61
THE GOVERNANCE OF EFFECTIVE
REGULATORY COOPERATION:
A FRAMEWORK, CASE STUDIES
AND “BEST PRACTICE”
G. Bruce Doern
Chancellor’s Professor,
School of Public Policy and Administration
Carleton University
and
Politics Department
University of Exeter
A Paper Prepared for the Symposium on North American
Regulatory Cooperation: A Results Agenda
Ottawa, December 8, 2005
Policy Research Initiative, Government of Canada
CONTENTS
Page
INTRODUCTION 3
CONCEPTUAL ISSUES AND ANALYTICAL FRAMEWORK 5
- Regulatory Cooperation
- Contexts and Perceptions of Cooperation
- Stages in the Regulatory Process
- Levels in a Regulatory Agency
- Core Features of Regulatory Cooperation Agreements
· Purposes
· Governance
· Priority-Setting
FOUR COMPARATIVE EXAMPLES OF INTERNATIONAL
REGULATORY COOPERATION AGREEMENTS/PRACTICES 13
- U.S.-South Korea Arrangement on the Prevention of Major
Chemical Accidents;
- U.S.-EU regulatory cooperation agreement
- The Australia-New Zealand Agreement for the
Establishment of a Joint Scheme for the Regulation
of Therapeutic Products
- European Medicines Evaluation Agency (EMEA).
FIVE FEDERAL GOVERNMENT EXAMPLES OF INTERNATIONAL
REGULATORY COOPERATION AGREEMENTS/PRACTICES 25
- The Competition Bureau
- The Pest Management Review Agency (Health Canada)
- The Canadian Food Inspection Agency (CFIA)
- Agriculture and Agi-food Canada (AAFC)
- New Substances Branch (Environment Canada)
CONCLUSIONS AND IMPLICATIONS FOR CANADA-U.S.
REGULATORY COOPERATION 45
- Regulatory Cooperation Contexts, Stages and Levels in a
Regulatory Agency
- The Purposes, Governance and Priority-Setting Aspects of
Cooperation Agreements
- Implications and Issues For Best Practices in Canada-U.S.
Regulatory Cooperation
References 58
INTRODUCTION
The purpose of this paper is to critically examine issues in the effective governance of regulatory cooperation through the development of a framework for analysis, a review of several Canadian and comparative/international case studies and through the resulting discussion of possible “best practices” in different regulatory contexts.[1] In particular, the paper examines four core questions:
1) What principles or purposes are set for regulatory cooperation arrangements?
2) What governance structures do various institutions around the world use to manage regulatory cooperation between jurisdictions?
3) How are priorities set by these governance structures for regulators for each country involved including any possible challenge function with regulators to justify reasons to deviate from co-operation?
4) What do these best practices mean for Canada – U.S. regulatory cooperation?
Given the vast range and complexity of regulation-- nationally, internationally, and regionally—and given the limited time available for the development of this paper, the analysis that follows must be viewed as very selective and exploratory in nature.[2] The paper provides only a descriptive summary account of each of the nine case study cooperative agreements examined. Though aspects of effectiveness are commented upon, the full effectiveness of these agreements have not been assessed in part because the views of how varied stakeholders might view these arrangements could not be canvassed in the time and space available nor their many possible impacts across significant periods of time.
Analytically, a framework is developed to help show the many different elements of cooperation and governance and hence the diverse situations where there may be quite genuine differences of view about what constitutes “best practice”. The concept of “best practice” is important but it can easily become just an undifferentiated slogan unless it is contextualized for varied real world situations and also varied values about what “best” might mean. Approaches identified as best practices are often just the preferred practices of some interests over others or they are often just plain “practices” which regulators think work quite well. The concept of best practices is always a conditional term in that one needs to ask questions such as “best practices at what stage of cooperative experience”, “best practices in what context?”; “best practices in terms of what kind of democracy”; or “best practices in terms of what kinds of economic market access, efficiency and innovation?”.
Empirically, the core of the paper is devoted to briefly examining nine quite varied examples of such cooperative regulatory governance arrangements, four that are comparative (e.g. U.S.-EU, Australia-New Zealand) and five that involve federal departments and agencies (Health Canada, Environment Canada, Agriculture and Agri-Food Canada, the Canadian Food Inspection Agency, and the Competition Bureau).[3] A limited number of interviews were conducted with officials in these federal departments.[4]
In addition, for brief contextual purposes, the paper draws on comparative academic literature and also on the author’s own research and experience with regulatory institutions in Canada and internationally, including recent work on multi-level regulatory governance (Doern and Johnson, 2005).
