In a reversal, US willing to consider financial sector regulations during European trade talks

By Sam Obenhaus

As recently as this summer, top U.S. officials were telling their European counterparts that financial sector regulations would not be included in the Transatlantic Trade and Investment Partnership (T-TIP) negotiations.  Treasury Secretary Jacob Lew and other Administration officials were eager to discuss market access issues, potentially making it easier for financial institutions to operate in both jurisdictions, but thought that financial regulatory reform should be addressed in another forum, such as the G20.  A major concern, presumably one the Administration still harbors, is that negotiations with Europe will only weaken the U.S.’s comparatively more rigorous financial regulatory system.

Nonetheless, Dan Mullaney, the U.S.’s chief negotiator, recently signaled an about-face with the U.S. now prepared to hold discussions on financial regulatory issues at a special November 27 meeting with his European counterparts.  One explanation for the shift is that the U.S. now believes that it can pull Europe closer to its position and force a compromise on its own terms.  Another explanation is the Administration is coming around to the idea that the benefits of regulatory convergence will outweigh the costs of compromise.

The Wall Street Journal has more information on Treasury Secretary Lew’s prior reluctance to include financial market regulations in the T-TIP talks while Bloomberg BNA has more on U.S. negotiators’ recent reversal.


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