EXCLUSIVE: Protect USA Act advances unanimously as Rep. Goldman warns EU rules threaten affordability

The House Energy and Commerce Committee’s Commerce, Manufacturing, and Trade Subcommittee unanimously advanced legislation Tuesday aimed at stopping European Union regulations from raising costs on American businesses and consumers.

The PROTECT USA Act passed the subcommittee by voice vote and is expected to receive a vote before the full committee on Sept. 14.

The legislation specifically targets foreign sustainability mandates including the European Union’s Corporate Sustainability Due Diligence Directive, or CSDDD, which has drawn growing opposition from congressional Republicans and American businesses concerned about its reach into the U.S. economy.

Rep. Craig Goldman (R., Texas) used the hearing to explain how those regulations could ultimately hit even small businesses that have no operations in Europe.

“Here’s what that looks like on the ground in my district,” Goldman said. “A gas station owner in Fort Worth, which is a handful employees, isn’t a multinational corporation doing business in Europe, he’ll never file a compliance report in Brussels.”

But the small business could still be forced to bear the costs of European regulations because of its relationship with a larger American company.

“But if his partner is with a major American fuel brand that does business in Europe, his franchise contract can get rewritten to satisfy EU mandates with new questionnaires, new supplier codes, new audit requirements, all from a regulation he had no say in, passed by a government he doesn’t vote for,” Goldman said.

“That’s a small businessman in my district spending time and money to comply with EU overreach because of who he partners with to sell gas to local families, truck drivers, and other small businesses.”

The unanimous vote marks a significant step in congressional efforts to push back against CSDDD and other European regulations that lawmakers say could raise costs for American companies and ultimately their customers.

The Washington Reporter has previously covered the growing Republican push against CSDDD, including warnings that the European mandate could force American companies and their suppliers to comply with regulations that go beyond U.S. law.

House Financial Services Committee Chairman French Hill (R., Ark.) previously told the Reporter that CSDDD “undermines U.S. jurisdictional sovereignty,” while warning about the costs the European rules could impose on American businesses.

Senate Banking Committee Chairman Tim Scott (R., S.C.) has also warned about the European sustainability mandates, arguing that they threaten American competitiveness and sovereignty.

Rep. Andy Barr (R., Ky.) told the Reporter earlier this year that the regulations could ultimately hit Americans directly in their wallets.

“Because energy markets are global, regulatory schemes like the CSDDD will jack up energy prices in the United States, whether they are implemented in Europe or elsewhere,” Barr said.

The PROTECT USA Act would prohibit entities deemed integral to U.S. national interests from being forced to participate in foreign sustainability due diligence regimes, including CSDDD.

The legislation is intended to prevent European regulators from effectively imposing their rules on American companies through supply chains, contracts, and other business relationships.

The unanimous subcommittee vote now sends the legislation to the full committee, where lawmakers are expected to consider it on Sept. 14.