Appendix A New Developments in International Standards and Global Trade: A Conference Summary
John S. Wilson, John M. Godfrey, Holly Grell-Lawe
On March 30, 1994, the International Standards, Conformity Assessment, and U.S. Trade Policy Project and the Academy Industry Program of the National Research Council convened a conference to explore new developments in international standards and global trade. Conference participants included leaders from industry, government, academia, and private-sector organizations. Participants discussed standards as technical barriers to trade and the economic benefits of international trade in the post-Uruguay Round trade environment; national standards and conformity assessment systems in overseas markets; the U.S. government role in standards and conformity assessment; and standardization in the information technology and telecommunication industries.
This appendix summarizes the conference presentations and discussions, highlighting key points and issues raised by the participants. It does not represent a consensus opinion of the panels or participants, nor does it contain policy recommendations.
The Post-Uruguay Round Trade Outlook: Economic Benefits Of International Trade
From a government perspective, trade is a tool of domestic policy. Since
John S. Wilson is Project Director/Senior Staff Officer, National Academy of Sciences. John M. Godfrey is Research Associate, National Academy of Sciences. Holly Grell-Lawe is Senior Research Associate, Center for International Standards and Quality, Georgia Institute of Technology. Special thanks to Patrick Sevcik, Project Assistant, National Academy of Sciences, for assistance in the coordination of the conference and preparation of this report.
conclusion of the North American Free Trade Agreement (NAFTA) and the Uruguay Round of multilateral trade negotiations of the General Agreement on Tariffs and Trade (GATT), policies to reduce barriers to trade and expand the total volume of trade are among the principal tools available to enhance the long-term U.S. economic growth rate.
A senior U.S. government trade official noted the desire of Congress and the public for empirical evidence that trade liberalization agreements enhance long-term growth prospects and prosperity, and reported some empirical findings, which are outlined below:
The Office of the U.S. Trade Representative (USTR) examined the wage levels of U.S. export workers in 1990, building on work done by the U.S. Department of Commerce (DoC), which had calculated that 7.2 million jobs are supported by U.S. merchandise exports. Matching the DoC data with average wages per industry, USTR found that U.S. workers in export-related sectors earn 17 percent more than the U.S. national average wage.
The USTR also reviewed economic research on the wage levels of workers in import-competing sectors. One study found that U.S. workers in import-competing sectors earned 16 percent less than the U.S. national average wage. The general conclusion reached by many studies is that policies lowering barriers and expanding market-driven trade will gradually shift the growth of job opportunities from lower-paying jobs toward higher-paying jobs.
In connection with the Uruguay Round, the U.S. Bureau of Economic Analysis explored both dynamic (growth) effects and static efficiency effects from a one-third cut in global barriers to trade, a primary goal of the Uruguay Round negotiations. It was found that for the United States at the end of 10 years there would be a growth enhancement of about 3 percentage points of Gross Domestic Product. The U.S. trade official noted that few policy levers can add an annual three-tenths of a percentage point to the country's long-term growth rate.
Developing nations around the world are moving toward more market-oriented policies, both internally and in their trade policies. In doing so, they have the potential for real economic growth rates far exceeding anything achievable in the United States, the European Union (EU), or Japan. Most of these countries have very broad needs—from telecommunications systems to road-building equipment to hospital equipment. This presents a tremendous opportunity for U.S. exporters.
Standardization is one of many areas that must be addressed to enhance the U.S. ability to take advantage of these opportunities. Standards can facilitate U.S. exports. Standards, however, may also pose barriers to trade. The United States needs to decide how to deal with standards issues more fully with developed country trading partners. The United States also has an interest in ensuring that as developing countries are more integrated into the global trading system, they adopt open standards models in which government's ability to interfere and
distort trade flows and reduce growth is limited and can be addressed through negotiation where it does exist.
The Post-Uruguay Round Trade Outlook: Standards And Technical Barriers To Trade
Significant changes in the global trading system have occurred over the past decade. The Uruguay Round of the GATT has been concluded, lowering tariff barriers to international trade in many industry sectors. Non-tariff barriers to trade, such as standards, however, have become a growing source of international friction. Standards have been identified by U.S. industry as a problem area in trade relations, which means standards have become increasingly important to the USTR.
Standards can serve as technical, non-tariff barriers to trade in several ways. In the setting of standards, it is possible that the standards adopted, their method of application, and the procedure to assess conformity will discriminate against foreign suppliers. Lack of access to information about what standards are and how they should be met also impedes global trade. Every country has the right to maintain its own standards, when necessary to protect health, safety, and the environment. Without harmonization of international standards wherever possible, however, differences in standards can result in barriers to trade. Trade is also restricted, and potential growth and economic welfare are reduced when there are (1) differences in standards, (2) needlessly burdensome conformity assessment processes, and (3) failure to reduce the costs of those processes by establishing methods and procedures to facilitate conformity assessment.
Standards And Technical Barriers To Trade: The European And Gatt Approaches
Both the Single Internal Market program of the EU and the Uruguay Round have wrestled with the issue of standards as technical barriers to trade. As a result, the EU has adopted a comprehensive approach to standards harmonization among its member states. The Uruguay Round addresses this issue by establishing a code of rules for governments and standards-setting bodies.
Prior to 1985, standards were a major stumbling block to European integration into a single market. Standards in Europe were created by governments. Harmonization required governments to agree on details of a common approach, but this proved impossible. In 1985, however, a new approach emerged. The solution gave industry responsibility for the development of standards that would meet ''essential safety and health requirements" mandated by EU legislation. This solution limited the role of the EU Commission to the definition, through legislation, of broad safety and health objectives to be met. Industry and private
standards-setting bodies provide the details of how those objectives are to be achieved.
