Think Tank: US and EU trade talks hit chemical quandry

22 November 2013 10:01  [Source: ICB]

US and EU negotiators meeting in Brussels to forge a new and comprehensive free trade agreement between the two huge economies faced a major challenge in reconciling fundamentally different rules for chemicals in commerce.

About 50 US officials, including the office of the US Trade Representative (USTR) and environmental regulators, met in November with their EU counterparts in the Belgian capital toward a Transatlantic Trade and Investment Partnership (TTIP).


 EU and US negotiators gathered in Brussels to thrash out a deal

Copyright: Rex Features

If completed, the partnership would eliminate about $1.5bn (€1.12bn) worth of chemical product tariffs on each side and mesh a wide variety of regulatory programmes that otherwise would inhibit increased trade between the US and the 27-member nations of the EU. The proposed treaty has been welcomed by US chemicals producers.

Eliminating the tariffs will be the easy part, according to Bill Allmond, vice president for government and public relations at the Society of Chemical Manufacturers and Affiliates (SOCMA). “The hard part will be how to eliminate or reduce the regulatory barriers to US-EU trade,” he said.

“I anticipate that during this week the US delegation and EU officials will come to a better understanding of which regulatory barriers must be addressed,” Allmond said.

But identifying regulatory barriers and resolving them are two wholly different tasks, and Allmond says that hopes for a final TTIP deal by mid-2014 are perhaps overly optimistic. “That is a very ambitious goal,” he said, “especially given the regulatory barriers that are in place, namely TSCA and REACH.”

TSCA is the US Toxic Substances Control Act, and REACH is the EU’s programme for Regulation, Evaluation, Authorisation and Restriction of Chemicals. The EU REACH system, based on the precautionary principle, is anathema to US chemicals manufacturers who prefer the risk-based and science-based approach to chemicals controls that underlies TSCA. Reconciling those two controls programmes may be the largest stumbling block to a final TTIP deal.

“The EU is not going to change its regulatory programme,” Allmond said, referring to REACH, “and EPA knows that there is no way that the US industry is going to accept a REACH approach here,” referring to the Environmental Protection Agency. “Clearly the EU regards its REACH programme as superior to TSCA, and they are not willing to change,” Allmond said.

“The EU will probably want to try to change TSCA,” Allmond said, “but there must be a realisation in Brussels that that is not going to happen.”

By: Joe Kamalick
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