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News, 4/29/2016

TTIP negotiations continued – 12th round addressed regulatory issues

The 12th round of the Transatlantic Trade and Investment Partnership  negotiations between the European Union and the United States was held in Brussels from 22 to 26 February 2016. The common political goal is to complete the TTIP negotiations by the end of 2016, during President Barack Obama’s term of office. However, much work remains to be done.

The parties to the Trans-Pacific Partnership (TPP) signed the TPP agreement in February 2016. The United States signed the agreement, but its ratification is still in progress. The ratification process is expected to slow the progress of the TTIP negotiations.

A comprehensive range of topics were addressed during the 12th round of negotiations and the related discussions, including investment protection and dispute resolution. The negotiations focused on regulatory issues and rules in particular.

The 13th round of negotiations will be held in New York from 25 to 29 April 2016.

I Market access

Goods trade

With regard to goods trade, the EU and the United States continued to negotiate based on customs offers. The negotiations focused on what types of products the parties would like to apply transition periods to in removing customs duties. The parties also continued to discuss the text of the agreement, particularly with regard to export and import restrictions, remade goods and goods returned after repair as well as the customs classification of goods.

Agricultural products

With regard to agricultural products, the discussion also concerned the text of the agreement and trade obstacles. The parties comprehensively reviewed the suggestions for the agricultural chapter for the first time. The EU reminded the United States of its goal to include regulations concerning wines and spirits in the agricultural chapter. The regulations are based on previous agreements. In addition, the parties continued to discuss trade obstacles.

Services and investments

With regard to services and investments, the round of negotiations again involved extensive discussions on cross-border services, the deregulation of investments, the mobility of people related to business and rules concerning various sections of the service sector. The topics addressed included financial services, postal and courier services, direct sales, telecommunications and e-commerce, among other topics. The recognition of professional qualifications and rules concerning permit and licence procedures were also discussed. The EU is planning to present a new suggestion for the text concerning permit and licence procedures before the next round of negotiations.

Market access was discussed only briefly, concerning some issues that had been left undecided during the previous rounds. The parties once again acknowledged the special status of public services.

Public acquisitions

During the 12th round of negotiations, the EU and the United States exchanged offers concerning the market access of public acquisitions for the first time. The parties discussed the content of the offers and the suggested text of the agreement with regard to public acquisitions. In addition, the parties discussed the goals concerning public acquisitions. They had previously agreed on these goals in a high-level working group.

The EU posed questions to the United States about its recent legislative initiatives and terms of federal funding for acquisitions carried out by states, among other issues. The EU believes these issues affect European companies providing offers in the US market. The parties want to improve the position of small and medium-sized enterprises in the market for public acquisitions. The EU considers it important that European companies have access to up-to-date, easy-to-find information about competitive bidding concerning public acquisitions by US states. Easier entry to the markets for public acquisitions at the levels of states, local administration and special sectors is important as well. Public acquisitions are a highly sensitive topic for the United States because of its laws that favour domestic products and services, among other factors. The negotiations on public acquisitions will continue during the next round in April.

II Regulation

Consistent regulation and regulatory cooperation

With regard to consistent regulation, the negotiations on regulatory cooperation and good regulatory practices continued. Concerning these two aspects, the EU presented new suggestions before the 12th round of negotiations. The goal is to continue these discussions even before the next round of negotiations.

Technical trade obstacles

With regard to technical trade obstacles, the negotiations addressed official procedures for when the authorities select standards that support technical regulations, cooperation between standardisation bodies and the use of the other party’s standards as part of new standards, among other topics. The EU and the United States agreed to combine their suggested texts related to standardisation and compliance assessment, for example, before further negotiations.

Health and plant protection

The parties continued to discuss health and plant protection (sanitary and phytosanitary measures, SPS) with regard to regionalisation, inspections, certification and resistance to antibiotics in particular. The discussions focused on the analysis and explanation of texts. The parties agreed to continue the discussions even between the rounds of negotiations.

Sectors

The negotiations concerned all of the nine sectors.

With regard to pharmaceuticals, the discussions focused on GMP inspections (Good Manufacturing Practices), generic drugs (containing the same amount of the active ingredient in the same dosage form as the original drug product), safety features in pharmaceutical packaging (Common Standards for Unique Identifiers) and the possibility of exchanging confidential information between regulatory authorities.

Concerning cosmetics, the discussions continued to address enhancing international cooperation. With regard to risk assessments related to cosmetic ingredients, the parties’ approaches have not converged since the previous round of negotiations. The discussions on alternatives to animal testing (ATM) continued.

With regard to textiles, the discussions concerned labelling related to fibre names and care instructions, fire safety tests and cooperation to promote business standards other than those related to regulation.

