Washington, D.C., March 22, 2002 — A new analysis of financial privacy and its role in trade negotiations by Competitive Enterprise Institute Senior Analyst Solveig Singleton was released this week by The Heritage Foundation. The study, Privacy as a Trade Issue: Guidelines for U.S. Trade Negotiators, explains how disagreements between the U.S. and Europe over privacy requirements threaten free trade in financial services – and what the U.S. can do to solve the problem.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
“Privacy, known in Europe as ‘data protection,’ is becoming a serious trade issue between the United States and Europe,” said Singleton.
So far the Bush Administration’s trade negotiators have resisted European pressure to force U.S. companies operating in Europe to sign restrictive and complicated data protection agreements. Opening borders to free trade has allowed companies around the world to trade and share information about market conditions and customer preferences, increasing efficiency. This increased efficiency, combined with the tradition of the free flow of information within the U.S. economy, has been a major factor in economic growth, making the Bush Administration’s position on privacy and trade especially important.
Singleton details several recommendations for the Administration in its negotiations with the European Union, particularly to support openness over the impulse to establish a “uniform” system of rules with the EU: “For both consumers and business, the U.S. regime, which favors the freedom of information, is superior. If the uniform rules follow the European model, the benefits of uniformity are likely to be outweighed by the costs of over-regulation.”Privacy as a Trade Issue: Guidelines for U.S. Trade Negotiators is available online or by calling The Heritage Foundation at 202-546-4400.
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