LAST UPDATED:May 8, 2013
(more webinars coming soon)
Regulating Risk in the EU: Science, Policy and Precaution
Check the Questions and Answers here.
Table of Contents:
What is Risk Regulation?
The European Union and the Risk Paradox
How to define Risk Regulation in the EU?
Risk Assessment, the Risk Management and the Risk Communication
Story no.1: Reinheitsgebot, Risk and Mutual Recognition
Story no. 2: Bisphenol A in baby bottles: EFSA, FDA, Canada
The Precautionary Principle and Innovation
The future of risk regulation
Recommendations for EU policy makers
Impact Assessment in regulatory issues
Questions from participants of the live session
Regulating Risk in the EU: Science, Policy and Precaution Transcript
Please note that the following transcript has been edited to make reading easier and may slightly differ from what was said in the webinar recording. Disclaimer: We aim to ensure a high level of accuracy, but the webinar and the transcript are for information purposes only and they cannot be considered as legally binding.
Speaker: Alberto Alemanno (moderator: András Baneth)
Today’s topic concerns Risk Regulation in the European Union: Sectors, Advocacy and the Precautionary Principle.
Regarding the speaker and regarding the organizer, just a few words on Prof. Alberto Alemanno who is a Jean Monnet Professor of EU Law & Risk Regulation at HEC Paris, which is one of the top business schools in Europe.He is an Adjunct Professor of Law at Georgetown Law School in Washington, DC. Alberto has extensive experience in Risk Regulation, EU Law, and related matters so he will be very happy to share all these insights and knowledge from both sides of the Atlantic, not just the European perspective.
My name is András Baneth, I am the Director of the European Training Academy: we deal with training courses on European Union affairs, training courses which are practical and to the point, less academic and much more for the practitioner’s mindset.
A course that I would like to call your attention to is coming up on the 16 May and could be relevant also for those interested in Risk Regulation. It’s on Impact Assessment and the New Comitology.
This is the point where I hand it over to Alberto.
Thank you to you, András. Hello everyone, wherever you are. I am very glad to be here with you today. This is Alberto Alemanno. I don’t have the chance to see you all but if you were in a room, well, it would be a fully packed room. So it is very exciting to talk to you today and as you know the aim of today’s presentation is to provide you a sort of overview of the emerging area of European law that we tend to call Risk Regulation. The topics I would like to touch upon are Science, Policy and Precaution.
Let me start from a very provocative statement. In order to make sure that everybody get a grasp of the complexity and the important context in which Risk Regulation is developing today. And my statement is that “Today we live in very strange times”. Why so? Because the world has never been a safer place. All life chance indicators seem to suggest that we are healthier, we live longer, we are physically bigger and we tend to be smarter and even wealthier than our ancestors. But this doesn’t mean that humans are feeling okay with themselves. We have never been actually so fearful about, for instance, injury or disease, but also, death.
The phenomenon I’m describing to you has been defined by many sociologists over the last 20 years as the ‘Risk Paradox’. There’s clearly a tension between the life chance indicator suggesting how safe and better off we are and our increased fear.
The phenomenon of fear is translating into what very often I call the ‘fear of the month’, or sometimes the ‘fear of week’ or sometimes even the ‘fear of the day’. And these are the typical fears that are triggered by the publication of some scientific studies, sometimes are picked up by some NGOs, by some consumer groups and sometimes they are even fuelled by the industry. And these are the classic questions we’ve been facing over the last weeks, months and years. The question whether cell phones may cause brain cancer, whether the WIFI, internet connection may somehow cause adverse effects… so forth and so on. You certainly know about the controversy which is still revolving around the issue of GMOs, the issue of Nanotechnologies and we will be mentioning many more during the presentation.
If this is the world in which we live, certainly innovation today is somehow faced by the way in which the regulation of risk happens and occurs. Very often the attempt of governments to regulate these emerging fears and emerging risks give rise to Protectionism and they may in the long run also somehow affect negatively growth and certainly economic growth today is partly affected also by our approach towards emerging risk.
What I propose to do during the next few minutes is to have a look at how the European Union has been addressing what we call the ‘Risk Paradox’. How the European Union has been developing over time several forms of Regulating Risks.
