Former House Science Committee Staffer Solicited ITSSD Post-Hearing Testimony On EU & China Use of Standards as Trade Barriers, But Ignored Findings

[THE FOLLOWING E-MAIL EXCHANGE REFLECTS A SOLICITATION FOR POST-HEARING TESTIMONY MADE BY A FORMER HOUSE SCIENCE COMMITTEE SENIOR STAFFER TO THE ITSSD'S CEO DURING APRIL-MAY 2005]


From : Huxley, Olwen
Sent : Monday, May 9, 2005 6:39 PM
To : Lawrence Kogan
Subject : RE: L. Kogan // information// Follow-up


We usually get a transcripts a few days after, and after a laborious editing process which takes a truly unreasonable amount of time, we have the transcripts ready. Couple of weeks?


OH Olwen F. M. Huxley
Subcommittee on Environment, Technology, and StandardsHouse Science Committee
2320 Rayburn HOBWashington, DC 20515
ph. (202) 225-8844fx. (202) 225-4438


-----Original Message-----

From: Lawrence Kogan [mailto:ssbs_llc@msn.com]
Sent: Monday, May 09, 2005 6:37 PM
To: Huxley, Olwen
Subject: RE: L. Kogan // information// Follow-up


Thank you for sending it. How long after this hearing will the transcripts be available to the public - posted to Committee's website? Have a good evening.


Lawrence A. Kogan
President
Sound Science Business Strategies, LLC
1625 K Street, NWWashington, DC 20006
(C) 609-658-7417 (F) 452-8160
___________________________________


From: "Huxley, Olwen" Olwen.Huxley@mail.house.gov>
To: Lawrence Kogan ssbs_llc@msn.com>
Subject: RE: L. Kogan // information>
Date: Mon, 9 May 2005 17:33:06 -0400>


Hi - I owe you some stuff.


Just so you know, the hearing is now scheduled for 2 pm on Wednesday, rather than 10 am.


Here's the list of witnesses:


Dr. Hratch Semerjian is the Acting Director of the National Institute of Standards and Technology (NIST).


Mr. Joe Bhatia is the Vice President for International Operations at>Underwriters Laboratory (UL). UL is a commercial laboratory company that tests products against U.S. and international standards, headquartered in Northbrook, Illinois.


Dr. Don Deutsch is the Vice President for Standards Strategy and Architecture for Oracle, headquartered in Redwood Shores, California.


Mr. David Karmol is the Vice President of Public Policy and Government Affairs at the American National Standards Institute (ANSI).


Mr. Robert W. Noth is the Manager of Engineering Standards for Deere & Company, headquartered in Moline, Illinois.


Here are the questions:


Dr. Hratch Semerjian, Acting Director, National Institute of Standards and Technology (NIST), Briefly describe how NIST supports standards development and answer the following questions:

1. What is NIST's role in the international standards arena?


2. Describe the Department of Commerce's standards document "Standards and Competitiveness: Coordinating for Results" and the status of the implementation of its recommendations. What remains to be done?


3. How would NIST's FY 2006 budget request improve the U.S. position with respect to standards development? Describe any other NIST standards initiatives that would contribute to the competitive position of U.S. industry.


>-----Original Message----->

From: Lawrence Kogan [mailto:ssbs_llc@msn.com]
Sent: Friday, May 06, 2005 10:48 AM
To: Huxley, Olwen
Subject: RE: L. Kogan // information


Ms. Huxley:


I am looking forward to receiving you witness list and list of questions for next week's hearing.
Also, my co-director and I would like to know how long after the hearing may we provide 'for the record' comments?

Sincerely,

Lawrence A. Kogan
President
Sound Science Business Strategies, LLC
1625 K Street, NW Washington, DC 20006 (C) 609-658-7417 (F) 452-8160


From: "Huxley, Olwen" Olwen.Huxley@ mail.house.gov
To: Lawrence Kogan ssbs_llc@msn. com
Subject: RE: L. Kogan // information
Date: Fri, 29 Apr 2005 17:52:17 -0400


These are all very interesting points that you raise, and they aren't the first time I have heard them.


