des Affaires Sociales writes to demand that you make 15 years of pension, health, and employment tax payments (equal to 150% of Jacques’ fee per year).

• What do you do?

• What are your options if the employment determination stands?


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Foreign Employment Issues

• What are the options for employing an individual (or individuals) in-country?

• Is there an option or model that makes sense? – Is your institution legally and operationally capable? – Can you afford it?

• How do you make your chosen model a reality? – What legal arrangements need to be in place?

• A specific type of agreement? • A specific legal structure of vehicle?

• What about U.S. workers overseas? – Is there and appropriate dichotomy between locals

and expats?

Foreign Employment Solutions

• Require legal review of any foreign pay-for-service relationship – Use reliable paymaster (PSA) and/or have local lawyer

review any arrangement – Periodic review every couple of years

• Analyze the status of people you send from U.S. to foreign countries (faculty exchanges and trip leaders) – Limit time in country and follow visa restrictions

• Consider using foreign partner institutions as agents – Look for consortiums and services agents

• Consider operating a separate U.S. affiliate


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We've got a place in _____

• Your university rents a small suite with a classroom, common area, and office in Provence for groups of students to congregate, study, and receive instruction while in Provence.

• Jacques was in charge of making the arrangements and he signed the lease in his own name.

• Now he wants to transfer it to the university.

• How can this be accomplished?

Foreign Real Estate Issues

• To lease or to buy? – Is your use sustained and permanent enough for

either? • Look out for programs that are dependant on one individual

or program

– How much flexibility do you need?

• Is there an appropriate vehicle available?

• Are the uses you intend

permitted?

• Is the cost prohibitive?


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Foreign Real Estate Solutions

• Rethink the need and options

• Have any leases reviewed by local counsel or specialty firm

• Do a competitive search

• Consider creating a U.S.-based holding corp – Might be same as employment vehicle

• Look to foreign institutional partners or consortiums

• Definitely have license-status reviewed

• Whose your agent?

Trust But Verify

Prof. Peril leaves for Moscow with a group of architecture students in three days. While in country, the students will use dorms and classroom space at the Putin Friendship University of Russia, a partner of your institution. In the past, the School of Architecture at your institution has simply used an electronic funds transfer to compensate PFUR.


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doveryai no proveryai

• PFUR's bank says that the payment has been "flagged" by the Ministry of Finance and cannot be processed. As of the day of departure, the transfer has still not gone through. • Was a bank-to-bank electronic funds transfer appropriate? • While trying to help, you notice that PFUR's website markets its relationship to your institution and includes a prominent display of your institution's emblem. When you ask Prof. Peril about this, he casually states that "It's okay. I told them they could do that."

Foreign Financial Transactions

• Look at major programs (employment, real estate, etc.) but don’t forget the small trips

• Ensure that travelers have access to the necessary liquid funds, but carry too much across boarders

• Bring in internal controls

• Use qualified accounting or consulting firm to navigate regulations and transfers – This shouldn't be too easy

• FATCA – Do you need a W8/W9?


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Driving Us Crazy

Your college institutes a new "service learning" program in Columbia, sending a group of nursing students to a remote underserved area to administer vaccinations. The program is run be Prof. Selfless. The Nursing Department contracts with Leave-It-To-Us, a tour provider that will handle all of the necessary travel arrangements. Leave-It-To-Us in turn hires Mr. Bus to take the students from Medellin to the village where they will be staying. Half way there, the bus breaks down.

Driving Us Crazy

• Mr. Bus is not bonded and apparently cannot afford the necessary repairs. • Calls to Leave-It-To-Us go unanswered. Apparently their CEO, Ms. Selfless, is out of the country on business. • With the help of a Columbian faculty member, you are able to arrange for another bus to pick up the students in the jungle and take them back to Medellin, but the cost is exorbitant. • Nothing in the contract covers this scenario • What do you do?


