The economic relations between European Union and the United States have been far from smooth. Even during the Cold War, when the two economic powers were supposed to be on the same side of the Cold War divide, rows occurred that led to a serious political tensions. The most famous was the American ban on export items produced in the United States with regard to the turbines parts which would be utilized in trans Siberian pipeline that would function as an energy gateway between the Soviet Union and the European economies in 1986. The ensuing thaw came only as a result of the intensification of the Cold War and resolution of the internal power struggle inside the State Department in favor of the soft-liners in the United States.
More recently economic disputes have taken place between the EU and the United States. The beef war over the hormones had lasted for 20 years and only resolved with an EU Parliament decision that authorized a higher new quota for the beef from North America that has not been treated with growth hormones. A similar row had taken place in 2012 when the Senate had passed a bill to counter the EU initiative for carbon emission caps that would be taken off or landing to Europe. The Senate decision had prohibited the American airlines to comply with the EU decision which left them in a situation where they might find themselves to pay fines amounting to billions of dollars for violating the carbon emission caps imposed by the EU.
Towards a Better Compliance and A Healthier Dispute Resolution?
The free trade agreement between the EU and the United States will not only create the largest single market in the world but at the same time will provide the corporation that are running their businesses across the Atlantic an ease in compliance in the sense that the compliance in one jurisdiction will mean compliance in the other. Especially, better compliance has ramifications for the business sectors like automobiles in which the third parties have to invest more for their designs to comply separately both with the U.S and the EU regulations. The harmonization of the EU and U.S regulations in such areas means reduction of costs for such industries which will found an expression for the consumers in cheaper prices and the creation of new jobs.
The issue of trade dispute resolution still remains to be one of the most controversial topics in the negotiations between the two blocks. The proposed term for the investors that will provide them the opportunity to bring their cases in international arbitration courts against the governments instead of local courts had created an uproar both on the political level and on the level of the people that perceived the issue as a concession to the corporations and a further loss of national sovereignty. Especially offensive was the association of such guarantees with the well advanced economies like the EU and the United States which were used to be associated with the developing world countries and designed as safeguards against possible rouge actions by such states. The pressure was so immense that the EU had to freeze negotiations on the investment chapter earlier this year. It is still not clear how the issue will be resolved but it is beneficial to re-frame the issue focusing on shared interests rather than a discourse based on a conflict between the consumers and the corporations.
Conclusion
The debate on the both sides of the Atlantic about the Transatlantic Trade and Investment Partnership agreement revolves around the issues of how and who will benefit from the agreement. It seems that the arguments that locate the benefits squarely on the corporations or on the consumers alone are missing the common interest that the consumers and the corporations share; lower prices. Better compliance between the EU and U.S regulations in broad range of business sectors will inevitably mean lower prices for the consumers, as the producers will spare money and extra effort to comply with these two jurisdictions' laws separately. Moreover the international arbitration panels which would give the investors an assurance for impartial trial will boost investments across the Atlantic which will, at the end, mean expansion of the economy and more jobs for these two crisis ridden economic players.
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