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It’s a shame for many reasons that the proposed trade agreement between the U.S. and the European Union has encountered major opposition on both sides of the Atlantic and looks unlikely to move forward until after Congressional elections later this year if at all.
One of the big reasons is the espoused objective of harmonizing standards so that more small businesses could enjoy the non-tariff benefits of international trade. Underscoring the need for action is a recent International Trade Commission report Trade Barriers That U.S. Small and Medium-Sized Enterprises Perceive As Affecting Exports to the European Union. The report identified both cross cutting and industry-specific barriers that U.S. SMEs said are more of a burden to them than to larger businesses.
During the last six months the ITC, the USTR, the U.S. Small Business Administration and the Commerce Department convened 28 small business roundtables in various U.S. cities, as well as in Washington, D.C., to gather input from small businesses about barriers to exporting to the EU.
While standards, technical regulations and conformity assessment procedures can be costly for larger firms, complying with such requirements can be prohibitive for SMEs, the USTR said, noting that many such costs are fixed regardless of a firm's size.
Challenges Identified
1) Small businesses also identified challenges with patenting costs, logistics, customs requirements and differing tariff classifications for products, which were seen by small businesses as hitting them harder than larger firms, the USTR said
2) The report noted the existence of industry-specific barriers in chemicals, cosmetics, biofuels, emerging technology products, machinery, electronics and apparel. For instance, SMEs in the chemical sector pointed to the EU chemical regulation (Registration, Evaluation, Authorization and Restriction of Chemicals, or REACH) as an obstacle, and to the high cost of complying with it. These regulations put European customers out of REACH from many smaller U.S. companies.
3) Among other examples, the report also noted that SMEs in the cosmetics industry faced difficulties with the EU's cosmetics directive. The requirement for independent testing can add many thousands of dollars to the cost of preparing to enter the market, and the costs are for each and every product you may wish to export.
4) Apparel exporters said that they were disproportionately affected by the recent EU retaliatory duties on women's denim jean exports from the U.S.
5) A multiplicity of barriers was reported in the agriculture sector. For example, SMEs in the corn, dried fruit, animal feed, cheese and wheat industries noted high tariffs; inconsistent EU rules and testing mandates; the lack of a science-based regulatory focus, particularly for genetically modified traits; the lack of harmonization between U.S. and EU standards; and the EU's protected designations of origin as concerns. Poultry and lamb industry respondents said that they were effectively shut out of the EU market.
6) Barriers for SMEs producing machinery, electronics, transportation and other goods included a lack of harmonized international standards and mutual recognition for conformity assessment and compliance issues with technical regulations and conformity assessment procedures, the report said.
7) SMEs in the healthcare, engineering, testing and audiovisual industries underscored a lack of mutual recognition of licensing, credentials and standards, in addition to broadcasting and film quotas, language dubbing requirements, government subsidies and intellectual property and piracy issues, the report said.
The EU government is very efficient at churning out directives and the blizzard of explanations, instructions and footnotes that accompany each one. Your WPG correspondent spent considerable time trying to figure out the definition of a “Competent Person,” before concluding, with head exploding, that it couldn’t be referring to the reader.
On a positive note, the report also discusses successes that U.S. SMEs have had in exporting to the EU. “Small businesses are the backbone of economic growth, job creation, and a stronger middle class in communities across America. Nearly 95,000 U.S. small businesses export to the EU, sustaining good jobs at home,” said the U.S. Trade Representative. That’s an impressive number considering there are only about 290,000 SME exporters in total. But think how many more small companies could sell to Europe if barriers were lowered.
This is what trade agreements are good at doing for companies in all participating countries, and that’s why we need T-TIP—sooner or later.
| Product Model | Inside Diameter | Outside Diameter | Thickness |
| PSMF030604A51 bearing | 3 | 6 | 4 |
| PSMF030504A51 bearing | 3 | 5 | 4 |