Skip to main content
×
×
Home

The Treatment of Regulatory Convergence in Preferential Trade Agreements

  • RODRIGO POLANCO LAZO (a1) and PIERRE SAUVÉ (a2)
Abstract

This article explores the concept of ‘regulatory convergence’ in the context of the evolving literature on legal convergence and divergence. Such a concept has emerged as an overarching horizontal discipline in the latest generation of preferential trade agreements and aims to reduce unnecessary regulatory incompatibilities between countries in order to facilitate cross-border trade and investment.

Differing approaches to regulatory convergence found in recently concluded PTAs, or are currently under negotiation, are examined, with a special focus on the ‘regulatory cooperation’ approach embedded in CETA, the path of ‘regulatory improvement’ taken by members of the Pacific Alliance, and the ‘regulatory coherence’ track included in the TPP. We also refer to the TTIP negotiations conducted between the EU and the US.

The article offers a broad understanding of the different ways in which regulatory convergence is implemented across PTAs, and the legal complexities resulting from the ambiguity of the concept. It further describes the scope and effects of the different mechanisms used to achieve regulatory convergence, on both substantive and procedural matters.

Copyright
Corresponding author
*Email: rodrigo.polanco@wti.org.
** psauve@worldbank.org.
Footnotes
Hide All

Previous versions of this article were presented at the ICTSD-IBD RTA Exchange (Geneva, 28 March 2017), the Latin American Studies Association (LASA) 50th Congress (27–30 May 2016, New York), and at the International Society of Public Law (ICON·S) 2015 Conference (New York University, 1–3 July 2015). The authors would like to thank Gráinne de Búrca, Henry Gao, Jörg Zimmermann, and two anonymous reviewers of the World Trade Review for their helpful comments and suggestions.