I would be pleased to meet with you and your co-director. I would suggest Friday of next week, since we have a mark-up on Thursday and everything that happens prior to that will be necessarily mark-up related. If Friday doesn't work for you, we can do it the week after.

OH

Olwen F. M. Huxley
Subcommittee on Environment, Technology, and Standards
House Science Committee
2320 Rayburn HOB
Washington, DC 20515
ph. (202) 225-8844 fx. (202) 225-4438


-----Original Message-----
From: Lawrence Kogan [ mailto:ssbs_llc@msn. com]
Sent: Thursday, April 28, 2005 1:56 PM
To: Huxley, Olwen
Subject: L. Kogan // information


Dear Ms. Huxley:


Please find attached comments I submitted on Monday, April 18, 2005, in response to the recently revised U.S. Standards Strategy drafted by the American National Standards Institute (ANSI). There are also attached weblinks to several papers I have prepared on the subject of EHS regulations and standards being used by the EU as disguised trade barriers.


As you are aware, ANSI is the U.S. National Representative to two ostensibly private non-governmental international standards bodies (the International Organization for Standardization [ISO] and the International Electrotechnical Commission [IEC] that are expressly referenced within the WTO TBT Agreement). The ISO/IEC are charged with developing relevant science and technology-based performance and use orientated international product standards that national governments are supposed to look to prior to enacting national regulations. In fact, with the help of the EU and the UN, the ISO is now in the business of developing food safety and medical device technical standards as well as corporate social responsibility standards. It may eventually get involved in some type of pharma standards, as the WHO isone of many UN agencies that serve as liaison organizations to the ISO.


As you will notice, my comments were prepared in the name of a new NJ-based NGO (a 501(c)(3) charitable, educational, and scientific organization)I have formed with a former European/ UN diplomat that is called: The Institute for Trade, Standards and Sustainable Development (ITSSD).


ITSSD's comments reflect how the EU has skillfully and systematically linked international regulation and standardization, and injected precautionary principle and environment-centric sustainable norms into the international standards development process. The ITSSD believes that ANSI's inability to detect this phenomenon has created serious vulnerabilities that have adversely impacted the U.S. negotiating position at the ISO/IEC. The ITSSD believes that, given the linkage noted above, this has also created serious vulnerabilities for the U.S. government's negotiating positions at the various WTO-relevant intergovernmental bodies in which different U.S. agencies participate. These include the Codex, the IPPC, the OECD and the UN (FAO, WHO, UNEP & CSD, as well as, others - Global Compact Office, UNDP, UNCTAD, UNIDO, etc.).


Perhaps, ITSSD can render assistance to the House Committee on Science in elaborating upon how its comments to the ANSI relate to the China standards issues now being looking into by the Ways and Means Committee...


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http://www.allbusiness.com/manufacturing/3900831-1.html

Olwen Huxley, a professional staff aide on the House Science Committee's subcommittee on environment, technology and standards,...

Publication: Manufacturing & Technology News Date: Monday, March 12 2007


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[THE FOLLOWING DOCUMENTS CONSIST OF: 1) A JUNE 2005 LETTER OF TRANSMITTAL TO THE FORMER CHAIR OF THE HOUSE SCIENCE COMMITTEE OF THE POST-HEARING TESTIMONY PREPARED BY THE ITSSD'S CEO; and 2) EXTRACTS OF SAID TESTIMONY].


http://www.itssd.org/Correspondences/ITSSDlettertoHouseSubcommChairEhlers.pdf


June 3, 2005


The Honorable Vernon J. Ehlers,
Michigan, Chairman
House Science Committee,
Subcommittee on Environment, Technology, and Standards
2320 Rayburn House Office Building
Washington, DC 20515


Dear Mr. Ehlers,


Please find attached ‘post-hearing’ testimony that we have prepared for submission to the Subcommittee on Environment, Technology and Standards in connection with the recent hearing on Standards that took place on May 11, 2005. We would appreciate your Subcommittee’s inclusion of this testimony within the official ‘hearing record’.


