COMMUNICATION FROM THE COMMISSION - COMMUNITY EXTERNAL TRADE POLICY IN THE FIELD OF STANDARDS AND CONFORMITY ASSESSMENT
Date: 1996-11-13
Institutions: European Commission
Subjects: World Trade Organisation, market access, mutual recognition principle, standardisation, trade relations

COMMISSION OF THE EUROPEAN  COMMUNITIES 

Brussels,  13.11.1996 
COM(96) 564  final 

COMMUNICATION FROM THE COMMISSION 

COMMUNITY EXTERNAL TRADE POLICY 

IN THE FIELD OF 

STANDARDS AND CONFORMITY ASSESSMENT 

COMMUNITY EXTERNAL TRADE POLICY IN THE FIELD OF STANDARDS AND CONFORMITY 
ASSESSMENT 

EXECUTIVE SUMMARY 

This  Communication  sets  out  the  European  Community's  trade  policy  objectives  in  the  field  of  standards  and 
conformity  assessment,  and the strategy to achieve these objectives.  Its aim is twofold.  First,  to establish  better 
understanding  of  the  Community's  policy  and  strategy  in  this  area,  so  that  it  may  be  promoted  coherently. 
Secondly, to review and where necessary modify  the strategy. 

The  Communication  rests  on  two  assumptions.  First,  that  trade  barriers  related  to  product  standards  and 
conformance  - technical barriers to trade - appear to be increasing, demanding greater attention and action than in 
the past.  Secondly,  that  the  completion  of  the  single  market  regulatory  regime  now places  the Community  in a 
position to pursue a more outward looking trade policy in this field. 

The  Community's  trade  objectives  can  be  summarised  simply.  First,  to  reduce  technical  barriers  in  overseas 
markets and prevent the emergence  of new ones. Secondly, to encourage our trading partners to adopt  standards 
and  regulatory  approaches  based  on,  or  compatible  with  international  and  European  practice.  Achievement  of 
both objectives will facilitate  our trade and market access for regulated products. 

These  trade  objectives  are being pursued  through  a four-fold  strategy  comprising: reliance  on  under  the WTO, 
notably  the Agreement  on Technical  Barriers To Trade, in the multilateral  framework,  and  on agreements  in the 
bilateral  framework  to reduce barriers and open markets; negotiation  of mutual recognition agreements  to reduce 
the costs of testing and certification  in other markets; technical assistance to a large number of countries to ensure 
that  regulatory  regimes  are  transparent  and  trade  friendly,  and  regulatory  cooperation  aimed  at  harmonising 
standards and regulations with other trading partners. 

Concerning the WTO, we  need to carry out a comprehensive review of the operation  and  implementation  of the 
Agreement  on  Technical  Barriers  To  Trade,  as  a  means  to  ensure  full  adherence  by  all  WTO  members,  and 
where necessary  improve its operation. This implies also more systematic use of the WTO Trade Policy  Review 
mechanism,  and  greater  attention  to  technical  trade  barriers  in  the  context  of  WTO  accessions.  Bilateral 
negotiations can also secure adherence to WTO rules, as part of the Community's Market Access Strategy. 

On Mutual  Recognition  Agreements  a clear line needs to be drawn between  the benefits  of mutual  recognition 
on the one hand and harmonisation of standards and regulations, since each can be pursued on its own merits. We 
should  however  place greater emphasis on using mutual recognition as a vehicle for greater harmonisation. In the 
longer term, we should be open to plurilateralising MRAs and consider the case for MRAs on a regional basis. 

Technical Assistance programmes to developing countries already promote the adoption by partner countries of 
international  and  European  standards  and practices.  But there  are ways in  which  technical  assistance  can  better 
serve  external  trade  objectives  in future,  and provide  a basis for  future  mutual  recognition  agreements. We can 
also improve coordination  of programmes and achieve better coherence between Community and Member States' 
programmes, so as to maximise economies of scale. 

As  concerns  Regulatory  Cooperation,  the  principal  Community  initiatives  in  this  field,  whether  multilateral, 
plurilateral,  or  bilateral,  cover  key  industrial  sectors  such  as  vehicles,  pharmaceuticals,  medical  equipment, 
foodstuffs  and  chemicals.  These  different  forms  of  cooperation  promote  international  harmonisation  or 
acceptance of the Community's regulatory approach, and in many cases provide a basis for mutual recognition. 

In  all  these  areas,  cooperation  and  coordination  between  the  Commission,  Member  States, European  industry, 
and  the European  standards  and  certification  community,  is  essential.  We  consider  it possible  to  improve  this 
cooperation. 

The  Communication  ends  with  a  summary  of  conclusions,  and  asks  the  Council  to  endorse  both  the  broad 
strategy set out in this document, and the specific proposals made. 

/- 

* 

COMMUNITY EXTERNAL TRADE POLICY IN THE FIELD OF 
STANDARDS AND CONFORMITY ASSESSMENT 

INTRODUCTION 

1.  In  recent  years,  standards  and  certification  issues  have  become  a  significant  factor  in  the 
Community's  external  trade  relations.  With  industrial  tariffs  at  historically  low  levels,  the  relative 
importance  of  non-tariff,  technical  barriers,  has  increased.  In  parallel,  more  and  more  countries, 
responding  to  a  legitimate  demand  for  increased  health,  safety  and  environmental  protection,  have 
progressively  introduced  new  product  standards  and regulatory  requirements.  Despite  the  efforts  of 
international  bodies  to  develop  globally  applicable  standards  and  requirements,  different  countries 
and  regions  have  frequently,  without justification,  adopted  differing  standards  for  the  same  product, 
unnecessarily  increasing costs, and preventing  manufacturers  from  enjoying  the economies  of  scale 
that flow from being able to produce against one common standard. 

2.  This  proliferation  of  different  standards  and  requirements  has  been  accompanied  by  the  growing 
demand  that compliance  be demonstrated  through  independent  inspection,  testing or certification,  by 
the  country  of  import.  Today,  an  ever-growing  range  of  industrial  products,  from  electrical 
equipment,  toys  and  machinery  to  chemicals,  drugs  and  medical  devices  must  to  be  tested  and 
certified  to  differing  national  requirements  before  sale.  These  conformity  assessment  procedures, 
while  often  unavoidable,  imply  additional  costs  to  companies  seeking  to  sell  in  multiple  markets. 
Even  in  cases  where  countries  rely  on  harmonised  rules  or  accept  as  equivalent  other  countries' 
regulations, reliance on the exporting country's tests and certificates  of conformity  is the exception. 

3.  This creates a number of potential barriers to trade. It necessitates the costly and largely  redundant 
repetition  of testing and certification  for different  national markets, raising costs for manufacturers  in 
a global market place, without commensurate public welfare benefits. The need to submit products for 
approval  in  often  distant  markets  means  delays  which,  particularly  for  innovative  technologies  or 
products  with  a  short  life-cycle  can  hamper  their  marketability.  Difficulties  in  understanding  the 
regulatory  regime in a foreign  market, whether because of distance, language, or cultural  differences, 
can also operate as a de facto discriminatory barrier against imports. Last but not least, the imposition 
of  burdensome  standards,  testing  and  certification  requirements  can  be  used  effectively  to  frustrate 
imports and shelter domestic companies from competition. 

4. Discussions with Member States and European industry reveal growing concern over the propensity 
of  standards  and conformity  requirements  to present trade  obstacles, and  one that  shows no  sign of 
receding.  A  number  of  solutions  have  been  proposed,  whose  appropriateness  may  vary  with 
circumstances,  but  which  include:  encouraging  third  countries  to  reduce  obligatory  technical 
requirements  and conformance  procedures  to what is necessary  to meet legitimate  policy  objectives; 
promoting,  where  feasible,  greater  harmonisation  of  standards  and  regulatory  approaches  in  other 
markets;  encouraging  our  trading  partners  to  adopt  or  accept  the  equivalence  of  the  standards  and 
technical  requirements  applicable  in  the  Community;  and  establishing  mutual  recognition  of 
conformity  assessment results, as a means to reduce conformity  barriers. 

5.  If  standards  and  conformity  obstacles  demand  greater  attention  than  in  the  past,  recent 
developments  within  the Community  now enable us to address these obstacles  more coherently.  The 
introduction  of harmonised European product directives through the Single Market exercise is now all 
but complete and the implementation of the directives is well underway, allowing more attention to be 
channelled  to  seeking  improvements  in the regulatory  regimes  of  our trading  partners.  At  the  same 
time, the regulatory  solutions developed by Europe, particularly under the Single Market  programme 
offer,  by  virtue  of  their flexibility,  trade-friendliness  and consistency  with  international  practice,  an 
appropriate  reference  point  for  other  countries  or  regions  as  they  establish  or  reform  their  own 
regulatory  systems. 

6.  Against  this  background,  the  Community  has  set  itself  two  basic  objectives.  First,  to  reduce  or 
prevent the emergence of new standards and conformity  assessment barriers for  industrial products in 
other  markets.  Secondly,  to  promote  where  possible,  the  adoption  overseas  of  standards  and 
regulatory  approaches based on, or compatible with,  international and European practices, in order to 
improve the market access and competitiveness of European products. 

7. These  trade  objectives  are being  pursued through  a four  fold  strategy  comprising: reliance  on  the 
WTO, notably  the Agreement  on Technical  Barriers To Trade, in the multilateral  framework,  and on 
agreements  in  the  bilateral  framework  to  reduce  barriers  and  open  markets;  negotiation  of  mutual 
recognition  agreements  to  reduce  the  costs  of  testing  and  certifying  products  in  other  markets; 
technical  assistance to developing countries to ensure that nascent regulatory  regimes are transparent, 
and  trade  friendly  ; and regulatory  cooperation  aimed  at harmonising  standards  and regulations  with 
our trading partners. 

8.  Section  I  below  describes  the  role  of  the  WTO  -  in  particular  the  Agreement  on  Technical 
Barriers  To  Trade  -  in  containing  and  reducing  technical  barriers,  and  suggests  ways  to  use 
multilateral  instruments  more  effectively  in  future.  The  role  of  bilateral  initiatives  in  securing 
adherence to WTO rules is also highlighted. 

9.  Section  II  of  the  document  describes  the  key  objectives  of  Mutual  Recognition  Agreements 
(MRAs),  and  the  relationship  between  mutual  recognition,  technical  assistance  and  regulatory 
cooperation. It suggests some adjustments  to the current MRA strategy. 

lO.Section  HI describes  the  objectives  of  the  various  Technical  Assistance  programmes  offered  by 
the  Community  to  developing  country  partners,  and  suggests  a  number  of  improvements  to  enable 
them better to meet our external trade objectives. 

11. Section  IV identifies  the principal  Community  initiatives  in the field  of  regulatory  cooperation. 
The  term  is  interpreted  broadly  to  include  both  bilateral  and  plurilateral  exercises,  and  describes 
initiatives 
to  simplify  conformity 
requirements, and to promote regulatory  reform. 

internationally  harmonise  standards  and  regulations, 

to 

SECTION  I:  STANDARDS  AND  CONFORMITY  ASSESSMENT  ISSUES  IN  THE  WORLD 
TRADE ORGANISATION. 

12. Since the late  1970's the multilateral trading system has attempted to limit the impact of  standards 
and  conformance  barriers.  The  GATT Tokyo  Round  led  to  the  conclusion  in  1979  of  a TBT  code, 
adherence  to which  was voluntary,  and  which  established  basic  disciplines  such  as transparency  and 
non-discrimination  in  the use  of  product  standards  and  regulations. This  code  was  strengthened  and 
made  binding  on  all  members  of  the now  World  Trade  Organisation  (WTO)  following  the  Uruguay 
Round in 1994. 

