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RR RUEHAG RUEHDF RUEHIK RUEHLZ RUEHPOD RUEHROV
DE RUEHBS #0770/01 1431419
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R 221419Z MAY 08
FM USEU BRUSSELS
TO RUEHC/SECSTATE WASHDC
INFO RHEHAAA/WHITE HOUSE WASHDC
RHEHNSC/NSC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC
RUEHC/DEPT OF LABOR WASHDC
RUEAUSA/DEPT OF HHS WASHDC
RUCNMEM/EU MEMBER STATES COLLECTIVE
RUCNMEU/EU INTEREST COLLECTIVE

UNCLAS SECTION 01 OF 06 BRUSSELS 000770 
 
SIPDIS 
 
STATE PASS TO OMB/OIRA FOR DUDLEY AND MANCINI, USTR 
FOR SANFORD 
 
E.O. 12958:  N/A 
TAGS: ECON ETRD EIND SENV SOCI EUN
SUBJECT: TRANSATLANTIC REGULATORY DIALOGUE ADDRESSES 
REGULATORY QUALITY, TRADE, INVESTMENT AND IMPORT 
SAFETY 
 
¶1.  Summary:  At the 25 April High Level Regulatory 
Cooperation Forum (HLRCF), senior U.S. and EU 
regulators discussed strengthening EU-US cooperation 
on import product safety, enhancing information 
sharing, collaborating on risk analysis, and the 
final joint OMB/Secretariat General report on the 
impact of domestic regulation on international trade 
and investment.  A subsequent session with non- 
government stakeholders addressed public 
consultation in the EU and the U.S. regulatory 
process.  U.S. and EU chairs discussed the HLRCF 
results at the 13 May TEC meeting. End Summary. 
 
 
History of HLRCF 
---------------- 
 
¶2.  The High-level Regulatory Cooperation Forum 
(HLRCF) was set up at the April 2005 US-EU Summit to 
allow regulators to discuss cross-cutting topics of 
general interest and issues that may be the 
responsibility of multiple regulatory authorities. 
As such, it provides a platform for exchanges 
between regulators and stakeholders on priorities in 
reducing unnecessary regulatory differences and 
thereby advancing transatlantic economic 
integration. 
¶3.  The first dialogue in January 2006 focused on 
"good regulatory practices."  Hosted by the European 
Commission, nearly 150 people attended the 
conference, including senior EU and U.S. regulators, 
representatives of the EU Member States, members of 
the European Parliament and the U.S. Congress, and a 
large number other stakeholders, including the 
Trans-Atlantic Business and Consumer Dialogues 
(QTABDQ and QTACDQ).  The primary purpose of the 
first dialogue was to glean insights into Qhow we 
regulateQ on both sides of the Atlantic.  A large 
part of the discussion was devoted to general 
regulatory policy, comparing the EU and U.S. 
regulatory systems and approaches in assessing the 
impact of regulations. 
 
¶4.  The second HLRCF, hosted by U.S. Department of 
Health and Human Services (HHS) Deputy Secretary 
Alex M. Azar II on 3 May 2006, sought to move 
forward on a common agenda of promoting better- 
quality regulation, minimizing regulatory 
divergences, increasing consumer confidence, and 
facilitating Trans-Atlantic commerce. 
Participation was of similar caliber and quality as 
the first Forum.  Azar addressed the HLRCF on the 
importance of collaboration between the U.S. 
Government and the EC as they develop regulations. 
He also shared insights on the strengths of the U.S. 
rule-making process, highlighting our transparency 
and stakeholder involvement our use of the most 
contemporary and robust science and our commitment 
to cost-justification and judicial review. 
¶5.  The third Forum, hosted by the Office of 
Management and Budget (OMB) on 7 November 2007, had 
a public and non-public portion, focusing on import 
safety and coordination on understanding risks 
before considering development of regulation.  The 
non-public portion provided an excellent opportunity 
to cross-fertilize ideas and address incorrect 
presumptions of the others' regulatory system, 
facilitating intensification of regulatory 
cooperation and information sharing.  The public 
portion discussed a draft OMB/Secretariat General 
joint report reviewing how the EU and U.S. analyze 
the impacts of regulations on international trade 
and investment. 
 