The first question I would like to address with you is why actually the European Union has been increasingly engaging with the issue of risk and has been attempt at somehow regulating risk.
So let me start from here. From a very open introduction to Risk Regulation and by basically saying that today working, but also travelling, communicating, eating and drinking, but even breathing are all activities which are largely governed by the European Union.
If you look at the law which is currently into force in each European Member State, it can be France, it can be in Germany, well we know that the vast majority of those laws and regulations do not come from their national capitals, meaning Paris or Berlin, but they actually are decided in Brussels through the decision making process of the European Union.
If we focus just on the European portion of national legislation, half of it is dominated by what I call Risk Regulation. These have affected European Law regulating risk, substances and activity, and this has been growing over the years.
How do I define Risk Regulation? These are regulations which are basically aimed at the protection of public health, safety and the environment. It is a broad definition which enables us to look and ask ourselves which have been the drivers leading the European Union to regulate those specific areas which are becoming more and more important, making headlines and coming under the scrutiny of public attention.
The first driver, as most of you certainly know, has been the creation of an internal market in the European Union. At the same time, if you want to create an internal market for specific substances and products like pharmaceuticals or chemicals or also food, well, it is pretty clear that you need to create their conditions for making sure that all these products do circulate freely in Europe and you know that to do so, we need to make sure they’re safe. At the same time, besides the internal market, push towards the European Union engaging more on risk activities, we also witnessed what we call ‘Consumer Expectations’: the European consumers no longer look only at their national capitals in order to have their safety somehow guaranteed or taken care of but also at the European Union itself.
The food crises of the 90s certainly have exacerbated consumer expectations towards the EU. These have been not only consistent in the classic mad cow disease but also the several Dioxine scandals that have erupted over the 90s in Perrier water, in poultry and many other crops.
As you know these food crises have led the Santer Commission back in 1999 to step down, and that certainly led to many institutional changes enabling the European Union to be more effective and more credible and certainly more trustworthy in its relationship towards the regulation of risk.
And at the same time, the enlargement process has also played the role in pushing the European Union to play a more significant part in the regulation of risk.
It is on the basis of these elements that comes my argument. And my argument says that today European Risk Regulation is not only big from a quantitative perspective. We saw how important European Risk Regulations are within European law as such. But risk regulation is also unique. It is unique because of several features.
It is fortuitous, meaning that our founding fathers never expected us being here today discussing about the role of the European Union in regulating risks stemming from pharmaceutical or Nanotechnologies or food products.
It is also embedded because of today guaranteeing safety within the internal market has become one of the pre-requisites for the functioning of the same market.
It is also necessary because since the entering to force of the Lisbon Treaty, the wellbeing of the people today is one of the objectives pursued by the European Union. It is certainly an area characterized by complexity. We have been witnessing over the last 20 years a mushrooming of new European agencies which have been established by the European Union across the EU. And at the same time, we have many other actors which certainly play a role. The agencies tend to provide the expertise to the policy making process but then we have the European institutions and we have many other actors which we tend to define under the label of civil society who also play a significant role in the regulation of risk.
Regulating Risk in Europe is also a highly technocratic exercise and this could not come as a surprise to all those of you who have been following the European integration process over the years. And this is certainly epitomized by the European Union when it embraced the classic Risk Analysis Framework developed on the other side of the Atlantic in the 80s in order to frame the regulation of risk through the classic distinction existing between the Risk Assessment, the Risk Management and the Risk Communication.
As you may know these are three very different steps. The Risk Assessment tends to be dominated by sciences. What we tend to call Risk Sciences, such as Toxicology, Epidemiology all using Statistical Analysis, all the sciences provide an answer about the safety of a particular product. They identify a particular hazard, they characterize it and then they will provide an answer, which is useful for the risk managers to take decisions upon those results. And throughout the old process is increasingly important and that the Risk Analysis Framework to provide to the public information about the outcome of the Risk Assessment and the final outcome of the Risk Management.