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Affiliates & Providers

• Who to choose

– Tour providers

– Hotels

– Transportation

– Facilities

• What to look for

• How to contract

• Agreements with

foreign institutions

Choosing Providers

• Due Diligence

– Don't rely on faculty!

• Larger companies might not seem as "authentic" or fun, but it's no fun to manage an emergency with mom & pop

• Look for higher education experience

– We have needs!

• History can be invaluable


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Choosing Providers

• Attempt to institute a competitive process

– Consider using a committee

• Academic, Risk, Legal and Business all have important views here

– Use an RFP (or modified) if possible

– Get multiple quotes

• May require some flexibility in plans

– Look at multiple inputs

• Price is not determinative

What to look for

• Tour Providers: – Experience – Size – Credentials – Insurance

• Housing/facilities: – Security – Fire safety

• Transport: – Licensed – Bonded – Insured – No student or faculty/staff drivers!


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Contracting

• Bind risk to control at every turn – Indemnity

– Insurance

• U.S. law or local counsel

• Guarantees – Locations (tour)

• Sites & hotels

– Timing

– Staff #s

– Licensure

Contracting

• Deposit, then increments – Cost should be all-inclusive

– Consider taxes and other payments (gratuity, etc.)

• Institution pays – Students never a party

• No kickbacks – Including "free" faculty travel

• If college is unwilling to pay for a necessary element, trip should be rejected

• Consider contracting for multiple trips – Better rates and avoids search/negotiation process


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Insurance

• Too boring for a hypo? • Four basic types:

– Liability – Kidnap & Ransom – Health – Evacuation

• Important for employees to have all four (depending on place)

• Students need health and evacuation (can be combine)

• Make sure trip leaders know basics and have contact info

Export Controls

• Goes beyond research • Academic conferences becoming suspect • Prioritize by country

• Iran & Cuba • China and Russia • Eastern Europe and Middle East

• Maintain "clean" technology • Look at incoming and outgoing

• Beware "deemed exports" • I-140 section 6

• Consider engaging in outside expertise if you don’t have it • Ripe for an audit or compliance review


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Bonus Risk: Brand Maintenance

• Be like DisneyTM

• Not every school, department or professor should be speaking on behalf of or granting IP licenses to foreign "partners"

• Clarify that usual protocols apply abroad

• Register vigorously

• Include language in every contract

Policies you need

• No person goes overseas without approval – Have self verification checklist (more in Part II)

• Tie to indemnification

– Tracking process is essential – Include export controls questionnaire

• No money spent overseas without approval – Centralize all international outflows

• Tie planning/approval to reimbursement

• Have procurements and contract authority sit outside of academic or research area – Require justification – Require legal review


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Part 2 – Student Affairs Risks

• Clery reporting and international programs

• Title IX issues with international programs

• Conduct issues in international programs

• International program leadership

• Emergency management

• Health and medical issues

• Drafting and applying policies for study abroad

Clery on Tour

• Just as with stateside reporting, Clery does not require you to report crimes based on WHO

• Clery requires you to report crimes based on WHERE

Example:

Two strangers are robbed by a third stranger while walking across the campus quad (they were not invited and had no business being there).

Report


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Reportable Places

Clery Act crimes are reportable as non campus incidents if they occur:

• In space that the institution owns or controls (control requiring only a formal agreement for use, such as a lease or rental agreement) overseas that are used to support the institution’s mission and are frequently used by students (i.e. not just administrative offices);

– The same hotel/hostel is used on a regular basis (multi year or semester); or

– It is a "trip of longer duration"

• Define by policy (20 days or more)

Reportable Places: Hotels

• Crimes that occur in that controlled or frequently used hotel/hostel are reportable as non campus crimes:

– Student’s rooms;

– Entrance and egress, lobby, elevator, escalator, stairwell

– Public areas (breakfast, pool, gym)

• Not reportable:

– Crimes that occur in non student private rooms

– Crimes that occur on floors not inhabited by students

– Crimes that occur in places not accessible to students (VIP lounge)


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Example

Student is robbed at an Occupy protest outside of Harrods while on spring break in London, sees the college president, punches her, then lights a fire with old issues of the News of the World.