The discussions on vehicles continued to address the safety aspects of regulations, particularly the equal prioritisation and harmonisation of regulation. Further discussions are still needed.

Concerning medical devices, experts of the EU will continue to monitor the consistent international auditing programme (Medical Device Single Audit Programme, MDSAP). Discussions will also continue with regard to compatible databases for tracing medical devices (Unique Device Identification, UDI) and the harmonisation of the application forms for the approval of medical devices (Regulated Product Submission, RPS).

Concerning information and communication technology, the parties continued to exchange information about current initiatives in the EU and the United States with regard to e-health, encryption technology, e-labels and cooperation in market control.

With regard to machinery and equipment, the parties continued to discuss the identification of the various aspects of cooperation. The EU again stressed the importance of this sector.

Concerning the chemical sector, the parties reviewed the progress of pilot projects. These are related to the prioritisation and assessment of chemicals and to classification and labelling.

With regard to pesticides, the parties discussed common goals to increase cooperation and improve the consistency of regulations. The parties examined consistent approaches to regulation and discussed the exchange of information and cooperation within international organisations (CODEX, OECD).

III Global rules

Investment protection

This was the first round of negotiations during which both parties’ proposals were discussed. The discussions were constructive. Based on the discussions, it seems that the parties are in agreement regarding certain objectives, such as the prevention of simultaneous disputes and the rapid rejection of unfounded claims. Otherwise, the parties exchanged views of their approaches, which differ from one another, particularly in terms of dispute resolution. The parties will continue to exchange views during the next round.

Industrial rights and copyright

With regard to industrial rights and copyright, the discussions continued to address aspects that could be included in the related chapter of the agreement. As the IPR environments of the parties are advanced, the EU maintains that the agreement may not necessarily need to address all of the aspects related to industrial rights and copyright. Instead, the agreement could focus on certain themes that the parties consider to be essential and on strengthening cooperation between the parties.

During the February rounds, the United States presented its written drafts for the first time. These two drafts concern international agreements on industrial rights and copyright (the EU presented its first draft concerning these topics in spring 2015) and general regulations of the agreement. The parties also continued to discuss and exchange information about their legislative initiatives and the progress of these initiatives, compare the content of their trade agreements and exchange information about international agreements (their situation with regard to the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled of the World Intellectual Property Organisation and the Beijing Treaty on Audiovisual Performances). Concerning geographical labelling, the views of the parties continue to be far apart.

Energy and raw materials

During the 12th round of negotiations, the parties continued their constructive discussions on energy and raw materials. The main focus was on topics related to energy, about which the parties exchanged information. For example, the EU presented the development of the Energy Union, and the parties presented the results of their most recently completed trade negotiations, such as the TPP agreement for the United States and the trade agreement between the EU and Vietnam. The United States also presented its latest legislative amendments. The parties also continued to discuss whether general regulations would be sufficient concerning themes related to energy and raw materials or whether a separate chapter would be justified. In addition, the parties discussed whether and how the issues concerning energy and raw materials are related to other chapters of the agreement under negotiation. The EU is still striving to establish a separate chapter on energy and raw materials for the agreement, but the parties are not in agreement regarding this.

Customs procedures and measures to ease trade

Negotiations on customs procedures and measures to ease trade continued successfully based on a summary of the proposals of the parties. Further negotiations were carried out with regard to the harmonisation of information, authorised operators, one-stop-shop systems and international standards. Temporary imports and returning goods after repair were discussed at a joint meeting with the working group on goods trade.

Small and medium-sized enterprises

The EU and the United States continued to discuss how information that is useful for small and medium-sized enterprises (SMEs) could be shared comprehensively and in a user-friendly manner. The parties also discussed the role of the committee focusing on SMEs and the importance of maintaining close contact with stakeholders.

Sustainable development

The United States presented its proposed text of the agreement with regard to trade and the environment as well as trade and the norms of working life. The EU emphasised that it would not present institutional questions, including dispute resolution, until later, after the content of the chapter has been discussed.  In addition, the EU continues to prepare the section concerning climate change, taking account of the Paris Treaty, negotiated in 2015. A consolidated negotiation text based on the proposals of the parties will be prepared next.

General dispute resolution

The purpose of the chapter on general dispute resolution (disputes between governments) is to create an effective mechanism for resolving disputes related to the interpretation and application of the agreement. In this respect, the views of the parties have converged considerably. During the round of negotiations, the focus was on issues concerning the phase following the panel report (the implementation of decisions). Progress was made in terms of combining the texts proposed by the parties, but their views still differ to some extent with regard to the content.

For more information about the negotiations, please contact:
Mary-Anne Nojonen, Commercial Counsellor, Department for External Economic Relations, Ministry for Foreign Affairs of Finland, tel. +358 295 351 494.

This document

Updated 4/29/2016

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