The Uruguay Round addresses standards at a global level by establishing a system of rules, the Agreement on Technical Barriers to Trade (TBT), by which government and private standards-setting bodies are to act in the future. In the view of one European panelist, this is a significant achievement of the Uruguay Round. Standards can serve as barriers to trade, and further problems can be anticipated over time, for example, as environmental concerns generate new standards and regulations.
Universality is another important achievement of the Uruguay Round TBT agreement. There are more than 115 signatories to the GATT, as amended, agreeing to abide by one comprehensive set of rules. A previous attempt in the Tokyo Round of the GATT to adopt a separate, optional technical barriers to trade code, the Standards Code, resulted in only 38 countries agreeing to exchange information on standards.
It is also important that the new TBT agreement, an integral part of the GATT, invokes a higher level of obligation. The signatories (sovereign governments) agree to take full responsibility in their respective countries for the application of the terms of the code to whatever level of government or private sector is involved.
In addition, both public and private standards-setting bodies are enjoined not to act in a discriminatory fashion or to use standards as hidden barriers to trade. It was noted that the EU was anxious to have the United States agree to this provision. In exchange, the EU agreed to submit itself to national treatment and be considered the responsible level of government. This will require all lower levels of government to adhere to the TBT. As one conference participant noted, the United States agreed to a certain degree of coverage of its private-sector standards bodies in return for more direct coverage through Brussels of European standards bodies, including the European Committee for Standardization (CEN) and the European Committee for Electrotechnical Standardization (CENELEC). In the view of a European panelist, this mitigates the danger of discriminatory application of the European standards system in the future.
With respect to government obligations concerning private standards bodies under the Uruguay Round agreement, there is a Code of Good Conduct under which private-sector bodies can submit to the Most Favored National Clause. If a private-sector body signs the code, it must treat others in a nondiscriminatory fashion. This means, for example, that if a standards organization admits some foreign participation in its procedures, it may not block other foreign participants.
Another achievement of the Uruguay Round has been to put in place not only agreements on technical standards, but also a multilateral trade body, the World Trade Organization. The dispute settlement system of this multilateral trade organization applies directly to technical standards as barriers to trade. Since the GATT is an intergovernmental organization, private organizations or firms can
access the dispute settlement system only through their government. On the other hand, the development of private diplomacy among standards-setting bodies at a global level is possible and encouraged in the text of new international trade agreements.
U.S. industry participants expressed concern about the dispute settlement system under the GATT. Improving the dispute settlement mechanism and integrating it into the Uruguay Round represented a very high priority for the United States. It was pointed out, however, that how often the dispute settlement mechanism will be invoked with respect to specific unfair trade practices is an open question.
The USTR was encouraged to draw on the advice and resources of private companies in bringing cases to the GATT. With respect to dispute settlement, the TBT agreement will have no practical effect unless companies bring cases to the GATT. The USTR requires this kind of assistance. It was also pointed out, however, that the GATT dispute settlement procedure is the end of a long process. Most disputes should not end up in the formal dispute settlement procedure, but should be settled privately.
The topic of access to the European standards system by non-European private-sector standards bodies elicited considerable discussion. The EU and Uruguay Round texts enjoin the private standards-setting bodies to participate actively in horizontal communication between groups, as well as in the International Organization for Standardization (ISO) and its subgroups. A European panelist noted that the easiest way to gain access to the European standards-setting system is via the ISO and strongly urged that U.S. firms (1) work to ensure full representation in the work of the ISO and (2) work to establish international standards. Where international standards exist, there is a general obligation, in the EU and GATT texts, for standards bodies to incorporate them in their own standards to the greatest possible extent.
The importance of the private sector in the standards process was highlighted during conference discussions. In the view of a European participant, if there is a full commitment in the United States and in Europe to develop international standards, the new processes outlined in the Uruguay Round will function properly. If there is no private-sector commitment, they will not work. The private sector needs to be an active participant where its interests lie. The hope was expressed that the idea that domestic markets can be protected with standards will be left behind as we enter the twenty-first century.
The emphasis on participation in international standards for access to European standards setting is not new. For example, as one U.S. industry participant commented, over a period of four years, the American National Standards Institute (ANSI) has had a highly productive dialogue with CEN, CENELEC, and the European Telecommunications Standards Institute. ANSI receives these organizations' standards for comment and has an opportunity to comment on their
processes. The challenge has been to motivate U.S. industry to use these opportunities for access more effectively.
Only U.S. multinational firms with operations in Europe have direct access to CEN and CENELEC committees. The answer to the problem of access, according to a European participant, is for private standards-setting bodies to develop international standards. It was noted that the United States does participate in many areas of international standards activities. For example, the United States holds 35 technical committee secretariats in the International Electrotechnical Commission (IEC) and is the largest single holder of secretariats in ISO.
National Standards And Conformity Assessment Systems In Overseas Markets: A U.S. Perspective
In the early part of the twentieth century, the world marketplace comprised strong, individual, independent trading markets. It now comprises a number of economically strong nations and trading regions. The integration of international markets has impacted product certification and standardization activities in a number of ways. Important changes are taking place in standards and conformity assessment systems in Europe, Asia, and emerging markets, affecting both regulated and unregulated product sectors.
Worldwide, standards harmonization activities have increased. For example, the countries of the EU and the European Free Trade Association (EFTA) are involved in harmonization efforts, while Japan is examining international standards harmonization, particularly as it relates to quality. Under NAFTA, Mexico is harmonizing its standards with the United States and Canada. Product certifiers involved in standards have increased their participation in international activities and standards harmonization. One U.S. organization participates in more than 150 international standards committees and 60 harmonization initiatives around the world.
A conference panelist from a U.S. testing laboratory reported that in response to changes in international trade, product testers and certifiers in the United States and other developed markets are internationalizing their activities and introducing new services to meet changing international service demands of their customers. The evolution of global manufacturing gives certifiers incentives to develop a global presence.
