The European Commission is understood to be pressing for sensitive product status for eggs in any transatlantic trade agreement with the United States.
The EU and US have been in negotiations to agree what would become the world's largest free trade deal, creating a market of 800 million people and boosting economic output by an estimated $100 billion a year. Although the second round of negotiations due to take place in early October was cancelled because of the partial government shutdown in the United States - the result of an acrimonious economic row between President Obama's Democrats and their Republican Party rivals - European negotiators have made clear the scale of their ambitions for the deal.
EU trade commissioner Karel De Gucht said the aim of the Transatlantic Trade and Investment Partnership (TTIP) was "beyond simply reducing tariffs across the board - is to make the EU and the US regulatory systems more compatible and to help shape global rules in trade." He said, “The reality is that over the last decades, Europe has seen its standards rise to a level of global excellence and leadership. And it's on this basis that both sides agree to use such a transformative process to raise their game.”
He said that “in many ways, Europe has 'been there, seen that and done that' in its early preparations during the 1980s for a single market.” Even if neither side had the ambition to go that far in TTIP, “our aim should still be to progressively build a more integrated transatlantic market place," he said.
Robert Gooch, director of policy with the British Free Range Egg Producers' Association (BFREPA), said he understood that the European Commission was seeking sensitive product status for eggs in its talks with its American counterparts. That would mean that a quota would apply to the number of eggs that could enter the EU tariff free. Egg imports above the agreed quota would be subject to tariffs in the normal way.
"I don't know how the American side are likely to respond to that. We will have to wait and see, but representatives of the European egg industry have, I believe, persuaded the Commission that eggs should have sensitive product status."
The subject of free trade for the European egg industry is complicated by the higher welfare rules in place in the European Union. As we reported previously in the Ranger, battery eggs from Ukraine are now being allowed into EU states following a trade agreement with the European Union, even though a ban on the use of conventional cages came into force in the EU on January 1 2012. Eggs do have sensitive product status under this agreement, invoking a quota, but under World Trade Organisation rules it is not currently permissible to protect against imports on grounds of animal welfare.
"I think there is going to be more and more pressure for welfare rules to be included in global and bilateral talks in the future because more consumers around the world are becoming more concerned about animal welfare. But at the moment we can't do anything because the WTO rules don't account for animal welfare," said Robert.
Animal welfare rules could be a potential source of friction between the EU and the US. At the Pig and Poultry Event at Stoneleigh in May this year Andrea Gavinelli, the head of the Animal Welfare Unit of the European Commission, said he was pressing for the inclusion of animal welfare standards in any trade agreements with other parts of the world. The issue of animal welfare and international trade was raised at the spring conference of the International Egg Commission (IEC) in Madrid when a number of European speakers said welfare rules should be part of trade agreements.
However, Chad Gregory of United Egg Producers in the United States said he objected to the idea that an international welfare standard should be introduced. "It is one thing for Europe and the US to have a position to take birds out of cages for social or emotional reasons, but it's a different thing to tell people in South America or Africa to do the same thing when they are struggling to feed their people."
The National Farmers' Union (NFU) has cautiously welcomed negotiations on a transatlantic trade agreement. It says there could be significant benefits to such a deal, but has warned that the potential challenges facing negotiators should not be underestimated. It says that whilst tariffs and quotas would not be major obstacles to enhanced EU-US trade, the removal of all tariffs, including those applied to sensitive agricultural products like eggs, may have a negative effect on some sectors.
Trade commissioner De Gucht has said he expects negotiators to provide an outline of the regulatory and rules components of an agreement for political review in January 2014. Both sides are hoping to conclude a deal by the end of 2014 because the European Commission's term ends in November next year and the United States holds mid-term elections.
According to an independent study by the London based Centre for Economic Policy Research, a transatlantic trade agreement could bring the European Union economic gains of €119 billion a year once the deal was fully implemented. It is believed that much of the financial gain would come from reducing costs and hurdles hindering transatlantic business through the agreement of shared regulatory standards.
