TPP Regulatory Coherence Auckland, New Zealand December 8, 2010 Sean Heather Executive Director

1. TPP Regulatory Coherence Auckland, New Zealand December 8, 2010 Sean Heather Executive Director Global Regulatory Cooperation Project U.S. Chamber of Commerce sheather@uschamber.com

2. GOAL: To ensure that TPP member countries maintain transparent, effective, enforceable and mutually coherent regulatory systems which are both risk and science based, adhere to international best practices, and assure high levels of collaboration among TPP governments and their stakeholders.

3. Result: Effective regulation, facilitating trade of goods and services, competitive economies, & economic growth.

4. How do we get there?

5. How do we get there? PARADIGM SHIFT

6. How do we get there? TRUST

7. How do we get there? Horizontal & Vertical Approach

8. How do we get there? Horizontal Chapter • Preamble – Paradigm Shift • Identification of Best Practices Make APEC-OECD Checklist Operational Effectively Begin to Address Internal and External Coherence • Mechanism for Dialogue – Building Trust

9. Preamble CONCERNS • Despite the highly integrated nature of the global economy, regulatory frameworks continue to be largely developed in isolation, country by country. • The growth of disparate regulatory regimes creates uncertainty, high costs and inefficiencies, and enforcement challenges for individual countries, their consumers, their industries and their workers. • Consumers lose confidence in their own regulator’s ability to act effectively in a global economy and lose confidence in products and services.

10. Preamble CONCERNS • The risk of consumer harm increases when regulators fail to comprehend the international implications of their regulatory action or inaction and therefore fail to adequately capture risks as a result of regulatory divergence. • Regulators often do not have the capacity or capability to develop, implement and enforce regulations that they’ve established to compete with similar regulations in other countries. • Regulatory coherence doesn’t require loss of regulatory power or sovereignty. • Regulations that is not pro-competitive, is not risk and science based will harm the competitiveness of the economy. • Products and services that cross borders face a growing array of regulations in multiple countries that can range from being opaque to duplicative to conflicting.

11. Preamble CONCERNS • Poorly crafted regulations create unnecessary trade and investment barriers, increase costs and lower consumer benefits when regulators act in isolation, failing thereby to promulgate regulations that are consistent with and support the development of open and competitive markets. • Manufacturers, service providers, retailers, SMEs, and farmers face arbitrary, duplicative and oftentimes opaque regulatory processes that fail to take into account their views and experiences. • The more barriers to trade that are created, the more citizens of our countries are deprived of new technology and new opportunities to have available products, raw materials, machinery, and services that allow for real economic growth within our economies.

12. Preamble BENEFITS • The citizens of TPP countries would have a higher degree of confidence that regulations are providing the appropriate safeguards which are properly enforced, including enhanced confidence in traded products and services. • Regulators would be better able to fulfill their enforcement mandate, with a risk-based focus to ensure optimal allocation of resources. • Improved transparency in regulation and enforcement. • Reigning in of unintended consequences of regulation would increase consumer access to a wide choice of goods and services at better prices. • Boost the competitiveness of our economy. • Regulation would be developed with sensitivities to the global market and with regard to limiting the adverse impact to trade and investment. • Businesses would have better predictability with regard to regulatory frameworks and their enforcement. • SMEs’ entry into foreign markets would be better facilitated.

13. How do we get there? Horizontal Chapter • Preamble – Paradigm Shift • Identification of Best Practices Make APEC-OECD Checklist Operational Effectively Begin to Address Internal and External Coherence • Mechanism for Dialogue – Building Trust

14. How do we get there? Identification of Best Practices Make APEC-OECD Checklist Operational Effectively Begin to Address Internal and External Coherence KEY -Professionalize & Depoliticize

15. How do we get there? Horizontal Chapter • Preamble – Paradigm Shift • Identification of Best Practices Make APEC-OECD Checklist Operational Effectively Begin to Address Internal and External Coherence • Mechanism for Dialogue – Building Trust

16. How do we get there? Mechanism for Dialogue – Building Trust • Trust Between Regulators 2) Trust Between Business & Regulators Trust Between Regulators & Consumers 3)Trust Between Business & Consumers Example: U.S. – EU HLRCF

17. Vertical Approach • Chapter-by-chapter basis a list of regulatory coherence deliverables should be generated. • Ex. MOUs, MRAs, Essential Equivalence Arrangements. • Where feasible, and on a sector-specific basis, best regulatory practices could be highlighted for the regulated industry, including particular approaches to addressing common trade-related issues that reflect past relevant regulatory experiences.