Europe Goes Protectionist on Global Technical Standards: The Example of “Common Specifications”
The European Union (EU), having spent years criticizing the United States for undermining the global trading system at the World Trade Organization (WTO), now has a message for the rest of the world regarding technical standards: Hold my beer.
In a bid for “digital sovereignty,” the EU wants to ignore international standards-setting processes (and related trade law) for new technologies such as artificial intelligence (AI). The EU’s theory of the case is that by setting its own standards rather than following standards developed by international organizations, it can promote European “values” in areas like data protection, cybersecurity, and ethics. But this is malarky: values are not built into standards; the EU can and is imposing its own “values” on these emerging technologies through regulations.
Instead, the logic and process reek of protectionism. By rejecting global technical standards in favor of its own alternatives, the EU is trying to give its firms an advantage over foreign competitors. The EU is not the first to succumb to this impulse. China and Japan have also tried this and suffered economic costs. Both found that in the long run, local standards make it much harder for local firms to achieve the global scale so critical for success in advanced technologies. Europe should not be surprised when it suffers similar consequences.
The EU’s new “common specifications” sound obscure and non-threatening, but they are potentially powerful tools for protectionism. A common specification is defined as “a document, other than a standard, containing technical solutions providing a means to, comply with certain requirements and obligations established under (laws/regulations).” This requirement features in recent legislation and regulations for medical devices, cybersecurity, the AI Act, machinery products, and the Data Act. For example, the AI Act specifically mentions it in the context of AI risk management and record keeping. In the Data Act it’s mentioned in relation to building interoperability of common European data spaces. When the Commission creates common specifications for these technologies, it will be mandatory for firms to abide by them to sell into the EU market.
The EU can use common specifications to override or ignore international standards when and how it sees fit. For example, it can do so when no harmonized European standard exists or if one needs revisions. They can also do so if one of the three key European standards organizations denies or delays the EU’s request to develop standards. Or if the EU simply deems the relevant international standard “unsatisfactory” or does not address European legislative requirements or the EU’s standardization request. The European Commission, at any point over the last few years, could have clarified that common specifications are a tool of last resort and that deference would be given to international standards. But it hasn’t.
The EU could easily engineer a situation to use common specifications, such as setting an unrealistically short deadline for standards or saying they are too slow. For example, the AI Act set an unworkable two-year deadline for two European standards bodies to develop a broad and complex set of (local) standards. Never mind that this tasking ignores the years of work that a joint committee of the International Standards Organization (ISO) and the International Electrotechnical Commission (IEC) has already done since 2019 on AI standards. In another case, the Commission released the standardization request for the Accessibility Act to the European Telecommunications Standards Institute (ETSI) at the last possible (legal) moment. It is virtually assured ETSI will miss the compressed legislative timelines, even though it has already spent years working on relevant standards.
The EU can do this as common specifications don’t have the critical safeguards of standards developed at international organizations—no transparency, inclusiveness, due process, or appeals mechanism. In contrast, the EU can handpick participants—who may not be technology experts but simply Commission officials—to work behind closed doors (away from scrutiny) to develop common specifications that are mandatory in the EU market. WTO members anticipated that countries could try to impose local technical specifications as trade barriers, exactly as the EU is now doing. That’s why WTO members have committed to using open, transparent, and voluntary standards. The EU and its member states are WTO members and are now violating their commitment.
International standards are an underappreciated part of how the WTO supports trade and innovation. Imagine if every country had its own Wi-Fi technology or required its own type of mobile phone to connect to its local network. That’s a world without international standards. Global trade and innovation would suffer in a fragmented system of competing national standards as firms wasted time and money developing duplicative and unnecessary product adaptions to suit multiple local standards rather than focusing on innovating and competing.
As a leading historical supporter of global technology governance, the EU is undermining the international standards system when it’s needed most for AI and other new technologies. International standards are essential in regulating these new technologies but are difficult and time-consuming to develop. How exactly do you measure AI governance, accuracy, and robustness? The EU thinks it can do a better, faster job developing standards for these things independently than through the global group of experts working on AI and other emerging tech standards.
The EU is quick to criticize the United States for undermining the WTO. But it recoils in horror and disbelief when it is called out for its hypocrisy in breaching WTO commitments on standards, cybersecurity, or data flows. The EU’s gambit differs from China’s and Japan’s failed efforts to use local technical standards as a barrier to trade because it has repeatedly said that it wants to work with the United States and others on technical standards for new and emerging technologies, including at the G7 and the EU-U.S. Trade and Technology Council. However, the EU’s actions speak louder than its words. Moreover, when the EU says it wants a strong transatlantic alliance, it mostly means it wants the American military in NATO to protect it against military aggressors because it is unwilling to spend adequately on its own defense. But that doesn’t stop it from relentlessly enacting protectionist measures against America.
The Biden administration (and other major trading partners) should push the EU to live up to its statements, abide by its WTO commitments, and support the development and use of international standards for new and emerging technologies.