I will be providing you several examples about this during my presentation. Risk Regulation is a scenario that is highly contentious. It is contentious because there are several ways in which we can regulate risk. We can focus on perceived risk. What people believe and feel, this can be a certain phenomenon or we can just focus on the real risk, the results that stemfrom the analysis made by the scientist. We can focus on the harm or the actual damage or we can focus on the simple hazard, the potential, the potentiality of a particular substance to cause adverse effects.
At the same time, Risk Regulation in Europe is a shared phenomenon. Why? Because we have both the European Union and the Member States who are competent about regulating risk: this is a typical shared area of competence; public health, consumer protection and, of course, the internal market.
At the same time, Risk Regulation is an ongoing activity. There’s no week in which a decision is not taken about the placing into the market of a new substance or a withdrawal from the market of a particular substance, as it seems to be the case for Neonix. This pesticide, which has been used for several years and now the European Commission decided, without having a majority of the Member States supporting such a decision, to withdraw those substances in the name of the precautionary principle. So Risk Regulation is by definition work in progress.
At the same time, Risk Regulation is also global in scope as it has been witnessed by the many disputes thatwere triggeredby the European Union Risk Regulatory decisions over the last few years within the framework of the WTO – World Trade Organization.
Finally, Risk Regulation also provides an opportunity for the European Union to gain some credibility and perhaps popularity among the European citizens. In other words, if the European Union gets it right and it pursues its high level of protection as stated by the Lisbon Treaty, well, you will have the chance to gain more credibility about its effectiveness.
This is the end of the first part of my presentation. I want to give you some background on how Risk Regulation has been evolving over the years but I think that in order to be more effective and in order to make sure that you will somehow remember what we’ve been discussing together today; I would like to share with you two stories. And these two stories are probably well-known to you but it is important to tackle those stories from a risk angle in order to get that full grasp of the potentiality of risk regulation in the European Union.
The first story looks at the past. It is certainly a European story whose title is Reinheitsgebot. Reinheitsgebot, as many of you know, are regulations concerning the production of beer in Germany, which dates back to the 16th century. It was enacted by William IV and according to Reinheitsgebot, the only ingredients that you could use in the production of beer were water, barley and hops. And that means that there was no possibility to call a product “beer” if that product contains other ingredients, such as additives.
The big question that arose back in the ‘70s was to what extent Belgian beers or UK beers, beers that by definition contain more ingredients than those allowed under Reinheitsgebot, could be marketed in Germany. And the answer to that question was pretty simple: as a result of the entry into force of this regulation, in the application of Reinheitsgebot to imported beers, well, those products could not gain market access into Germany.
The European Commission a master of the Treaty, as you all know, decided to bring Germany in front of the European Court of Justice by somehow challenging the legality of this regulation under European law. And the big question faced in the Court, as it is often the case even today, is whether we were facing an instance of protectionism or whether we are facing a situation of genuine consumer protection.
The German authorities tried to develop an argument which is a very much a science-based argument, the risk-based argument. They basically suggested that given the high consumption of beer by Germans (n.b. that’s exactly what they argued), well, there was a need to ban the additives to reduce the consumer’s overall exposure in their diets.
The answer of the Court despite this attempt of the German government to make scientific regulation was to say, ‘Well, we don’t buy this.’
We don’t buy this argument because it sounds absolutely inconsistent and somehow disproportionate. The additives that you are banning in beers are actually allowed in other products like cheese. Why should we accept such a regulation?
In any event, this regulation clashes against the principle of mutual recognition under which ‘once the product has been legally marketed in producing in one country, let’s say Belgium, that product should be accepted by the hosting country, meaning Germany’. Unless their country can show that their level of protection that they want to assure in their own country is certainly not assured by the legislation of the exporting country, in other words, there’s no equivalence.
Well, the lesson learned from this story is pretty clear. Historically, European law has been focusing on the free movement imperative but not really on public health goals, so the European Court inevitably had to prioritize the free trade imperative over the public health reasons that the German government has been somehow invoking. This according to many is the original “sin” of European integration.
Science has been invoked often as an anti-protectionist tool. The same European Court of Justice, certainly not the European legislator, has been pushing for leading the Member States to bring evidence in order to substantiate their claims and their national risk regulations. And we’ve seen how this kind of approach found its way through risk regulation today.