13. The  1994 Agreement on Technical Barriers To Trade carries several innovations. It draws a clear 
distinction between standards, which are voluntary, and technical regulations, which are mandatory. It 
brings regulations and standards on product - related process and production methods within its scope. 
It strengthens the test of proportionality  in the adoption of technical regulations, requiring members to 
regulate  products  in  the  least-trade-restrictive  way  possible. 
It  makes  members  responsible  for 
standards  and  rules  applied  at  sub-federal  level,  and  establishes  a  Code  of  Good  Practice  for  non 
governmental  standards  bodies.  It  imposes  disciplines  on  the  way  in  conformity  assessment  of 
products  may  be  carried  out,  and  encourages  WTO  members  to  recognise  tests  and  certificates  of 
other  members  where  they  can  be  relied  upon,  noting  that  this  may  be  secured  through  mutual 
recognition  negotiations. Finally, as part of the Uruguay  Round  package, the Agreement  is subject  to 
the integrated WTO Dispute Settlement  system. 

Operation and Implementation of the TBT Agreement 

14. At this  stage  it  is too early  to draw firm  conclusions  as to whether the new TBT Agreement  has 
fully  met  its  objectives.  On  one  hand, 
there  is  arguably  a  limited  awareness  of  the  Agreement 
amongst those WTO members adhering to it for the first  time, and of the domestic reforms  they may 
have to make to bring their regimes into compliance. An educational effort  is therefore  needed. It may 
be  questioned  whether  some  of  our  trading  partners  are  making  sufficient  effort  to  accept  and  use 
international  standards, to comply  with  notification  procedures,  to encourage  adherence  to the  Code 
of Good Practice, or ensure that technical regulations are proportionate. 

15.  On  the  other  hand,  the  introduction  of  several  new  disciplines  in  the  1994  Agreement,  their 
binding nature, and the availability  of dispute  settlement  procedures  in the event  of  non-compliance, 
should over time lead to improvements. Already, the number of WTO dispute settlement  consultations 
related  to  the  new  Agreement  shows  the  determination  of  some  WTO  members  to  ensure  proper 
implementation and to take action where its provisions are not respected. 

16. A major  review  of  the  operation  and  implementation  of  the Agreement  will  take  place  not  later 
than the end of  1997 (Article  15.4 of the Agreement), and this will be the appropriate  time to review 
the Agreement's  success, to identify  if it has been  adequately  implemented,  and to consider  whether 
its operation is adequate. 

17.  The  WTO  Ministerial  meeting  in  Singapore  in  December  this  year  will  be  an  opportunity  for 
Members  to reaffirm  the  importance  of  full  implementation  of  the TBT Agreement,  and  to  obtain  a 
commitment to make the  1997 review a comprehensive  one.  Further to that we should then  consider 
elements  appropriate  for  this  review.  One  such  element  is  to consider  how  to  reinforce  the  role  of 
international  standards,  concern  having  been  expressed  that  international  standardisation  fails  to 
reflect  the  real  needs  of  international  trade.  To  achieve  this  objective,  the  coordination  between 
national,  regional  and  international  standards  bodies  is  an  area  for  improvement.  A  procedure  to 
measure  the  extent  of  members'  adoption  and  use  of  international  standards  should  be  developed. 
Other  issues  which  have been  raised  include  the possibility  of  developing  guidelines  to assist  WTO 

members in complying with the agreement, for example concerning the "least trade restrictive" test in 
the use of technical regulations and conformity  assessment procedures. It could also include  clarifying 
the  scope  of  existing  rules  relating  in  particular  to  non-product  related  process  and  production 
methods  (PPMs),  and,  if  need  be,  whether  a  more  structured  relationship  between  the  WTO  and 
international  standards-making bodies may be useful 

18.  The  Commission  therefore  concludes  that  if  both  the  implementation  and  the  operation  of  the 
Agreement  are to be properly  examined, the WTO Ministerial  must both underline the importance of 
proper  implementation  of  the  TBT  Agreement,  and  commit  to  a  thorough  1997  review.  The 
Community  should therefore  seek, at the Singapore Ministerial meeting : 

a) reaffirmation  by  all WTO Members  of their commitment  to thorough  implementation  of  the  TBT 
Agreement; and 

b)  commitments  to  undertake  a  comprehensive  and  in-depth  review  of  the  implementation  and 
operation of that Agreement in  1997. 

19.  A  closely  related  issue  is  the  relationship  between  the  Community  and  international  rule-
making/standards  setting bodies.  The TBT Agreement  and other WTO Agreements have given  great 
weight  to the activities  of  international  bodies and in  several  fields  it has become difficult  to deviate 
from  internationally  developed  rules  and  standards  even  where  there  may  be  technical  reasons  for 
doing so.  Because of this it would be desirable to consider whether, and in which  circumstances, the 
Community  should be involved more closely in the work of such international bodies, so as to ensure 
continued  consistency  between  internationally  established  rules  and  standards,  Community  rule 
making and our WTO obligations.  These questions will also need to be considered. 

Complementary Actions in the WTO 

20. The WTO  offers  several  additional  avenues to  secure full  implementation  of the Agreement,  and 
which can in future  be used more  fully. 

a) The Trade Policy Review Mechanism (TPRM). 

21. The TPRM was established  in  1988 as a mechanism to study at fixed  intervals the trade policies of 
each  WTO member,  and  to enable  other WTO members to evaluate their WTO-compatibility.  So  far 
TPRM treatment of standards, conformity  assessment and technical barriers to trade has been cursory. 
It is clear however that the growing importance of these issues merits closer TPRM scrutiny. 

22.  A  benefit  of  the  TPRM  is  obviously  to  focus  attention  on  the  regimes  of  our  trading  partners. 
Problems  in  other  members  regimes  can  be  identified  and  solutions  proposed.  Transparency  is 
required,  and the country under review has to justify  the maintenance of particular rules or standards, 
which in many cases could be a challenge. The process itself  can be used by the reform-minded  as an 
external pressure to encourage regulatory  reform. 

23.  In  addition,  the  Community  should  be  open  to  detailed  review  of  its  standards  and  regulatory 
policy  under  the  TPRM.  Our  regime  offers  a good  model  of  compliance  with  the TBT  Agreement. 
Harmonised  Directives  satisfy  its key requirements.  Standards  - largely  based  on international  ones -
are mostly  voluntary, and regulatory  requirements  set only where necessary  on health, safety  or other 
legitimate  grounds.  Producers  thus  have  flexibility  in  how  to  meet  requirements,  in  line  with  the 
obligation  to  make  technical  regulations  the  least  restrictive  possible.  Conformity  assessment 
procedures  are  transparent,  while  the  modular  system  under  the  New  Approach,  which  provides 
different  approval  procedures  related  to  degree  of  risk,  offers  an  example  of  how  to  meet  the  least-
trade  restrictive  test.  Acceptance  of  third  country  test  data  is  possible  through  sub-contracting  by 
European  certification  bodies,  while  the  Community  can  also  point  to  its  efforts  to  secure  mutual 
recognition  agreements with other partners. 

24. The Commission therefore  recommends that standards and certification  issues be more thoroughly 
addressed  in  future  TPRM  reviews, notably  those  of  our  major  trading  partners  and  those  countries 
where  barriers  are  particularly  acute.  We  would  also  be  open  to  similar  study  of  the  Community's 
standards  and conformance  system  at its next review.  To do this  will require  improved  coordination 
within  the Commission  and  with  Member  States in the run-up to TPRM reviews, while we will  need 
also to request  the WTO  Secretariat,  to focus  on the issue more fully  when compiling future  TPRM 
reports. 

b) WTO Accessions 

25.  In  the  past  technical  barriers  to  trade  were  rarely  an  issue  for  GATT  accessions  due  to  the 
voluntary  nature  of  the  Tokyo  Round  TBT  Code.  And  in  those  cases  where  a  GATT  member 
voluntarily  subscribed  to  the  Code,  this  was  quasi-automatic.  With  the  integration  of  the  Uruguay 
Round TBT Agreement  into the body of WTO obligations, compliance has naturally  become an  issue 
for  new accessions, and  one to which European  industry  attaches priority. Considerable  attention  has 
been  given  to  standards  and  certification  issues  in  the  accessions  of  Russia  and  Saudi  Arabia,  and 
similar  attention  should  be  given  to  these  issues  in  other  Working  Parties,  so  as  to  secure  concrete 
commitments to align systems to TBT Agreement rules. 

26. The Commission  will therefore  ensure, in coordination  with Member States,  that these issues are 
given high priority in current and forthcoming  accession negotiations. 

Bilateral  Initiatives to Secure Compliance with WTO Rules and Reduce TBTs 

27.  The  Council  recently  approved  a  new  Community  Market  Access  Strategy  by  which  the 
Commission  will address trade barriers in third countries both through the multilateral framework  and 
where  appropriate  bilaterally.  Trade  barriers  relating  to  standards  and  certification  clearly  figure 
among  the  non-tariff  barriers  the  market  access  strategy  must  overcome.  In  conformity  with  the 
approach  underlined  there, the Community  will continue to use WTO dispute  settlement  proceedings 
to address the most egregious and clear breaches of the TBT Agreement. 

28.  For  those  barriers  which  will  continue  to  be  more  amenable  to  bilateral  resolution  without 
recourse  to  the  full  WTO  machinery,  the  Community  has  a  range  of  resources  at  its  disposal, 
including  its  trade  and  cooperation  agreements  with  many  trading  partners,  formal  consultative 
mechanisms  such  as Ministerial  and high level meetings, and the possibility  to address  problems  in a 
sector  specific  or  ad  hoc  way  as  they  arise.  The  Trade  Barriers  Regulation,  while  primarily 
multilateral  in purpose, can also be a useful  instrument to resolve bilateral disputes. 

29.  In  view  of  the  apparently  growing  number  and  importance  of  technical  barriers  to  trade,  more 
systematic  use  of  these  mechanisms  may  be  necessary  in  future.  It  follows  from  this  that  the 
Community's  limited  resources  will  need  to  be  used  effectively,  and  priorities  set  rigorously. 
Decisions will need to be made, for example, on whether in a particular case to use the WTO route or 
bilateral  means;  whether  to  seek  solutions  through  market  access  negotiations  or  via  longer  term 
regulatory  dialogue;  whether  to  concentrate  efforts  on  resolving  problems  in  one  or  two  major 
markets or cast the net more widely; and whether to  seek to address all TBTs in a particular market  or 
focus  only on the most serious ones. 

30. It is not easy to give a categorical  answer on how such priorities  should be fixed.  But  experience 
to  date  suggests  that  the  Community  has  emphasised  problems  in  the  USA  at  the  expense  of  other 
countries  where  problems  clearly  exist  and  are growing. At the  same time the  relative  priority  to  be 
accorded  to  different  problems  has  not  always  been  established.  A  refocussing  to  encompass  other 
trading  partners,  as  well  as  to  assess  the  relative  importance  of  different  barriers  - and  hence  the 
resources to devote to them - is warranted. 

31.This  refocussing  will  be  carried  out  in  the  following  ways.  First,  within  the  framework  of  the 
Market  Access  Strategy  a  data  base  of  third  country  barriers  is  being  established  and  will  be 
operational  next  year. This  will carry  information  on technical  trade barriers  of  our trading  partners, 
and  be  verified,  updated  and  published  regularly.  This  information  will  provide  a  basis  for 
consultations  with  Member  States  and  industry  so  that  collectively  our  priorities,  both  geographical 
and  sectoral,  can  be firmly  established,  regularly  updated,  and  agreement  reached  on the  appropriate 
actions to take. 

