European Union - Market ChallengesEuropean Union - Market Challenges
Historically, U.S. exporters and investors have faced relatively low barriers to doing business in the EU. Nonetheless, issues exist as would be expected given the breadth and depth of the commercial relationship. These issues generally come in the form of compliance requirements established by EU legislation.
EU legislation generally takes two forms. “Regulations” have mandatory language and are directly applicable in member states when implemented. “Directives” provide a general framework and must be “transposed” into national legislation at the member state level. Differences in how directives are transposed in member states are common, which complicates compliance for U.S. companies doing business in the EU. Industry has periodically raised concerns over perceived onerous regulations and high compliance costs.
The EU has legislative harmonization competence that it can choose to exercise in such areas as the free circulation of goods, services and capital within the internal market as well as agriculture, fisheries, transport and energy. Human health, tourism and civil protection are examples of areas where the EU can only legislate in support of member states’ initiatives.
While the EU continues to move in the direction of a Single Market, the reality today is that U.S. exporters in some sectors continue to face barriers to entry and other challenges. In several industries such as pharmaceuticals, chemicals, telecommunications, legal services, and government procurement, some of these barriers are pronounced in specific member states.
Because the EU and United States have different legal approaches to protecting the data privacy of its citizens, the EU wants to be assured that its citizens’ data is protected in a manner consistent with EU law, when transferred for commercial purposes to the United States. This has been the focus of much discussion between the EU and the United States and resulted in the negotiation of the EU-U.S. Data Privacy Shield agreement, which when enacted will provide a mechanism for companies that participate in the voluntary program to legally transfer data from the EU to the United States. The Privacy Shield will help foster a secure operating environment for both citizens and industry, while promoting a productive and innovative transatlantic digital economy and help facilitate data transfers, protecting the fundamental rights of EU citizens whose data is transferred to the United States as part of a commercial transaction.
Discussions on a range of existing and proposed trade irritants are ongoing, including transparency in developing regulatory procedures and standards. To ensure that U.S. companies get the full benefits of the trade agreements the United States has negotiated, the U.S. Government has developed a trade compliance initiative that includes the establishment of the Interagency Trade Enforcement Center (ITEC) (http://trade.gov/enforcement/itec/index.asp). U.S. trade agencies work closely and diligently with the business community to ensure that the EU and its member states comply with their bilateral and multilateral trade obligations, and to minimize market access problems affecting U.S. firms.
European Union 28 Trade Development and Promotion