EU, US Ink Mutual Recognition Customs Deal

9 May 2012

Brussels and Washington have signed an agreement to recognise each other's authorised traders, a top EU official announced on Friday 4 May. The move is aimed at facilitating customs procedures between the two sides, with the goal of increasing bilateral trade and creating jobs.

"Today's agreement is a major step forward in the EU-US trade relationship," EU Commissioner for Taxation and Customs Union Algirdas Šemeta said in announcing the accord.

Starting on 1 July 2012, the two sides will formally recognise each other's so-called safe traders, a move that will subject certified companies to faster controls and reduced administration for customs clearance. To date, Brussels has authorised 5,000 companies as Authorized Economic Operators (AEOs); Washington, for its part, has certified 10,000 companies under the US Customs-Trade Partnership against Terrorism (C-TPAT).

According to the European Commission, the deal will allow EU- and US-certified traders to "enjoy lower costs, simplified procedures, and greater predictability in their transatlantic activities."

Switzerland, Norway, and Japan already have similar reciprocal agreements with Brussels, which is also exploring the possibility of a mutual recognition accord with China.

Brussels and Washington are also looking at extending mutual recognition in other areas, Šemeta told US congressional newspaper The Hill. "We're working now in the area of maritime transport, in air cargo security, and several other areas where I think that if we agree to mutually recognise our systems, that will significantly facilitate our trade and will lead to growth in jobs, which we badly need."

Late last year, leaders from both trading partners agreed to examine various options - including the possibility of launching bilateral trade talks - in order to strengthen the US-EU trade and investment relationship. (See Bridges Weekly, 30 November 2011) Bilateral trade between the two sides amounted to €500 billion in 2011, according to European Commission statistics.

Back in February, the two sides also clinched a deal on recognising each other's certificates for organic agriculture products - a decision that officials acknowledged as a "significant step" in strengthening trade ties between Brussels and Washington. (See Bridges Weekly, 22 February 2012)

ICTSD reporting; "EU, US Sign Accord Aimed At Lowering Import, Export Costs," WALL STREET JOURNAL, 4 May 2012; "Europe Trade Chief sees boom in trade and export jobs, thanks to customs deal with US," THE HILL; 7 May 2012.

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