32. Secondly,  and  separately,  we can  improve coordination  by pooling the resources  of  all  interested 
parties  in  Europe:  the  Commission  and  the  Member  States  (with  their  respective  overseas 
delegations),  European  industry  including  European  Business  Councils  in  third  countries,  and 
European  standards, certification  and accreditation  bodies, to understand  more fully  regulatory  issues 
and barriers in key markets - for example the USA, Japan, Korea, China and Russia, and to follow  and 
influence  the course  of  regulatory  change. Information  (for  example  translations  of  regulations  made 
by different  parties) needs to be shared, a continuous dialogue established  with regulatory  agencies in 
the  third  countries  in  question,  an  ongoing  assessment  of  problems  made,  and  systematic  pressure 
applied to reduce technical barriers on the basis of the priorities  identified. 

33.  This  is  an  exercise  which  demands  time  and 
expertise,  and  involves  not  only  thorough 
coordination  within  the  Community,  but  also  in  the  third  countries  concerned.  In  respect  of  the key 
markets  noted  above,  and  potentially  others,  the  Commission  will  ensure  that  its  delegations  are 
charged  with making standards and regulatory  issues a priority. In this way, coordination between the 
Commission  and  the  Member  States  (and  their  respective  overseas  delegations),  European  business 
and the third country authorities can be enhanced, developments in the third country regimes  followed 
systematically,  and  more  coherent  action  taken.  Such  coordination  will  of  course  be  of  benefit  not 
only  in  cases  involving  technical  barriers  to trade, but  also  to  support  the Community's  activities  in 
the  fields  of  mutual  recognition,  technical  assistance  and  regulatory  cooperation,  each  of  which  is 
considered  below. 

10 

SECTION II: MUTUAL RECOGNITION AGREEMENTS 

34.  Two years ago, on the basis of negotiating directives from  the Council, the Commission  opened 
negotiations  for  mutual  recognition  agreements  (MRAs)  with  a  number  of  third  countries. 
Negotiations  are  currently  underway  with  the  USA,  Canada,  Australia,  New  Zealand,  Japan  and 
Switzerland,  some  of  which  should  be  concluded  this  year.  Further  negotiations  with  additional 
priority countries will subsequently be opened'1. 

Nature of MRAs 

35.  Mutual  Recognition  Agreements  are  agreements  on  the  mutual  recognition  of  conformity 
assessment  of  regulated  products.  Through  an  MRA,  each  party  is  given  the  authority  to  test  and 
certify  products against the regulatory requirements of the other party, in its own territory and prior to 
export.  Each  party  recognises  the  tests,  certificates  and  approvals  issued  by  agreed  conformity 
assessment bodies of the other party, and the products can be exported and placed on the other party's 
market  without  undergoing  additional  procedures.  Such  delegation  of  procedures  can  be  envisaged, 
for obvious reasons, only in those cases where countries require mandatory third-party certification  of 
products.  This  is  normally  required  for  products  which  present  risks  and  which  governments  must 
submit to stringent controls. 

MRAs  seek to  facilitate  trade  while  safeguarding  the health,  safety  and environmental  objectives  of 
each  party.  They  do  not  require  or  presuppose  harmonisation  of  each  Party's  substantive 
requirements or recognition of their equivalence (as is the case in the EC internal market).  Each party 
to an MRA is free  to set its health, consumer protection, environmental standards or other regulations 
at whatever level it deems necessary as long as they comply with international obligations.  MRAs do 
not interfere  iwith that freedom  at all.  However, they do require that each side has full confidence  that 
the certification  process of the other side can wholly satisfy  its requirements.  Such confidence  is most 
easily  established  at  a  bilateral  level  and  between  partners  with  broadly  comparable  concepts  of 
product testing and approval, and once established requires mechanisms for its maintenance. 

Benefits of MRAs 

36. MRAs can  bring several benefits  : some immediate and others long term, some tangible in terms 
of  savings  to  industry,  some  less  quantifiable  but  nonetheless  useful  in  promoting  efficient, 
transparent, and increasingly compatible regulatory systems in different  countries. All of these  factors 
should be borne in mind when considering the benefits of mutual recognition in the future. 

a) the expense, time and above all the unpredictability incurred in obtaining approvals can be reduced 
by having the product evaluated  in the country  of production, or a quality  system evaluated  by  local 
inspectors.  These  savings  can  be  particularly  important:  where  the  market  is  distant,  and  where 
rejection  of  products  by  agencies  in  the  country  of  destination  can  create  delays  and  necessitate 
additional shipping or other costs;  where the sector is very heavily regulated; where testing is carried 
out  both  prior  and  post  export,  or  where  early  marketing  may  be  crucial  to  competitiveness  of  a 
product. 

b) for  small  and medium sized  enterprises, who may lack the resources to understand  and  access  the 
regulatory  systems of a distant third country  market. MRAs can bring benefits  by enabling all  testing 
and certification  steps to be carried out locally. 

1 The Council indicated the following priorities : USA, Canada, Japan, Australia, New Zealand, Hong Kong, 
Israel, Korea, Singapore, Philippines and, upon membership of the GATT (now WTO) TBT Agreement  : China, 
South Africa,  Malaysia, Indonesia, Thailand and Turkey.  Among the latter six countries, all but China are now 
members of the WTO TBT Agreement.  Mutual recognition arrangements with Turkey form part of the EC-
Turkey Customs Union.  A separate negotiating mandate for Switzerland was obtained in 1995 following 
Switzerland's decision not to accede to the Agreement Establishing the European Economic Area (EEA). 

11 

37. In addition, MRAs can create longer term regulatory benefits, including the following: 

c) delegation  of the right to certify  products to bodies in the other party to the MRA represents a type 
of  regulatory  reform,  particularly  where regulation  of a sector had previously  been the preserve  of  a 
single  regulatory  agency.  This  can  reduce  the  risk  of  conformity  assessment  being  used  to  protect 
domestic  manufacturers,  or in a way which could  lead to unauthorised  technology  transfer,  problems 
over  intellectual  property  rights,  or  other  uncompetitive  practices  (a  risk  where  testing  and 
certification  is carried out in conjunction  with research for domestic industrial interests). 

d)  long  term  regulatory  cooperation,  and  indeed  regulatory  convergence,  may  be  stimulated  by 
MRAs, since each party must understand and apply correctly the regulatory  requirements of the other 
party. This implies regular contact between regulatory agencies and conformity  assessment  bodies  in 
order  to  ensure  continued  and  uniform  application  of  each  other's  rules.  This  in  turn  creates  an 
incentive  to  seek  compatible  solutions  when  developing  new  regulations,  or  conformity  assessment 
procedures. 

e)  finally,  mutual  recognition  can  assist  regulatory  efficiency.  Through  being  able  to  rely  on 
assessments  carried  out  by  another  competent  party,  the  limited  resources  of  the  regulator  can  be 
reallocated. 

MRAs and Harmonisation of Standards and Regulations 

38.  It  was  noted  in  paragraph  35  that  mutual  recognition  of  conformity  assessment  can  operate 
irrespective  of  whether  the  parties'  underlying  product  standards  and  requirements  are  the  same  or 
equivalent.  In  the  case  of  the  EEA,  the  EC-Turkey  customs  union,  and  future  arrangements  with 
Central  European  Countries,  the  goal  of  economic  integration  dictates  that  mutual  recognition  be 
based  on common  regulations.  In most other cases  however - such as negotiations  with the USA or 
Canada - MRAs will also operate where the parties' underlying rules remain  different. 

39.  It follows  from this that mutual recognition  and harmonisation  are in no way mutually exclusive. 
Harmonisation  brings economies  of  scale to the producer, enabling him to sell on multiple  markets a 
product  produced  against  a single  or equivalent  standard.  However,  harmonisation  does not  of  itself 
guarantee  market  access  in  terms  of  product  approvals:  only  mutual  recognition  will  enable  the 
product  to  be  certified  in  the  country  of  export,  and  then  placed  on  the  market  of  destination. 
Conversely,  mutual  recognition  on  its  own  does  not  allow  one-stop  approval  for  multiple  markets, 
unless accompanied  by harmonisation  or equivalence of the regulations of each party. In general, the 
greatest  gains  are  to  be  made  where  mutual  recognition  is  achieved  against  a  background  of 
harmonised  or equivalent  rules, so that  a single test and approval  is  sufficient  for  both  domestic  and 
foreign  markets. 

40.  This  distinction  has  not  always  been  understood.  Increasingly  however,  European  industry  and 
other  interested  groups  have begun  to recognise the  separate though clearly  complementary  roles of 
MRAs  and  harmonisation  initiatives,  and  have  demanded  that  both  be  pursued  in  order  to  facilitate 
trade. The real question  is not then whether to pursue MRAs or harmonisation,  since their  objectives 
and  benefits  are  different,  but  rather  if  there  are  any  circumstances  in  which  one  should  receive 
priority over the other. 

41.  On  this  question  we  cannot  be  categorical.  In  some  sectors  the  benefits  of  harmonisation,  by 
removing  the  costs  to  industry  of  national  differences  in  standards  or technical  regulations,  may  be 
judged  more important than MRAs. In these cases mutual recognition  may be perceived  mainly  as an 
important first  step towards regulatory convergence, which remains the priority and should be pursued 
in  parallel.  Clearly,  mutual  recognition  should  not  operate  to  hinder  this  objective,  for  example  by 
diverting  resources  away  from  harmonisation  work,  or  from  inhibiting  regulatory  change.  In  cases 
where harmonisation  is imminent, there may be an economic  argument for basing mutual recognition 
arrangements  up-on  such  harmonisation,  as  in  the  field  of  pharmaceutical  Good  Clinical  Practice 
(GCP) (paragraph 74 below), or vehicle approvals (paragraph 76). 

12 

42. In other cases, however,  mutual recognition  may be the priority  or sole interest  of industry.  This 
may  be  the  case  where  conformity  assessment  costs  are  particularly  burdensome,  where  regulatory 
differences  do  not  represent  major  additional  costs  in  terms  of  product  modification,  -  where 
harmonisation  is  considered  achievable  only  in  the  very  long  term  or,  in  particular,  where 
harmonisation  is  not  feasible  because  conditions  and  parameters  are  different  in  each  country.  The 
non-quantifiable  benefits  of mutual recognition, such as their regulatory benefits, need also to be built 
into any such  assessment. 

43.  The  Commission  draws  from  this  assessment  two  general  conclusions.  First,  the  difference 
between  harmonisation  initiatives  and  mutual  recognition  needs  to  be  well  understood,  and  each  be 
pursued on its own merits. In particular, in situations where mutual recognition  has been identified  as 
beneficial  for  the  Community,  harmonisation  initiatives  applicable  to the  same  sector  should  not  be 
allowed to interfere  or delay mutual recognition unless the harmonisation is imminent. 

44.  Secondly,  in  view  of  the  importance  industry  places  on  achieving  greater  international 
harmonisation  of standards and regulations, and the frequent  complementarity  between  harmonisation 
and mutual recognition, we should ensure that MRAs support this goal wherever possible. 

