VZCZCXRO1464
RR RUEHAG RUEHDF RUEHIK RUEHLZ RUEHRN RUEHROV RUEHSL RUEHSR
DE RUEHBS #1059/01 2121553
ZNR UUUUU ZZH
R 311553Z JUL 09 ZDK
FM USEU BRUSSELS
TO RUEHC/SECSTATE WASHDC
INFO RUCPDOC/DEPT OF COMMERCE WASHDC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC
RHEBAAA/DEPT OF ENERGY WASHINGTON DC
RUEAEPA/HQ EPA WASHDC
RUEHC/DEPT OF LABOR WASHDC
RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHSS/OECD POSTS COLLECTIVE

UNCLAS SECTION 01 OF 05 BRUSSELS 001059 
 
SENSITIVE BUT UNCLASSIFIED 
 
SIPDIS 
 
WHITE HOUSE FOR NSC (KVIEN, BELL) AND FOR OMB/OIRA 
STATE FOR EUR/ERA KESSLER, PURL, WILLIAMS 
 
E.O. 12958:  N/A 
TAGS: ECON ECIN ETRD ENRG ETRD ECPS SENV TPHY TSPL EUN
SUBJECT: U.S.-EU HIGH LEVEL REGULATORY FORUM MEETS IN BRUSSELS 
 
¶1. (SBU) SUMMARY: EU and U.S. officials covered a packed agenda 
during a well-attended High-Level Regulatory Cooperation Forum 
(HLRCF) in Brussels on July 24.  The European Commission hosted 
this, the sixth HLRCF, gathering regulators from both sides of the 
Atlantic to discuss regulatory cooperation, including new ideas and 
advances, and to update private stakeholders on joint progress. 
Presenters noted progress on issues such as risk assessment, 
standards, and import safety, and examined regulatory issues around 
energy technology cooperation and nanotechnology development.  In 
the afternoon, Business Europe hosted a public stakeholder session 
featuring panel discussions on energy efficiency, counterfeiting and 
consumer protection.  END SUMMARY. 
 
BACKGROUND 
---------- 
 
¶2. (SBU) This was the first Forum involving Obama administration 
officials; the 12-member U.S. delegation from Washington, led by 
Michael Fitzpatrick, Associate Administrator for OMB's Office of 
Information and Regulatory Affairs (OIRA), was joined by 12 U.S. 
Mission officials for discussions with over 25 European Commission 
officials, led by Enterprise Director General Heinz Zourek. 
Participants briefed on U.S. and EU regulatory reform efforts and 
priorities, including new U.S. emphasis on openness and transparency 
and consideration of recommendations for a new presidential 
executive order on regulatory review, as well as continued EU 
implementation of its programs on simplification and reduction of 
administrative burdens. 
 
¶3. (SBU) Participants reviewed ongoing work on impact assessment, 
standards in regulation, risk assessment and import safety.  Both 
sides discussed regulatory issues around deepening energy technology 
cooperation and efforts to address rapid nanotechnology development, 
agreeing to prepare inventories/status reports on both issues for 
the Fall Transatlantic Economic Council (TEC) meeting.  Officials 
also agreed to pursue another Forum meeting to be held just prior to 
the Fall TEC.  The officials briefed a large group of business and 
consumer stakeholders in the afternoon on the discussions and 
participated on issue panels. 
 