The Institute for Trade, Standards and Sustainable Development, Inc. is an independent and nonpartisan not-for-profit organization dedicated to the promotion of a positive global paradigm of sustainable development consistent with World Trade Organization (WTO) principles. We have undertaken considerable research and public outreach activities to highlight the increasing use of disguised regulatory trade barriers cast in the form of overly stringent environment, health and safety regulations and standards that are justified by reference to the need to achieve ‘sustainable development’. We have both observed and analyzed how such measures have increasingly threatened U.S. products and technologies and the science and intellectual property rights-based legal and economic frameworks which are critical to maintaining U.S. global competitiveness in the future.


We thank you for the opportunity to submit this testimony, and we remain at your
Subcommittee’s disposal should it be interested in speaking with us further about these issues.


Very truly yours,


Lawrence A. Kogan, Esq.
CEO

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http://www.itssd.org/Correspondences/LKogan-ITSSDtestimony-6-3-05-HouseScienceComm.pdf


Europe, China and the Use of Standards as Trade Barriers How Should the U.S. Respond?


Lawrence A. Kogan, CEO, Institute for Trade, Standards and Sustainable Development, Inc.


House Science Committee, Subcommittee on Environment, Technology, and Standards


June 3, 2005


Mr. Chairman, and ranking members of the Subcommittee, my name is Lawrence Kogan, and I am CEO and Co-Director of the Institute for Trade, Standards and Sustainable Development, Inc. (ITSSD). The ITSSD is an independent and non-partisan not-for-profit organization dedicated to the promotion of a positive paradigm of sustainable development consistent with World Trade Organization (WTO) principles. The ITSSD is pleased and honored to comment about the subtle, complex and significant challenge posed to U.S. global economic and technological competitiveness by the growing use of new market access barriers. During the past several years, it has become more obvious that such disguised trade barriers are typically cast as overly stringent and extra-territorial environment, health and safety (EHS) technical regulations and product and process standards, which have the effect of protecting underdeveloped, lagging or ailing industries in other countries.


Our research has revealed that most such measures are premised on an evolving European norm known as the precautionary (‘better safe than sorry’) principle. As employed by the European Union (EU) the precautionary principle severely restricts or altogether bans the introduction of a number of new and existing U.S. products, substances, processes and technologies into the marketplace, unless they have first satisfied rigorous pre-market authorization requirements that are in excess of relevant international standards, but which are not scientifically, economically or technically justified. Once permitted into the marketplace, they are then subject to overly stringent post-market testing requirements that are also in excess of relevant international standards. In addition to ignoring free market principles, such rules arguably also violate the terms of three WTO agreements: the Sanitary and Phytosanitary (SPS) Agreement; the Technical Barriers to Trade (TBT) Agreement; and the General Agreement on Tariffs and Trade (1994).


As requested, my testimony will respond to the following two sets of questions posed by the Subcommittee to the list of witnesses that testified during the May 11, 2005 hearing:


1. What has been China's and Europe's approach to the development and use of standards? How is this approach changing international standards development in organizations such as the International Standards Organization, and through bilateral relations with other countries? What are the implications for U.S. trade with China and the rest of the world?


2. Based on the U.S. Standards Strategy that ANSI has been developing, what should the Federal Government, States, U.S. standards development organizations, and companies be doing to reduce their vulnerability to the use of standards as trade barriers, and how could they promote the adoption of non-exclusionary standards in the global marketplace? How should these efforts be coordinated?....

ISO 26000 Betrays Organization's Technical Roots: ISO Embarks on Slippery Slope Path Towards 'Soft' Political Standards Development

http://www.itssd.org/Programs/ITSSDAssessmentISO26000Standard.pdf


ITSSD Assessment of the new ISO 26000 Social Responsibility Standard

December 2005

Preliminary Conclusions:

1. It may be possible to procedurally shape and/or delay the development of the ISO SR guidance standard at the national mirror and international levels.