45.  In  the  light  of  these  two conclusions,  we must, first,  ensure  in  future  consultation  of  European 
industry  groups that the relationship  if any between  mutual recognition  and harmonisation  initiatives 
can  be  established  in each  case  , their technical  feasibility  understood,  the appropriate  timescale  for 
each  determined,  and  resources  appropriately  allocated.  Such  consultation  should  obviously  take 
account of the separate but complementary nature of mutual recognition. 

46.  Secondly,  MRAs  should  be  used  explicitly  to  enhance  regulatory  cooperation  and  promote 
harmonisation  or  convergence.  While  MRAs  do  not  imply  or  require  convergence,  clearly  their 
benefits  may  be  greater,  compliance  easier  to  monitor,  and  regulatory  efficiency  maximised,  to  the 
extent that the regulatory  systems of the parties to MRAs are similar. We should therefore  seek within 
each MRA a commitment by the parties to increase regulatory cooperation and, as appropriate, greater 
convergence of technical requirements, which the agreement  itself can support, and to identify  within 
agreements those sectors where harmonisation or equivalence exists. 

47. Thirdly, in determining future  negotiating partners, and future  sectors to negotiate, we should take 
account  of  the  partner's  commitment  to  harmonising  rules  in  a  given  sector  with  international  or 
European  practice,  as  we  are  doing,  for  example,  in  the  case  of  Central  and  Eastern  European 
Countries. Where  possible,  mutual  recognition  should  be a means to encourage  greater  convergence 
by  partners  who  have  developed  divergent  national  rules.  For  those  countries  where  technical 
assistance is being given, as a prelude to future  mutual recognition, this assistance should continue to 
be used to facilitate  convergence  with European  and international  approaches. This  will make  future 
mutual  recognition  between  the Community  and these countries easier to establish,  and maximise  its 
value. 

Current and Future Priorities 

48. The Community's  negotiating  priorities  and  strategy  for  mutual  recognition  were  last  considered 
by  the Council  in March  1995, when  the Commission's  proposals  to open  additional  negotiations  or 
exploratory  discussions  with  Korea, Singapore, Israel and Hungary  were endorsed. The rationale  for 
these  proposals  still  holds,  and  on  the  basis  that  current  negotiations  with  a  number  of  countries 
should  soon  be  successfully  concluded,  further  negotiations  can be progressively  opened.  Since  that 
time  however,  a number  of  developments  have taken  place  which  necessitate  further  adjustments  to 
this strategy. 

49. First, requests have been made by some additional  associated Central European  countries to open 
MRA negotiations  with the Community.  This issue has been discussed  several times by the Council, 
which  has endorsed  the  principle  of  opening negotiations  with  associated  countries  which  can  fulfil 
the  necessary  technical  conditions.  It  has  also  been  stressed  that  any  MRAs  should  both  benefit 

13 

bilateral trade in the pre-accession  phase, and be based on these countries'  legislative alignment  with 
Community  rules.  Against  this  background  the  Commission  is  now  preparing  for  negotiations  as 
provided for under the respective Europe agreements, once the countries concerned meet the relevant 
conditions. 

50.  Secondly,  the  prospect  in  the  near  future  of  the  Community  having  a  series  of  bilateral  MRAs 
raises questions  as to whether they could be made plurilateral. Discussions  in the QUAD  framework 
and  elsewhere  have  shown  interest  in networking  future  bilateral  agreements  to create  a  plurilateral 
framework.  We  should  support  this  idea,  provided  that  we  first  secure  a  number  of  bilateral 
agreements,  that  any  future  plurilateralisation  preserves  our  trade  benefits,  and  that  such  a 
"networking" is consistent with ensuring that health and safety objectives are in no way compromised. 

51.  Thirdly, mutual recognition arrangements are now being developed  within the APEC region.  To 
ensure  that  the  Community's  interests  in  this  field  are  safeguarded,  we  should  seek  the  greatest 
possible  consistency  between  these  arrangements  and  our  own  approach  and  objectives  in  mutual 
recognition.  This  can  in  practice  be  achieved  by  progressively  negotiating  MRA's  with  those 
members  of  APEC,  which  fulfil  the  technical  and  other  conditions  for  MRAs. 
In  practice,  the 
geographical  priorities  identified  by  the  Council  in  1992  also  include  a  number  of  APEC  member 
economies. 

52.  Fourthly, the growth of regional trading agreements may become over time relevant to our MRA 
policy. Currently a number of regional groupings, including Australia and New Zealand via its Closer 
Economic  Relations  Agreement,  NAFTA, ASEAN, the Gulf Cooperation  Council, Mercosur  and  the 
Central European Free Trade Agreement (CEFTA), all plan to introduce forms  of mutual recognition, 
once a common regulatory framework  has been introduced.  With some exceptions (eg the Australia -
New  Zealand  Trans-Tasman  MRA), these arrangements  are at a nascent  stage. While  in the  medium 
term the Commission  will continue to negotiate bilateral MRAs, we should be sensitive to any  future 
regional arrangements, and seek to benefit  from them. If,  in the future,  such arrangements constitute a 
regulatory  union  like  that  of  the  European  single  market,  and  provide  the  necessary  technical 
guarantees,  there  may  be  economies  of  scale  in  concluding  MRAs  at  regional  level.  In  discussing 
technical  assistance  programmes  in  Section  III  below,  we  suggest  giving  greater  emphasis  on 
encouraging  regional  arrangements  through  our  programmes.  In  doing  so,  the  scope  for  such 
arrangements to lead to regionally-based mutual recognition in the long term should be kept in view. 

53.  Fifth,  the Community  must remain  sensitive to the importance  attached  to mutual recognition  by 
other  countries  and  regions,  in  for  example  the  Mediterranean  and  Latin  America,  with  whom  we 
have  important  bilateral  economic  relations,  for  whom  the  Community  is  the  principal  market  or 
whose  domestic  regimes  approximate  to  or  may  be  guided  by  European  standards  and  regulatory 
approaches. For many  such countries  and regions, mutual recognition  is seen  as a specific  long term 
aim,  and  an  objective  of  technical  assistance,  or  can  create  an  incentive  for  approximation  to 
Community  standards and rules. The Community also has an interest in MRAs which can facilitate  its 
exports to these regions and stimulate compatible standards  and regulations. While our policy  should 
continue to be guided by the geographical priorities set out in Council negotiating mandates, and must 
take account of resource constraints, we should nonetheless be open to consider negotiations  in  future 
with additional countries, once they are able to meet the technical conditions for mutual recognition. 

54. Finally,  we note that  the implementation  of  a number  of MRAs  in the future  will  have  resource 
implications,  for  both  Member  States  and  the  Commission  services.  They  will  need  to  coordinate 
relations  between  authorities  and  conformity  assessment  bodies  of  each  party,  track  legislative 
changes,  and  ensure  the  continued  good  operation  of  agreements,  ensuring  in  particular  the  good 
functioning  of their testing  and certification  bodies. As far  as the Commission  is concerned,  priority 
should be given to ensuring that resources are identified  among the existing ones, both at headquarters 
and in delegations to ensure the proper functioning  of future MRAs. 

14 

SECTION III:  TECHNICAL ASSISTANCE PROGRAMMES IN THE FIELDS OF 
STANDARDISATION. CERTIFICATION. METROLOGY AND QUALITY 

55. Since  1990 the Community  has provided a growing number of countries with technical  assistance 
programmes  in  standards, certification,  metrology  and quality. Some of these have been executed  on 
the Community's behalf  by the Comité Européen de Normalisation  (CEN). Programmes  are currently 
being provided  to numerous  trading partners, including those  of Central  and  Eastern  Europe,  Russia 
and the CIS, several  countries  in the Mediterranean  and Middle East, Latin America, Asia,  and  ACP 
countries.  Some  of  these  programmes  are  delivered  within  the  framework  of  trade  or  cooperation 
agreements with our partners. A list of current and planned programmes is at Appendix 1. 

56. When a technical assistance policy was first established, it was for the following purposes: 

- 

to  respond  to  developing  countries'  requests  for  information  on  European  standardisation  and 
regulations, particularly those developed for the Single Market. In this way the transparency  of the 
Community  system could be demonstrated, and developing countries would find  it easier to export 
to the Community; 

- 

to  assist  developing  countries  to  develop  a  standards  and  conformity  infrastructure  that  would 
facilitate  international trade; 

-  and to encourage the adoption by developing countries of International and European standards, as 

a form of technology  transfer. 

57. Over time, the scope of programmes has often  gone beyond these original elements. Programmes 
are now typically multi-annual undertakings, and may include  : providing information  on Community 
standards  and  regulations; 
training  and  advice  on  the  establishment  or  improvement  of 
standardisation  bodies;  assistance  in  upgrading  physical  infrastructure;  assistance  in  setting  up 
accreditation  systems; 
training  of  personnel  in  standards  writing,  conformity  assessment  and 
accreditation; assistance in developing technical regulations; and training and awareness programmes 
in  the  field  of  quality,  from  developing  quality  systems  certification  capabilities  to  improving  the 
capacity of industry to meet European quality requirements at both the regulatory and private levels. 

58. In setting priorities for such programmes, the Commission takes into account a number of  factors, 
in  particular:  the  importance  of  such  cooperation  in  the  context  of  overall  relations  with  the  third 
country; its economic or technological  level; the capacity of programmes to reduce technical barriers; 
and their capacity to facilitate  trade and investment through promoting the acceptance of  international 
and  European  standards  and  regulatory  approaches,  including  where  these  compete  with  other 
countries'  standards  and  rules.  In  terms  of  programme  design,  the  Commission  has  also  taken  in 
account the specific  priorities established  by the Community and the partner country;  sectoral  needs; 
budgetary  limitations; and whether the programme should be purely bilateral  or could benefit  from  a 
regional focus. 

59.  Technical  assistance  programmes  have  certainly  helped  to  demonstrate  the  openness  of  the 
Community's  regulatory  regime,  and  in  doing  so  have  helped  third  countries'  understanding  of  that 
regime and the exports of their products. This continues to be the main goal of programmes for  lesser-
developed  countries. It has also been  in the  interest  of both  the Community  and  the third  country  in 
question  to  be  assisted  in  producing  better  quality  or  safer  products,  while  the  Community  has  an 
obvious  interest  in  promoting  in  third  countries  a  consumer  demand  for  quality  which  Community 
products  are  often  best  able  to  supply.  It  is  less  clear  however,  whether  all  programmes  have 
effectively  reduced  barriers  to  trade,  or  have  propagated  international  or  European  standards  and 
practices to the maximum extent. 

60. The  Commission  has  identified  some  areas  which  need  more  attention  if  the  value  of  technical 
assistance  is  to  be  maximised.  First,  Community  trade  interests  have  not  always  been  explicitly 
determined, or fully  integrated into programme implementation. Companies and individuals chosen to 

15 

carry  out programmes  have not  always been  adequately  aware of  their trade, as opposed  to technical 
and industrial  objectives. Programmes can be designed and executed  so as to take more account of the 
specific  needs or characteristics of the partner country and priorities of European  industry. 

61.  Secondly,  programme  coordination  can  be  further  improved  so  as  to  better  fix  priorities  and 
ensure  a consistent  approach  between  programmes. We can  be  more  active  in  ensuring  exchange  of 
information  with  Member  States,  to  avoid  duplication  of  resources,  and  ensure  common  objectives 
between Community and Member States'  programmes. Similarly, synergy with programmes in related 
fields  such  as  consumer  protection  policy,  customs  procedures,  pre-shipment  inspection  and  market 
surveillance could be beneficial. Programmes could also in some cases benefit  from  a more resources, 
and more systematic follow  up or evaluation of their success. Improved coordination  and management 
are thus possible. 