¶4. (SBU) U.S. agencies represented included the Food and Drug 
Administration (FDA), the Environmental Protection Agency (EPA), the 
Department of Homeland Security/Customs and Border Protection (CBP), 
the Department of Energy (DOE), the Department o H@mmitmenQf Americans and 
to econity, all important elemeHLRCF agenda.  He described the initial customary review of ongoing 
regulatory actions at the start of a new Administration, and 
outlined the regulatory review currently underway by order of the 
President.  He explained that OMB solicited public comments to 
inform the development of its recommendations for a new presidential 
Executive Order on regulatory review, eliciting 185 submissions from 
the public.  The recommendations are under review, with a new 
Executive Order expected to be issued within the next few months. 
Fitzpatrick emphasized, however, that while this broad regulatory 
review runs its course, the Washington regulatory process was moving 
"full steam ahead," with new proposals under development. 
¶6. (SBU) Fitzpatrick stressed the Administration's commitment to 
open government and transparency, highlighting a range of new Web 
tools for the public to gain information about and participate in 
the U.S. regulatory process.  These include sites such as 
www.regulations.gov , which contains over two million documents, 
including proposed and final rules, public comments, and supporting 
documents; www.business.gov, an official business link to the USG 
which also hosts an online community for business to share 
questions, answers, and best practices; www.data.gov, a searchable 
site populated by data sets from across the USG and updated 
regularly; and www.recovery.gov, which allows readers to track 
stimulus and recovery act funds as they move through the system.  He 
 
BRUSSELS 00001059  002 OF 005 
 
 
said the USG will continue to use the Federal Register process for 
public comment purposes, but also noted the Administration's 
groundbreaking use of blogs and other web-based technologies to get 
input on the regulatory process from new and different stakeholders. 
 Fitzpatrick encouraged Commission interlocutors to participate in 
U.S. public comment processes, saying these are open to all 
stakeholders. 
¶7. (SBU) Marianne Klingbeil, Director within the EU Secretariat 
General responsible for impact assessment, provided an update on the 
EU's Better Regulation drive.  She said the Commission's 
Simplification Program, a comprehensive program of simplifying 
existing regulations, is one key component, complemented by the 
Administrative Burden Reduction Program, with a goal of reducing the 
costs to business of administrative burdens 25 percent by 2012.  She 
added that the Commission's online consultation is also open to 
third country comments. 
¶8. (SBU) Georgette Lalas, Director at DG Enterprise for consumer 
goods, foods and pharmaceuticals, said that U.S.-EU cooperation on 
pharmaceuticals, medicines and cosmetics regulation is strong.  She 
emphasized DG ENTR's good relations and frequent discussions with 
the U.S. FDA in all of these areas.  She added that the EU is 
working to rationalize its current large number of auto safety 
regulations.  Lalas, whose division also covers the automotive 
industry, also commented that cooperation with the National Highway 
Transport Safety Administration is less active, despite the recent 
conclusion of a Memorandum of Understanding. 
 
¶9. (SBU) Bernd Langeheine, Director at DG Information Society for 
electronic communications policy, reviewed DG INFSO's efforts to 
facilitate ambitious EU plans to extend broadband coverage across 
the 27 Member States and to help Member States manage their 
transition (at different times) from analogue to digital TV 
broadcasting.  DG INFSO's goal is to keep Member States focused on 
service and technology neutrality as a basic principle during this 
transition.  In this respect, he said, DG INFSO followed closely the 
successful June analogue to digital switchover in the U.S.  He also 
updated participants on the EU's extensive telecoms reform package, 
which has passed through much of the EU legislative process but will 
undergo conciliation in the fall.  When adopted, he said, the reform 
will establish the "nucleus" of a single EU telecoms regulatory 
authority that will take the EU another step toward a true single 
market for telecommunications. 
 
IMPACT ASSESSMENTS 
------------------ 
 
¶10. (SBU) Klingbeil said that the EU is continually striving to 
improve its impact assessment process, and reminded the Forum that 
the EU evidence-based approach was applied "at the beginning of the 
legislative process" and allowed policy makers in the Commission to 
evaluate "different impacts with different options".  She noted that 
impact assessment guidelines were revised and improved in January 
¶2009.  She said that, though an impact assessment should be done on 
major amendments under terms of an agreement with the European 
Parliament (EP) and the EU Council (member states), this was not 
always followed in practice.  On quality control, Klingbeil said the 
EU Impact Assessment Board sent back one-third of all impact 
assessments done in 2008 because they were not good enough, and she 
expected that record to improve. 
 