2. It may be impossible to prevent the actual adoption of an SR standard at the DIS and FDIS stages, unless the ISO voting rules are first modified to reflect only one vote for the European Community as a whole through its regional standards representative (e.g., CEN), as opposed to twenty-five separate votes representing the national standards bodies of each of the EU member states.

3. It is likely to be difficult to reverse the new stakeholder engagement process that has been introduced at the ISO incident to the commencement of this SR standard initiative, though it may arguably be shaped by filing procedural objections, and by strengthening traditional ISO benchmarks for consensus.

4. The real challenge is to prevent the new process from being expanded institutionally to all of ISO’s technical standards work, and thereby from being incorporated within business contracts that reference or directly incorporate such standards as conditions of manufacture, sale, service, etc. This is likely to be quite difficult given the current efforts of governments, NGOs and UN agencies to incorporate sustainable development dimensions into all ISO technical standards.

5. Further study and analysis of the evolving ISO SR operating procedures, the multi-stakeholder engagement process, and the ISO’s general consensus procedures is necessary to determine the proper course of action and the appropriate actors with which/whom to collaborate...

It is Sometimes Necessary to Go Backward Before You Proceed Forward: Revisiting ITSSD Comments on the US Standards Strategy

http://www.itssd.org/Programs/ITSSDcommentletter-ANSI5yrreview-USSSREVISED.pdf


...The Institute for Trade, Standards and Sustainable Development (ITSSD) is pleased to have the opportunity to submit comments concerning the contents of the draft revision to the United States Standards Strategy (USSS). The USSS appropriately emphasizes the increasingly important role served by international standards in facilitating global commerce. It also accurately reflects the ever-closer relationship that foreign governments have drawn between environment, health and safety (EHS) regulation and industry product, process and service standardization.


The Institute’s comments are divided into two sections. The first section responds to several of the specific initiatives proposed. The second section discusses crosscutting issues which, though not addressed in the USSS, must nevertheless be adequately considered if the USSS is to preserve U.S. international economic interests.


...Conclusion:


The USSS represents a first attempt to articulate a comprehensive plan that addresses a growing number of challenges posed to the global dominance of U.S. standards and to U.S. global economic competitiveness in general. As currently drafted, however, the ITSSD believes that the USSS falls short of achieving this goal, and therefore, should be extensively revised.


Thank you once again for the opportunity to submit comments in response to the draft of the newly revised U.S. Standards Strategy. We hope that our comments will be seriously considered and look forward to receiving your organization’s thoughtful response to them.


[THERE WAS NO SURPRISE WHEN ANSI FAILED TO RESPOND]

EU Injects Political Precautionary Principle and Anti-Patent-based Industry Standards to Secure Global Competitive Advantage

By Lawrence A. Kogan


Back during 2002, a Wall Street Journal columnist prepared a prescient but largely unnoticed article that unfortunately was a negative harbinger of things to come. It described how the European Union had largely become the de facto global legislator and regulator of all kinds of rules concerning the environment, human health and safety that would eventually touch and materially impact practically every industry sector within the United States, and by extension, the world.


“Because of differing histories and attitudes toward government, the EU…with the world’s second-largest economy, regulates more frequently and more rigorously than the U.S., especially when it comes to consumer protection. So, even though the American market is bigger the EU, as the jurisdiction with tougher rules, tends to call the shots for the world’s farmers and manufacturers. EU rules often cause particular friction in the high-tech fields, such as software, electronic commerce and biotechnology” (emphasis added). [1]


EU policy documents then reflected that the products covered by EU environment, health and safety regulations, directives and standards “represent a large proportion of [all] products placed on the market. It is estimated that, as of 2003, the trade of products covered only by the major [agricultural and industrial] sectors regulated…largely exceeds the volume of 1500 billion euro (1.5 trillion euro) [(or approximately $2.25 trillion)] per year”. [2]


In effect, this article implied that America would, over time, lose its sovereign ability to determine its own economic fate and destiny, first outside, and then within its own borders, if it did not act quickly and resolutely enough to slow down and reverse Europe’s regulatory juggernaut.


