Draft Opening Remarks Prepared for

U.S. Secretary of Labor Elaine L. Chao

Transatlantic Economic Council

Monday, May 12, 2008

Thank you, Vice President Verheugen.

The Department of Labor recognizes that SDoC is an important issue for
the EU.  We have spent significant time meeting with EU experts on SDoC,
analyzing the SDoC system and reaching out to all interested parties.
Following last month’s meeting of the High Level Regulatory
Cooperation Forum, the Department has agreed to issue a second Request
for Information on SDoC.

As you know, one of the primary missions of the Labor Department is to
protect the health and safety of workers.  So third party approval of
electrical equipment is required before it enters the workplace.  Safety
testing is done by Nationally Recognized Testing Laboratories, or
“NRTLs.”  These requirements apply uniformly to all products,
regardless of country of origin.

Let me note that the NRTL system already has many features that
facilitate trade.  Among them are the following:

The NRTL system is open to third-party entities from any country.

The NRTL system is simple to use; there are no elaborate rules or
complicated bureaucracies governing how the system operates. 

The NRTL system has flexibilities that reduce the cost and time for
manufacturers to get their products approved.

The system relies heavily on the private sector, minimizing the need for
large government resources and regulations.

Last, and most important, the NRTL system has proven to be very
effective in ensuring the safety of products used in the workplace.

Notwithstanding this history, the Department has taken the EC’s
request very seriously and has devoted significant time analyzing the
SDoC system. 

In addition to meeting with EC representatives numerous times—most
recently on May 5th—the Department has met with many other
stakeholders to explore SDoC more fully.  These stakeholders include:

The Information Technology Industry Council 

The American National Standards Institute 

Other U.S. Government agencies, and 

Representatives from foreign and domestic testing laboratories.  

In that regard, let me note that any proposal to change to the current
NRTL system would need to involve all stakeholders, including organized
labor.

In addition, the Department would also like to consult with the
institutions in member States that actually administer and enforce
electrical safety laws and directives.  This would help us better
understand how SDoC is implemented, since each country uses varying
approaches. 

Finally, let me note that adopting an SDoC system for the safety of
electrical products in the United States would not be a simple
administrative matter.  It could be perceived as negatively impacting
worker safety and would, therefore, be controversial.

Adopting an SDoC system, in whole or in part, could require a
significant increase in the budget of the Department’s Health and
Safety Administration.  And from what we have learned to date, this
could also require an expansion of OSHA’s authority to include post
market surveillance and recall in its jurisdiction.  This would require
legislative changes that must be approved by the U.S. Congress.  All of
these will be problematical in the current budgetary and political
environment.

Let me also emphasize that the rulemaking process in the United States
is very public and transparent.  All interested parties may comment, and
by law each comment must be recorded, analyzed and taken into account.
It is also worth noting that regulatory decisions are based not on the
volume of comments received, but on their substance and quality.  The
most weight is given to hard data and to peer-reviewed research and
documentation.  And rulemaking is a lengthy process, taking several
years to complete. Failure to follow the process exactly can be, and
frequently is, the basis for lawsuits delaying or stopping regulations
from going forward.  

In conclusion, the Department would like to discuss with the EC ways to
facilitate trade in electrical products in addition to the issue of
SDoC.  The Department recently proposed a new component to its NRTL
Program, which could further facilitate trade in electrical products
worldwide.  And we would welcome the opportunity to share this with you.

We also would like to discuss some of the barriers to trade that exist
within the EU with respect to conformity assessment. I refer to the
requirement  that designated safety conformity organizations, known as
“notified bodies,” must be physically located within the EU. The
NRTL system has no comparable requirement—recognized organizations can
be based in any country, close to manufacturers.

So there are many opportunities for further discussion.  Thank you, and
I look forward to our continued cooperation on this issue.

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