- This report synthesises work carried out by the OECD Regulatory Policy Committee and the OECD Trade Committee on understanding the trade costs of regulatory differences and addressing them through international regulatory co-operation. It is a topical issue. Recent international trade negotiations therefore put an emphasis on promoting greater interoperability for businesses operating in countries with varying regulatory requirements.
- The analysis shows that trade costs may arise from unintended regulatory heterogeneity across jurisdictions, including information, specification and conformity assessment costs. Evidence on the magnitude of these trade costs remain largely unknown, although they are likely to vary significantly by sectors. Greater understanding of the trade costs of regulatory divergence could usefully inform the rule-making process. Regulatory impact assessments (RIA) provide a useful vehicle for this.
- The report shows that policy makers can draw from a wide range of approaches to address the trade costs of regulatory divergence, including unilateral, bilateral and multilateral. It draws a preliminary list of considerations to reduce trade costs through IRC. It identifies the generic measures that countries can take that promote regulatory quality and trade. It highlights the considerations that can drive the selection of specific IRC approaches.
For further information, please contact Céline Kauffmann, Regulatory Policy Division, OECD.