April 25 HLRCF Meeting 
---------------------- 
 
¶6.  At the fourth HLRCF on April 25 in Brussels, 
senior regulators discussed strengthening EU-US 
cooperation on import product safety, enhancing 
 
BRUSSELS 00000770  002 OF 006 
 
 
information sharing, collaboration on risk analysis, 
and the final joint OMB/Secretariat General report 
on the impact of domestic regulation on 
international trade and investment. Susan Dudley, 
Administrator for OMBQs Office of Information and 
Regulatory Affairs (OIRA), co-chaired the HLRCF and 
led the Washington-based delegation that included 
OMB/OIRA, FDA, CPSC, OSHA and CBP; and USEU 
representatives from USTR, CBP, USDOC and State. 
European Commission Director General for Enterprise 
and Industry (DG ENT) Heinz Zourek co-chaired, 
joined by regulators from the Public Health and 
Consumer Affairs (SANCO) Directorate, Customs and 
Taxation Directorate (TAXUD), DG ENT and the 
Secretariat General. 
 
Import Safety 
------------- 
 
¶7.  The report on our respective approaches to 
import safety in key areas (cars, toys, electrical 
equipment for consumer use, pharmaceuticals, 
cosmetics, food, and customs issues related to these 
products), and cooperation in these areas, was 
nearly complete by the time of the HLRCF; however, 
recommendations on next steps were still being 
finalized.  The discussion at the HLRCF focused on 
proposed recommendations for improved information 
sharing.  For the most part, both sides came to 
agreement on these recommendations.  The discussion 
also focused on more general challenges to improved 
information sharing. 
 
¶8.  Confidentiality, especially with respect to 
sharing product recall and other business 
confidential information with the member states, 
surfaced as a key problem.  While discussing OSHAQs 
suggested recommendation in the draft report that 
OSHA may benefit from access to the EUQs RAPEX 
system (their rapid alert system for dangerous non- 
food products), the Deputy Director General of DG 
SANCO Paola Testori-Coggi demanded "reciprocity" 
before sharing information that they would consider 
helpful to us.  OSHA's Ed Foulke explained that his 
agency did not regulate products per se, but their 
impact on workers in the workplace.  Deputy 
Commissioner of FDA Randall Lutter pointed out how 
we readily shared a new testing methodology to 
detect a contaminant in heparin that could and did 
save lives.  This information was immediately shared 
in order to contain the negative public health 
effects.  OIRA Administrator Susan Dudley pointed 
out that our goal should be sharing information as 
expeditiously as possible to protect our citizens. 
 
¶9.  European Medicines Agency (EMEA), DG Enterprise 
and FDA have a confidentiality agreement; however, 
the Commission does not have full competence for 
regulation of pharmaceuticals, and must defer to 
member states in particular instances.  FDA has 
regulatory authority and responsibility for 
enforcing its laws, including with respect to 
information sharing.  The difficulty FDA has is that 
EMEA must share information it receives from FDA 
with the member states, which have no obligation to 
keep the information private.  To fill this gap, 
EMEA is negotiating a network of confidentiality 
agreements with its EU member state regulator 
counterparts, which would oblige the member state 
regulators to keep FDA information confidential.  DG 
Zourek stated that although pharmaceuticals are 
somewhat unique due to the sharing of responsibility 
with member states, the Commission may be able to 
apply this strategy to other product classes, and 
that in particular this may be a model that could 
help, for example, CPSC and SANCO to intensify 
information sharing once CPSC receives legislative 
authority to do so.  (Comment:  Statutory 
limitations were discussed at the May 13 TEC as well 
but leaders also recognized that such barriers could 
 
BRUSSELS 00000770  003 OF 006 
 
 
be overcome with the political will to share vital 
safety information such as in the case of heparin. 
End comment.) 
 
¶10.  Both sides recognized the importance of closer 
cooperation and coordination in dealing with China, 
the key source of consumer product imports for both 
the US and the EU.  CPSC and SANCO will jointly 
reach out to China in September and Commissioner 
Kuneva will be hosting a trilateral product safety 
conference (EU, U.S., China) in November 2008. 
 
¶11.  Testori-Coggi also expressed concern with 
certain elements of the FDAQs Food Protection Plan, 
i.e. proposals for inspection fees for imports, 
systematic registration with the FDA, etc.  She said 
that if the FDA would decide to implement the plan, 
the EC would want to achieve recognition that EU 
food is as safe as U.S. food. 
 