Let’s have a look at the second story. The second story makes a shift through time and we look at the case study, which is very much an issue of today. It is a global food regulation story, a risk regulation story that is keeping busy not only the European Union but also the entire world. We’re talking about Bisphenol A. We’re talking about the chemical substance which tends to be used in very tiny amounts in the production of polycarbonate bottles and also in epoxy resins of food cans. So it is used and used to be used in baby bottles, but also in the epoxy resins in the linings in food cans, in plastic bottles and in many other products, which tend to be used regularly in our daily life.
Well, as you might have heard, there is a concern, an emerging concern about the possibility that this chemical product, which is used in their container, may somehow migrate, may leak from the container itself into the liquid, into the food which is contained in it.
Let’s have a look at the science. What the science is asking is to what extent this migration may actually occur and to what extent this may lead to adverse effects? We can say that virtually all food safety bodies across the globe are looking at this food content material, and they have been suggesting that there’s no risk to human health at the current exposure rates. But we’ve been witnessing an emergence of new studies over the years suggesting that there might be some concerns, so the US Food and Drug Administration (FDA), after Canada, was the second agency in the world to recognize those possible concerns and have expressed a sort of “amber light” to the decision makers.
The European Food Safety Authority (EFSA), the FDA counterpart, only a couple of years ago said, by looking at exactly the same evidence that did not consider the currently available data as convincing evidence, suggested to somehow change our old regulation on Bisphenol A, so the green light given by EFSA was addressed by the Commission’s services and our current rule set to decide whether to keep the substance in the market or not.
Let’s have a look at the law. How scientific evidence we just examined was integrated into the policy making process. If you look at the United States, the FDA, despite the amber light, decided at the very beginning of this re-examination process to keep the substance in the market and to somehow support the industry in shifting towards possible alternative to this particular substance. And finally, recently only around a year ago, the American Chemistry Council, meaning the trade association which is supporting the chemical industry, has been asking through a petition the FDA to finally ban the use of BPA in baby bottles because by then the chemical industry maybe got rid of this particular substance. May be an interesting outcome to observe. So we got the amber light from the scientists, we got the green light from the FDA and finally a red light on BPA using baby bottles, upon demand of the industry itself.
What about the rest of the world? Well, Canada has been the first mover in banning BPA in baby bottles and in taking an active stance against the use of the substance, followed by some individual states in the US like Minnesota, New Hampshire, the City of Chicago and many others.
And what about the European Union? As it is often the case where we’ve been witnessing a phenomenon that is often called a “California effect”, where some individual states like Denmark, France and Belgium have been taking action at the national level: restricting measures towards the use of BPA. And this has inevitably led the European Union to take a stand either in favor or against these national measures. And finally, in January 2011, the European Union decided to embrace a ban on the use of BPA in baby bottles.
I insist that the focus has been on baby bottles only. That means that basically BPA today is still allowed in all other food content materials in the European Union. However, things are getting bit complicated because France decided to move to a complete ban. It has already adopted the legislation suggesting that from 2015, all BPA made containers would be illegal in the French territories. This certainly represents a possible disruption for the internal market and these calls upon the European Union to decide what to do next.
In the meantime, many producers of those food containers are somehow claiming that their products are “BPA free” and they are trying to convey this message to the consumer possibly to capture their willingness to pay higher prices for BPA free products.
The big question once more is about whether we are witnessing an instance of protectionism or consumer protection. That’s exactly where the science and the law of Bisphenol A stand today.
Which are the lessons learned? Well, the BPA case really epitomizes a dilemma on whether the risk regulator should follow rationality and scientific truth or should rather follow public knowledge, trying to reconcile these two perspectives. While we make this choice very often, we tend to overlook their trade-off existing between the benefits and the risks. And also what we call the risks versus the risks trade-offs. You know the words “precautionary approach”, which does not necessarily tell us what is best because the focus is on the hazard, the possible negative consequences stemming from the use of a substance.