¶11. (SBU) In terms of ongoing HLRCF initiatives, Klingbeil noted 
continuing cooperation between OMB/OIRA and the Impact Assessment 
Board.  She said it would be interesting to explore further an 
integrated approach to impact assessment that incorporates economic, 
environmental, and social impacts.  She added that it also would be 
useful to compare notes on impacts on Small and Medium Enterprises 
(SMEs), an area that needs more study, particularly given that SMEs 
account for 95 percent of all EU companies.  Finally, Klingbeil said 
impact assessments and health might provide another area for U.S-EU 
discussion and potential collaboration. 
 
¶12. (SBU) Alex Hunt from OMB/OIRA provided an update on OMB's 
request for public comments on draft guidance to agencies on the 
type of analysis needed to assess international trade and investment 
impacts.  The draft guidance was released as part of OMB's 2008 
draft Report to Congress on the Costs and Benefits of Federal 
Regulation.  In January 2009, OMB released the final Report to 
Congress, in which OMB responded to the public comments on this 
draft guidance.  Although OMB received supportive public comment, 
due to the pending change in Administration, OMB did not feel it 
would be appropriate to formally incorporate the international trade 
 
BRUSSELS 00001059  003 OF 005 
 
 
guidance into Circular A-4 or other official agency guidelines. 
Hunt said the process for developing a new Executive Order on 
regulatory review might change the way U.S. impact analysis is 
conducted. In the meantime, OMB has encouraged agencies to refer to 
the discussion in the Report for a useful framework for satisfying 
their existing obligations to consider the international impacts of 
proposed and final regulations, and carefully evaluate concerns that 
new U.S. rules could act as nontariff barriers.  He agreed that the 
U.S. would also be interested in looking at the impact of regulation 
on SMEs. 
 
STANDARDS 
--------- 
 
¶13. (SBU) On standards, Pedro Ortun, Director at DG Enterprise, 
recalled that the October HLRCF had requested that the U.S. and EU 
prepare papers on our respective uses of international standards in 
regulation.  He said the EU contribution would be finished in time 
for a fall Forum.  He noted that in the paper, the Commission will 
examine different approaches to standards in regulation.  He said 
the Commission had just published a White Paper on ICT 
standardization, the public comment period for which was nearly 
finished.  This would provide input into a Commission deep review of 
standards.  Ortun added that the Commission would discuss a draft of 
this broader report at an October 14 conference in Brussels, with a 
final version due early 2010. 
 
¶14. (SBU) OIRA's Hunt said that the Department of Commerce has 
drafted a paper on the role of standards in the rule-making process 
and that an exchange of papers could promote mutual understanding. 
He said the U.S. paper provides a detailed overview of the U.S. 
regulatory process, the policy and legal context for the use of 
standards in support of regulation and procurement, as well as the 
various ways standards are referenced in U.S. regulations.  Hunt 
added that he looked forward to reviewing a Commission paper on 
standards and said an exchange of views on the respective U.S. and 
EU papers might be an agenda item for a fall HLRCF.  Jonathan 
Farnell of DG ENTR suggested that both sides should share their 
papers in September, and prepare a cover note on similarities, 
differences and challenges in their respective systems prior to the 
fall Forum.  Hunt agreed that a jointly drafted introduction to the 
U.S. and EU papers on their respective approaches to standards would 
be useful. 
 
RISK ASSESSMENT 
--------------- 
 
¶15. (SBU) Panagiotis Daskaleros of DG SANCO emphasized his 
directorate's long cooperation with OMB/OIRA and the fruitful 
dialogue between scientists on risk that has been underway since 
¶2007.  He noted that rising interdependence and globalization "means 
we have to work together on risk, especially on new and emerging 
technologies and the challenges that arise from them."  Daskaleros 
said SANCO and OMB agreed to work together on three broad areas 
moving forward: exposure assessment, including how to incorporate 
new technologies into the assessments; risk assessment terminology 
and characterization; and emerging risks. (Note: The area of 
emerging risks may include a joint analysis of past crises to gather 
lessons learned from how those emerging risks were assessed and also 
an evaluation of how we can use new state of art "avant garde" 
technologies such as toxicogenomics and systems biology to inform 
adverse effects in risk assessments.  End note).  Daskaleros said 
collaboration should be guided by a commitment to avoid duplication 
and should be forward looking, while learning from past experience. 
OMB's Nancy Beck agreed with Daskaleros' comments, noting that U.S. 
scientists are very enthusiastic about cooperation with Europe on 
risk assessment. 
 
