B|Brief TTIP Round 1 (1 Aug 2013)

AUGUST 1, 2013

TTIP NEGOTIATIONS: A SUMMARY OF ROUND 1

BY KARA SUTTON

Setting the Stage US and EU negotiators ended the first round of TTIP negotiations following a week of comprehensive and productive dialogue that took place July 8–12, 2013. The week ended with optimism about the next series of meetings to be held in the autumn.

Takeaways 

The focus was on procedure and not delving into specific issues. Negotiators established priorities, exchanged ideas and set up technical workstreams. This process-oriented approach allowed negotiators to forestall discussion that could disrupt an agreement at the start of talks. It is likely that controversial issues will not be addressed until later negotiation stages. The approximately 150 delegates were split into 24 working groups focusing on the wide range of market-access, trade and regulatory issues to be covered in the TTIP. 1

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The EU and US have taken steps to increase transparency. Following the first round of negotiations, the US released the names of its TTIP lead negotiators, and the EU publicly released six of 10 initial position papers, though they were previously leaked. Increased inclusiveness and openness in the negotiation process was reaffirmed by witnesses at a July 24, 2013 House Energy and Commerce Committee hearing.

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Stakeholders hope for an agreement on customs and trade facilitation in the run-up to the December 3–6, 2013 WTO Ministerial in Bali, Indonesia. The Transatlantic Economic Council (TEC) established a dialogue on customs and trade facilitation, an issue on which consensus should be easily achieved.

The US is waiting for an impact assessment from the US International Trade Commission (ITC) before engaging in conversations on tariffs.

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Potential Sticking Points 

The week fleshed out the procedural difficulties in achieving regulatory cooperation. The US should continue to engage regulatory agencies during the negotiation process.

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Longstanding and contentious sanitary and phytosanitary (SPS) and agriculture issues were discussed in depth. High-level political commitment by US and EU officials will be necessary to ensure negotiations do not get bogged down as they previously have when handled solely by technical experts.

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With recent allegations of US spying on EU offices, data-flow issues were taboo in the first round.

Chief US negotiator Dan Mullaney stressed that data-protection conversations relevant to the spying scandal would remain in the US-EU data-protection working group, not in the TTIP talks. But these conversations will be needed within the TTIP negotiations to address e-commerce and Internet issues that are a part of what Mullaney hopes will be a “21st-, even 22nd- century agreement”2.

The US-EU data protection working group first met in Washington, DC during the same week that TTIP negotiators gathered. The group met again July 22–23, 2013 in Brussels.

On the Margins 

A July 11, 2013 US Commodity Futures Trading Commission (CFTC) and EU Commission announcement on derivatives regulation is a positive step for US-EU financial-regulation cooperation, yet the announcement signals that a dialogue on financial services beyond market access is less likely to occur in the TTIP talks. Negotiators, however, are still discussing the inclusion of financial services beyond market access.

Michael Barnier, European commissioner for internal market and services, stressed in meetings with US officials and in public statements that the TTIP would be incomplete if financial regulation were excluded.

US Treasury Secretary Jack Lew has emphasized that financial-regulatory dialogue should remain within the appropriate global forums. US Trade Representative Ambassador Michael Froman commented in a July 18, 2013 House Committee on Ways and Means hearing that financial-regulatory alignment should not be part of a TTIP agreement but would be better discussed in parallel to TTIP negotiations.

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EU officials welcomed the announcement of substantive negotiations on a US-China bilateral investment treaty (BIT). With Brussels and Washington concurrently negotiating TTIP between themselves and BITs with China, the EU and US can work

Comment made by Dan Mullaney at stakeholder briefing on July 10, 2013.

together to address issues of mutual concern, such as investment advantages that Chinese state-owned enterprises have over US and EU businesses. 

The US National Institute of Standards and Technology (NIST) and the EU’s Joint Research Center (JRC) announced cooperation in 10 new scientific areas on July 17, 2013. This cooperation will focus on standards and measurements in areas such as energy, transport and healthcare.

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The first Electronic Vehicle-Smart Grid Interoperability Center was launched on July 18, 2013 at the Argonne National Laboratory in Illinois. Its EU counterparts will open in 2014 in Italy and the Netherlands. These centers will facilitate closer US and EU standards on electric vehicle interoperability.

Next Steps 

The US International Trade Commission (ITC) releases on September 26, 2013 its impact assessment of eliminating import tariffs on EU products under a TTIP.

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The second round of TTIP negotiations takes place in Brussels the week of October 7, 2013.

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Congressional legislation on trade promotion authority (TPA) or “fast track” is slowly advancing.

Senator Max Baucus and Congressman Dave Camp’s staff are working together on bipartisan TPA legislation.

Ambassador Froman declined at the July 18 House Committee on Ways and Means hearing to state when the administration would request TPA. Trans-Pacific Partnership (TPP) negotiations are expected to conclude in December, and the administration may request TPA prior to that.

Kara Sutton is project manager for legislative relations at the Washington, DC-based Bertelsmann Foundation. kara.sutton@bfna.org