The paper is organized in a basic straight-forward manner. The first section examines core conceptual issues and provides the author’s analytical framework or typology. The second section looks at the four comparative examples of international regulatory cooperation. This is followed by an examination of five examples of international regulatory cooperation from the above-named federal departments and agencies. Brief comments are offered after each individual comparative and Canadian case illustration and these in turn are aggregated into an overall set of conclusions, observations and recommendations in the final section of the paper on the core questions being examined. These conclusions again draw on the framework and typology presented in the first section.
CONCEPTUAL ISSUES AND ANALYTICAL FRAMEWORK
Both the comparative and the Canadian federal examples of regulatory cooperation
need to be put in the context of some core conceptual issues about regulatory cooperation. These are explored briefly in this section, first at a basic definitional level and then through a suggested framework or typology.
Regulatory Cooperation
Regulatory cooperation can occur among governments within Canada and between Canada and other countries or international bodies. In this paper the focus is on international regulatory cooperation which in turn can be bilateral in nature or regional and/or multi-lateral. As defined by the OECD, regulatory cooperation refers to a “range of institutional and procedural frameworks within which national governments, sub-national governments, and the wider public can work together to build more integrated systems for rule-making and implementation, subject to the constraints of democratic values such as accountability, openness, and sovereignty” (OECD, 1994, 15). This is a definition which the Policy Research Initiative (PRI) has also used for its work and, in a general way, it is a sensible starting point (Policy Research Initiative, 2004, 9).
To proceed further, however, an analytical framework or typology is useful. With the aid of Table 1, I first sketch out this framework of some possible features, variables and criteria. The typology is intended as a useful analytical aid but I do not claim that it covers or captures all of the concerns about choices in regulatory cooperation. For example, one could have other key issues and features such as particular kinds and forms of democracy and accountability and more particular notions of sovereignty, independence, and pooled sovereignty (Zahariadis, 2004; Raustilia, 1997; Holzinger and Knill, 2004). The typology employed in this paper indicates that choices about purposes, governance, and priority-setting for international regulatory cooperation are a function of three broad elements or factors within each of which there are still more particular items for consideration:
1) The contexts and perceptions of cooperation at any given time when greater international regulatory cooperation is being contemplated;
2) The stages of the regulatory process potentially involved; and
3) The levels in the regulatory agencies involved or potentially involved.
Each of these is discussed briefly.
Table 1: A Typology of International Regulatory Cooperation Choices/Criteria
Regulatory Contexts,
Stages, and Agency
Levels Purposes Governance Priority-setting
1)Perceptions ofCooperation. Cooperation seen
as:
- a) Early stages of cooperation
- b) voluntary
- c) coercive or power-compelled
- d) competitive imperatives
- e) mature evolving later stage cooperation
2) Stages of the Regulatory Process
-a) Rule-making
- b)Product/Case approvals
- c)overall compliance,
monitoring, enforcement
3) Levels in the
Regulatory Agencies
- a)Leadership
- b)Overall operational
- c)Scientific and technical staff
Perceptions of Cooperation
The above quite sensible definition of regulatory cooperation is quite silent on what cooperation actually might mean and how it is perceived by key bodies in different countries
at particular time periods or in different contexts (Hart, 2005; EACSR, 2004). Two features
are a part of this perception element of the framework: the voluntary versus coercive basis of the need to “cooperate” and early versus late or mature stages of cooperation. In a general sense cooperation sounds like it means a set of voluntary actions and hence does not involve coercion (legitimate or otherwise) or being subject to some other jurisdiction’s political or economic power. Much like debates about voluntary codes or the role of guidelines in regulation, regulatory cooperation occurs within the shadow of the law or within the context of an underbelly of existing rules and power relationship (Webb, 2004; Braithwaite and Drahos, 2000). Thus cooperation has a range of perceived and real feelings and motivations for governments, citizens and stakeholders. Perceptions of cooperation may range from truly voluntary motives to those which feel more like compulsion and with being subject to some other jurisdiction’s political power or to the imperative of competitive markets. In addition, cooperation may be perceived as occurring or being contemplated at quite early stages in the relationships between regulators/countries or they may be arising at quite a mature evolved stage.
