Pass the “Parmesan-like” Cheese, Please: Will Battle over Geographic Indications Kill TTIP?

The word “daunting” comes to mind when considering the task before U.S. and EU trade negotiators, who are meeting in Miami this week for the 11th round of the Transatlantic Trade and Investment Partnership negotiations, which commenced in late spring of 2013.  If a TTIP deal is eventually reached, the 11th round may only be remembered as part of the early era of the negotiations. Not only are there so many issues on the table, but the number of issues that have drifted from low-hanging fruit to difficult, and from difficult to intractable, seems to be growing.

One seemingly intractable issue is the matter of “Geographic Indications,” (GIs) and what protections, if any, they should be afforded. EU negotiators consider GIs to be intellectual property deserving of robust protection, which includes proscribing use of words like “Champagne,” “Parma” ham, and “Muenster” cheese (yes, GIs could just as aptly signify gastrointestinal issues) unless the product is made in the named region using processes and standards traditional in the region.  It’s a priority issue for the EU negotiators, but the U.S. negotiators aren’t buying it at all.

My colleague Bill Watson has immersed himself in the details of the geographic indications issue and, in his Cato Online Forum essay (published in conjunction with last week’s Cato TTIP conference), describes the conflicting EU and U.S. positions and explains why there is very little room for compromiseBill does offer up some possible solutions, but he’s not betting the house that it will work:

The United States has demands of its own in the TTIP negotiations that are at least as unpopular in Europe as is GI protection in the United States.  American negotiators have been tasked with the near impossible mission of opening up Europe’s market to genetically modified crops and meat from hormone-treated cattle, ractopamine-fed swine, and chlorine-washed chicken.

It may be possible that TTIP could include a grand bargain in which some combination of these agricultural demands are met along with a commitment for stronger GI protection in the United States.  For traditional trade barriers like tariffs and quotas, that kind of bargain would be a welcome outcome and, indeed, is the basic way that reciprocal agreements work to liberalize trade.  

In the regulatory sphere, however, this sort of political horse-trading raises questions of democratic legitimacy and is, in any event, not a way to arrive at well-reasoned policies.  Many regulatory policies that impede market access are motivated by non-economic interests.  And the benefits for foreign producers that stem from changing those policies aren’t going to mollify irate domestic constituencies.  

The tradeoff strikes at the heart of the difference in American and European cultural approaches to agriculture.  It’s difficult to imagine that TTIP negotiators could strike a deal that overcomes the European desire to protect traditional foods and ways of life or America’s ingrained preference for high-tech production and innovation.

Read Bill’s essay here.  Read all of the Cato Online Forum essays here.