International Regulatory Cooperation

The range of possible approaches

Céline Kauffmann, Deputy Head, Regulatory Policy Division

OECD Public Governance and Territorial Development

Key questions

1. What do we know of the various approaches and instruments of IRC?

2. What are the lessons learnt from the use of different IRC approaches in different country and sector contexts?

3. What are the conditions of success and effectiveness of different IRC approaches?

Regulatory dialogues, exchange of information

Harmonisation through supra-national institutions

Specific negotiated agreements (conventions, treaties)

Formal regulatory co-operation partnerships

Joint standard setting through IGO

Trade agreements with regul. provisions

Mutual recognition

IRC requirement when drafting regulation, GRP

Recognition of international standards

Trans-governmental networks of regulators

Soft law, guidelines, principles, codes of conduct

Source: OECD (2013), International Regulatory Co-operation: Addressing Global Challenges

The ladder of IRC approaches

Lessons learnt on merits / challenges Type of mechanism Merits Challenges

Integration / harmonisation

The rules are the same for all.

Compliance is the greatest.

Less likely to regulatory capture than networks

Long process.

Costs of structure & enforcement.

Sovereignty & legitimacy issues.

Regulatory partnerships between countries

High-level leadership

Flexible & continuous mechanism Impact on regulators & levels of jurisdiction?

IGOs Promote continuous dialogue & anticipate emerging issues.

Progress may be slow to materialise

Weaknesses in enforcement and compliance.

Regional agreements with regulatory provisions

Legal force and direct connection to trade and economic integration.

Multiplicity of provisions

Impact on regulators?

Area-specific legally binding agreements

Legal force Lack of enforcement in some cases

Lack of flexibility to adapt to changes

MR Preserve State sovereignty

Reduce duplication efforts & time to market

Time-consuming, costly

Extensive trust

Adaption with changes in regulations?

Lack of enforcement

Transgovernmental networks

Low-cost, flexible and adaptable

Foster experimentation & innovation

Support trust building, technical approaches & may help avoid race to the bottom

Soft law / exchange of practices

Limited enforcement and monitoring

Exclusion issues? Legitimacy of decisions?

Mutual Recognition: spectrum of modalities Mutual recognition of rules: equivalent

objectives, regulatory requirements, standards,

and conformity assessment procedures

Mutual recognition of conformity assessment

(procedures / results) for goods under different

partner’ rules

The EU principle

of MR as a

corollary of the

‘free movement of

goods’ in the non-

harmonised

sectors

The Trans-

Tasman

Mutual

Recognition

Agreement

MRAs

incorporated in

RTAs

Stand-alone

MRAs

Government

MRAs Non-

Government

MLAs (between

CABs or

Accreditation

Bodies) Multilateral

MRAs (legally

non-binding)

Bilateral MRAs

Agreements on

Conformity

Assessment and

Acceptance of

Industrial Products

(ACAAs)

Enhanced

MRAs

(equivalence

of regulatory

requirements)

Traditional

MRAs (without

equivalence of

regulatory

requirements)

Source: GOV/RPC(2014)12/REV1

MRAs: benefits, costs & success factors

• (Small) positive impact on trade

• Avoid duplication of test, uncertainty on rejection & shorten ‘time-to-market’

• Knowledge flows & peer learning

Benefits

• Seen as costly by regulators /admin

• Challenging political economy & implementation

Costs

• Science-driven domains • Big global value chains • Regulatory divergence is not too high • Confidence / institutional proximity

Success factors

THANK YOU

Contacts:

Celine.kauffmann@oecd.org

IRC website: www.oecd.org/gov/regulatory-policy/irc.htm

Recommendation of the Council on Regulatory Policy and Governance: www.oecd.org/gov/regulatory-policy/2012-recommendation.htm

OECD (2015), Regulatory Policy Outlook, OECD Publishing, Paris: www.oecd.org/gov/regulatory-policy/Coming-soon-OECD-Regulatory-Policy-Outlook-2015.htm