Commission to launch plan for EU-US market

By Andrew Beatty

Date: 12/05/05

The European Commission is to approve next week its biggest drive towards a common EU-US marketplace in ten years. Following months of consultation with 136 'interested partners', Trade Commissioner Peter Mandelson and External Relations Commissioner Benita Ferrero-Waldner are expected to present their communication next Wednesday (18 May).

With current transatlantic trade and investment flows estimated to be worth €1 billion each day, business leaders complain that costs are increased by an unnecessary duplication of legislation.

The proposals are to focus on ways of limiting the costs and impact of doing business in the two regulatory environments on either side of the Atlantic. "It is everything but a free trade agreement," said one Commission official.

The Commission hopes the text will be adopted by EU governments in time for it to be agreed at the EU-US summit next month.

The 20 June summit in Washington will mark the tenth anniversary of the New Transatlantic Agenda (NTA), which called for the governments to progressively reduce barriers "that hinder the flow of goods, services and capital".

With both sides unwilling to move towards harmonisation of regulation, the focus will be on convergence and on ironing out disputes before they result in litigation at the World Trade Organization.

While Commission officials point out that "98% of trade is dispute free", since the NTA was launched in 1995 the EU and US have had a host of trade scuffles over steel, tax breaks, bananas, accounting standards, data protection and most recently over subsidies to aerospace giants Boeing and Airbus.

The Commission hopes the new proposals will help limit the damage caused by different regulatory systems, industry standards and interpretation of legislation through consultations.

"Perhaps EU decision-making could be better understood in the US," said one EU official.

But Jim Murray of the European Consumers Organisation and a member of the steering group of the Trans-Atlantic Consumer Dialogue, said that businesses also exploited the divergences they claimed to oppose.

Anticipation of a Communication on EU-US relations to be presented by the European Commission on 18 May 2005. The Communication was planned to focus on the deepening of economic partnership and on ways to upgrade the framework of EU-US relations and was called by one Commission source 'everything but a free trade agreement'.