Now, more than four years later, this has become abundantly clear.


“Sometimes voluntarily, sometimes through gritted teeth and sometimes without knowing, countries around the world are importing the EU’s rules. It is a trend that has sparked concerns among foreign business leaders and that irritates US policymakers. But whether they like or not, rice farmers in India, mobile phone users in Bahrain, makers of cigarette lighters in China, chemical producers in the US, accountants in Japan and software companies in California have all found that their commercial lives are shaped by decisions taken in the EU capital.


...The EU’s emergence as a global rulemaker has been driven by a number of factors, but none more important than the sheer size and regulatory sophistication of the Union’s home market...At the same time, the drive to create a borderless pan-European market for goods, services, capital and labor has triggered a hugely ambitious program of regulatory and legislative convergence among national regimes.


This exercise has left the Union with a body of law running to almost 95,000 pages – a set of rules and regulations that covers virtually all aspects of economic life...Compared with other jurisdictions, the EU’s rules tend to be stricter, especially where product safety, consumer protection and environmental and health requirements are concerned. Companies that produce their goods to the EU’s standards can therefore assume that their products can be marketed everywhere else as well.


...As...two US-based academics point out in a recent paper that examines the global impact of three recent EU laws on chemicals, electronic waste and hazardous substances, ‘The EU is increasingly replacing the United States as the defacto setter of global product standards and the center of much globally regulatory standard setting is shifting from Washington DC to Brussels’”. [3]


Indeed, Europe had long targeted the U.S. regulatory and free enterprise systems for fundamental restructuring. Its aim has all along been to achieve supranational legal and economic governance over the affairs of global (mainly U.S.) industry through an environment-centric negative paradigm of ‘sustainable development’.[4] There is, in fact, significant documentary evidence showing how the European Community and a number of EU member state governments have, for many years, tried to persuade/compel American-based international businesses and their domestic and foreign suppliers, as well as, U.S. federal, state and local legislators, to adopt similar rules. In so many words, Europe has been engaged in a legalistic and economic war with the United States in an effort to reshape the post-World War II paradigm in the European image.[5] And, it has employed ‘soft’ regulatory rather than ‘hard’ military power to achieve this. The unfortunate reality is that Europe is now well on its way to governing the American way of life, that is, re-colonizing America and the world, unless America and its allies find a way to reverse this trend.


“...Brussels is becoming the world's regulatory capital. The European Union's drive to set standards has many causes—and a protectionist impulse within some governments (eg, France's) may be one. But though the EU is a big market, with almost half a billion consumers, neither size, nor zeal, nor sneaky protectionism explains why it is usurping America's role as a source of global standards. A better answer lies in transatlantic philosophical differences.


The American model turns on cost-benefit analysis, with regulators weighing the effects of new rules on jobs and growth, as well as testing the significance of any risks. Companies enjoy a presumption of innocence for their products: should this prove mistaken, punishment is provided by the market (and a barrage of lawsuits). The European model rests more on the “precautionary principle”, which underpins most environmental and health directives. This calls for pre-emptive action if scientists spot a credible hazard, even before the level of risk can be measured. Such a principle sparks many transatlantic disputes: over genetically modified organisms or climate change, for example.


In Europe corporate innocence is not assumed. Indeed, a vast slab of EU laws evaluating the safety of tens of thousands of chemicals, known as REACH, reverses the burden of proof, asking industry to demonstrate that substances are harmless. Some Eurocrats suggest that the philosophical gap reflects the American constitutional tradition that everything is allowed unless it is forbidden, against the Napoleonic tradition codifying what the state allows and banning everything else.


