Regulations Act as Market Access Barriers

Regulations Act as Market Access Barriers

This piece was originally published in the March 2018 issue of electroindustry.

Joel Solis, Senior Manager, Conformity Assessment, NEMA, and Craig Updyke, Director, Trade and Commercial Affairs, NEMA

As economies develop, consumption of manufactured goods increases, often leading to import competition. While governments may seek to protect their citizens from substandard, inferior goods and ensure orderly competition by imposing regulations, conflicts often occur when regulation imposes burdens far in excess of global norms.

One example is playing out now in the Republic of South Africa, which last autumn cited its consumer protection law as the basis for immediate implementation of a new and costly system for compatibility certification of “non-telecommunications electronic and electrical products” that may emit electromagnetic interference (EMI).

While the regulation ensnares a broad range of products, it tries to solve a problem with counterfeit products by imposing a requirement for EMI testing by a laboratory accredited by South Africa Bureau of Standards (SABS) instead of taking direct action at the border. In summary, the new system places SABS at the head of a new “authorized laboratory program,” but the lack of transition time, requiring laboratories to be directly accredited by SABS, the imposition of additional costs for accreditation, and inattention to international and alternative solutions are causing concerns and likely will not solve the issue with counterfeit products.

Regulation Without Restriction

International trade rules specify that governments inform each other of proposals for new or modified technical regulations that could act as barriers to foreign products and accept input from interested parties. The rules also encourage governments to choose an approach that achieves well-founded regulatory objectives without unnecessarily restricting trade.

Electrical and medical imaging equipment are frequent subjects of such notifications, which are distributed by the World Trade Organization (WTO) and national-level enquiry points such as the National Institute of Standards and Technology (NIST). NEMA tracks notices closely and works with its Members to provide written comments.

A 2016 paper issued by the U.S. Department of Commerce found that technical regulations of which WTO members had been notified could be linked to 90 percent of U.S. goods exports. Leaving aside any regulations and proposals that countries fail to distribute under the WTO Agreement on Technical Barriers to Trade (TBT), the author concluded that technical regulations, “especially those [that] are based on national or regional standards instead of on international standards—can create additional costs for exporters as they seek to adapt their products and processes to differing regulatory requirements around the globe.”

In the case of South Africa’s September 2017 notice on EMI and electromagnetic compatibility (EMI/EMC), the government’s objectives in immediately adopting a new conformity assessment and certification system include protection for public networks and consumers, ensuring products entering the market meet required standards, and “traceability of actual testing samples and address[ing] changes to critical components in electrical and electronic products.” The Department of Trade and Industry and the Independent Communications Authority of South Africa (ICASA) cited urgent safety, health, and environmental problems and asserted that any delays in implementation could necessitate a cessation of imports.

NIST forwarded NEMA’s concerns to South Africa regarding its requirement to directly accredit EMI testing laboratories, citing certification cost increases of as much as 400 percent, possible alternative approaches to direct accreditation, and lack of clarity as to the precise product scope of the new requirements. Commerce Department officials have requested answers from counterparts in Pretoria, Johannesburg, and the South African embassy in Washington, but at this time no resolution has been reached. So far, only one U.S.-based laboratory has received SABS approval.

The U.S. and other member states are expected to invoke complaints about South Africa’s EMC approach at the March meeting of the WTO TBT Committee in Geneva, Switzerland.

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