NOT Clery reportable

Example

Student is robbed in the elevator of a hotel that the college rents a floor from for a week each semester.

IS Clery reportable


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TIX & ISSS

"OCR recommends that a school take steps to ensure that its employees who work with international students, including the school’s DSO, are trained on the school’s sexual violence policies and that employees involved in handling sexual violence complaints and counseling students who have experienced sexual violence are aware of the special issues that international students may encounter."

TIX Abroad

• Title IX Coordinators should consider all incidents and allegations, including those that occur overseas, consistent with their responsibilities to spot patterns and track complaints

• Students participating in study abroad through a Host or Provider are subject to the policies and procedures of the Provider or Host, as well as those of his or her Home Institution.


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TIX Abroad

• Which institution takes the lead in investigating and responding to allegations of sexual harassment and/or violence shall be determined immediately following the reporting of an incident. Factors to consider include: – the location of the incident; – the enrollment status of the student(s) involved; – the nature and duration of the program; – the timing of the report (during or after a program).

• Generally, the institution with immediate and primary control over the parties and evidence shall lead the investigation and response.

Example

Student from your college who is in summer program at University of Florence alleges sexual assault by a student from college in neighboring state who is in the same program. She calls the faculty member at U Florence who coordinates the program with your College to report the incident.

• What happens next?

• Who is involved?

• What options are available for victim?


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TIX Abroad

• Planning and speed are key

– Sadly, this will happen to you

• Be ready to offer: • Counseling

• Options

• Legal assistance

• Be ready to perform an investigation

• Be ready to conduct a hearing

– Have distance-capability and educated staff on site

• Prepare and educate partners

– Reach out to US counterparts immediately

The Code of Conduct Goes Global

What parts of your code apply?

• TIX yes

• What does the provision/prohibition say? – Is it limited to on campus or applied anywhere?

• Add local law

• Does campus' law travel? – Drinking age?

– Marijuana?

• Specific cultural or safety considerations? – Look at specific trip and history


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An American Code in Paris

Conduct:

• Notice of charges

– Time to prepare

– Doesn't limit interim safety precautions

• Opportunity to be heard

– Usually a hearing (look at code)

– Consider distance options

• Add provisions to compliment process

• Expulsion is student's expense

An American Code in Paris

Conduct (cont.):

• Appeal

– Good idea to have opportunity to correct deficiencies

Academic:

• Retain full discretion

– Usually some appeal or review process

Trip Leader Training is Essential

– Give authority to act


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Forum Standards

• Standard 8: The Organization has established and continuously maintains effective health, safety, security and risk management policies, procedures and faculty / staff training.

–The Forum on Education Abroad 2011

http://www.forumea.org/standards-standards.cfm

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Program Leader Qualifications

• Proposal Process

• Orientation/Training

• Student/Staff Ratios

– Never one lone leader!





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Essential Functions

• Attendance at mandatory pre-departure meetings;

• 24-7 availability for the term of the program (the details of this differ by program but student emergencies rarely happen during the business days);

• Ability to manage the teaching requirements for the course in addition to the student service requirements;

• Maintain contact with the education abroad office/sponsor unit throughout the program;

• Report all behavior and health/safety incidents to the education abroad office/sponsor unit and consult on required response;

• Participate fully in all aspects of the program.

Leader Training (cont.)

• It is a constant process! – Consider multiple workshops/meetings

– Draw on past leader experiences

– Build a cohort

– Training vs. professional development

• Mandatory? If yes, how enforced?

• Private Companions? – Allowed?

– What training/credentials?