As we know, the precautionary principle tends to be sometimes biased against innovation, as it prioritizes protection. In particular in this case, it tends to overlook the benefits versus the risks, meaning that the BPA use since the 1930s has been providing also some advantages that need to be taken into account. There are some virtues that are not necessary taken into account. What is probably even more of interest and more critical is that if we switch from a substance to an alternative substance, very often we do not necessarily know which are the risks this new substance somehow entails. By doing so, very often we got the impression that we believe in a world dominated by a zero risk approach, and perhaps we can in the long run stifle innovation.
I’m also suggesting that the precautionary principles systematically lead us to make this possible mistake, but unfortunately the precautionary principle as such does not enable us to put onto the larger screen all the possible elements that we should take into account when making difficult trade-offs.
To sum up, the first story, Reinheitsgebot, told us about the Genesis – the evolution of risk regulation in the European Union, whereas the second story told us about the Genesis and evolution of global risk regulation, by showing how the European decisions may have an impact on other jurisdictions and how the European Union itself is somehow affected by the decisions taken in other countries.
It is pretty clear we can easily predict that there are some tough decisions ahead for the European risk regulators and these do not only focus on our old, difficult and tough questions revolving around genetically modified organisms (GMOs).
As you know we currently witness a sort of impasse on how we should better regulate and do justice to the complexities of GMO agriculture, but also Nanotechnologies for which the European legislator has decided deliberately not to adopt a ban like in the GMO sector, but an ad hoc regime, rather saying that “we should apply the different regulator regimes stemming from chemicals or for food and apply them into different applications, such as Nano applications”.
But also the challenges stemming from the use of veterinary drops like Ractopamine, which is used in reproduction. As you may know, the European Union has been banning the use of this substance despite the fact that Codex Alimentarius accepts it. The world is divided over this issue. The European Union, supported by China and Russia, and in the past also Taiwan, has been supporting a ban in the restriction of drugs, based on animal welfare grounds and possibly also on public health grounds.
Another big challenge for the EU is to decide how to regulate possibly the food coming from offsprings of cloned animals, and the new debate is very much linked to lab grown meat: this idea of growing meat in laboratories. All these issues have not been regulated but of course they are discussed, they raise significant scientific issues, but of course also ethical issues that have to be taken into account by the European legislator.
As I already anticipated, one of the most controversial decisions taken by the EU is not a law yet, but it has been anticipated by the European Commissioner in charge, Mr. Borg. It is a decision that will ban from use in the European market the most widely used pesticides in the world, which are called Neonicotinoids or Neonics for short. Their concern, which is partly supported by emerging scientific evidence, is that the use of those substances would be responsible or is one of the responsible factors for the decrease in the number of bees around the world.
Let’s have a look at the future and let’s try to be proactive by providing some possible recommendations on how the EU can get it right.
The first suggestion I have for the European legislator is to possibly adapt a more credible science-based policy making. That means that we should certainly rely on the scientific expertise coming from our agencies but we certainly have to make sure that the way which this scientific expertise is integrated into the decision making process becomes more transparent and more participatory for all stakeholders involved.
A positive sign has been the appointment for the first time of a Chief Scientist in Europe ,so President Barrosso around one year ago appointed Anne Glover as Chief Scientific Adviser. Certainly one of the jobs, one of the tasks within the mandate of Anne will be to somehow re-order or to organize the way in which science is producing European legislation and how it is integrated into the European decisions and policy making process.
Second advice I have for the European Union when regulating risk is to pay more attention to how risks are communicated to the public. As I’ve mentioned in the very beginning of the presentation, we too often witness the phenomenon of risk of the month. Too often we have new studies which are published very quickly, which are miscommunicated to the public that they trigger high concern, which sometimes are not entirely justified by the size of that particular study. We need to become more sophisticated in the way which we communicate the science. We need to become more sophisticated in which we make sure that our media convey the message to the public in order to make sure that our resources will be used and focused on the real risk that really caused the most concern and where our efforts can save more lives rather than least lives.
Media certainly has a role to play. I don’t have time to tell you more but of course I would be glad to tell you more about this particular issue of media involvement in risk communication.