...One American official says flatly that the EU is “winning” the regulatory race, adding: “And there is a sense that that is their precise intent.” He cites a speech by the trade commissioner, Peter Mandelson, claiming that the export of “our rules and standards around the world” was one source of European power. Noting that EU regulations are often written with the help of European incumbents, the official also claims that precaution can cloak “plain old-fashioned protectionism in disguise” (emphasis added). [6]


Europe's efforts to define global standards has now extended beyond politically motivated environmental and health standards to also include intellectual property standards. This was revealed within a recent IP Watch newsletter article.[7]


Efforts by European Union authorities to take advantage of standardisation as a de facto regulatory tool have not been sufficiently systematic in recent years, according to a study published by the European Commission last week. Yet standards especially in information and communications technology (ICT) are becoming more important, said Patrick Van Eecke, attorney at the Brussels office of DLA Piper UK and co-author of the study. [8]http://ec.europa.eu/enterprise/ict/policy/standards/piper/executive_summary.pdf .


The study recommended a dialogue between standardisation organisations and all stakeholders. Also urgently needed is a balance between technical standards and intellectual property rights, according to the study. Concerns that overly rigid IPR protection might become a problem for invention and innovation recently also resulted in other recommendations and decisions at the EU level. A call for changes in the EU patent system was made in a study commissioned by the European Parliament’s Scientific and Technological Options Assessment (STOA) unit and an inquiry into possible anticompetitive practices by the pharmaceutical industry that was initiated by European Commissioner for Competition Neelie Kroes.


A debate on future EU standardisation policy will take place at a conference organised by the European Commission on 12 February in Brussels.Author Van Eecke, speaking with Intellectual Property Watch, pointed to the growing relevance of technical standards that “are more important than legislation.” Companies and citizens either abide by laws passed by governments or not, but to not follow well-established technical standards would mean to be excluded from the market.


“If you are a policymaker, you really would like to make sure that companies and citizens abide by the rules, so instead of drafting a law you could put them into a standard,” he said.


Using privacy as an example, he said, “You can draft one hundred laws that should protect it - and hope that people follow the law. But if you are able to have EU data protection implemented in the technical standards, it might be much more effective.” Van Eecke said that legislators who try to rule via standards would end up drawing the conclusion from American cyberlaw luminary Lawrence Lessig’s theory that code is the (new) law and shifts legislators’ attention to standardisation.



[1] See Brandon Mitchener, “Rules, Regulations of Global Economy Are Increasingly Being Set in Brussels”, WALL ST. J., (4/23/02).
[2] See “Enhancing the Implementation of the New Approach Directives, Communication from the Commission to the Council and the European Parliament”, COM (2003) 240 final, May 7, 2003, at 3, at: http://europa.eu.int/eur-lex/en/com/cnc/2003/com2003_0240en01.pdf .
[3] See Tobias Buck, “Standard Bearer”, Financial Times (July 10, 2007) at: http://www.ft.com/cms/s/0/6e721ba2-2e7d-11dc-821c-0000779fd2ac.html .
[4] For a discussion of this concept, See, e.g., “Issues”, The Institute for Trade, Standards and Sustainable Development, website at: http://www.itssd.org/issues.htm .
[5] See Lawrence A. Kogan, “Exporting Europe’s Protectionism”, The National Interest (Fall 2004) at p. 95, at: http://www.itssd.org/Publications/Kogan%20TNI%2077FINAL.pdf .
[6] See “Brussels Rules OK - How the European Union is Becoming the World's Chief Regulator”, The Economist (Sept. 20, 2007) at: http://www.economist.com/world/europe/displaystory.cfm?story_id=9832900 .
[7] See Monika Ermert, "Standardisation Policy More Effective Than Legislation On IP?", Intellectual Property Watch (Jan. 25, 2008) at: http://www.ip-watch.org/weblog/index.php?p=894 .
[8] DLA Piper and the Universidade Nova de Lisboa and T.U. Delft, "EU Study on the Specific Policy Needs for ICT Standardisation" (July 2007) at: http://ec.europa.eu/enterprise/ict/policy/standards/piper/full_report.pdf .