DIFFERING REGULATORY REGIMES MAY HINDER TRANSATLANTIC TRADE TALKS
c.2013 New York Times News Service
BRUSSELS — A key challenge for U.S. and European trade negotiators will be deciding which differing industry regulations to retain on each side of the Atlantic, and which to map out jointly. That was the view of American and European officials conferring here Monday as the two sides prepare for the next round of discussions toward a sweeping trans-Atlantic trade pact.
Ahead of the next round of talks, to be held Oct. 7-11 in Brussels, European officials are wary of watering down what are generally stricter regulations in sectors like food safety and chemicals, and they are pressing for both sides to accept existing rules for some sectors. The U.S. trade representative, Michael Froman, in a speech here Monday, criticized the European approach to industry regulations, saying they were too eurocentric.
U.S. negotiators are leaning toward a bilateral and more open approach to rule making that could apply more broadly as a way to improve trade.
A deal could bring huge benefits to the two economies, which between them already account for about half of global economic output and a third of world trade. But doubts about how much progress Europe and the United States will be able to make arose even before the talks officially began this summer. The potential sticking points include the way Europe restricts biotech foods and the way some U.S. states restrict which companies can apply for public procurement contracts.
Bridging two often very different regulatory regimes could prove especially complex. In the area of car safety, for example, the Europeans want the Americans to accept different, if similar, safety requirements on automobile lights, door locks, brakes, steering, seats, seat belts and electric windows.
Karel De Gucht, the European Union trade commissioner, said in a statement Monday that “we should ultimately strive for the mutual recognition of our regulations across a broad range of sectors” as “the most efficient way to connect our two systems to allow our businesses to operate more effectively across the Atlantic.”
De Gucht issued his statement just after meeting his counterpart, Froman, over lunch, before Froman headed off to give a speech in Brussels to the German Marshall Fund, a research group.
“We think there needs to be a balanced approach,” Froman told a news conference after that speech, referring to across-the-board rulemaking as well as recognizing existing regulations in particular industries.
Froman criticized the European approach to regulations — a sign that the trade talks could become acrimonious.
“Our standard-setting bodies include the participation of companies from Europe and around the world,” Froman said in his speech to the German Marshall Fund. “Yet the only bodies the EU recognizes as producing international standards are those in which the EU member states cast the bulk of the votes.”
Froman also suggested that EU authorities could learn from aspects of the U.S. approach to rulemaking, which he described as more transparent. “I hear regularly from U.S. companies and associations about wanting to be more involved in the EU process of developing regulatory measures,” he said.
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As for standard-setting, Froman said the EU should give industry and other groups, including nongovernmental organizations, equal access to points of view to avoid protectionism. “Instead of their passports, it should be their professional expertise and judgment that should open the door,” he said.
The comments were another sign that the two sides might struggle to hit a deadline of the end of 2014 for a deal that politicians on both sides had previously described.
Froman declined to confirm that deadline on Monday, saying only that he was committed to making as much progress as possible before October 2014, when the five-year term for De Gucht and the rest of the European Commission comes to an end. “The substance will dictate the timetable,” Froman said.
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Another sign of the complexity of the talks were comments by the trade chiefs designed to tamp down concerns that protections for European consumers could be dismantled.
De Gucht sought on Monday to reassure critics who regarded the trade effort as a way to “water down Europe’s current set of rules and regulations” by highlighting the bloc’s standards of “global excellence and leadership.”
But Froman tried to deflect the notion that the American approach to regulation was any more lenient than Europe’s, saying in his German Marshall Fund speech that talks were “not about launching a broad deregulatory agenda.”