IMPORT SAFETY 
------------- 
 
¶16. (SBU) Jeffrey Shuren, FDA Associate Commissioner for Policy, 
briefed on FDA's expanding pharmaceutical joint inspection program 
with the EU.  He noted FDA's placement of officials in Brussels and 
at the European Medicines Agency in London to facilitate deeper 
cooperation, and FDA's plans to launch a similar exchange with the 
European Food Safety Agency.  He reviewed closer bilateral work on 
drug development, orphan diseases, cosmetics and tobacco, and FDA 
interest in increasing cooperation on medical devices as well, to 
avoid duplicate inspections.  Shuren stressed the Administration's 
high priority on food safety, highlighted by the establishment of a 
 
BRUSSELS 00001059  004 OF 005 
 
 
cabinet-level working group on food safety and proposals for a 
modernization of U.S. food safety laws.  USEU CBP Attache David 
Dolan reviewed CBP's increasing focus on import safety, noting joint 
enforcement operations and work in the Joint Customs Cooperation 
Committee (JCCC) and World Customs Organization (WCO). 
 
¶17. (SBU) Ortun of DG ENTR lauded useful bilateral cooperation with 
the Consumer Product Safety Commission on toy safety, including such 
items as magnetic toys and childrens' books, and over testing 
methods.  Daskaleros of SANCO reiterated some of this, but also 
commented on cooperation in the area of product traceability. 
 
FUTURE DIRECTIONS IN REGULATORY COOPERATION 
------------------------------------------- 
 
¶18. (SBU) Forum participants then turned to discussion of finding 
common ground in regulation of emerging technologies such as new 
energy technologies and nanotechnology.  David Rodgers, Director for 
Strategic Planning and Analysis, in the Office of Energy Efficiency 
and Renewables at DOE, reviewed the increased funding ($45 billion 
total) the USG is directing toward clean energy technology 
development in the new budget and stimulus package.  He pointed to 
the June DOE rulemaking to phase out incandescent lightbulb usage in 
the U.S. by 2012, which will save four quadrillion BTUs in U.S. 
energy use.  He highlighted key areas of cooperation with Europe, 
including on development of biofuels, batteries and efficiency 
standards.  Jim Jones, of the Office of Prevention, Pesticides and 
Toxic Substances at EPA, reviewed longstanding U.S.-EU cooperation 
on the U.S. Energy Star efficiency standards program, and growing 
cooperation on green building standards. 
 
¶19. (SBU) Didier Herbert of DG Enterprise previewed the Commission 
Green Paper, expected for the end of 2009, on promoting energy 
technology development in the EU.  This will be accompanied by a 
strategic paper on innovation, he said.  He discussed the EU 
directives on ecodesign and efficiency labeling, which cover 
lighting, motors, refrigerators and other products.  He noted the 
four drivers for the EU emphasis on new environmental industries: to 
promote EU growth, innovation and competitiveness; to enhance 
sustainability; as an exit strategy from the current economic 
crisis; and to lead the way toward larger global solutions to 
climate change and sustainability problems.  John Farnell then 
proposed, and Michael Fitzpatrick agreed, that both sides should 
complete an inventory/map of bilateral energy technology performance 
standards and areas of potential cooperation for the TEC, including 
identification of areas for future cooperation. 
 
