EU consumer groups are calling for transatlantic product standards legislation to be better enforced. But business representatives warn that regulatory cooperation is “not always very good” for industry.
Ahead of the US presidential elections on 4 November, EU consumer organisations called for transatlantic cooperation to be strengthened.
“It is not just regulation that makes people feel safe. It must be enforced or consumers won’t feel safe at all,” Monique Goyens, director general of EU consumers’ organisation BEUC, told a 28 October conference on regulatory cooperation organised by BusinessEurope, the EU employers’ organisation.
Consumer confidence had been “shaken” by the ongoing turmoil in financial markets, said Goyens, explaining that now would be a good time for governments and the establishment to prove that regulation was in place to keep them safe.
But the European Commission does not necessarily see things in the same way, and appears to be wary of overburdening buisnesses with new rules. “The Commission does not embark on regulatory cooperation from a societal point of view,” explained Françoise Le Bail, deputy director general of the Commission’s enterprise and industry directorate and a member of the Transatlantic Economic Council (TEC). “What the EU institutions are negotiating is the elimination of technical barriers to trade.”
For their part, business representatives expressed fears that more legislation would serve to increase costs by creating compliance problems. “Regulatory cooperation means more efficient and better regulation, not necessarily more or less,” argued Stanton D. Anderson, chairman of the Global Regulatory Cooperation Project at the US Chamber of Commerce.
He cited the example of the Sarbanes-Oxley Act introduced in the US to respond to the Enron and WorldCom corporate accounting scandals of the beginning of the decade, which “created more problems.”
Similarly, Adrian Harris of Orgalime, the association representing the EU engineering industry, spoke of “basic barriers” to harmonisation facing some companies, such as different electrical voltages and frequencies on each side of the Atlantic. Indeed, the electrical industry still faces such problems within Europe itself, he said, citing the voltage difference between the UK and the rest of the continent as an example.
Moreover, Harris said environmental legislation often represented an obstacle for business. “In Europe, DG Environment has its own model of environmental standards,” he said, complaining that EU requirements differed from those of the US, where they even varied from state to state. He also said that different customs regulations made transatlantic trade “complicated” for business.
Industry representatives also complained that they were not being consulted early enough in the legislative process. “[It] would be more helpful if people spoke before rather than after regulating,” said Orgalime’s Harris. “We are not getting very happy noises from US industry or regulators” on the need for further transatlantic cooperation, he added.
Asked whether transatlantic trade relations would change after the upcoming presidential elections in the US, Anderson said he did not expect the outcome to make much difference. Instead, the TEC should address “horizontal issues” concerning the industrial sectors of the future to bring about more regulatory cooperation.
“It is very difficult to change regulation that has already been in place for years,” he explained, identifying nanotech regulation as “a real area for change and cooperation” in this regard.
The US will hold presidential elections on 4 November 2008. After eight years of the Republication administration headed by President George W. Bush, voters will be asked to choose between his would-be successor John McCain and his Democratic rival Barack Obama. Both candidates are expected to make an effort to repair relations with Europe after the divisions of the Bush years.