Finally, I would like to advise the EU to make sure that public participation in science-based policy making become more effective and there should be a discussion. This is not taking place in Europe at the moment, the opportunity to allow stakeholders, meaning the industry on the one side, the consumer protection and the NGOs on the other side, and possibly the overall society to consult and to actually have the possibility to provide advice on the publication of a draft scientific opinion. This is something that EFSA or ECA (European Court of Auditors) do not currently do. Most of the agencies they work with are very serious on the production of science. They sometimes consult the public during the process, but they tend to publish the very final outcome of their scientific opinion without engaging, without providing feedback and allowing anybody in the public also outside of the EU to have a say. This is the current practice in many jurisdictions. This is something the European Union should do more often and with more commitment.
One of the privileged tools to ensure that the above goals are actually attained by the European Union is certainly Impact Assessment. As you know, since 2002, the European Union took the commitment to analyze prospectively, meaning before a rule actually enters into force, which are the social, environmental and economic consequences stemming from such a rule. In doing so, the European Union services, not only the Commission services, have to identify what is the problem. The problem might be that BPA, which is a substance called Bisphenol-A, may today produce some adverse effect, so how can we solve such an issue? Are there some alternatives available, which are the possible options that can be taken? Should we go for a ban? Should we go for a labeling? Should we provide more research funding to the industry in order to identify alternatives? Well, this is the kind of discussion that the European Commission usually undertakes when engaging into an Impact Assessment. And in doing so, the Commission has to stick to the Impact Assessment Guidelines that somehow procedualized its own activity.
Well, the big challenge today is to make sure that this kind of approach, this kind of perspective analyses the impact of possible rules that will be based on the legislative acts. There are only 60-70 such legislative acts adopted per year, “policy” acts adopted every year by the EU. However, under the so-called non-legislative acts, which in the past used to be called “Comitology” items, there are almost 2000 such acts each year. This is an important difference existing between the 60-70 legislative acts (regulations and directives) adopted by co-decision by the legislator (European Parliament and Council), and the incredibly important number of decisions taken under what we call “new Comitology”.
The big challenge, of course, is to make sure that Impact Assessment is going to play a major role not only in legislative acts but also in non-legislative acts (regulatory decisions). I do believe that if this is going to happen, well this would certainly facilitate our ongoing discussions between the United States and Europe regarding the possibility to establish for the first time a Transatlantic Market, the TTIP (the Transatlantic Trade and Investment Partnership), a future international agreement that may boost the trade exchanges existing across the Atlantic.
Finally, I am coming to the end of talking about Risk Regulation. Regulations, and not only curative medicines like pharmaceutical products and doctors, may save lives since regulations have a role to play in reducing risks and save lives. In doing so, we have to be very open minded, very creative in trying to account as many instances as possible.
What can be the consequences on EU Risk Regulation after the new EU-US trade deal negotiations were complete?
That’s a wonderful question. Certainly, there’s a lot of excitement for the first time about the possibility of somehow boosting trade across the Atlantic through the adoption of such TTIP and as you may know, since you have been taking this webinar, is that one of the most sensitive issues we left to be tackled by the United States and by the European Commission will be how to regulate risks across the Atlantic.
What kind of possible standards we can adopt? And there we already have the paths which are somehow sketched out by the SPS agreement which basically says that countries around the world are encouraged to rely on mutual recognition agreement. So, ideally what the TTIP should try to bring about would be the conclusion of mutual recognition agreements enabling US products to comply with EU standards and to be placed into the European market.
We are all of course pretty realistic on this and we know that agreeing substantive standards might be difficult. That’s why the same SPS agreement tells us that sometimes mutual recognition agreements can have as their objects not only substantive standards but simply the results of the conformity assessment procedures which are conducted in the respective country.
To give you an example, we can imagine a situation in which US products would be tested against the European standards before being exported to the EU, so that we won’t have to test this product again as it is actually the case when it is being exported into the EU. So there might be some saving through conformity assessment procedures. But of course, which are the consequences, this is your real question within your question: the consequence might be to save a lot of ‘red tape’ to make sure that we are going to agree on some an appropriate level of protection in certain areas like the pharmaceutical sector or the food safety sectors, and these of course could bring significant gains in terms of GDP. There are lots of studies quantifying and trying to quantify how much our respective GDP could grow as a result of this kind of agreement.