¶12.  Assistant Secretary for Occupational Safety and 
Health Ed Foulke suggested the EU and U.S. also 
exchange information on their approach to the safety 
of nanotechnology.  Zourek invited Foulke to take a 
look at and comment on the CommissionQs nanotech 
Staff Working Paper, which Zourek said would be 
released mid-May.  (Comment:  This communication was 
scheduled to be released since last September, but 
many believe it has been delayed due to differences 
of opinion on how the Commission should handle 
regulation of nanotechnology applications.  The 
College of Commissioners recently debated the form 
of the document, apparently choosing to release as a 
Staff Working Paper as opposed to a Communication, 
which now allows more flexibility to change opinions 
in the future.  See reftel BRUSSELS 184) 
 
Risk Analysis 
------------- 
 
¶13.  OIRA Administrator Dudley characterized an 
underlying goal of our risk analysis dialogue as not 
necessarily to converge on the same policies, since 
we operate in different systems, but rather to see 
if we can agree on the underlying risks for which 
both the EU and U.S. are considering regulation. 
FDA mentioned an idea for reviewing analysis of a 
potential endocrine disruptor to facilitate 
illustration of methodological differences, but 
there were different thoughts on the usefulness of 
defining specific case studies.  Many agreed that a 
discussion of case studies might be ripe for the 
fall 2008 HLRCF.  Zourek expected a report to come 
from this meeting that could be delivered to the 3rd 
TEC. 
 
¶14.  In part in preparation for that, OIRA and 
SecGen/SANCO and other regulatory agencies from the 
US, EU and Canada will hold a government-only 
workshop on risk assessment July 10-11, and then 
SANCO will host a major international conference in 
Brussels later this year, possibly November 13-14. 
 
Joint Report on Incorporating Trade and Investment 
Impacts in Regulatory Analyses 
------------------------------- 
 
¶15.  OIRA and SecGen had virtually completed their 
report on how our impact assessments account for 
impacts on trade and investment, including 
responding to, and in some cases incorporating, 
stakeholder comments at the time of the Forum.  When 
discussing opportunities for public comment, Dudley 
and others mentioned that U.S. regulatory agencies 
must consider all comments received equally, i.e. 
comments from EU companies are just as valid as 
those from U.S. companies.  The Administrative 
Procedure Act requires US regulatory agencies to 
provide reasoned responses to all inquiries, 
although some statutes constrain the factors that 
 
BRUSSELS 00000770  004 OF 006 
 
 
may be considered (e.g., the Clean Air ActQs focus 
is on U.S. air quality).  OMB and SecGen agreed at 
the Forum to report steps they take to more fully 
account for trade and investment impacts.  The 
report was delivered to the TEC on May 13. 
 
¶16.  They also agreed that "case studies" on impact 
assessments would be useful to better understand how 
our respective guidelines can and should be applied, 
and how our analysis might differ on reviewing 
alternative approaches to effectively achieve policy 
priorities.  Although the initiative was not yet 
fully defined, suggestions included two distinct 
projects.  One study would focus on 
legislation/regulation for which the U.S. and the EU 
have already done an impact assessment in the past, 
an ex-post assessment.  Both sides would apply the 
otherQs guidelines to the impact assessment and see 
whether methodologies are different. 
 
¶17.  Another study would deal with an area where one 
side is considering regulating and the other already 
has regulated (and done an impact assessment). 
These case studies would include a review of how 
trade and investment would be affected by the 
various options; however, the case studies would 
focus on the application of all aspects of our 
respective guidelines.  Forum participants 
identified two possibilities:  biofuels 
sustainability (the EU has done impact assessments 
on portions of their proposals and we are soon to 
begin ours), (and electronic stability control for 
cars (we have done ours and are using it as a case 
study with the Canadians and Mexicans, the 
Commission should be presenting theirs by 20 May). 
 
Future Agenda Items Q Standards? 
-------------------------------- 
 
¶18.  In terms of future agenda items, DG Zourek 
suggested focusing on how using (varying) standards 
affects technological innovation and 
competitiveness.  Zourek clarified standards to be 
those as defined under TBT, thus voluntary.  He 
suggested we could "revive the US-EU standards 
dialogue" with the Commerce Department and discuss 
these issues in 2009.  Dudley suggested that one 
recommendation coming from their joint report was to 
look at international standards first, and determine 
if there was a necessity to go beyond them.  A 
previously planned U.S.-EU standards DVC took place 
on Monday April 28. 
 
¶19.  Comment:  The government to government part of 
this HLRCF was marred to some extent by having each 
side sit opposite the other, as opposed to 
interspersed with each other, as had been done in 
the previous one.  This arrangement encouraged more 
of a Qtrade negotiationQ atmosphere. End comment.) 
 