The need for multiple market access has led to increased cooperation between certifiers through the establishment of memoranda of understanding, bilateral agreements, and other arrangements. These have built confidence in a capacity to certify, test, quality register, and provide other elements of conformity assessment services worldwide. U.S. certifiers have built agreements with certifiers in countries that are primary markets for U.S. products.
The experience of one U.S. product certifier suggests that the keys to cooperation in assessing and certifying products locally or supplying data locally in foreign markets, are confidence building, cross-training, audits, and the right to reject.
Certifiers can also provide global assistance to customers that want to export to new markets by identifying the requirements, codes, standards, and laws that a product must meet, including the processes by which a product must be evaluated. In the view of one participant, the certifiers of the future will need not only experience and flexibility, but also foreign market intelligence, transparency in foreign standards and certification processes, and the backing of national treatment before they can help producers reach U.S. export markets.
National Standards And Conformity Assessment Systems In Overseas Markets: A European Perspective
A European perspective on conformity assessment was provided by a panelist from the European testing and certification community. Conference participants were advised that a new industry is developing around conformity assessment. There is the danger that it could develop in such a way that customers will reject it as an obstruction and try to find a way around it, at either the national, the European, or the international level.
Via the European Organization for Testing and Certification (EOTC), Europe is attempting to harmonize accreditation in nonregulated industry sectors through the calibration, certification, and laboratory accreditation communities in 18 countries. A private-sector, not-for-profit association, the EOTC seeks to establish confidence, through mutual recognition agreements, among parties concerned with conformity assessment issues.
To accomplish this, the EOTC uses sectoral committees and agreement groups that represent the interests of manufacturers, users, and third parties in a specific economic sector, and of the laboratory, certification, and accreditation communities. Comprising national delegations from at least five EU or EFTA countries, sectoral committees discuss mutual recognition arrangements where they perceive a market need for harmonized conformity assessment. Agreement groups are formed among organizations from at least three EU or EFTA countries that have agreed to operate in conformance with similar European or international standards. This requires that the national conformity assessment accreditation system be available to both domestic and foreign laboratories. One panelist noted that such systems are not presently in place in some European countries.
EOTC is working to promote conformity assessment arrangements whereby a product is tested once, certified, and accepted everywhere within the market, whether in Europe or in another country through a mutual recognition arrangement. It was noted that harmonized or compatible conformity assessment arrangements
within the EU or other countries would remove the requirement that U.S. products be sent to European laboratories or certification bodies for tests.
In the discussion of conformity assessment in overseas markets, several U.S. industry participants stressed the need to maintain reliance wherever possible on self-certification, by using the supplier's declaration of conformity rather than services provided by an independent third party.
The Administration's Defense Acquisition Reform Policies
An overview of the recommendations of the U.S. Department of Defense (DoD) Process Action Team (PAT) for Specifications and Standards was provided by a conference participant from DoD.
The PAT was chartered to, among other tasks, develop a comprehensive strategy for permitting reliance in defense procurement on commercial products, specifications, and standards, as well as practices and processes. The team works to ensure that (1) system and data requirements do not unnecessarily preclude the use of commercial products and practices in form, fit, and function; (2) unnecessary specifications and standards are eliminated; (3) nongovernmental standards and commercial item descriptions are used to the maximum extent practical; (4) industry is encouraged to propose alternative technical solutions; and (5) standards and specifications are applied correctly to contracts.
Several of the team's primary recommendations include the following:
- Performance specifications: For all Acquisition Category programs for new systems, major modifications, technology generation changes, nondevelopmental items, and commercial items, DoD's need shall be outlined in terms of performance specifications. The contractor, rather than DoD, will be responsible for designing and developing solutions to meet these performance requirements.
- Manufacturing and management standards: Management and manufacturing standards shall be canceled or converted to performance or nongovernment standards. Contractors will be given the option, in complying with military specifications (milspecs), of proposing relevant nongovernmental standards or industry practices as substitutes that meet the intent of the specific milspecs or military standards.
- Innovative contracting processes: All new high-value solicitations and ongoing contracts will include a statement encouraging contractors to submit alternative solutions to milspecs and standards. Incentives will be provided to allow current contractors to switch to a new specification or standard.
- Partnerships with industry associations: DoD will encourage partnerships with industry to help replace milspecs and standards with nongovernmental standards, where practical.
- Reduction of oversight: DoD's recent directive authorizing the use of the
- ISO 9000 series of quality management system standards allows, but does not mandate, the use of the series. DoD will no longer dictate how contractors establish quality systems. Contractors will be responsible for establishing systems, processes, and standards.
- Establish goals to reduce the cost of contractor development and production test and inspection: The team recommended that DoD set a specific goal of reducing the cost of contractor development, production, testing, and inspection, as well as the use of innovative techniques utilized in industry. These include simulation, environmental testing, dual-use test facilities, process controls, metrics, and continuous process improvement.
It was also noted that in the acquisition of commercial products, DoD will rely on third-party certification of compliance with standards in place of DoD certification where possible. Where such programs do not exist, DoD will cooperate with industry to establish them. DoD is working to make maximum use of third-party organizations.
It was acknowledged by a DoD participant that it will be difficult to change the culture in DoD and reengineer the acquisition process. The key to this effort is leadership in management. Metrics of success developed by teams will help determine both the progress and the impact of changes.
The U.S. Government Role In Standards And Conformity Assessment
The U.S. government plays an active role in many aspects of standards and conformity assessment. Participants discussed existing and potential missions for the U.S. government in these areas. Also considered were the desirable mix of government and private-sector activity in standards and conformity assessment and ways to arrive at those desired relationships.
A Government Agency Perspective
In the changing international trade environment, according to a U.S. government panelist, many of our previous assumptions that others will generally adopt U.S. standards and buy U.S. products are no longer valid. In addition, international standards are often developed without active U.S. input or representation. Exporters also face aggressive trade practices by other countries, including the use of standards as barriers to trade. On the positive side, international cooperation is increasing as evidenced by both GATT- and NAFTA-related activities.