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• University policies – Privacy (FERPA, HIPAA)

– Sexual harassment (Title IX, Campus SaVE, Clery)

– Health, disabilities (ADA)

– Staff and faculty code/job description

– Education abroad

– Academic

– Student behavior code

– Driving/transportation


• Today’s student and responding to common issues – Mental health

– Drinking

• Division of duties – Program leader

– Local support

– Home university

• Emergency response plan – Communication

– Meeting place

– Location specific

• Incident response – Reporting and 24-7

contacts

– Using insurance

– Scare stories/case studies


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March 11, 2011

A megathrust earthquake, one of the five largest ever recorded, occurs off the Oshika Peninsula in Japan. It was followed by a tsunami with waves of up to 10 m (33 ft). Thousands are dead and there is extensive material damage to buildings and infrastructure, leading to significant accidents at four major nuclear power stations, including one at Fukushima in Tohoku. 2,654 people are missing.

Woodwho, woodwhere?

• On part of its Asian tour, your university's woodwind ensemble arrived in nearby Miyagi two days before.

• Ms. Phrantic calls and asks if her little Jimmy is alright.

• How do you answer?


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Emergency Planning

• Have an Emergency Team at home

• Includes: Counsel, Risk, International, Student Services, External Relations, Public Safety, Health Services, etc.

• Has authority to take action

• 24/7 availability

• Consider State Department warnings

• In-country contacts?

– Partners, friends, authorities

• Including local authorities, insurance carriers, and consulate/embassy

• Make sure that these are available to someone at home

Emergency Planning

• Require an Emergency Plan

– Lists country-specific risks and steps taken to mitigate or planned as response

– Defines emergency and/or levels

• Includes student conduct and criminal activity

• Includes sexual assault response plan

– Automatic emergency contacts

– Consider loss of leaders

– Repatriation plan


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It's the 8th day of a three week study trip in Thailand and Sally gets a fever. The group is led by Professor Wrisk and includes 14 other students. Wrisk calls campus to seek advice, but gets no response because it's in the middle of the night EST. The local clinic seems clean and safe, so Wrisk and the group go on to the next stop and leave Sally. Sally speaks no Thai.

• Not having heard from Sally in two days, her mom calls. • What information does your college have for her? • When Prof. Wrisk finally contacts the campus, who does what?

In the Middle of the Night

Health Risk Planning

• Require student orientation • Require leader orientation • Require waivers and agreements

– General and activity specific – Gives decision-making authority to leaders

• Consider health forms – Doc approval?

• Require immunizations – Country specific

• Insurance – Health and repatriation


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Health Planning (ADA)

• Just assume ADA applies in all of your programs, at home and abroad – More complicated with foreign partner programs

– Consider addressing in agreements

• Prepare to provide disability accommodations – Think creatively about alternatives

– Use resources from home where possible

– This will not be low-cost

• Seek information AFTER admission to program but BEFORE trip leaves

• Make sure students and their providers understand the complications and difficulties of international travel

Policies you need

• No money spent overseas without approval

– Centralize all international outflows

• Tie planning/approval to reimbursement

• Have procurements and contract authority sit outside of academic or research area

– Require justification

– Require legal review


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Bonus Risk To Address In Policy: Travel

• Road crashes are the leading cause of death and injury for healthy Americans traveling abroad

• Policy should require preparation for road safety situations in any country or regions where university-sponsored groups will be driving

• Allow employees to drive? NEVER

Association for Safe International Road Travel (ASIRT) publishes in–depth Road Travel Reports about the world’s roads for over 160 countries

Bonus Risk: Travel


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- Country-Specific Information

• Driver behaviors

• Signage

• Laws and customs

• Public transportation

• Taxis and buses

• Night travel

• Holiday travel

• Pedestrian safety

• Weather hazards

• Extreme terrains

• Dangerous roads

• Police enforcement

• Emergency care

• Post-crash procedures

Bonus Risk: Travel

Discuss?

Have Risk, Will Travel: Compliance Issues In International ...€¦ · SCCE Higher Education...

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