Footnotes
References
Hide All
Abbott, K. W. and Snidal, D. (2010), ‘International Regulation without International Government: Improving IO Performance through Orchestration’, The Review of International Organizations, 5: 315344.
Ahearn, R. J. (2009), ‘Transatlantic Regulatory Cooperation: Background and Analysis’, Congressional Research Service, Washington, DC, https://fas.org/sgp/crs/row/RL34717.pdf (accessed 29 November 2017).
Andenas, M. (2014), ‘Reassertion and Transformation: From Fragmentation to Convergence in International Law’, Georgetown of Journal of International Law, 46: 685734.
Andenas, M. and Bjorge, E. (eds.) (2015), A Farewell to Fragmentation: Reassertion and Convergence in International Law (1st edn), Cambridge University Press.
Anderson, G. and Sands, C. (2007), ‘Negotiating North America: The Security and Prosperity Partnership’, White Paper, The Hudson Institute, www.channelingreality.com/NAU/HudsonNegotiatingNorthAmericaadvanceproof2.pdf (accessed 30 August 2017).
APEC–OECD (2005), APEC–OECD Integrated Checklist on Regulatory Reform, APEC–OECD Co-operative Initiative on Regulatory Reform 2005, Asia–Pacific Economic Cooperation (APEC) and Organization for Economic Co-operation and Development (OECD), 1, www.oecd.org/gov/regulatory-policy/41992858.pdf (accessed 30 August 2017).
Arvíus, C. and Jachia, L. (2015), Regulatory Cooperation: A Wikihow, E15 Task Force on Regulatory Systems Coherence Think Piece, International Centre for Trade and Sustainable Development (ICTSD) and World Economic Forum, http://e15initiative.org/wp-content/uploads/2015/09/E15-Regulatory-Coherence-Arvius-and-Jachia-Final.pdf (accessed 28 August 2017).
ASEAN (Association of Southeast Asian Nations) (2014a), ‘Standards and Conformance’, ASEAN Secretariat, 2014, www.asean.org/communities/asean-economic-community/category/standards-and-conformance (accessed 30 August 2017).
ASEAN (Association of Southeast Asian Nations) (2014b), ‘Asean Framework Agreement on Mutual Recognition Arrangements’, ASEAN Secretariat, www.asean.org/communities/asean-economic-community/item/asean-framework-agreement-on-mutual-recognition-arrangements-2 (accessed 30 August 2017).
Barfield, C. (2011), ‘The TPP: A Model for 21st Century Trade Agreements?’, East Asia Forum, 25 July 2011, www.eastasiaforum.org/2011/07/25/the-tpp-a-model-for-21st-century-trade-agreements/ (accessed 30 August 2017).
Boele-Woelki, K., Einhorn, T., Girsberger, D., and Symeonides, S. (eds.) (2010), Convergence and Divergence in Private International Law – Liber Amicorum Kurt Siehr, The Hague: Eleven International Publishing.
Bollyky, T. (2012), ‘Regulatory Coherence in the TPP Talks’, in Lim, C. L., Elms, D. K., and Low, P. (eds.), The Trans-Pacific Partnership: A Quest for a Twenty-first Century Trade Agreement, Cambridge University Press: 171186.
Broude, T. and Shany, Y. (2011), Multi-Sourced Equivalent Norms in International Law, London: Bloomsbury Publishing.
Canuel, E. T. (2011), ‘Comparing Exculpatory Clauses under Anglo-American Law: Testing Total Legal Convergence’, in Cordero-Moss, G. (ed.), Boilerplate Clauses, International Commercial Contracts and the Applicable Law, Cambridge University Press, 80103.
Cho, S. (2016), ‘Legalizing the ASEAN Way: Toward Comparativist Understanding of Legalization in the ASEAN Investment Regime’, 11 May 2016, Brown-Bag Presentation, World Trade Institute, Bern.
Cordero-Moss, G. (2014), International Commercial Contracts: Applicable Sources and Enforceability, Cambridge University Press.
Costa, M. and Jacoby, W. (2014), ‘Informal Drivers of Regional Regulatory Integration: The Auto Sector in Central Europe and Latin America’, in Bruszt, L. and McDermott, G. A. (eds.), Leveling the Playing Field: Transnational Regulatory Integration and Development, Oxford University Press: 183204.
Crettez, B., Deffains, B., and Musy, O. (2014), ‘Legal Convergence and Endogenous Preferences’, International Review of Law and Economics, 39: 2027.
Department of Foreign Affairs and Trade of Australia (DFATA) (2017), ‘Trans-Pacific Partnership Ministerial Statement’ (11 November 2017), http://dfat.gov.au/trade/agreements/tpp/news/Pages/trans-pacific-partnership-ministerial-statement.aspx (accessed 14 December 2017).
Drezner, D. W. (2008), All Politics Is Global: Explaining International Regulatory Regimes, Princeton, NJ: Princeton University Press.
European Commission (2015a), ‘EU–US Cooperation’ (10 June 2015), http://ec.europa.eu/growth/industry/international-aspects/cooperation-governments/eu-us/index_en.htm (accessed 30 August 2017).
European Commission (2015b), ‘TTIP Detailed Explanation on the EU Proposal for a Chapter on Regulatory Cooperation’, European CommissionTrade, 6 May 2015, http://trade.ec.europa.eu/doclib/docs/2015/may/tradoc_153431.1.1%20Detail%20explanation%20of%20the%20EU%20proposal%20for%20a%20Chapter%20of%20reg%20coop.pdf (accessed 30 August 2017).
