Every time Daimler, the German car manufacturer, tests models for safety, they have to crash two cars against a concrete wall — one to fulfil EU standards and the second to fulfil US standards.
Much of the differences between the two countries — now under the spotlight as negotiations on the EU- US trade agreement began in Washington this week — will not be eliminated, US government officials have said.
Instead they accept that the most and possibly best solution is to agree to accept each other’s testing and results.
“When the EU negotiates with a much smaller and less developed economy they can insist on their standards and regulatory standards — it will be much tougher between well developed and mature economies like the EU and US,” a source said.
One example of what could be expected is the success of the Aviation Safety agreement where there are two strong regulatory systems, but the EU and US reached agreement to accept one another’s standards.
The source expected that general principles will be agreed during the negotiations, forecast to take between a year and 18 months, and then specialists will work on details.
But the Transatlantic Trade and Investment Partnership will not cover every single area, many such as food issues will be difficult if not near impossible to resolve while well developed systems could not be eliminated in the short term.
“The FDA [Food and Drugs Authority] have jurisdiction over approving food and drugs, and we would have to change the law, change their authority or eliminate them to reach agreement with the EU authority... FDA is not going to compromise,” the source said.
Areas that are obviously contentious such as agriculture and culture exception is a very small part of the overall pie, but they were not strangling EU and US trade.
“We are more likely to have mutual acceptance of testing than complete harmonisation on for instance car parts.”
Many of the solutions the talks are expected to reach could also have a knock on effect in progressing many of the obstacles to the EU single market where states are unable to agree on technical issues, the source said.
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