Programme Objectives and Content 

62.  In  terms  of  the  content  of  technical  assistance  in  this  field,  we  believe  that  while  the  original 
objectives  listed above remain relevant, they need to be complemented  in at least four areas. 

63.  First,  we  must  integrate  into  future  programmes  a  clearer  concept  of  their  trade  and  economic 
objectives. Mutual economic and trade interest  should be a more explicit factor  in programme design, 
the  means  to  accomplish  these  objectives  specified,  and  programmes  evaluated  in  terms  of  whether 
these goals have been achieved.  Training and assistance in applying and complying with  multilateral 
trade disciplines, notably  the WTO TBT Agreement, can also be incorporated  into more programmes 
as  a  specific  component.  Programmes  can  also  provide  more  systematically  for  the  identification  of 
priority  industrial  sectors,  to  be  carried  out  in  consultation  with  partner  countries  and  European 
industry, and on the basis of mutual economic interest. 

64.  Secondly,  some  partner  countries  have  now  reached  a  stage  of  economic  and  industrial 
development  where  basic  infrastructures  -  such  as  a  functional  standards  body,  a  range  of  basic 
industrial standards, and testing laboratories - are in place. Assistance may therefore  be better targeted 
towards  areas  such  as  improving  the  regulatory  regime  for  specific  sectors,  or  refining  the 
infrastructure  necessary  for  mutual  recognition  agreements to be concluded. The potential to promote 
the  absorption  of  European  and  international  regulatory  approaches,  as  opposed  to  solely  standards, 
should  receive  more  attention,  since  an  increasing  number  of  trade  barriers  are  related  not  to 
standardisation  but to regulatory  activity, including conformity  assessment. 

65.  Thirdly,  we  should  ensure  that,  where  appropriate,  and  where  technical  conditions  are  met, 
mutual recognition can be one of the objectives pursued by technical assistance. 

66.  Fourthly,  the  rapid  growth  of  regional  arrangements  and  groupings  in  the  last  five  years  can  in 
future  be better reflected  in the aims of technical assistance, which is still mostly delivered  bilaterally 
or geared to national, rather than regional  solutions. Today a number of regional groupings, including 
ASEAN, Mercosur, the Gulf Cooperation  Council and the CIS, are developing common standards and 
regulatory  systems. To  the extent  these  and  other  regions  develop, over the next  decades,  regulatory 
unions like that of the Community, these should where possible be reflected  in and supported  through 
our  programmes.  We  have  an  interest  in  encouraging  standardisation,  and  the  development  of 
technical  regulations and conformity  assessment on a regional basis, in view of the economies of scale 
it  brings  to  producers,  the  potential  to  access  multiple  markets  on  the  strength  of  a  single  product 
assessment and the likelihood of regional structures using international  standards and practices. At the 
same time the Community's  own single market experience may be a relevant model for  many areas of 
the  world  considering  regional  systems.  The  solutions  we  have  found  can  be  shared.  We  therefore 
consider  that  we  should  encourage  other  countries  seeking  to establish  regional  regulatory  systems, 
and  that  our  programmes  should  to  a  greater  extent  than  heretofore  be  designed  to  facilitate  such 
developments. 

16 

Programme Coordination and Management 

67. In order to improve programme coordination and management in future, we need : 

a) to ensure that  European  industry  is aware of,  and  able to indicate  its priorities  in the provision  of 
technical  assistance programmes. We propose to inform  industry  federations  on a regular basis  about 
both  current  and  forthcoming  programmes,  and  to  seek  the  involvement  of  European  industry  and 
other interested parties in programme implementation  where this can be beneficial. 

b) to ensure the best possible synergy, and to avoid duplication between  Community programmes  and 
those  provided  by  Member  States  or  other  international  organisations  (eg  ISO,  World  Bank,  UN, 
WTO),  through  regular  exchange  of  information  about  the  broad  lines  of  current  and  planned 
programmes.  Programmes  can  then  be  designed  or  modified  to  dovetail  with  other  programmes. 
Basic information  can be shared between  the Commission  and Member States through the mechanism 
of the  113 Committee  Technical  Group on Mutual  Recognition.  The Commission  will  aim to  secure 
similar information  exchange with the international organisations, and inform Member States of these 
through  the  same  channel.  The  Commission  will  also  seek  closer  coordination  with  programmes  in 
related  fields,  as  consumer  protection,  customs  procedures,  pre-shipment  inspection  and  market 
surveillance  practices. It is not  intended  that  this exchange  of information  would  in any  way  replace 
the established  mechanisms  for  consultation  on technical  assistance  and cooperation  with  developing 
countries 2; instead it will offer  a forum which is broader in scope. 

c)  to  provide  a  new  means  to  administer  programmes  in  future  through  a  new  framework  contract 
envisaged  with  the  CEN,  which  will  allow  programmes  to  be  administered  by  CEN  on  the 
Community's  behalf.  Use  of  this  mechanism  while  optional,  and  not  replacing  existing  tendering 
procedures, can nonetheless bring advantages. First, CEN can maximise resource efficiency  by having 
a  reliable  medium  term  forecast  of  programming  needs  and  budget.  Secondly  through  CEN  we  can 
better  promote  the  European  nature  of  programmes.  Today  many  partner  countries  are  virtually 
unaware that the programmes  are Community  ones. Thirdly, CEN will be charged  with building up a 
repository  of  information  on  third  country  systems,  agencies  and  consultants  used,  and  a  library  of 
programme  information  and training materials, which can be drawn on in designing and  carrying  out 
programmes. In this way a focal  point for the different  European  organisations competent  in this  field 
can be provided. 

d) to improve choice of programme  executors, first  by ensuring in the framework  contract  with  CEN 
access  to  the  best  possible  sources,  and  by  giving  the  Commission  a  clearer  say  in  the  choice  of 
programme  sub-contractors.  To  a  greater  extent  than  in  the  past,  we  should  give  public  sector 
organisations (European and Member State standards bodies and accreditation  organisations, Member 
States  regulatory  authorities)  the  opportunity  to  participate  in  programmes.  These  have  a  long-term 
public  interest  in  the  success  of  programmes  and  can  establish  permanent  links  with  partner 
organisations  and  officials.  Greater  involvement  of  regulators  is  also  desirable  to  the  extent  that 
future  programmes  place  greater emphasis  on  improving  the regulatory  framework  in  third  countries 
(paragraph 64 above). 

e)  finally,  to  incorporate  in  programmes  the  possibility  of  their  independent  review  in  order  to 
evaluate whether they are achieving their objectives. 

2  In particular the Committee established under Article 15 of Council Regulation (EEC) N) 443/92 of 
25 February  1992 on financial and technical assistance to, and economic cooperation with with, the developing 
countries in Asia and Latin America (OJ L 52 of 27.2.1992); and the Committee established under article 21  of 
the Internal Agreement on the financing and administration of Community aid under the Fourth ACP-EEC 
Convention (91/401/EEC; OJ L 229 of 17.8.1991) 

17 

SECTION IV: REGULATORY COOPERATION 

68. The term regulatory cooperation is used broadly, encompassing both : 

a)  multilateral  and  plurilateral  initiatives  for  the  harmonisation  or  equivalence  of  standards, 
regulatory requirements and conformity  procedures, or promoting best practices; and 

b)  bilateral  cooperation  with  our  trading  partners  in  developing  technical  regulations,  standards 
harmonisation, and regulatory  reform. 

69. An overview of multilateral  and plurilateral  initiatives  is presented  first,  followed  by a review of 
principal bilateral  activities. Technical assistance programmes, while an important form of regulatory 
cooperation,  and  indeed  the major  form  of cooperation  with developing countries  - are not  discussed 
here  in detail, having been  presented  in  Section  III above.  Bilateral  mutual recognition  agreements, 
which  may  be  a  vehicle  for  regulatory  cooperation,  have  been  dealt  with  separately  in  Section  II 
above. 

Mutilateral and Plurilateral  Initiatives 

70. Below  is  a description  of  the key multilateral  and plurilateral  activities  of the Community  in the 
field of regulatory cooperation, together with the objectives of each. 
The following  is not comprehensive, but identifies  the priority initiatives underway. 

a) OECD 

71.  The  Community  and  Member  States  have  been  active  in  developing  within  OECD  a  multi-
disciplinary  study  on  Regulatory  Reform.  This  aims  at  an  agreed  statement  of  the  principles, 
arguments for, and trade benefits  of regulatory reform, and encompasses deregulation,  harmonisation, 
and mutual recognition. The process has let the Community  share its experience of the single market, 
and promote Europe's regulatory  approach  as an example of good practice.  By extending the OECD 
to  non-OECD  countries  via  the  organisation's  "outreach"  policy,  this  will  spread 
process 
internationally the argument for regulatory  reform. 

72.  A  parallel  exercise  in  the  OECD  Consumer  Policy  Committee  aims  to  clarify  the  relationship 
between  consumer  policy,  certification,  and  international  trade.  This  has  led  to  a  study  and 
recommendations  for  consideration  by  Ministers.  The  study  underlines  the  consumer  and  trade 
importance of standards and conformity  assessment, and how to align consumer, regulatory  and trade 
objectives.  The  work  draws  on  the  Community's  regulatory  approach  as  an  example  of  how  to 
achieve alignment, and again will be shared with non-OECD countries. 

73. Finally,  since the  1980's the OECD Chemicals Committee has promoted harmonisation  of  testing 
practices  used  when  approving  chemical  products,  and  the  mutual  recognition  of  data  from 
laboratories  complying  with  Good  Laboratory  Practice  (GLP).  OECD  principles  of  GLP  have 
progressively  become the international  standard, and the Community  and others have integrated  them 
in  their  own  regulations.  The  common  OECD  standards,  and  the  cooperation  between  members 
organised  through  OECD,  have  provided  a  technical  basis  to  negotiate  MRAs  between  the 
Community  and third countries. The OECD's work in this area is expected  soon to be opened to non-
OECD countries, which will further  internationalise the OECD standards. 

b) Pharmaceuticals  : the International  Conference on Harmonisation 

74.  The  International  Conference  on  Harmonisation  of  Technical  Requirements  for  Registration  of 
Pharmaceuticals  (ICH) brings  together  the  regulatory  authorities  of  the  European  Union,  Japan  and 
the  United  States  and  pharmaceutical  industry  experts  to  discuss  scientific  and  technical  aspects  of 
pharmaceutical  registration.  The  purpose  is  to  reduce  or  obviate  the  need  to  duplicate  the  testing 
carried  out  during  the research  and  development  of new  medicines,  so as to achieve  a more  rational 
use of human, animal and material resources.  Harmonised guidelines are adopted by the regulators of 
18 

the three regions under a stepwise process.  It is anticipated  that all the current ICH guidelines  could 
be  finalised  in  the  next  ICH  to take  place  in  July  1997, with  follow-up  work  continuing  thereafter. 
ICH  work  is  likely  to  facilitate  conclusions  of  MRAs,  notably  in  the  area  of  GCP  (Good  Clinical 
Practice). 

The  International  Co-operation  on  Harmonisation  of  Technical  Requirements  for  Registration  of 
Veterinary  Medicinal  Products  (VICH)  was  launched  in  April  96  with  a  similar  purpose  and 
participation. 