From the perspective of one U.S. government agency, the private voluntary standards system represents the best approach for the U.S. economy. There is a need, however, for much better cooperation and communication among standards organizations, industry, and government to make this system work effectively.
The U.S. government's general role in standards is, first, as a user of standards. Agencies use standards in the purchase of products (e.g., DoD) and through their incorporation into federal regulations (e.g., the Occupational Safety and Health Administration). The government also provides the technical foundation for many standardization activities and advocates for U.S. interests around the world.
The National Institute for Standards and Technology (NIST) plays many roles in standardization. NIST provides the technical basis for standards through fundamental physical standards measurement, test methods, reference data, and production of standard reference material. NIST participates in voluntary standards committees, presently holding 1,143 memberships on 816 standards committees of 79 organizations. NIST chairs 118 of these standards committees. NIST also runs the National Voluntary Laboratory Accreditation Program. In addition, about 170,000 standards-related inquiries are handled annually by NIST's National Center for Standards and Certification Information. The center serves as the U.S. GATT Inquiry Point. NIST has begun to explore mutual recognition of accreditation bodies through its National Voluntary Conformity Assessment Systems Evaluation program. Finally, NIST is working to improve communication and cooperation among government agencies, standards organizations, and industry.
The U.S. standards system faces several challenges. The current process may not always be adequate to deal with the changing international environment. For example, ANSI is often the U.S. representative in the international standards arena. In one panelist's view, ANSI's lack of formal government backing can place it at a disadvantage relative to other parties. The United States often acts in a reactive mode in some areas of standards, rather than setting the agenda for the rest of the world. There is some movement by the private sector, however, to recognize the importance of participation in the international standards arena. This is evidenced by the growing number of U.S.-held ISO committee chairs.
A government participant proposed developing a systems approach to the standards process to achieve national goals more effectively. This would require (1) focusing on a clearly defined national goal; (2) delineating responsibilities and relations among standards organizations, industry, and government; and (3) improving communication among all parties in the voluntary standards process.
A Private-Sector Perspective
A private-sector panelist's perspective on the U.S. government's role in standards and conformity assessment emphasized the need for a more definitive relationship between the government and the private voluntary standards system. The panelist stressed that government must recognize and use the private voluntary standards system. In addition, U.S. industry should support ANSI as a credible mechanism for promoting integration of the voluntary standards system.
The U.S. government must also organize to speak coherently as a sovereign nation on the issues of standards and conformity assessment, both internally and externally. This is particularly important in view of the new responsibilities and accountability of the sovereign government signatories to the Uruguay Round. Finally, the cost of standardization should be borne by those who gain value from the activity.
Many conference participants agreed that the United States must support an infrastructure that is competent, equitable, and credible. Some expressed the view that ANSI and the voluntary standards system should not be governed and funded by the present mixture of government, associations, standards developers, and a small percentage of industrial firms in the United States. This represents an uneven and inequitable distribution of governance and of financial support. A private-sector panelist maintained that revenue must be derived from value received and that ANSI should concentrate on activities that are of value, identifying who values them, and assessing revenue sources from that value structure.
The future will be substantially different from the past. Both private and public leaders need to seek improvements to the U.S. standards system in a way that involves the government. One participant pointed out that undesired levels of government control, which may accompany government involvement in private activities, can be mitigated through negotiation.
Industry–Government Cooperation in Regulation and International Standards
The medical device industry and the Food and Drug Administration (FDA) have developed and implemented a program to provide industry access to effective mechanisms to influence international standards, regulations, and trade. This program has been built on cooperation between industry and government. In 1989, the U.S. medical device industry instituted a program to influence international and European Community standards to promote harmonization of medical device standards and regulations. The industry administers most national standards and almost all horizontal medical device international standards.
The program's success could not have been achieved without the support of the FDA, according to an industry panelist. The program was enhanced by the fact that the U.S. industry's standards were used by many foreign governments. With FDA's support, the industry adopted as national standards all of the international standards that it administers in the United States. FDA support was critical to the medical device association's involvement with an ISO technical committee that will write, interpret, and coordinate medical device quality system standards for the international community. It is also working to harmonize medical device standards and regulatory requirements for all countries worldwide.
FDA provided leadership, resources, and credibility to this exercise. FDA also provided scientific and political leadership to industry's efforts to influence
ISO, IEC, CEN, and CENELEC standards. Through the FDA, the industry gained access to CEN and CENELEC committees. The U.S. medical device industry was able to join standards-writing committees by gaining the respect and confidence of the Europeans and making it clear to them that U.S. industry has as much interest in writing appropriate standards as they have.
The FDA has also assisted industry leaders in promoting the message that international standards activities are important, not only to industry but to the FDA. U.S. industry in general needs to make more of a commitment to international standards, and more companies should carry the burden, emphasized the industry panelist.
The FDA has benefited from this activity in several respects. First, FDA relies on standards for regulatory activities, almost all of which are based on some form of voluntary standards. These include manufacturing practices, product approval processes, and clinical investigations. FDA experts are also provided access to experts from all over the world. As a technical regulatory body, FDA needs to maintain its knowledge base. The most important reason for FDA's interest in international standards may be that harmonization of international standards and regulations can significantly reduce FDA's regulatory cost.
In the view of one industry participant, it is critical that FDA continue as a major participant in the international standards system. Its leadership, knowledge, resources, and management can contribute to industry's effort to ensure that standards expand global market access rather than limit it. For example, FDA experts support the formulation and acceptance of U.S. positions on international standards. Continued funding for participation in these international activities was encouraged by the industry panelist.
Finally, the medical device industry supports the notion that the government should be a full and equal participant in, but not the director of, private-sector international standards participation. It is important for the government and the private sector to speak with a unified voice. FDA has shown a willingness to share responsibility with the private sector in international standards, commented an industry participant.
