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By Len Bracken
May 23 — U.S. and European Union negotiators honed the language in the areas of technical barriers to trade, competition, state-to-state dispute settlement and small- and medium-sized enterprises during the fifth round of the Transatlantic Trade and Investment Partnership (TTIP) talks, EU Chief Negotiator Ignacio Garcia Bercero said May 23.
U.S. Chief Negotiator Dan Mullaney said the work conducted during the fifth round included services, investment and government procurement, and he noted that the two sides engaged in discussions on the tariffs and the market access issues for goods during the course of this week.
“We are looking for increased market access,” Mullaney said, “and I think we've made plain that our objective is the elimination of all tariffs to open up the markets on both sides to the maximum extent possible.”
When asked about the EU's stated dissatisfaction with the initial U.S. tariff offer, Garcia Bercero said the two sides had good technical discussions on the initial tariff offers. Mullaney said the two sides will be moving toward second tariff offers, although he declined to give a time frame.
Mullaney verified at the press conference that the U.S. had made an initial services offer during the round. The EU is refraining from making an offer at this stage, according to U.S. industry sources.
The US Coalition of Services Industries (CSI) and the European Services Forum (ESF) May 22 said in a statement that services must be a major component of the TTIP, given the large potential for growth if the remaining market-access barriers, regulatory inconsistencies and burdensome processes on both sides of the Atlantic are removed. The groups called on negotiators to ensure that through TTIP cross-border data flows and data processing can take place free from trade-distorting conditions, such as requirements to use local network infrastructure or local servers.
“These commitments should be applied across all service sectors, including financial services,” the groups said.
U.S. and EU chief negotiators said the top financial services regulators, the Treasury Department and the Internal Market and Services Directorate General (DG MARKT), participated in the talks in this area.
The U.S. prefers to limit the scope of financial services under the TTIP to market access, while the EU sees the TTIP as an opportunity to establish a committee or other structure for regulators on both sides of the Atlantic to prevent regulatory divergences, such as those that would inhibit market access.
Garcia Bercero said this could be done without interfering with the independence of financial regulators or with ongoing efforts associated with the Group of 20 countries. He stressed that the talks do not concern specific regulatory issues in a particular aspect of the financial services sector but, rather, ideas for a horizontal framework for regulatory cooperation.
Tim Bennett, director-general of the Trans-Atlantic Business Council, told Bloomberg BNA that he would like to see binding obligations to coordinate financial services regulation. He added that the EU negotiators are sensitive to the ongoing efforts to implement the Dodd-Frank Wall Street Reform and Consumer Protection Act and will likely wait to push for inclusion of financial services regulations in the TTIP talks.
Mullaney said the two sides are also discussing ideas to promote greater regulatory compatibility in a range of sectors, including medical devices, pharmaceuticals, cosmetics, information communication technologies, automobiles, pesticides and chemicals.
Garcia Bercero said in the context of sectoral regulatory compatibility, no size fits all.
“The solutions that could be envisaged are very much sector-specific,” he said. “For instance, in the case of the automotive sector where we had, I believe, very intensive and productive discussions, what the regulators have been doing is comparing our respective technical regulations on safety, identif[ying] and discuss[ing] the type of data which is needed to find compatible levels of safety, and how to compile such data.”
He added that in sectors like chemicals, where harmonization or mutual recognition is not an option because the divergences in regulations are so great, the two sides are identifying practical ways of enhancing the exchange of information to help the regulatory processes on both sides of the Atlantic.
In a statement issued at the conclusion of the round, U.S. Trade Representative Michael Froman said the negotiations were productive.
“We've moved from discussing a conceptual framework to defining specific ideas for addressing the majority of the negotiating areas,” Froman said. “We are looking to advance the remaining areas soon.”
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The statement from CSI and ESF can be found at https://servicescoalition.org/images/CSI__ESF_Joint_Statement_on_TTIP_-_FINAL.pdf.
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