Separately,  the  Community  acceded  in  1994  to  the  Convention  on  the  Elaboration  of  a  European 
Pharmacopeia  drawn  up  by  the  Council  of  Europe.  This  aims  to  harmonise  specifications  for  the 
manufacturing  and  quality  control  of  pharmaceuticals  in  order  to  enable  them  to  circulate  within 
Europe.  The  monographs  of  the  European  Pharmacopeia  become  official  technical  rules  applicable 
within the territories of parties to the Convention 

c) Food and Agriculture Organisation (FAO) 

75.  The  Codex  Alimentarius  Commission,  a joint  programme  of  the  FAO  and  the  World  Health 
Organisation  (WHO), adopts  standards, guidelines  and recommendations  covering certain  aspects  of 
food  safety  and  hygiene.  The  WTO  Agreement  on  the  Application  of  Sanitary  and  Phytosanitary 
Measures presumes that Members are in conformity  with their WTO obligations if their measures  are 
based  on  Codex  standards,  guidelines  and  recommendations.  WTO  Members  who  adopt  other 
measures may be called upon to justify  them on the basis of scientific  evidence or as a consequence of 
the need to achieve a higher level of protection.  The Community has based much of its legislation  in 
the  fields  of  food  safety  and  hygiene  on  Codex  standards  and  will  continue  to  so  where  they  are 
appropriate  to  our  needs.  Furthermore,  the  Commission  will  continue  to  monitor  the  sanitary  and 
phytosanitary  measures  of  our  trading  partners  to  ensure  that  they  conform  to  their  international 
obligations. The Commission  has received  a mandate to start negotiations  with the Codex  secretariat 
in order to become a full  member of Codex in order to ensure that the Community can play its proper 
role in international harmonisation  in this field. 

d) United Nations Economic Commission for Europe (ECE) 

76.  Under  the  UN-ECE  an  agreement  has existed  since  1958 on  the harmonisation  of  standards  and 
technical regulations for motor vehicle equipment and parts, and mutual recognition of approvals. The 
Community,  fourteen  of  whose  Member  States  are  contracting  Parties  to  the  Agreement,  has 
introduced a large number of UN-ECE rules into domestic legislation.  With the anticipated  accession 
of  the  Community  itself  to  the  UN-ECE  Agreement,  which  is  currently  under  discussion  in  the 
Council  and  the  European  Parliament,  the Community  will  be better  placed  to  integrate  more  ECE 
rules into the EC type approval system in the future. 

77. The Community has spearheaded  efforts  to turn the ECE agreement into a global regime, in order 
to encourage adoption internationally  of ECE-based vehicle regulations, and approvals. This goal was 
recently  brought  nearer  through  a  renegotiation  of  the  1958  Agreement  which  opens  it  to  non-
European  countries. Japan  has committed  itself  to joining  the  Agreement,  while  the  EU  and  the  US 
have  designated  the  establishment  of  a  revised  agreement  to  develop  international  standards  for 
automotive  products  in the UN-ECE on a worldwide basis  as a priority  under  the New  Transatlantic 
Agenda  for  the  second  half  of  1996. The  Community  will  continue  to  seek  participation  of  other 
important car producing and importing countries, so as to ensure the widest possible adoption of ECE-
based  rules,  and  mutual  recognition  of  approvals.  Any  bilateral  MRA's  in  this  sector  should  be 
designed in such a way that they serve as a stepping stone for the partner countries'  accession. 

e) Global Harmonisation  Task Force for  Medical Devices 

78.  Established  in  1992  as  a  forum  for  exchanging  experience  on  medical  devices  regulation,  the 
Global  Harmonisation  Task  Force  has  become  a  focal  point  for  efforts  to  introduce  harmonised 
quality  system  requirements  among  the  major  economies.  Supported  by  both  European  and  US 
19 

industry,  the  Task  Force  has  allowed  the  Community's  regulatory  approach  in  the  field  of  quality 
systems certification  to gain acceptance as the international model. Canada, Australia and Japan  have 
been  influenced  through  this  to  adopt  rules  close  to  those  of  the  Community,  while  evidence  is 
appearing  that  the  USA  is  starting  to  do  the  same.  The  Task  Force  is  an  example  of  how  the 
Community  single  market  experience  - resulting  in  a flexible  regulatory  approach  - offers  a  model 
which  may  be  referred  to  elsewhere.  The  Commission  will  continue  to  give  priority  to  the  Task 
Force's  work,  in particular  as a basis  for promoting  the quality  systems  approach  in  other countries, 
notably in East Asia, which are overhauling their medical device rales. 

f) Civil Aviation 

79. Extensive  regulatory  cooperation  in civil  aviation  matters is carried  out at the international  level 
by  the  International  Civil  Aviation  Authority  (ICAO),  and  at  European  level  through  the  Joint 
Aviation  Authorities  (JAA).  The latter, which groups the EC Member States  and  12 other European 
Countries,  cooperates  to  harmonise  aviation  regulations  and  promote  the  mutual  recognition  of 
aircraft  certification  throughout Europe. 

The  Community's  role  in  these  activities  has  in  the  past  been  limited,  but  is  expected  to  grow  in 
future.  First, the further  development  of the Community's regulatory regime for civil aviation  will in 
both  international  fora  and  bilaterally  strengthen  its  capacity  to  cooperate  with  third  countries. 
Secondly,  as part  of  a future  aviation  safety  strategy, the Commission  envisages  launching  technical 
cooperation programmes aimed at improving safety  standards in these countries and promote adoption 
of the European regulatory approach.  These programmes are likely, in the first  instance, to be carried 
out in collaboration with ICAO or the JAA. 

g) The Organisation for Asia Pacific Economic Cooperation (APEC) 

80.  In  1995  the  APEC  members  launched  a 
long  term  programme  of  cooperation  in  the  field  of 
standards  and conformance.  This encompasses  harmonisation  of  standards  and regulations, based  on 
international  ones,  cooperation  to  improve  certification  and  accreditation  systems,  and  mutual 
recognition  agreements. The Community's  trade can potentially  benefit  from  these APEC  initiatives. 
We  have  an  interest  in  seeing  maximum  possible  compatibility  between  the  standards,  regulations, 
and  conformity  assessment  infrastructure  developed  by  APEC  economies  -  especially  their  newly 
industrialising members - and Community ones.  In view of the technical cooperation being offered  to 
some APEC Members by both the Community  and the more developed APEC members, there should 
also be an interest in seeking coherence between these programmes, so as to maximise their value. 

81 The Commission considers that our interest in the APEC process can be served first, by continuing 
to  monitor  developments,  and  secondly  to  seek  a  dialogue  with  the  APEC  Working  Group  on 
Standards  and  Conformance,  which  would  be  used  to exchange  information  and  experience  on  our 
respective activities. 

Bilateral  Initiatives 

82.  At  the  bilateral  level  the  objectives  of  regulatory  cooperation  with  the  Community's  principal 
trading partners can be summarised as follows: 

a) to improve transparency through exchanging information  on current and planned initiatives, such as 
forthcoming  laws and technical regulations affecting  industrial products; 

b)  to minimise  divergences  in  regulatory  approaches, and  the risk  of  ensuing  trade  friction  with  our 
trading partners,  through pre-legislative consultation; 

c)  to  facilitate  harmonisation,  or  recognition  of  equivalence  of  standards,  technical  regulations  and 
conformity  assessment procedures between the Community and third countries, in those sectors where 
these have been judged achievable and of economic benefit to Community exporters. 

20 

In  some  cases  bilateral  cooperation  can  lay  the  foundations  for  the  development  of  standards  or 
regulations in the multilateral  framework. 

a) USA 

83. Regulatory cooperation between the world's two largest trading entities has always been a priority, 
and in recent years has been extended and formalised.  In  1995 the Community and the USA adopted, 
at sub-cabinet  level, a document setting out "Principles of Regulatory Cooperation". This statement of 
principles  encompasses  the  objectives  listed  above,  and  is  meant  to  guide  officials  and  regulatory 
agencies  in  their  work.  EC-US  regulatory  cooperation  is  currently  being  pursued,  taking  these 
principles  into  account,  in  many  areas  including:  industrial  standards  (DGHI-CEN/ANSI-Dept  of 
telecommunications 
Commerce);  Environment 
(DGXIII/FCC);  foodstuffs  and  pharmaceuticals  (DGIII/FDA);  energy  (DGXVII/EPA-Dept  of 
Energy); pesticides  (DGVI/EPA); and biotechnology  (DG m/VI/XI/FDA/USTR).  At the  sub-cabinet 
meeting  in  May  1996,  five  pilot  projects  on  regulatory  cooperation  (covering  smoke  measurement, 
dioxins, biotechnology, diesel engines and port state control) were proposed for future  work. 

(DGXI/EPA);  civil  aviation 

(DG  VTJ/FAA); 

84.  Regulatory  cooperation  has  been  significantly  boosted  through  the  announcement,  at  the 
Ministerial  summit  of  December  1995, of  the EC-US Transatlantic  Agenda  and  Action  Plan,  which 
instituted  a  comprehensive  and  forward-looking  agenda  for  further  cooperation  in  the  field  of 
standards,  technical  regulations  and  conformity  assessment  in  several  industrial  sectors. Industry  on 
both  sides  of  the  Atlantic  has  contributed  to  setting  priorities  through  a  Transatlantic  Business 
Dialogue (TABD), in which different  sectors have identified  the short, medium and long term actions 
to reduce technical barriers, and enhance convergence of EC and US regulatory systems. 

b)Japan 

85.  Although  regulatory  cooperation  with  Japan  has  not  been  as  comprehensive  as  with  the  USA, 
dialogue  between  the two  sides has  increased  in recent  years. The main  bilateral  activities  linked  to 
standards and regulatory issues are : 

-  Japan's  autonomous  deregulation 

to  Japan's  standards  and 
conformance  regime  figures  prominently,  and  where  the  Community  has  indicated  priorities  for 
improving access to Japan's regulatory regime in several sectors. 

initiative,  in  which  changes 

- 

- 

the annual Industrial Policy and Industrial Cooperation dialogue, through  which the EC and Japan 
facilitate  cooperation  programmes  between  key 
includes 
consideration of regulatory issues; 

industrial  sectors,  and  which 

the EC-Japan Standards and Quality dialogue,  which aim to improve understanding of each party's 
standardisation  and quality certification  approaches. 

-  annual high level consultations on telecommunications policy. 

- 

the  annual  high  level  consultations  on  environmental  issues  aimed  at  cooperating  in  the 
development of environmental regulations; 

86. Regulatory cooperation  with Japan also occurs in several of the plurilateral fora, described above. 
There is nonetheless  scope for intensifying  bilateral cooperation  with Japan, as was recognised  in the 
1995 Communication  to the Council  "Europe and Japan: The Next  Steps". There, we indicated  that 
the  dialogue  on  regulatory  cooperation  should  be perceived  as  a continuous  one,  in  which  the  EC's 
experience  in  regulatory  reform,  acquired  particularly  through  the  Single  Market  exercise,  could  be 
put  to  use.  This  remains  a  priority  for  the  Community,  and  we  intend  to  seek  from  Japan  a 
commitment to such  an ongoing exercise which  could  over time become comparable  to that  with  the 
USA. 