European Commission (2004) ‘Information Note from Vice-President Verheugen to the College:EU–Canada Framework for Regulatory Co-operation’, 14 December 2004, http://ec.europa.eu/transparency/regdoc/rep/2/2004/EN/2-2004-1605-EN-1-0.Pdf (accessed 29 November 2017).
Falcón, R. (2005), ‘Armonización de Normas en el Mercosur’, Revista de Negócios Internacionais, Piracicaba, 3(5): 4247.
Fergusson, I. F. and Vaughn, B. (2011), The Trans-Pacific Partnership Agreement’, Congressional Research Service, www.fas.org/sgp/crs/row/R40502.pdf (accessed 30 August 2017),
Fergusson, I. F., McMinimy, M. A., and Williams, B. R. (2015), ‘The Trans-Pacific Partnership (TPP) Negotiations and Issues for Congress’, www.fas.org/sgp/crs/row/R42694.pdf (accessed 30 August 2017).
Fishbein, M. and Trebilcock, M. (2007), ‘International Trade: Barriers to Trade’, in Guzman, A. T. and Sykes, A. O. (eds.), Research Handbook in International Economic Law, Cheltenham: Edward Elgar: 161.
Glaeser, E. L. and Shleifer, A. (2002), ‘Legal Origins’, The Quarterly Journal of Economics, 4: 11931229.
Hart, M. (2007), ‘Trading up: The Prospect of Greater Regulatory Convergence in North America’, Estudios y Perspectivas , 79: 168, Economic Commission for Latin America and the Caribbean.
Hoekman, B. (2015), ‘Fostering Transatlantic Regulatory Cooperation and Gradual Multilateralization’, Journal of International Economic Law, 18: 609624.
Hoekman, B. M. and Mavroidis, P. C. (2015), Regulatory Spillovers and the Trading System: From Coherence to Cooperation, E15 Task Force on Regulatory Systems Coherence, Overview Paper, International Centre for Trade and Sustainable Development (ICTSD) and World Economic Forum, http://cadmus.eui.eu/handle/1814/35862 (accessed 29 August 2017).
Jacobs, S. H. (1994), Regulatory Co-Operation for an Interdependent World, OECD Publishing, www.oecd-ilibrary.org/content/book/9789264062436-en (accessed 30 August 2017).
Jacobs, S. H. (1997), ‘An Overview of Regulatory Impact Analysis in OECD Countries’, Regulatory Impact Analysis: Best Practices in OECD Countries, Organization for Economic Co-operation and Development.
Karmakar, S. (2013), ‘Prospects for Regulatory Convergence under TTIP’, Bruegel Policy Contribution 2013/15, www.econstor.eu/handle/10419/106310 (accessed 30 August 2017).
Kelsey, J. ‘Preliminary Analysis of the Draft TPP Chapter on Domestic Coherence’, Citizens Trade Campaign, 23 October 2011), www.citizenstrade.org/ctc/wp-content/uploads/2011/10/TransPacific_RegCoherenceMemo.pdf (accessed 30 August 2017).
Koskenniemi, M. (2006), ‘Fragmentation of International Law: Difficulties Arising from the Diversification and Expansion of International Law', Report of the Study Group of the International Law Commission, http://repositoriocdpd.net:8080/handle/123456789/676 (accessed 30 August 2017).
La Porta, R., Lopez-De-Silanes, F., and Shleifer, A. (2008), ‘The Economic Consequences of Legal Origins’, Journal of Economic Literature, 46: 285332.
Lesser, C. (2007), ‘Do Bilateral and Regional Approaches for Reducing Technical Barriers to Trade Converge Towards the Multilateral Trading System?’, OECD Trade Policy Papers 28, Organization for Economic Co-operation and Development, www.oecd-ilibrary.org/content/workingpaper/051058723767 (accessed 30 August 2017.
Lierman, S. (2014), ‘Law as a Complex Adaptive System: The Importance of Convergence in a Multi-Layered Legal Order’, Maastricht Journal of European and Comparative Law, 21: 611629.
Malmström, C. (2015), ‘Trade in the 21st Century: The Challenge of Regulatory Convergence’, European Commission – Trade, 19 March 2015, http://trade.ec.europa.eu/doclib/docs/2015/march/tradoc_153260.pdf (accessed 30 August 2017).
Malyshev, N. and Kauffmann, C. (2015), International Regulatory Co-operation: The Menu of Approaches, E15 Task Force on Regulatory Systems Coherence Think Piece, International Centre for Trade and Sustainable Development (ICTSD) and World Economic Forum, http://e15initiative.org/wp-content/uploads/2015/09/E15-Regulatory-Coherence-Kauffmann-and-Malyshev-Final.pdf (accessed 28 August 2017).
Mattei, U. A., Antoniolli, L., and Rossato, A. (2000), ‘Comparative Law and Economics’, in Bouckaert, B. and De Geest, G. (eds.), Encyclopedia of Law and Economics, Cheltenham: Edward Elgar: 505560.
Mattoo, A. and Subramanian, A. (1998), ‘Regulatory Autonomy and Multilateral Disciplines: The Dilemma and a Possible Resolution WTO Dispute Settlement System’, Journal of International Economic Law, 1: 303322.
Mattoo, A. and Sauvé, P. (2011), ‘Services’, in Chauffour, J.-P. and Maur, J.-C. (eds.), Preferential Trade Agreement Policies for Development: A Handbook, Washington, DC: World Bank: 235274.
Mavroidis, P. C. (2016) Regulatory Cooperation: Lessons from the WTO and the World Trade Regime, E15 Task Force on Regulatory Systems Coherence – Policy Options Paper, E15 Initiative, International Centre for Trade and Sustainable Development (ICTSD) and World Economic Forum, http://diana-n.iue.it:8080/handle/1814/38749 (accessed 28 August 2017).
Merryman, J. H. (1994), The Civil Law Tradition: Europe, Latin America, and East Asia, Micchie, Co.
