U.S. Opening Remarks at the Trade Policy Review of the European Union
As Delivered by Ambassador María L. Pagán
U.S. Deputy United States Trade Representative
June 5, 2023
On behalf of the United States, I am pleased to participate in the European Union’s fifteenth Trade Policy Review and extend a warm welcome to the EU delegation, led by Director-General Sabine Weyand.
The EU and the United States are vital strategic partners and share the largest trade and investment relationship in the world. The United States highly values its close working relationship with the EU in the WTO and in multiple other fora, including with respect to Russia’s unprovoked war against Ukraine.
We are also grateful for the EU’s partnership over the past two and a half years in finding solutions to trade-related disagreements, including some longstanding ones.
Notwithstanding our close strategic partnership, it is important to acknowledge in the context of this TPR that certain U.S. goods and services face persistent barriers in the EU market. These barriers limit the opportunity of U.S. workers and businesses to benefit from transatlantic trade. It is important that we are able to speak honestly with one another about issues of concern, always with a view to finding ways to resolve them.
I want to highlight a few specific examples:
First, U.S. stakeholders have longstanding concerns with the EU’s lack of adequate opportunities to offer meaningful comments on proposed regulations and decisions. EU notifications often are made at a procedural stage when it is too late to revise proposed measures to take into consideration substantive concerns raised by other WTO Members.
In addition, we have longstanding concerns regarding the EU’s hazard-based approach to regulations, which can lead to measures that limit U.S. market access. One well-known example is the EU regulation known as REACH, concerning the production, marketing, and use of chemicals as substances, mixtures, articles, and product. It relies on an unduly restrictive hazard-based approach instead of a
scientific assessment of the actual risks of exposure to a chemical in a specific use. U.S. stakeholders have raised concerns that, as part of the registration process under REACH, they must provide data that is not relevant to the specific hazards and proposed uses of a registered substance. Additionally, EU Member States’ application of REACH appears to be inconsistent and lacks transparency, resulting in requirements that are more onerous for U.S. exporters than for EU businesses and products that are already in the EU single market.
Third, U.S. agricultural products continue to face a number of market access barriers. For example, U.S. stakeholders are concerned that implementing regulations for the EU’s Farm to Fork Strategy require the adoption of EU production practices in order to access the EU market. These practices are not appropriate, effective, or efficient in other parts of the world, and these requirements could unnecessarily restrict trade or force farmers in the United States and other countries outside the EU to produce crops in less sustainable ways than they otherwise would have.
Additionally, despite having succeeded in litigation years ago, the United States continues to have concerns regarding the lack of predictability, excessive data requirements, and delays in the EU’s approval process for genetically engineered crops, which have prevented safe products from being exported to the EU, even though these products have been approved and grown in the United States for many years.
The EU also continues to restrict the use of “traditional terms,” such as “tawny,” “ruby,” and “chateau,” on labels on imported wine. This impedes U.S. wine exports to the EU, including U.S. wines that include these traditional terms within their trademarks. We remain troubled by the EU’s overbroad protection of geographical indications and approach on geographical indications with its trading partners, which adversely impacts both protection of U.S. trademarks and market access for U.S. products that use common names in the EU and third country markets.
Fourth, the EU has proposed a new cybersecurity certification scheme for procurement of cloud services that would close access to foreign suppliers. U.S. stakeholders have expressed concerns about provisions of the proposed scheme, including restrictions on domestic ownership requirements. The EU covers cloud services in its GPA commitments and is required to provide non-discriminatory access to covered procurement.
Fifth, U.S. companies across a range of sectors also continue to cite concerns about the EU’s exclusionary approach to standards-related measures, including its conformity assessment framework, and its efforts to encourage governments around the world to adopt this restrictive approach. The EU’s approach impedes market access for products that do not conform to European regional standards (ENs), even if they conform to international standards that meet or exceed the EU regulatory requirements. Products regulated by the EU must conform to these EU-specific regional standards – and must then be certified by European testing bodies – in order to benefit from a presumption of conformity with the EU’s essential regulatory requirements.
The new European Standardization Strategy raises concerns that the EU is moving away from cooperation with trading partners in standardization. Under it, European Standardization Organizations will constrain the involvement of non-EU interests in the development of harmonized EN standards. In addition, new Commission policies, such as a refusal to reference underlying standards developed outside of Europe and new restrictions on participation in expert advisory committees, signal a deliberate effort to exclude foreign participants, undermine the acceptance of international standards developed in the United States, and impose European regional standards on foreign trade partners.
Finally, notwithstanding the existence of EU-wide customs legislation, the EU does not have a single customs administration. This makes it difficult for the EU to ensure that its rules and decisions on classification, valuation, origin, and customs procedures are applied uniformly across Member States. The EU also lacks tribunals or procedures for the prompt review and EU-wide correction of administrative actions relating to customs matters. Although differences in Member State tribunal decisions can be taken to the Court of Justice of the European Union, referral of a question to the Court is generally discretionary, may take many years, and may not afford sufficient redress.
Notwithstanding the particular concerns we have raised, the United States looks forward to continued close partnership with the EU in working towards our shared trade policy goals and reform of the WTO. I heard today a clear vision to use and adapt trade policy to serve important global and societal goals – and the need for cooperation and consultation at the WTO to improve understanding by trading partners of the balancing and trade-offs necessary. We want to work with the EU to better understand its objectives and hope that the EU will work with the rest of the Membership with an open mind as we all seek to adapt trade policies to meet global challenges.
Finally, I want to recognize the strong leadership of Ambassador João Aguiar Machado here at the WTO and look forward to continued collaboration on many areas of joint interest with him and his team.