21 

c) Canada 

87.  The  regulatory  dialogue  with  Canada  has  in  the  past  been  pursued  mainly  through  plurilateral 
fora.  Recently however Canada has sought to strengthen the framework  for bilateral cooperation  with 
the  Community  through  concluding  an  accord  comparable  to  the  EU-USA  Transatlantic  agenda. 
Although  an  agreement  with  Canada  may  be  not  as  comprehensive  in  its  scope,  it  will  nonetheless 
provide  an  important  vehicle  to  increase  convergence  in  the  future  in  sectors  of  common  trade 
interest,  while  enhancing  the  scope  for  future  NAFTA  cooperation,  which  can  bring  obvious 
economies of scale.. 

d) The Associated Countries of Central and Eastern Europe 

88. A special  case  is that  of  the Central  and Eastern  European  countries  with  whom the  Community 
has  concluded  Europe  Agreements.  To  prepare  these  countries  for  eventual  EU  accession,  major 
programmes  have  been  launched  to  assist  institutional  reform  enabling  alignment  of  their  standards 
and regulatory  systems  with those of the Community.  Implementation  of the Europe Agreements, in 
particular through the Committees of the Association Councils dealing with legislative alignment, and 
industrial  cooperation;  PHARE  programmes  of 
the  development  of 
progressively  closer  relations  with  European-level  standardisation,  certification  and  accreditation 
bodies;  and  possible  mutual  recognition  agreements,  are  the  main  means  to  promote  regulatory 
alignment in the pre-accession  period. 

technical  cooperation; 

e) Other Countries 

89.  With  the  exception  of  Switzerland,  with  whom  there  is  a  sustained  regulatory  cooperation  in 
several  fields,  most regulatory  cooperation  with other trading partners  is pursued  through  plurilateral 
or  multilateral  means, which  were  described  above.  As further  needs  arise  in  a particular  sector  or 
field  of cooperation, these will be pursued. 

22 

SECTION V:  CONCLUSIONS AND SUMMARY OF RECOMMENDATIONS 

Conclusions 

90. In the preceding  pages  the  Commission  has underlined  the  need  for  a more  active  and  outward-
looking  strategy  to  reduce  technical  barriers  to  trade,  to  facilitate  the  wider  use  of  European  and 
international  standards  and  regulations,  and  to  bring  nearer  the  goal  of  one-stop  testing  and 
certification.  We consider such a strategy to be both necessary and timely. It is necessary if we are to 
stem the proliferation  of unjustifiably  divergent standards and rules in a growing number of countries, 
and  encourage  approaches  which  are  compatible  with  multilateral  obligations, 
transparent, 
proportionate  and  advantageous  to  European  exporters  on  world  markets.  It  is  timely  because  the 
regulatory  system underpinning  the Community's  own  internal  market  has now  matured  to the  stage 
where we can afford  both to focus  more on our partners' regimes, and draw on our own experience to 
propose solutions to some of the problems faced. 

91. In reviewing the elements of this strategy - the instruments of the WTO, and bilateral agreements, 
technical  assistance, regulatory  cooperation  and mutual recognition  - we have recommended  ways to 
make  them  more  effective  or  respond  better  to  a  rapidly  changing  trading  environment.  The 
recommendations made are summarised in paragraph 96 below. 

92. At the same time we have stressed the importance of coherence between different  components of 
this  strategy.  We  have  noted  the  importance  of  WTO  instruments  in  reducing  technical  barriers  to 
trade and in promoting use of international  standards and  regulations, and have suggested  how  these 
instruments  can  be used  more  fully.  Technical  assistance programmes  can  also however  support  the 
goals of the WTO: we have argued that such programmes, given a suitable trade orientation, provide a 
major  means  to  assist  compatibility  with  WTO  rules.  They  also  constitute  a  major  vehicle  for 
promotion  in  other  countries  of  European  standards  and  regulatory  practices  -  themselves 
substantially  based  on  international  rules  -  in  sectors  of  mutual  commercial  interest.  Technical 
assistance programmes can also help prepare more advanced partners to meet the necessary  conditions 
for  future  mutual  recognition  agreements,  which  may  provide  an  important  incentive  for  good 
programme  implementation. 

93.  We  have  presented  mutual  recognition  as  a response  to  the  legitimate  - but  increasing  - use  of 
third  party  conformity  assessment  in  international  trade. MRAs can  facilitate  trade  in  sectors  which 
will  continue  to require  government  regulation,  and whether  or not underlying product  requirements 
are  or  can  be  harmonised.  We  have  argued  however  that  mutual  recognition  may  often  bring  the 
greatest  trade  benefits  in  sectors  which  have  been  harmonised,  and  that  the  necessary  confidence 
between  MRA  partners  may  be  more  rapidly  gained  and  maintained  in  these  circumstances. 
Membership  of  the  WTO TBT  Agreement,  while  a precondition  to conclude  MRAs, is  of  itself  not 
enough to provide this confidence. 

94.  Finally,  we have noted  that  harmonisation  of  standards  and  regulatory  requirements  is  achieved 
through  regulatory  cooperation  taking  place  both  at  the  multilateral  level  and  bilaterally.  These 
initiatives, like technical  assistance, help to prevent trade barriers and may establish  a good  technical 
basis for mutual recognition. Regulatory cooperation in particular at the multilateral level ensures that 
the Community's interests in the development of international standards and regulations - vital for our 
international  trade,  besides  being  the  basis  on  which  our  WTO  obligations  largely  rest  -  are 
safeguarded. 

95. The policy  goals  set out in this paper can only  succeed  however  with  good coordination  and  the 
right institutional  framework.  Some  specific  recommendations  have  been  made: to consult  industry 
more  widely  when  setting  priorities;  to  improve  exchange  of  information  on  technical  assistance 
programmes,  to strengthen  external  delegations' coverage  of  standards  issues. But the full  benefit  of 
the  strategy  set  out 
in  this  Communication  can  only  be  reaped  through  proper  coordination  and 
monitoring.  Within the Commission, we will consider the case for  strengthening the resources  of the 
services  responsible  for  oversight  and interservice  coordination  of policies  set  out  in  this  document. 

23 

At  the  level  of  the  Council  however,  we  see  merit  in  broadening  the  current  mandate  of  the  113 
Committee  Technical  Group  on  Mutual  Recognition  to  encompass  technical  barriers  to  trade, 
technical  assistance  and  regulatory  cooperation  in the field  of  standards  and  conformity  assessment. 
This  Council  committee  comprises  both  trade  and  regulatory  expertise  and  is  well  placed  to  give 
guidance  on  this  issues  while  remaining  subject  to  the  strategic  guidance  and  oversight  of  the  113 
Committee.  The Commission therefore recommends such an extension of the MRA Group's mandate. 

Summary of  Recommendations 

96.  Below is a summary of the recommendations made : 

a.  To ensure improved implementation  and operation of the WTO Agreement on Technical Barriers 
To  Trade  (TBT),  the  Community  should  seek,  at  the  WTO  Singapore  Ministerial  meeting  in 
December  1996: 

1)  reaffirmation  by  all  WTO  Member  of  their  commitment  to  fully  implement  the  TBT 

Agreement; 

2)  commitment  to  ensure  a  comprehensive  and  in-depth  review  of  the  TBT  Agreement  as 

foreseen  in  1997 (paragraph  18). 

b.  Furthermore,  to  consider  whether,  and  in  which  circumstances,  the  Community  should  be 
involved  more  closely  in  the  work  of  the  international  rule-making/standards  bodies,  so  as  to 
ensure  continued  consistency  between  international  rules  and  standards,  Community  rule 
making, an our WTO obligations (paragraph  19). 

c.  To seek thorough coverage of  standards and conformity  issues in future  TPRM reviews, notably 
those  of  our  major  trading  partners  or  in  countries  where  barriers  have  been  identified  as 
particularly  acute.  In  addition,  to  be  open  to  thorough  TPRM  review  of  the  Community's 
regulatory system (paragraph 24). 

d. 

In  the  context  of  current  and  forthcoming  negotiations  on  accession  of new  WTO Members,  to 
ensure that standards and conformity  assessment issues are given prominence (paragraph 26). 

e.  Within  the  framework  of  the  Market  Access  Strategy,  to  ensure  that  market  access  problems 
relating  to  technical  barriers  to  trade  are  comprehensively  documented,  and  that  adequate 
consultation  and  exchange  information  on  these  issues  takes  place  between  the  Commission, 
Member States and European industry (paragraph 31). 

f.  To ensure that key  external delegations make coordination  on standards  and conformity  issues a 

priority (paragraphs 32-33). 

g.  As  concerns  Mutual  Recognition  Agreements  (MRAs),  to  ensure  that  the  differences  between 
harmonisation  on  the  one  hand  and  mutual  recognition  on  the  other  be  better  understood,  and 
each  continue  to be pursued  on  its own merits. Consistent  with  this, the  objective  of  regulatory 
harmonisation  should  be  taken  into  account  in  future  MRA  negotiations,  in  particular  through 
using  such  agreements  to enhance cooperation  and promote harmonisation. At the same time, in 
determining  future  negotiating  priorities, commitment  to harmonising  its regulatory  regime  in a 
given sector with international or European practice should be taken into account (paragraphs 43-
47). 

h.  To  open  negotiations  on  mutual  recognition  with  associated  countries  of  Central  and  Eastern 
Europe  to  the  extent  they  can  fulfil  the  technical  and  other  conditions  for  such  agreements 
(paragraph 49). 

i.  To  be  open  to  the  principle  of  plurilateralising  bilateral  MRAs,  once  concluded,  and  where 
consistent  with  both  our trade  interests  and regulatory  objectives. In addition,  to be  open  to the 
possibility in the long  term, of establishing agreements on a regional basis (paragraph 50). 

24 

j. 

To continue  to attach  priority  to MRAs  with  individual  members of APEC in order to  maximise 
consistency between these arrangements and APECs work in this field  (paragraphs 51) 

k.  Taking account  of existing guidelines and mandates, to continue to be open 10 negotiating mutual 
recognition with other countries which meet the necessary technical requirements (paragraph 53). 

1.  To  ensure  the  means  are  available  to  allow  the  proper  implementations  of  MRAs,  both  at  he 

national  level and within the Commission  (paragraph 54). 

m. 

In respect  of technical  assistance programmes, to integrate trade objectives  fully  into current and 
future  programmes  including, where appropriate, assistance in complying with WTO  obligations 
and  disciplines  (paragraph  63).  The  specific  trade/market  access  needs  of  lesser-developed 
countries should continue however to be served by programmes. 

n.  To  ensure  that  technical  assistance  programmes  concentrate  adequately  on  regulatory  issues, 

where necessary in a more sector-specific  way (paragraph 64). 

o.  To continue  to utilise technical  assistance  to establish  a basis for  mutual  recognition  agreements 

and other forms  of regulatory cooperation  (paragraph 65); 

p.  To  take  full  account  of  the  regional  dimension  in  providing  programmes,  including  the 
encouragement  of  regional  systems  of  product  regulation  and  conformity  assessment,  and  to 
promote where appropriate the Community's regulatory  approach in such programmes  (paragraph 
66). 

q.  To  consult  with  and  seek  involvement  of  European  industry  groups  on  a  regular  basis  about 

current and forthcoming  technical assistance programmes (paragraph 67a). 

r.  To establish  through the  113 Committee of the Council  a mechanism for  systematic exchange of 
information  between  the Commission,  Member  States, European  and  international  organisations 
on  programmes  in  this  field,  so  as  to  enhance  transparency,  reduce  duplication  of  effort  and 
create  synergies  between  programmes  (paragraph  67b).  Noting  however  that  this  is  without 
prejudice  to existing provisions for information  exchange and consultation. 

s.  To  offer  as  an  option  a  new  mechanism  for  programme  administration  through  a  framework 
contract  with  the  Comité  Européen  de  Normalisation.  This  will  assist  programme  planning, 
enable  the  creation  of  an  information  base  for  use  by  programme  planners,  the  Commission, 
Member  States,  industry  and  other  interested  parties,  and  promote  the  European  profile  of 
programmes (paragraph 67c). 

t.  To  improve  the  means  of  choosing  programme  consultants  and contractors,  and  in particular  to 
use  to  a  greater  extent  than  in  the  past  European  level  or  national  organisations  and  Member 
States regulatory  authorities (paragraph 67d). 

u. 