Standardization and harmonization processes in sectors other than medical devices can likely be furthered by cooperative relationships between industry and government. For some 25 years, industry—working in cooperation with the FDA rather than being directed by it—has produced a tremendous number of standards critical to FDA regulation. It also has made a major contribution to marketplace safety.
Comments and Concerns
A number of other comments and concerns about the U.S. government role in standards and conformity assessment were voiced by conference participants. Several of these are highlighted below:
There are several existing mechanisms that demonstrate significant interface among the U.S. government, industry, and standardization matters. One is the Government Member Council of ANSI, and another is the NIST-chaired Interagency Committee for Standards Policy.
There is a need for an exchange of information concerning standards developments among federal agencies. Another challenge is overall coordination of the government's role in standards, by taking into account the differing roles and missions of the various agencies involved in standards-related matters.
Some participants maintained that ANSI would benefit from a federal charter, while others did not see the need for the additional processes or potential bureaucracy that might result from such formalization.
The government can assume a more proactive role in standards by working to influence standards setting in developing countries or in emerging markets through the provision of technical support or training. Europe and Japan are active in this area. It was noted that NIST has such an effort ongoing with Saudi Arabia.
Sectoral Case Studies: Telecommunications And Information Technology
Standards issues are an increasingly important and contentious issue in the telecommunication and information technology industries. This has been driven by several forces. First, the number of players in the standards process has increased markedly as government policies have opened many markets to new entrants. In addition, the rate at which these industries need to develop new standards is accelerating as rapid technological progress leads to the introduction of both new services and new ways of providing old ones. The blurring of traditional industry lines in these sectors is also driving demand for changes in standards as firms capitalize on the convergence of industries and technologies to create advanced services for customers. Finally, as many firms have moved outside traditional domestic markets to compete internationally, foreign standards have become important to their success and the role of international standards has become more critical.
Telecommunications
The telecommunication industry is dependent on universality, which depends in turn on standards. In the wake of the dynamics mentioned above, it is critical that standards become adaptable at a much faster pace, according to a telecommunication industry executive. The key is to develop standards that from the outset adapt to the movement of the industry. To accomplish this objective, standards need to be open, scalable, and extensible: open in terms of being
available to all potential providers on a equitable basis; scalable in that they can adapt readily to improve performance in a given technology; and extensible to new technologies as they become available.
In evaluating the telecommunication standardization process, the question of whether formal standards are necessary arises. In some cases, not developing formal standards could lead to chaotic marketplaces or to inefficient or costly services. In other cases, standards may be better left to the marketplace. In yet other cases, adoption of standards could be counterproductive.
The government should not actually set standards, in the view of the telecommunication panelist. The government does not generally have the prerequisite technical expertise or marketplace savvy. Government can, however, encourage and participate in the standards process in order to meet public interest responsibilities. It was noted that the private sector is motivated to get involved in the standards process when adopting a common standard would produce a far larger market with less risk of failure than would a market consisting of multiple incompatible technologies.
Historically, most telecommunication standards bodies were not formed with the notion of creating standards that would invite open competition and rapid change. Instead, they were formed under the aegis of national monopoly service providers. Although telecommunication standards processes work, they have been generally slow. The implementation of accelerated procedures has improved the speed of the processes, but not enough, in the opinion of a telecommunication industry participant.
Rapidly changing telecommunication technologies and markets should force industry consideration of some fundamental goals: (1) acceleration of the standards process; (2) attention not only to the most current technology, but to technologies that can be anticipated and technologies that are available to competing countries; and (3) making standards as flexible, scalable, and extensible as possible, by anticipating improvements in present and future technologies.
Information Technology
Standards drive development in the information technology (IT) industry. Customers demand interoperability among networks, computers, applications, and people, as well as the freedom to choose between vendors. The IT industry has a broad range of formal and informal standards development processes. The U.S. industry has been successful in having its standards adopted internationally through private-sector processes.
Informal systems for IT standards development include a variety of consortia. The industry has formed multiple consortia to perform specific technical work, promote standards and ensure their implementation, test products, and build common software. Consortia are usually formed, however, to facilitate the timely completion of standards and ensure that they pertain to real products.
Consortia have done effective and efficient work in regard to the latter. However, there is no credible evidence that the consortium-based process is inherently faster than the formal standards process, according to an IT industry panelist. In particular, consortia sometimes fail to meet their objectives because they believe they can short-circuit the painful political process of developing consensus on a broad base. Relying one the willingness of the participants to passively follow the major players has not proved an ideal solution.
Consortia have nevertheless remained popular because (1) they are involved in activities other than standards development and (2) they focus on near-term success by concentrating on existing technology and product implementations. Consortia also appear to use effective methodologies. They tend to work more intensively than formal standards groups. They make better use of technology and therefore have the potential to be more efficient. Yet, unlike the formal standards process, consortia may exclude the small participant because of the higher level of resources required to participate.
Consortia will continue to be a factor in the IT industry. They add value and are easy to form. One problem, however, is that the number of groups has increased so dramatically that there is considerable confusion about which standards are the best technical solution. It has become difficult to judge the credibility of any particular standard or standards group. There is also a general inability to deal with mutually exclusive standards. Vendors react to this situation by participating in all the groups and implementing all standards. Users express their frustration and demand the formation of yet another new consortia to do it right. This results in inefficiency and added costs.
There is a need to take advantage of the strengths and weaknesses of all these groups. Actions suggested by an industry panelist include, first, recognizing a preference for the formal processes at the national and international levels. At the same time, the formal standards process needs to separate technical development from formal approval. In this way, the IT industry can take advantage of good work being accomplished, while maintaining a system for establishing legitimacy and minimizing confusion. This will require changes in the standards process. One possibility would be to give international consortia nonvoting membership in international organizations.
