EU raises doubt over US trade deal

The high hopes that greeted a transatlantic trade deal ostensibly ending a dispute over online gambling have been almost immediately dashed by a look at the small print.

The European Union last week hailed an agreement with Washington to open up its warehousing, courier and testing service sector as compensation for closing the online gaming market to foreign companies last year.

The Office of the US Trade Representative (USTR) said the US Postal Service had allowed foreign competitors to handle overseas mail for 20 years. All it was doing was making the decision legally binding so it could not be reversed. Sensitive sectors such as domestic delivery and storage at ports and airports would remain closed.

“There will be no effect on the terms of competition and no supplier of such delivery services will receive any advantage,” said spokeswoman Susan Schwab, the day after the deal. It would not involve “any change in US law and practice”.

An official added that this had “real value” and the EU agreed. “It gives the sector legal certainty. There is real value in binding the commitments,” said a spokesman for Peter Mandelson, the EU trade commissioner.

However, company officials and their lobbyists on both sides of the Atlantic are not so sure. “To us, this market was already liberalised and we have been operating in it for many years. It is too early to evaluate what long-term benefits this decision would have,” said a spokesman for the German courier.

TNT, the Dutch operator that has a 1 per cent hold in the US market, said: “De facto nothing really changes although current affairs are legally better backed through the WTO.”

Market leader UPS declined to comment. “We’re looking into the details,” FedEx spokesman Howard Clabo said.

A USTR official said it was “a rebalancing of legal commitments”. Nao Matsukata, a former USTR official who is now policy adviser at Alston & Bird, the law firm, said his old office appeared to be attempting to stop short of legal changes that would require congressional sanction. “If they have agreed legally binding commitments that must have the approval of Congress as they do not have fast-track authority. I would expect to see congressional leaders taking a look at this,” he said. His firm works for a financial services company with interest in the case.

World Trade Organisation officials said that it was up to the US and trading partners to agree adequate compensation between them. Washington would then notify the WTO of changes to US services commitments.

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