TTIP represents a land of opportunity for businesses. Opening up markets on both sides of the Atlantic will create a wealth of business opportunities, and EU negotiators should adopt a small business perspective, too, writes David Caro.
David Caro is president of the European Small Business Alliance and EU and International Affairs Policy Chairman for the Federation of Small Businesses (FSB).
The Trans Atlantic Trade and Investment Partnership (TTIP) could well be the biggest and most important trade agreement in history. It is almost a year since the negotiations started, and from the very beginning both sides agreed that this trade deal should include small businesses. This inclusion comes in the form of a specific Small Business Chapter. The European Small Business Alliance (ESBA), and our members believe this represents a unique chance for small firms to shape, and benefit from this deal.
Today, (19 June) ESBA and SEAP, the Society of European Affairs Professionals are hosting an event to discuss what the impact of TTIP will be on the small business community. Alongside the US Ambassador to the EU and key voices from the EU institutions will be members of the Federation of Small Businesses (FSB). It is essential to hear directly from small businesses themselves, who can explain what the trade deal means for them.
Opening up markets on both sides of the Atlantic will create a wealth of business opportunities, and European companies will be more likely to come into direct competition with their American counterparts. That’s why it is crucial to get the detail of the Small Business Chapter right. We want the Chapter to contain concrete smart regulation principles which will reduce the burden of legislation on small firms. Any future legislation the US or EU produce should be drafted with the smallest firms in mind. With a Small Business Chapter in place on both sides, there should be enough common ground for joint smart regulation principles that would make life simpler for businesses in the Trans-Atlantic trading area.
With Member States looking to increase their export potential, more small firms could look to take their first step to trade with the US if tariffs were abolished and paperwork reduced to a minimum. At the same time European businesses would also benefit from cheaper imports from the US. The inclusion of a small business chapter in TTIP recognises that businesses need practical help when trading overseas, such as where to find a local trader or which local laws apply. A single portal for leads, information and support which would be established for small firms, would help stimulate trade across the Atlantic.
TTIP will also likely spur an increase in foreign direct investment (FDI), benefitting many small firms in the supply chain of overseas companies. At the EU-US Legal Summit Earlier this week, the FSB called for barriers to FDI to be tackled. The expected increase in GDP through the trade deal could also raise demand for local goods and services in the long term, leading to a significant number of new jobs in the EU. Small businesses can be expected to create a significant share of these new jobs.
US businesses have mentioned they want more transparency in the EU legislative process and will press for open consultations on future EU legislation. We agree with this. The earlier regulators know how a particular piece of law impacts on the ground, the better the chances legislation will be fit for smaller firms. Currently, many US regulations are prohibitive for small firms expanding across the pond, so the same courtesy on consultation must also apply to US legislation, and indeed State legislation, where harmonisation is far less advanced than within the EU.
TTIP represents a land of opportunity for businesses and we want to see policy makers do everything they can to ensure it meets the lofty expectations being set for it, without losing sight those who might be impacted differently. We hope that the agreement will mean a greater push for entrepreneurship, with more people starting their own business, or finding new markets by exporting and selling online. TTIP needs to reflect the ambitions of our small businesses and provide them with the tools to succeed.