EP News Article: It is not only tariffs that hamper free trade
Removing obstacles to trade between nations is not only important for exporters who can thus better penetrate foreign markets and make more money, but also for consumers who can enjoy a wider choice at better prices. Trade liberalisation in the last couple of decades has pushed tariffs down across the world, but other barriers to trade still present problems.
Tariffs have been lowered and so-called non-tariff barriers removed mainly in the framework of the World Trade Organisation (WTO) through: reciprocal tariff concessions (you lower yours, I lower mine); discipline on non-tariff barriers by limiting export subsidies and imposing strict rules on antidumping procedures, subsidies and standards; and dispute settlement, through which governments can “sue” countries that fail to abide by WTO rules.
How non-tariff barriers are hurting EU companies
A report by British Conservative Robert Sturdy on the negative impact of non-tariff barriers on EU companies was discussed in plenary on 12 December. Among the examples, the report says the EU steel sector is paying more for vital raw materials because Russia has raised export duties on copper and nickel, meaning Russian exporters have to pay higher duties to the Russian government, which means higher prices for EU buyers.
Because of how the US treats the names of European wines including “champagne” it is hard for EU exporters to register and defend geographical indications on their products, causing damage to the reputation of their goods and loss of market share.
Call for clear distinction on NBTs
And, the report says it is almost impossible to register European cosmetics containing new ingredients for more than a year in China, because China lacks the necessary regulatory procedures.
Non registration of cosmetic products because they can’t be properly evaluated can be justified on health protection grounds. Therefore the EP is calling on the Commission to establish a “clear distinction between those NTBs, which give rise to unfair distortions of competition and those which reflect legitimate public-policy aims” such as health and environmental protection.
“Reducing unjustified NTBs and other regulatory obstacles applied by the EU’s key strategic partner countries by means of regulatory dialogue should be one of the key regulatory priorities of the new EU trade policy,” says the report.