In the field  of regulatory cooperation, to continue to give priority to the work being carried  out in 
the OECD in the  area of  regulatory  reform,  in order to improve international  understanding  and 
consensus on its benefits, to share experience with the single market exercise, and to promote the 
use of Europe's regulatory  approach. In addition, to continue to support ongoing OECD activities 
in  the  field  of  harmonisation  and  mutual  recognition  of  data  in  the  chemicals  field  (paragraphs 
71-73). 

v.  To  ensure  that  the  current  work  under  the  International  Conference  on  Harmonisation  in  the 
pharmaceutical  sector  is  completed  by  July  97,  in  order  to  allow  a  reallocation  of  resources 
towards  harmonisation  of the registration  dossier and inclusion  of GCP in MRAs  with  the USA, 
Canada, Japan, Australia and others, (paragraph 74). 

25 

w.  To  promote  actively  the  adoption  by  our  trading  partners  of  the  standards  set  by  the  Codex 
Alimentarius  in  order  to  reduce  technical  barriers  and  facilitate  trade  in  foodstuffs  (paragraph 
75). 

x. 

In respect  of the UN-ECE Agreement on harmonisation  of regulations and mutual recognition of 
approvals  for  vehicles  and  parts,  to  seek  participation  in  the  Agreement  of  other  important 
trading partners, so as to ensure the widest possible adoption of UN-ECE-based rules, and mutual 
recognition  of approvals.  Any bilateral agreements on mutual recognition of vehicle approvals in 
this sector should serve as a stepping stone for the accession  of partner countries to the UN-ECE 
system (paragraph 77). 

y.  To  continue  to  support  the  work  of  the  Global  Task  Force  on  Harmonisation  in  the  medical 
device sector, as a means to  promote the quality  systems approach in other countries  (paragraph 
78). 

z.  To strengthen  the Community's  regulatory  cooperation  in the field  of civil aviation, in particular 
through  developing  technical  cooperation  programmes  which  promote  safety  and  the  wider  use 
of European regulations (paragraph 79). 

aa.  In  respect  of  APEC,  to  monitor  the  work  of  the  APEC  Working  Group  on  Standards  and 

Conformance,  and to establish a dialogue with APEC on this matter (paragraphs 80-81). 

bb.  As  regards  bilateral  regulatory  cooperation,  to  continue  to  attach  priority  to  such  cooperation 
with the USA, in particular through implementation  of the Transatlantic Action Plan decisions in 
this  respect;  and  with  the  associated  countries  of Central  and Eastern  Europe; and to  strengthen 
cooperation  with other major  trading partners such as Japan and Canada (paragraphs 82-89). 

cc.  To ensure  that  standards  and  conformity  assessment  issues  receive  appropriate  attention  and  to 
improve  coordination  of  the  various  policy  instruments  described  in  the  document,  to  consider 
resource and needs within the Commission  services (paragraph 95). 

dd.  At  the  level  of  the  Council,  to  broaden  the  current  mandate  of  the  113 Committee  Technical 
Group  on  Mutual  Recognition  to  encompass  technical  barriers  to  trade,  technical  assistance  in 
the field  of standards and conformance,  and regulatory cooperation  (paragraph 95). 

97. The Council  is invited  to note the contents  of this Communication,  and to endorse both  its broad 
conclusions and the specific  proposals made. 

26 

SX 1 : SUMMARY OF CURRENT MRA  NEGOTIATIONS 

BY COUNTRY / SECTOR 

Sectors  under 
discussion 
MEDICAL DEVICES 
PHARMACEUTI 
CALS GMP 
GLP 
TELECOMS 
EQUIPMENT 
ELECTRICAL 
EQUIPMENT & EMC 
PRESSURE VESSELS 
MACHINERY 
PPE 
AIRCRAFT 
AUTOMOTIVE 
PRODUCTS 
RECREATIONAL 
CRAFT 
LAWN MOWERS 
MEASURING 
INSTRUMENT 
TOYS 
PHYTOPHARMACE 
UTICALS 
DANGEROUS 
SUBSTANCES AND 
PREPARATIONS 
CONSTRUCTION 
SITE EQUIPMENT 
ELECTRICAL 
EQUIPMENT FOR 
EXPLOSIVE 
ATHMOSPHERS 
(ATEX) 
GAS APPLIANCE 
TRACTORS 

USA 

CANADA 

AUSTRALIA 

1  NZ 

JAPAN 

SWITZERLAND] 

X 
X 

X 

X 

X 
X 

X 
X 

X 
X 

X 

X 

X 
X 

X 

X 
X 

X 
X 

X 

X 
X 
X 

X 
X 

X 
X 

X 

X 
X 

X 

X 
X 

X 
X 

X 

X 
X 

X 

X 

X 
X 

X 
X 

x 

X 
X 
X 

x 

x 
X 
x 

x 
X 

x 

X 

X 

X 
X 

j 
| 

l 

1 
Î 

! 
1 

j 

27 

ANNEXE2A 

ACTIONS IN PREPARATION 

THIRD 
COUNTRIES 

NATURE OF 
PROGRAMME 

SECTORS 

DURATION 

AMOUNT(ECU) 

India 

Metrology,  standardisation, 
certification,  quality 
assurance, testing 

Sri Lanka 
Vietnam 

Normes, quality assurance 
Normes, quality, assurance 

Malta 

Mexique 

Marocco 

Algeria 

Tunisia 

Israel 

Egypt 

Argentina 

Bulgaria 

Standardisation,  certification 
metrology, quality assurance, 
testing 
Certification,  accreditation, 
standardisation 
Certification,  accreditation, 
metrology, quality promotion 
Certification, 
standardisation, intellectual 
property, quality  assurance 
Certification, 
standardisation, quality 
assurance 

Identification  mission to 
design a comprehensive 
programme 
Certification  and assistance 
to laboratories 

Certification, 
standardisation, 
methodology, quality 
assurance, testing 

Vehicle, 
foodstuffs, 
domestic 
electrical 
appliances and 
ITT 
Horizontal 
Horizontal 

Horizontal 

Not specific 

Horizontal 

Plumbing 
Cement 

Horizontal 

Parti 
1988/1992 

Part 2 : 
1992-1997 
2 years 
3years 

4 years 
1992/1996 
3 years 
1993/1996 
6 years 
1992-1997 

1995/1997 
3 years 

electrical and 
electronic 
products 
Not specific 

1996 

2 phases 
91-95 ; 96-98 

3 years 
1996/1998 

2000000 

2.528.000 
450.000 
3.500.000 

2200000 

1650000 

1575000 

400.000 

5.000.000 

200000 
35000 

1089000 

2.000.000 

18 

ANNEXE 2 A (follow) 
PROGRAMMES IN PREPARATION 

THIRD 
COUNTRIES 

NATURE OF 
PROGRAMME 

SECTORS 

DURATION 

AMOUNT (ECU) 

Quality assurance, 
Standardisation, 
Certification, Accreditation, 
testing 

Metrology, Certification, 
Accreditation and Quality 
assurance 

various sectors 

5 years 
1993/1997 

500000 

not specific 

5 years 
1991/1995 

Romania 
(Phare) 

Hungary 
(Phare) 

Hungary 
(Phare) 

Certification, type approval 

Telecoms 

Czech Republic 
(Phare) 

Metrology, Standardisation, 
Testing 

Czech Republic 
(Phare) 

Standardisation and 
Metrology 

Czech Republic 
(Phare) 

Testing, Standardisation, 
Accreditation 

Quality 
infrastructure 

Quality 
infrastructure 

Quality 
infrastructure 

Testing & Certification 

Telecoms 

3 years 
1995/1997 

5 ans 
1991/1995 

4 years 
1992/1995 

4 years 
1995/1998 

4 years 
1991/1994 

3 years 
1995/1997 

3 years 
1996/1998 

3 years 
1996/1998 

Not specific 

Foodstuffs 
industry 
Pressure 
equipment. 
Electrical 
équipement 

Not specific 

Quality 
Infrastructure 

4 years 
1995/1998 

Not specific 

Not specific 

Various sectors 

3 years 
1996/1998 

1996/1998 
3 years 

500000 

690.000 

1580000 

4000000 

700000 

5000000 

3800000 

2055000 

1800000 

600000 

2000000 

35500000 

& 

Czech Republic 
(Phare) 

Slovak Republic 

Standardisation, Science et 
Technologie 

Lithuania 
(Phare) 

Standardisation, 
Approximation of legislation 

Latvia 
(Phare) 

Estonia 
(Phare) 

Romania 
(Phare) 

Bulgaria 

Multicountry 
Programmes 
PRAQ 91, 
PRAQ 93 
PRAQ in 

Standardisation 
Approximation of legislation 

Standardisation, 
Accreditation, Metrology, 
conformity assessment 

Standardisation,Consumer 
protection 
Certification Methodology 
quality assurance, 
Standardisation 

Metrology, Certification, 
Standardisation, 
Accreditation, Testing, 
Legislation 

ANNEXE2B 

PROGRAMMES IN PREPARATION 

THIRD COUNTRIES 

NATURE OF PROGRAMME 

SECTORS 

DURATION 

AMOUNT 

Pakistan 

Chili 

Certification,  standardisation 
and quality assurance 

Certification  standardisation, 
quality assurance, metrology 

Mongolia 

Standardisation,  certification 

Certification, 
quality, 
Awareness 
Training 

2 years 

500000 

Certification  standardisation, 
quality assurance, metrology 

not  specific 

4 years 
1997-2000 

5210000 

China 

Cyprus 

ASEAN 

Jordan 

Lebanon 

Marocco 

Paraguay 

Standardisation,  certification, 
metrology, quality assurance 

Standards, quality  assurance 
of conformity 
Identification  mission 
certification,  standardisation, 
quality assurance 
Industrial and Commercial 
standards 
alignment of rules, 
legislation, mission to 
identify  needs 
Certification,  standardisation, 
quality assurance, metrology 

Brazil 

Metrology,  certification 

MERCOSUR 

AIDMO 

GCC 

ANDEAN PACT 
(5 countries) 

h:public:jc:diveis:auexpoll .doc 

Certification,  standardisation, 
procedures of  notification, 
metrology and quality 
assurance and management 
Certification,  standardisation 

Certification,  quality, 
standardisation 
Regulations,  notification, 
standardisation, testing, 
certification,  quality 
assurance, metrology 

not  specific 

5 years 
1997-2002 

not yet 
determinded 

horizontal 

1996-

30.000 

horizontal 

horizontal 

industrial 
products 

industrial 
products 

industrial 
products 

not specific 

to be 
determined 

3 years 
1997-1999 

1996 
2 months 

2 - 3 years 
(to be 
determined) 

6.000.000 

30.000 

+/- 900.000 

8 months 

+/- 400.000 

3 years' 
1993/1996 

3 years 
1997/2000 
3 years 
1996/1999 

3950000 

750000 

700000 

to be 
determined 

3 years 
1997-2000 

2.300.000 

^SSr  3o 

ISSN 0254-1475 

COM(96) 564 final 

DOCUMENTS 

EN 

11  10  02  15 

Catalogue number  : CB-GO-96-587-EN-C 

ISBN 92-78-11605-X 

Office  for Official  Publications of the European Communities 

L-2985 Luxembourg 

5/