Public Session with Stakeholders 
---------------------------------- 
 
¶20.  The public session was separated into two 
parts.  First, Susan Dudley, Heinz Zourek, and 
Alexander Italianer summarized the morning meetings 
between U.S. and EC officials on import safety, risk 
analysis, and impact assessment, stating that the 
Forum would deliver both the import safety 
information sharing report and the final Joint 
Report on Incorporating Trade and Investment Impacts 
in Regulatory Analyses to the May 13 TEC.  (On the 
margins of this meeting, Jim Murray, on behalf of 
the TACD, suggested it would be very useful to 
receive either an early copy of these reports, or a 
summary, before the TEC meetings.  The USG agreed to 
provide a summary of the reports to the Advisors, 
but not to the general public, before the TEC.) 
 
¶21.  Second, the public session addressed the role 
 
BRUSSELS 00000770  005 OF 006 
 
 
of public consultation and notice and comment in our 
respective systems.  Susan Dudley and Alexander 
Italianer presented an overview of the U.S. and EC 
regulatory development processes, with a particular 
emphasis on the role of public participation.  Then 
the session continued with a panel consisting of 
business, consumer, and government representatives 
from both sides of the Atlantic. 
 
¶22.  Highlights of the many issues discussed 
included: 
 
--A suggestion that full consultation procedures 
should be used for the ECQs QcomitologyQ process. 
(Note:  Comitology refers to the process by which 
the Community adopts implementing measures pursuant 
to existing legislation.  In general, the Commission 
makes a proposal which is then considered by a 
committee of experts from the member states before 
adoption, either by the Council or by the 
Commission.  The European Parliament has just forced 
the Commission and Council to amend this comitology 
process to allow the Parliament to veto comitology 
decisions if these are determined to either exceed 
or amend the legislative language.) 
 
--A suggestion that any consultation requirements on 
either side be viewed by regulators as minimum 
requirements.  Transparency should not be viewed as 
a burden, but rather as an essential part of the 
process of developing quality policies. 
 
--A suggestion that transparency is getting better. 
There appears to be more momentum to these latest 
U.S.-EU cooperative efforts. 
 
--A suggestion that a simple principle that all 
submissions to the EC eventually be published would 
be a welcome improvement in transparency. 
 
--A comment that the REACH consultation may have 
been hurt by what was characterized by the DG ENT 
panelist as businesses exaggerating the impact of 
REACH. 
 
-- Referring to the EUQs demand for use of suppliers 
declaration of conformity for low-voltage electrical 
products, TACDQs Jim Murray commented that OSHAQs 
Nationally Recognized Testing Laboratories (NRTL) 
system must be compared to the EUQs suppliers 
declaration of conformity (SDOC) combined with post- 
market surveillance, and that it is not clear which 
one is more effective or burdensome. 
 
--Ed Foulke mentioned that the previous RFI on the 
subject did not yield much support for SDOC, but 
signaled fairly strongly in response to a question 
that OSHA would develop a new RFI on the issue. 
 
--Regarding the use of committees in the US, FDA 
(Randall Lutter) summarized the six separate 
statutes (not just FACA) FDA had to comply with. 
 
--Jim Murray of TACD suggested the transatlantic 
economic framework concentrate not only on reducing 
trade barriers, but on taking joint action on common 
problems such as climate change and obesity. He also 
suggested the U.S. and the EU develop an overall 
strategy on nanotechnology, QOtherwise, we will end 
up with a system we now have for GMOs.  Nobody is 
happy with it, unless maybe when you are a believer 
in chaos theory. 
 
¶23.  Audience questions and comments to the panel: 
 
--Reinhard Quick of the German Chemicals Industry 
(VCI) suggested the EU and the U.S. coordinate their 
implementation of the GHS on labeling and 
classification of chemicals.  He commented that 
REACH had actually widened the transatlantic 
 
BRUSSELS 00000770  006 OF 006 
 
 
regulatory divide. 
 
--The European cosmetics industry focused on the 
fast-approaching deadline for non-animal tests for 
cosmetics products, seeing that as a priority both 
sides needed to address to avoid trade disruptions. 
 
--Another commenter asked if there were any 
mechanisms to QforceQ international stakeholder 
concerns to be taken into account.  Several panel 
members responded that stakeholders must continue to 
be active participants in the public comment and 
consultation process.  In the U.S. system at least, 
the U.S. representatives suggested that neither 
domestic or foreign firms, nor other interested 
parties, are forced to participate.  If they do 
participate, however, a U.S. agency has an 
obligation to respond to their concerns. 
 
¶24.  Comment:  The public session was long on 
speakers and short on interactive dynamics.  By the 
time the long list of speakers had completed their 
thoughts, there was little time to discuss some of 
the very thoughtful comments made to the U.S. and 
the EU on public consultation, notice and comment, 
and how to improve the regulatory process.  End 
comment. 
 
Murray