Differing Approaches to Some Issues

Although the vast majority of transatlantic contacts are cordial and productive, sources of disagreement have arisen over time. In many cases, as in the promotion of international human rights and domestic consumer rights, these disagreements represent differing approaches to the same ultimate goals.

For matters falling under the authority of the European Commission, negotiations take place between the Commission and the US administration to try to resolve disputes. When appropriate, the EU presidency also takes part in negotiations with the US on behalf of the EU. Past negotiations have sought to resolve trade disputes, for example, in agricultural trade, aircraft manufacturing, and steel products over such issues as import quotas or state subsidies. Recent disputes have included the Foreign Sales Corporations (FSCs) benefiting US business.

New technologies can also give rise to friction as a result of different regulatory responses on each side of the Atlantic to the development of new food or pharmaceutical products. There can be different ways of evaluating scientific evidence and applying it to the regulation of new products to satisfy consumers regarding safety, environmental effects, and other issues. This can be particularly important where consumers have special concerns, as in the case of genetically modified organisms (GMOs) and other food safety issues.

Disagreements may also arise as competition (antitrust) authorities on both sides rule on multinational corporate mergers, joint ventures, or other corporate relationships that might trigger enforcement of competition rules. Such cases have come into prominence—including the Boeing-McDonnell Douglas merger and the proposed GE-Honeywell merger—with the globalization of manufacturing and service industries and the growing phenomenon of multilateral or global corporate alliances.

It is important to realize, however, that these high profile cases are the exceptions that prove the general rule of close cooperation. Of 394 proposed mergers involving US companies notified to the European Commission from September 1990 to October 2000, only one was prohibited by the Commission.

The Positive Comity Agreement signed on June 4, 1998, enhances existing bilateral antitrust cooperation in place since 1990 and provides that either the EU or US may request the other to take action against anticompetitive behavior occurring in its territory. The European

Commission continues to seek close cooperation with the US authorities regarding merger issues, and in 2000 a transatlantic working group was established to seek further EU-US convergence on important aspects of merger control. The ED has also proposed that a multilateral agreement on competition rules be established through the World Trade Organization.

The ED and US have successfully demonstrated their ability to deal with long-standing trade frictions in resolving their dispute over bananas and in reaching agreement over the "safe harbor" principle for the protection of private electronic data. In the case of bananas, the EU agreed to adopt a new regime providing a transition to a tariff-only system by 2006, while the US agreed to suspend the increased customs duties it had imposed on certain EU exports in 1999. The banana agreement also gave evidence of the productive working relationship between European Trade Commissioner Pascal Lamy and US Trade Representative Robert Zoellick.

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