How can we be sure that the agencies conducting the studies do not serve certain interest groups?
Wonderful! This is one of the hot topics in European Risk Regulation. Many agencies, starting from the European Medicines Agency, and going all the way to the European Food Safety Authority, have been facing growing concerns and also criticisms of sometimes ‘not being independent’ in the way which they produce science.
So this is certainly a timely issue that we have to discuss. I think there’s a very important methodological premise that we have to make: very often, most of those criticisms do not necessarily affect the way in which the science has been used, meaning that the scientists who attend those panels have been checked against possible conflict of interest.
We do not have very often a real conflict of interest stemming, let’s say, from the participation of a Monsanto employee in an EFSA panel, deciding on GMOs. This is certainly a situation that never occurs.
So we are not talking about this. What we are talking about very often when we discuss about these criticisms are situations in which we have a perceived lack of independence, meaning that the public perceive an Agency as independent because of some circumstances surrounding the functioning of the agency. So in our current European Risk Regulation system it is the industry that provides the science that enables the legislator to decide whether a substance should be placed into the market or not, is very often perceived as somehow weakening the independence of the body.
Overall, I think that the European agencies, especially EFSA, has been doing a lot of work to improve and ensure the independence of its own scientific body. Certainly EFSA is the most scientific and it has the most sophisticated independence policy and it has to be praised for this. All the perceptions regarding the lack of independence should be dealt with a more effective communications strategy by the European institutions themselves.
Could you please give us some example of non-legislative acts the EU passes?
Absolutely. When we look at the words “non-legislative acts”, we basically have to think about the significant number of measures that basically provide details to the general rules in regulations or directives, sometimes even in decisions. The classic example I think might be the GMO regime, where we have directives establishing the way in which a GMO may be placed into the market.
This is the legislative act, what we call the GMO regime, and then we have the individual decision which determines whether a particular GMO should be or cannot be placed into the market. These individual decisions are non-legislative acts.
Other examples might be the labels present today in electronic appliances. These are green labels; they provide the consumers information about how much electricity, how much energy is needed to make the machine work. Other examples are the images that appear on the tobacco packs. Well, these images are decided through “non-legislative acts”, not through legislative acts. I would be glad of course to provide more examples but I think we have to move to the next question.
Could you please give more details about the hierarchy between the social, environment and economic impact when applying the impact assessment procedure?
Wonderful question. This is a methodological question that is very important when performing an impact assessment. When we look at the way in which the European impact assessment system has emerged and developed in the European Union, well, we can say that this is a very sophisticated system, it’s very ambitious, unlike other systems like the American one. In the EU we do not only look at the economic impact of the rule, we also try to integrate as much as possible the environmental impact and the social impact. Why we can afford to do so? Why the economic, social and environmental impacts are basically on the same level? Why there’s no hierarchy? So this is the answer to your question. There’s no hierarchy.
Why we can afford this? We can afford this because in the EU, unlike the US, there’s no duty (obligation) imposed on the European legislator to propose a rule only when the benefits stemming from that rule outweigh its cost.
Why are you only restricting risk regulation to health-related issues? What about financial regulation aimed to reduce risk to and protect public interest as well, or maybe consumer-related issues? Where should we draw the line?
I think that this is the methodological question that would probably deserve an entire workshop, an article or probably a book, but in short I can tell you that historically, when looking at the regulation of risk maybe in the United States but also in other parts of the world, there’s been a lot in common in the way in which safety, health and environmental issues have been tackled.
As soon as we open up the door towards, let’s say, non-health risks and we look at financial risk or banking risk, well, probably the tools that we need to have are different. We need to take into account a phenomenon: risk, which is basically a voluntary risk. You invest money on a voluntary basis, you engage in certain activities because you really want to.
Of course, the way in which I draw the line is subject to criticism, you can counter-argue that at the end of the day if you take a consumer perspective angle, we should also include those fields. But then again, I would like to provide you as a final answer a reflection on the methodological tools, basically we use the risk analysis framework to assess risk on safety of health and environment, whereas we use much more sophisticated tools in order to understand the risks which are usually linked to the use of a particular financial product or in the banking sector.