y James T. Areddy
June 29, 2018 5:13 p.m. ET
12 COMMENTS
SHANGHAI—A son of the American ambassador to Beijing used his connections to President Donald Trump this week to drum up business for his public-relations firm.
Eric Branstad, a son of Ambassador Terry Branstad, and the U.S. Commerce Department’s liaison to the White House until January, spoke on Thursday in Shanghai to more than 100 lawyers, bankers and advisers at a seminar titled “How to React To (Potential) US-China Trade War?”
Mr. Branstad highlighted his personal relationship with Mr. Trump and plans for his firm to open a China office, attendees said.
It isn’t unusual for former U.S. government officials to visit China dangling the keys to understanding Washington, and ethics rules don’t appear to bar Mr. Branstad from doing so. But such a move could raise the appearance of ethical conflicts, experts say.
Mr. Trump is upending longstanding U.S.-China ties that he has criticized as cozy and harmful to American interests. His administration imposed tariffs on Chinese goods that are set to begin on July 6; Beijing says it will retaliate.
Mr. Branstad endorsed Mr. Trump’s challenges to China while onstage with a colleague, but his efforts to build his own business in the country appeared to hinge on his personal connection to the president, the attendees said.
“It was this whole splash about how they met Donald Trump,” said Richard Chenel, a Shanghai-based private-equity investor who attended the presentation. Mr. Chenel said he had hoped to gain insight about how trade tensions might affect investment valuations. He said he was disappointed that Mr. Branstad’s primary message was that Mr. Trump supports the American worker.
The U.S. Embassy in Beijing didn’t respond to a request to comment. The White House didn’t immediately respond. Reached by email, Mr. Branstad declined to comment.
In his travels to Shanghai and Beijing this week, Mr. Branstad was representing Mercury Public Affairs LLC, a Washington communications firm he joined in February as managing director weeks after leaving U.S. government service. At his presentation, Mr. Branstad said Mercury plans to soon open an office in China, attendees said.
Mercury, a division of Omnicom Group Inc., recently began representing a Chinese telecommunications equipment maker that has been in the crosshairs of the U.S. government: ZTE Corp.
On May 13, Mr. Trump set in motion a reversal of a Commerce Department prohibition on ZTE’s access to U.S. suppliers because of allegations the company broke U.S. law. Mr. Trump in a tweet cited a determination to work with Chinese President Xi Jinping to get ZTE “back in business, fast.”
Mercury subsequently said in a filing with the U.S. Justice Department that as of May 14 it would act as a subcontractor to the global law firm Hogan Lovells on matters involving ZTE at a rate of $75,000 a month for three months.
In June, the U.S. Senate voted to reinstate the ZTE ban.
Hogan Lovells declined to comment. A Mercury spokeswoman said she couldn’t comment.
Scott D. Williams, a Shanghai investment broker and co-founder of the organization that sponsored Mr. Branstad’s presentation, said the event was intended to provide insight on the Trump administration’s China policy. The U.S. strategy has left businesspeople wondering whether tensions between Washington and Beijing will become a full-blown trade war.
Eric Branstad was an early fundraiser for Mr. Trump. He joined the administration as it began raising pressure on China. His father was a long-serving Iowa governor who first met China’s president, Mr. Xi, in 1985.
An earlier attempt by the family of a Trump administration official to promote business in China backfired.
When family members of Mr. Trump’s son-in-law and adviser, Jared Kushner, visited Beijing and Shanghai in May 2017 offering chances to earn a U.S. visa by investing in New Jersey apartments that family-owned Kushner Cos. was developing the political backlash was swift.
The company later issued an apology for any suggestion it was benefiting from ties to the White House, and to cancel the participation of Mr. Kushner’s sister during the final leg of the China fundraising tour.
Mr. Branstad’s actions didn’t violate any ethics rules unless his father encouraged him to tout his ties to the U.S. government, said Walt Shaub, former director of the Office of Government Ethics. But Mr. Shaub suggested the event didn’t look good.
“The culture of the federal government has always been that if you’re in a sensitive post like ambassador, particularly for a country as important to our national interest as China, you would strongly discourage your family members from going there for business purposes,” Mr. Shaub said.
In an invitation to the Shanghai event, Mr. Branstad’s bio suggests in both English and Chinese that he continues to have a role with the U.S. government. It describes him as “the main point of contact and chief aid” to U.S. Secretary of Commerce Wilbur Ross. The Commerce Department didn’t respond to a request to comment. The bio also says “he works as a partner and senior adviser directly with” the secretary and other officials.
Eric Branstad's LinkedIn profile shows him standing between President Donald Trump and his father Terry Branstad, the current U.S. ambassador to China.
Eric Branstad's LinkedIn profile shows him standing between President Donald Trump and his father Terry Branstad, the current U.S. ambassador to China.
Mr. Branstad, whose LinkedIn profile includes a photo of him squeezed in between Mr. Trump and his father, the ambassador, described at the Shanghai event how he and Mr. Trump had bonded over a discussion about tennis, attendees said.
Two organizations listed on an invitation for Mr. Branstad’s appearance distanced themselves from the event.
Organizers distributed the American Chamber of Commerce’s address as the event’s venue. But the chamber said it never agreed to host the talk. Organizers changed the address to an adjacent hotel.
Meanwhile, the logo of law firm Davis Wright Tremaine LLC appeared on the invitation. The firm’s partner in charge, Ron Cai, said he had been asked to underwrite the event but declined. “I told the event organizer we were not interested in sponsoring. I personally have no interest in politics or government-relations work.”
Mr. Williams, the event sponsor, said the free-by-invitation but off-the-record event was planned on short notice after his organization learned Mr. Branstad would be in China.
—Rebecca Ballhaus and Brody Mullins in Washington and Zhang Chunying in Shanghai contributed to this article.
Write to James T. Areddy at james.areddy@wsj.com