With respect to the government role in IT standards processes, several suggestions were made. These included (1) continued active participation in the voluntary standards process on the same basis as other interested parties; (2) a greater funding role through, for example, coverage of specific infrastructure items (e.g., ISO and IEC dues, hosting of international standards meetings in the United States); (3) R&D tax credits for standardization activities; (4) negotiation of mutual recognition agreements, where required; (5) offering such services as accreditation of laboratories or recognition of private-sector accreditation programs; and (6) formal recognition of the existing private-sector standards system through, for example, the granting of a federal charter to ANSI.
New Developments In International Standards And Global Trade
International Standards, Conformity Assessment,
and U.S. Trade Policy Project Committee
and
The Academy Industry Program
Wednesday, March 30, 1994
National Academy of Sciences Building
Washington, D.C.
The Lecture Room
- Agenda - |
|
|
|
8:30-9:30 a.m. |
Continental Breakfast and Registration |
|
9:30-9:40 a.m. |
Welcome STEPHEN A. MERRILL, Executive Director, Science, Technology, and Economic Policy Board Director, Academy Industry Program Introduction JOHN SULLIVAN WILSON, Study Director, International Standards, Conformity Assessment, and U.S. Trade Policy Project |
|
9:40-10:20 a.m. |
The Post-Uruguay Round Trade Outlook: Standards and Technical Barriers to Trade. The panel will address the status of standards and conformity assessment systems as barriers to trade in the post-Uruguay Round trading system. |
|
Moderator: |
Gary Hufbauer, Senior Fellow, Institute for International Economics David Walters, Acting Assistant U.S. Trade Representative for Economic Affairs and Chief Economist, Office of the U.S. Trade Representative Victoria Curzon-Price, University of Geneva |
|
10:20-10:50 a.m. |
Open discussion: Uruguay Round and changes to technical trade barrier provisions—effects on U.S. firms' technology development and export strategies; industry perspective on emerging standards-related trade issues, such as environmental standards, quality standards, and intellectual property protection |
|
10:50-11:00 a.m. |
Break |
|
11:00-11:50 a.m. |
National Standards and Conformity Assessment Systems in Overseas Markets. The panel will address trends in national standards and conformity assessment systems in prominent and emerging U.S. export markets. |
|
Moderator: |
Lawrence Wills, Director of Standards, IBM Corporation David Stanger, Secretary General, European Organization for Testing and Certification Laszlo Belady, Chairman, Mitsubishi Electric Laboratories S. Joseph Bhatia, Vice President, External Affairs, Underwriters Laboratories |
|
11:50-12:30 p.m. |
Open discussion: impact of standardization and conformity assessment trends in U.S. trading partner countries on U.S. exports; firms' experiences and participation in standards development in these countries |
|
12:30-1:30 p.m. |
Lunch |
|
1:30 p.m. |
The Administration's Defense Acquisition Reform Policies Coleen Preston; Deputy Under Secretary for Acquisition Reform, U.S. Department of Defense |
|
2:00-2:50 p.m. |
The U.S. Government Role in Standards and Conformity Assessment. The panel will discuss current roles and potential new initiatives for the federal government in standards development, conformity assessment, and quality assurance. |
|
Moderator: |
Richard Schulte, Senior Vice President, Laboratories, American Gas Association Belinda Collins, Program Analyst, National Institute of Standards and Technology Robert Hermann, Senior Vice President, Science and Technology, United Technologies Corporation Michael Miller, President, Association for the Advancement of Medical Instrumentation |
|
2:50 p.m. |
Open Discussion |
|
3:20 p.m. |
Break |
|
3:30-4:20 p.m. |
Sectoral Case Study: Information Technology (IT) and Telecommunication. The panel will discuss the link among standards, technology, and development of new products and services in the context of rapid technological change and the ongoing convergence of these industry sectors. |
|
Moderator: |
Stanley Besen, Vice President, Charles River Associates Richard Liebhaber, Chief Strategy and Technology Officer, MCI Communications Corporation Stephen Oksala, Director, Corporate Standards, Unisys Corporation |
|
4:20-4:50 p.m. |
Open discussion: emerging trends in standards and technology development in the IT and telecommunication industries; role of international standardization in strengthening U.S. export performance |
|
4:50 p.m. |
Concluding Remarks GARY HUFBAUER |
|
5:00 p.m. |
Reception |
Participants List
Melvyn R. Altman
Associate Director
Office of Standards and Regulations Center for Devices and Radiological Health
U.S. Food and Drug Administration
Guy A. Arlotto
Deputy Director
Office of Nuclear Material Safety and Safeguards
U.S. Nuclear Regulatory Commission
Diana Artemis
Associate Director
Chemical Manufacturers Association
Daryl Back
Counselor, Industry, Science and Technology
Embassy of Australia
Earl S. Barbely
Director, Telecommunication and Information Standards
CIP Bureau
U.S. Department of State
James Baskin
Director, Standards
NYNEX Corporation
Cora Beebe
Office of Management and Budget
Executive Office of the President
Laszlo Belady
Chairman
Mitsubishi Electric Research Laboratories, Inc.
Diego Betancourt
Manager
Office of Strategic Standardization
Polaroid Corporation
S. Joseph Bhatia
Vice President, External Affairs
Underwriters Laboratories, Inc.
Eric Biel
Trade Counsel
Senate Finance Committee
Ezra L. Bixby
President
Lovell Associates
Judy P. Boehlert
Vice President, Quality Control
Roche Pharmaceuticals
Hoffmann-La Roche Inc.
Barbara Boykin
Standards Coordinator
American Petroleum Institute
Richard Bradshaw
Vice President
North Atlantic Research, Inc.
