Donald Trump’s biggest office tenant at his namesake Fifth Avenue tower could become one of his biggest headaches.
The state-owned Industrial & Commercial Bank of China, the world’s biggest lender measured by assets, occupies 20,404 square feet of office space at Trump Tower. The bank’s lease is set to expire in 2019, and renewal negotiations could run Trump afoul of a little-known piece of the U.S. Constitution meant to avoid conflicts of interest.
The “emoluments” clause prevents U.S. officials from receiving gifts from foreign governments. In the case of the ICBC lease, any terms deemed to be favorable to the bank could get Trump in hot water.
“It could be a problem if they pay anything more than the market rate or the market rate has changed somehow by the fact that he’s president,” said Richard Painter, a University of Minnesota law professor who served as the chief ethics lawyer under President George W. Bush. “Any concessions to him by the bank could be viewed as a gift, as a monetary value.”
The bank was paying $95.48 per square foot for its Trump Tower space as of September 2012, the latest lease data available, Bloomberg reported.
Trump was highly critical of the Chinese government on the campaign trail, while at the same time highlighting his business deals with the country. Ethics experts have been critical of his plan to hand over his company to his children, arguing Trump should sell his interests in his properties and put the resulting funds into a blind trust.
In an extreme scenario, Congress could impeach Trump for violating the Constitution, though the emoluments clause has never been litigated. What’s more likely to happen is that his administration would be tied up with information requests or litigation over his business deals with foreign countries.
There is some disagreement, however, on whether the emoluments clause would apply in situations such as the ICBC lease.
“If we start to see foreign governments providing gifts directly to the President, that would be problematic,” said Robert Kelner, head of the election and political law practice at the law firm Covington & Burling. “But ordinary course-of-business dealings between a state-owned enterprise and a bona fide corporation owned by the President won’t come anywhere close to violating the Constitution’s emoluments clause.
“The founders would have been surprised to learn that George Washington couldn’t sell his crops to a foreign chartered trading company,” he added. [Bloomberg] – Rich Bockmann