¶20. (SBU) Sally Tinkle, of the National Institute of Environmental 
Health Sciences at NIH, discussed the U.S. National Nanotechnology 
Initiative, a 10-year old interagency group (27 agencies) 
coordinating USG nanotechnology activity, including to: develop new 
technologies for commercial and societal benefit; develop 
nanotechnology infrastructure that encompasses standards, 
terminology metrics and a skilled workforce; and ensure responsible 
development of nanotechnology to maximize benefit and minimize risk 
to public health and safety. 
 
¶21. (SBU) Lalas of DG Enterprise explained that the Commission is 
preparing a 2010-15 nanotechnology management plan.  She said the 
Commission had examined whether the existing EU regulatory framework 
sufficed to manage emerging nanotechnologies, and concluded that 
different sectors are doing adequate risk assessment.  No single 
framework can cover all sectors, she noted.  That said, she 
emphasized that the precautionary principle is particularly relevant 
in the area of new technologies, noting that in the absence of 
environmental and safety data, it would be difficult to approve 
products.  The EU needs to fine-tune existing legislation, not 
completely overhaul it, she concluded. 
 
¶22. (SBU) A DG Environment representative noted that cooperation 
over nanotechnology approaches has been difficult, however, with 
OECD work, for example, not keeping pace with the worldwide 
dissemination of nanotechnologies.  This cooperation seems limited 
by industry and government resource commitments, he added.  Farnell, 
alluding to the precautionary principle issue, agreed that the 
Commission sees some differences in U.S. and EU approaches, and 
suggested that the HLRCF prepare a report for the TEC mapping and 
identifying similarities and differences.  Fitzpatrick agreed this 
would be valuable. 
 
¶23. (SBU) Finally, Farnell proposed that the Forum could prepare a 
 
BRUSSELS 00001059  005 OF 005 
 
 
report on how mutual recognition might help the overall goal of 
increasing long-term U.S.-EU economic integration.  He suggested 
that a Forum paper discussing possibilities and constraints over the 
use of mutual recognition for bilateral regulatory frameworks, could 
be ready to present to the TEC by spring 2010.  Hunt of OMB/OIRA 
agreed this could be useful, suggesting that such a paper review the 
history of Mutual Recognition Agreements (MRAs), and in particular 
assess the lessons learned from previous U.S.-EU MRAs.  Hunt also 
suggested that the Forum should focus on specific sectors, since 
this approach has generally been proven easier to negotiate and 
implement.  USEU EMIN Chase noted that some agencies had taken 
potentially more useful, broader approaches, as with the Securities 
Exchange Commission's notion of findings on "compatible regulatory 
regimes".  Farnell promised to provide the U.S. team a more detailed 
proposal on the issue. 
 
BRIEFING PUBLIC STAKEHOLDERS 
---------------------------- 
 
¶24. (U) The afternoon of July 24, leading U.S. and EU Forum 
participants briefed over 100 business and consumer stakeholders on 
the morning's discussions.  Hans Glatz, Chair of Business Europe's 
U.S. network, welcomed the Forum participants, noting private sector 
commitment to regulatory cooperation discussions and the TEC process 
overall.  Glatz stressed the value of these dialogues in promoting 
joint U.S.-EU efforts to recover from the financial crisis and fight 
creeping protectionism. 
 
¶25. (SBU) In a novel approach to the HLRCF de-brief sessions, 
business and consumer representatives then made panel presentations 
on "Counterfeiting and Import Safety," and on "Regulatory Impacts on 
Deployment of New Energy Technologies," with U.S. and EU officials 
serving as respondents.  Business reps, including Bill Kovacs, 
Senior Vice President of the U.S. Chamber of Commerce for 
Environment, Technology and Regulatory Affairs, emphasized the need 
to strengthen IPR protection to fight counterfeiting, improve import 
safety and promote energy innovation.  Willemien Bax, Deputy DG for 
the European Consumer Organization, said IPR enforcement efforts 
should focus on dangerous products first, and supported development 
of common standards to promote clean energy technologies. 
 
¶26. (U) Michael Fitzpatrick, Associate Administrator for OMB's 
Office of Information and Regulatory Affairs (OIRA), has not cleared 
this cable. 
 
CHASE