Maureen Breitenberg
Economist
National Institutes of Standards and Technology
U.S. Department of Commerce
Dennis Brining
Director, International Program Development
Lockheed Corporation
George Brubaker
Deputy Director
Office of Standards and Regulations
U.S. Food and Drug Administration
Milton M. Bush
Director of Public Affairs
American Council of Independent Laboratories
Amy Cheng
Industrial Engineer
Facilities Management Division
U.S. General Services Administration
Colin B. Church
Voluntary Standards and
International Activities Coordinator
U.S. Consumer Product Safety Commission
Belinda Collins
Program Analyst
National Institute of Standards and Technology
James D. Converse
Director of Corporate Standards
Eastman Kodak Company
Hugh Conway
Director
Office of Regulatory Analysis
Occupational Safety and Health Administration
U.S. Department of Labor
Stephen Cooney
Senior Policy Director, International Investment and Finance
National Association of Manufacturers
Lori L. Cooper
Director, Internal Market Staff
Office of European Community Affairs
U.S. Department of Commerce
Francis L. Criqui
Manager, Technical Document Management
General Motors Corporation
Helen Davis
Washington Representative
American Society for Testing and Materials
Lester Davis
Chief Economist
Department of Commerce
Myles Denny-Brown
International Economist
U.S. Department of Commerce
Helen A. Domenici
Associate, Federal Relations
Corporate Affairs Division
Pfizer Inc.
John Donaldson
Chief, Standards Code and Information Program
National Institute of Standards and Technology
Helen Donoghue
First Secretary
Washington Delegation of the European Commission
Anita Drummond
American Council of Independent Laboratories
Lester F. Eastwood
Director, Standards Strategy
Motorola, Inc.
Williams Edmunds
Manager, Codes and Standards
Owens Corning Fiberglas
George L. Edwards
President
Alliance for Telecommunications Industry Solutions
Thomas Ehrgood
International Trade Counsel
Digital Equipment Corporation
Fara Faramarzpour
Director
Office of Strategic Standardization
Polaroid Corporation
Wendell Fletcher
Senior Associate
Office of Technology Assessment
Thomas B. Fowler
Principal Engineer
The MITRE Corporation
Kim Frankena
Chief, Major Trading Nations Branch
U.S. International Trade Commission
James French
Director of Standards
American Institute of Aeronautics and Astronautics
Louis Geoffrion
Manager, Corporate Quality Assurance
Raytheon Company
Richard B. Gibson
Technical Standards Director
AT&T Bell Laboratories
Neal Goldenberg
U.S. Department of Energy
Melvin R. Green
Associate Executive Director, Codes and Standards
American Society of Mechanical Engineers
Alf S. Gunnersen
Associate Technical Director
The MITRE Corporation
Joseph K. Haeglin
General Manager, Central Engineering and Purchasing
Texaco Inc.
William F. Hanrahan
Senior Director
Computer and Business Equipment Manufacturers Association
William Hendrickson
Senior Editor
Issues in Science and Technology
Robert J. Hermann
Senior Vice President, Science and Technology
United Technologies Corporation
Peter L.M. Heydemann
Director, Technology Services
National Institute of Standards and Technology
Derek Holden
Vice President, Industry and Government Relations Market Development
Owens Corning Fiberglas Corporation
Virginia A. Huth
Office of Management and Budget
Executive Office of the President
Charles W. Hyer
Editor/Publisher
The Marley Organization, Inc.
Brian Kahin
Director, Information and Infrastructure Project
Science, Technology and Public Policy Program
John F. Kennedy School of Government
Harvard University
Sheldon Kimmel
U.S. Department of Justice
Louisa Kock
Program Examiner
Office of Management and Budget
Roy E. Lancraft
Division Manager
United Parcel Service
Holly Lawe
Senior Research Associate
Georgia Institute of Technology
Center for International Standards and Quality
Mary Anne Lawler
Director of Standards Relations
IBM Corporation
William Lehr
Assistant Professor
Graduate School of Business
Columbia University
Walter G. Leight
Deputy Director, Office of Standards Services
National Institute of Standards and Technology
Richard Liebhaber
Chief Strategy and Technology Officer
MCI Communications Corporation
Henry Line
Director, Global Products Standards
AMP Incorporated
John W. Locke
President
American Association for Laboratory Accreditation
Charles Ludolph
Director
Office of European Communities Affairs
U.S. Department of Commerce
Mark Mahaney
Council on Competitiveness
William A. Maxwell
Director, Government Relations
Convex Computer Corporation
Leroy M. May
Senior Staff Member and Standards Consultant
AT&T
Sergio Mazza
President
American National Standards Institute
Nina I. McClelland
Chairman, President, and Chief Executive Officer
NSF International
Mary McKiel
National Coordinator, EPA Standards Networks
Office of Pollution Prevention and Toxics
U.S. Environmental Protection Agency
Barbara McLennan
Staff Vice President, Government and Legal Affairs
Electronic Industries Association
Kenneth McLennan
President
Manufacturers' Alliance for Productivity and Innovation
Richard Meier
Deputy Assistant U.S. Trade Representative for GATT Affairs
Office of the U.S. Trade Representative
Michael J. Miller
President
Association for the Advancement of Medical Instrumentation
Thomas P. Monkus
Compliance Officer, Director QA/RA
Medical High Technology
International, Inc.
Keith A. Mowry
Manager, Governmental Affairs
Underwriters Laboratories, Inc.
Robert W. Noth
Manager, Engineering Standards
Deere & Company
Stephen Oksala
Director, Corporate Standards
Unisys Corporation
Anthony R. O'Neill
Chairman of the Board
American National Standards Institute
J. Paul Oxer
Executive Assistant to the President
Ecology and Environment, Inc.
John P. Palafoutas
Director of Federal Relations
AMP Incorporated
Bernard J. Phillips
Head of the Competition and Consumer Policy Division
Organization for Economic Cooperation and Development
Herbert Phillips
Vice President, Engineering
Air-Conditioning and Refrigeration Institute
Kyle Pitsor
Manager, Energy and Trade
National Electrical Manufacturers Association
George Porter
Quality Systems Manager
ISO 9000
Roche Pharmaceuticals
Hoffmann-La Roche Inc.