Mumford, P. (2014), ‘Regulatory Coherence: Blending Trade and Regulatory Policy’, Policy Quarterly, 10: 39.
Organization for Economic Co-operation and Development (OECD) (2008), Introductory Handbook for Undertaking Regulatory Impact Analysis (RIA), OECD Publishing, p. 3, www.oecd.org/gov/regulatory-policy/44789472.pdf (accessed 30 August 2017).
Organization for Economic Co-operation and Development (OECD) (2009), Regulatory Impact Analysis, OECD Publishing, www.oecd-ilibrary.org/governance/regulatory-impact-analysis_9789264067110-en (accessed 30 August 2017).
Organization for Economic Co-operation and Development (OECD) (2013), International Regulatory Co-operation, 22–51, www.oecd-ilibrary.org/content/book/9789264200463-en (accessed 28 August 2017).
Peetman, S. (2013), ‘Standards Harmonization in ASEAN: Progress, Challenges and Moving Beyond 2015’, ERIA Discussion Paper Series, www.eria.org/ERIA-DP-2013-30.pdf (accessed 30 August 2017).
Platsas, A. E. (2009), ‘The Idea of Legal Convergence and International Economic Law’, International Journal of Private Law, 2(4): 385399.
Polanco Lazo, R. (2013), ‘The Trans-Pacific Partnership Agreement and Regulatory Coherence’, in Voon, T. (ed.), Trade Liberalisation and International Co-operation: A Legal Analysis of the Trans-Pacific Partnership Agreement, Cheltenham: Edward Elgar: 231261.
Posner, T. and Wolff, D. (2011), ‘Making “Regulatory Coherence” Coherent’, International Trade Law, 360, 25 April, www.crowell.com/Practices/International-Trade/articles/Making-Regulatory-Coherence-Coherent-International-Trade-Law360 (accessed 30 August 2017).
Raustiala, K. (2002), ‘The Architecture of International Cooperation: Transgovernmental Networks and the Future of International Law’, Virginia Journal of International Laws, 43: 192.
Sheargold, E. and Mitchell, A. D. (2016), ‘The TPP and Good Regulatory Practices: An Opportunity for Regulatory Coherence to Promote Regulatory Autonomy?’, World Trade Review, 15: 587612.
Slaughter, A.-M. (2005), A New World Order, Princeton, NJ: Princeton University Press.
Steger, D. P. (2012), ‘Institutions for Regulatory Cooperation in “New Generation” Economic and Trade Agreements’, Legal Issues of Economic Integration, 39: 109126.
Steger, D. P. (2014) ‘CETA – A New Model for Regulatory Cooperation, Transparency and Coherence?’, 6 May 2014, http://slideplayer.com/slide/2411068/ (accessed 30 August 2017).
Stoler, A. L., Pedersen, P. N., and Herreros, S. (2014), ‘Negotiating Trade Agreements for the 21st Century’, Comercio Internacional 116: 1–40, Economic Commission for Latin America and the Caribbean (ECLAC), www.cepal.org/en/publications/4346-negotiating-trade-agreements-21st-century (accessed 30 August 2017).
Street, A. W. SC, ‘The Art of Legal Convergence’ (Presented at the UNSW Litigation Master Class, 26 March 2013), https://www.yumpu.com/en/document/view/51650331/the-art-of-legal-convergence-by-alexander-w-seven-wentworth (accessed 29 November 2017).
Sykes, A. O. (1999), ‘Regulatory Protectionism and the Law of International Trade’, The University of Chicago Law Review, 6: 146.
United Nations (2012), United Nations Conference on Trade and Development, World Investment Report 2012, Towards a New Generation of Investment Policies, United Nations.
US Chamber of Commerce (2015), ‘Regulatory Coherence & Cooperation in the Transatlantic Trade and Investment Partnership (TTIP)’ (February 2015), www.uschamber.com/sites/default/files/regulatory_coherence_regulatory_cooperation_-chamber_ttip_paper-final_2.pdf (accessed 30 August 2017).
United States Department of Commerce (2013), ‘US–Mexico High Level Regulatory Cooperation Council’ (August 2013), http://trade.gov/hlrcc/ (accessed 30 August 2017).
United States Department of Commerce (2015), ‘US–Canada Regulatory Cooperation Council’ (May 2015), www.trade.gov/rcc/ (accessed 30 August 2017).
Woolcock, S., Holzer, B., and Kusmu, P. (2015), The Transatlantic Trade and Investment Partnership: Challenges and Opportunities for Consumer Protection, Paper No. 11, CEPS-CTR project ‘TTIP in the Balance’ and CEPS Special Report No. 115, Paul H. Nitze School of Advanced International Studies, Center for Transatlantic Relations and Centre for European Policy Studies, http://aei.pitt.edu/66136/ (accessed 29 August 2017).
Young, A. R. (2015), ‘Liberalizing Trade, Not Exporting Rules: The Limits to Regulatory Co-ordination in the EU's “New Generation” Preferential Trade Agreements’, Journal of European Public Policy, 22: 12531275.
Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

World Trade Review
  • ISSN: 1474-7456
  • EISSN: 1475-3138
  • URL: /core/journals/world-trade-review
Please enter your name
Please enter a valid email address
Who would you like to send this to? *
×

Metrics

Full text views

Total number of HTML views: 7
Total number of PDF views: 77 *
Loading metrics...

Abstract views

Total abstract views: 685 *
Loading metrics...

* Views captured on Cambridge Core between 28th December 2017 - 26th April 2018. This data will be updated every 24 hours.