Joseph Potts
Director
Technical Support Group
GTE Laboratories
Ernest H. Preeg
William M. School Chair in International Business
Center for Strategic and International Studies
Colleen Preston
Deputy Under Secretary for Acquisition Reform
U.S. Department of Defense
Victoria Curzon-Price
Professor of Economics
University of Geneva
Anne Rafferty
Economist
U.S. Department of State
Kim Ritchie
AVX Corporation
Sadi Ubaldo Rife
Counselor, Science & Technology Attache
Embassy of Argentina
Lloyd Rodenbaugh
Promega
Richard Rounsevelle
Chief, Recreational Boating Product Assurance
U.S. Coast Guard
Deborah Rudolph
Manager, Technology Policy
Institute of Electrical and Electronics Engineers - USA
William A. Ruh
Associate Technical Director
The MITRE Corporation
Francine Salamone
Associate Director, Medical Operations
International Pharmaceuticals Group
Pfizer Inc.
Andrew Salem
Staff Director
Institute of Electrical and Electronics Engineers
Gregory E. Saunders
Acting Director for Manufacturing Modernization
Office of the Secretary of Defense
U.S. Department of Defense
Mary H. Saunders
Assistant to the Director
Office of Standards Services
National Institute of Standards and Technology
Jane W. Schweiker
Director of Government and Organization Relations
American National Standards Institute
C. Ronald Simpkins
Manager, Corporate Engineering Standards
E.I. DuPont DeNemours & Company
Anna Slomovic
Senior Policy Analyst
Rand Critical Technologies Institute
Oliver Smoot
Executive Vice President
Computer and Business Equipment
Manufacturers Association
Carlos Souto
Industrial Scientific Counselor
Embassy of Portugal
Michael B. Spring
Assistant Professor
Department of Information Science
University of Pittsburg
David Stanger
Secretary General
European Organization for Testing and Certification
Steve Stewart
Program Administrator, Public Affairs Telecommunications
IBM Corporation
Gene Strull
Consultant
Westinghouse
Marty Sullivan
Director, Standards
Bellcore
Audrey Talley
Office of Food Safety and Technical Services, Foreign Agriculture Service, ITP
U.S. Department of Agriculture
John C. Tao
Director, EH&S
Audits Department
Air Products & Chemicals, Inc.
Keith B. Termaat
Executive Engineer, Engineering Materials and Standards
Ford Motor Company
James Thomas
President
American Society for Testing and Materials
Marie Thursby
Professor and Director
Center for International Business Education and Research
Purdue University
Maria Tilves-Aguilera
Manager, Government Relations
Northern Telecom, Inc.
Robert Toth
President
R.B. Toth Associates
Suzanne Troje
Director, Technical Trade Barriers
Office of the U.S. Trade Representative
Executive Office of the President
Francis J. Turpin
Director
Office of International Harmonization
National Highway Traffic Safety Administration
U.S. Department of Transportation
Debra H. van Opstal
Fellow in Science and Technology
Political-Military Studies Program
Center for Strategic and International Studies
Jerrold L. Wagener
Senior Technical Consultant
Amoco Production Company
Caroline Wagner
Senior Analyst
Rand Corporation
William G. Wagner
Technical Standards Division Manager
Society of Automotive Engineers
David Walters
Acting Assistant U.S. Trade Representative for Economic Affairs and Chief Economist
Office of the U.S. Trade Representative
Executive Office of the President
Les Weinstein
Attorney
U.S. Food and Drug Administration
Martin Weiss
Assistant Professor
University of Pittsburgh
Fritz Whittington
Texas Instruments
Fred H. Williamson
Director, Imaging Technology Policy
Eastman Kodak Company
George T. Willingmyre
Vice President
Washington Operations
American National Standards Institute
Mel Woinsky
Senior Manager, Technical Industry Standards
Northern Telecom Inc.
Dorothy Zolandz
National Institute of Standards and Technology
Joseph F. Zimmer
Deputy Associate Administrator
Office of Management and Budget
Joseph S. Zajaczkowski
Staff Consultant
Standards Coordination
Storage Technology Corp.
International Standards, Conformity Assessment, and U.S. Trade Policy Project Committee (attending)
Gary Hufbauer, Chairman
Senior Fellow
Institute for International Economics
Stanley Besen
Vice President
Charles River Associates
Dennis Chamot
Associate Executive Director
Commission on Engineering and Technical Systems
National Research Council
Leonard Frier
President
MET Laboratories
Steven R. Hix
Chairman
In Focus Systems
Ivor N. Knight
Vice President, Business Technology and Standards
COMSAT World Systems
Gerald H. Ritterbusch
Manager of Product Safety and Environmental Control
Caterpillar, Inc.
Richard J. Schulte
Senior Vice President, Laboratories
American Gas Association
Lawrence Wills
IBM Director of Standards
IBM Corporation
Academy Complex
Stephen A. Merrill
Executive Director
Board on Science, Technology, and Economic Policy and
Director, Academy Industry Program
Lois Perrolle
Associate Director
Academy Industry Program
Daniel LaRue Gross
Staff Associate
Academy Industry Program
Shirley Cole
Administrative Assistant
Academy Industry Program
John S. Wilson
Project Director
International Standards, Conformity Assessment, and U.S. Trade Policy Project
Board on Science, Technology and Economic Policy
National Research Council
John M. Godfrey
Research Associate
International Standards, Conformity Assessment, and U.S. Trade Policy Project
Board on Science, Technology and Economic Policy
National Research Council
Patrick P. Sevcik
Project Assistant
International Standards, Conformity Assessment, and U.S. Trade Policy Project
Board on Science, Technology and Economic Policy
National Research Council
This page in the original is blank. |