These different perspectives are captured in analytical perspectives in the literature about how one might analyze regulatory cooperation in greater detail. Thus, regulatory cooperation can been seen from a neo-institutional perspective, in short, as being the product of institutional change as agencies respond to changes in their environment but with such changes having to be managed and advanced within specific statutory mandates, agency cultures and ways of doing things (Majone, 2000). Regulatory cooperation has also been analyzed as a part of an exchange process where one looks at interests and institutions which are the demanders of cooperation and those which supply it (Macey, 2000). It has been examined as a part of much more complex processes such as more general exercises in mutual recognition strategies within trade regimes or common market systems such as NAFTA or the EU or within federations such as Australia or Canada (Schmidt, 2002; Doern and Johnson, 2005). Regulatory cooperation is also bound-up in perspectives which simply see rule making cooperation as a part of competitive regulation and competitive bench-marking (Stephan, 2000; Radaelli, 2004). Still others see it constrained by complex systems of federalism or different systems of law and the historic political cultures which underpin those deep multi-level systems of politics and law. And last but far from least, authors focus on regulatory cooperation when it involves stakeholder networks composed of regulators, business interests and NGOs which are in some sense arms-length and “ on the loose” and thus not easily subject to conventional state-led controls or accountability processes (Slaughter, 2000).
Stages in the Regulatory Process
Another practical conceptual feature of regulatory cooperation must be linked to different stages in the regulatory process. Thus cooperation can occur among countries and agencies over rule-making per se when regulations (and laws) are being formulated or amended (see the U.S.-EU example below). It can occur during the handling of product approvals or other kinds of high volume case loads which often are at the centre of what some (but not all) regulatory bodies do and are thus its core business volume (See the Australia-New Zealand case and the PMRA case below). This aspect can refer to products such as drug or food products or to case loads such as environmental assessment cases. Finally, cooperation can occur at the overall stage of compliance, monitoring, and enforcement, activities which can take place spatially at numerous sites and locales or in diverse eco-system areas in Canada, over borders, or inside other countries where supply and production chains begin or flow through (See the CFIA and Agriculture and Agri-Food Canada examples below). Our illustrative examples in this paper often deal with only one of these stages of regulation.
Levels in a Regulatory Agency
Regulatory cooperation must also be tied to the different potential logics and drives for cooperation which may arise at different levels in a regulatory body.[5] Such bodies may be directly headed by cabinet ministers or may be arms-length and independent and headed by appointed officials. But regardless there can be different dynamics at play at the leadership level, the operational level, and the science and technology staff level of such regulatory bodies (see the PMRA-pesticides and the European Medicines Evaluation Agency examples below). At the leadership level, regulatory chairs or heads of an agency, may be cautious or highly entrepreneurial about aggressively pursuing cooperative strategies. For them cooperation may be obtained through infrequent but important top-down meetings with their counterparts in other jurisdictions. At the operational level (e.g over the handling of product approvals or day-to-day compliance) cooperation can take the form of literally day-to-day problem-solving and issue-management where officials (scientific, technical, legal, communication) are in touch with each other internationally and across borders all the time. At the scientific and technological level, cooperation will include these daily operational habits but cooperation at this level can also include exchanges and meetings about longer term future needs, such as for research, fact-finding, problem solving, science, diagnostic methods, and monitoring.
All three of the above elements or factors are important when looking at choices regarding international regulatory cooperation and when discussing what “best practice” or other kinds of better practice and improvement. In the abstract, the three elements (and their sub-elements) can constitute a kind of prior initial analytical check list. This is how we initially present them here in Table 1 at this stage of the paper. But we will also return to this typology after we have examined the illustrative examples. At that point we can fill in illustratively some (but not all) of the now empty boxes in the framework.
Core Features of Regulatory Cooperation Agreements
When examining these 9 examples the three core features of regulatory cooperation agreements that this paper is focused on are as follows:
Purposes refer to the goals and ideas being pursued either in quite formal regulatory cooperation agreements or in informal practices and work-sharing. This normative dimension is obviously crucial but one should expect quite diverse principles to be expressed in various arrangements including those dealing with the substance of the regulatory realm in question and those dealing with norms and ideas linked to democracy and openness and also to trade, access to products, innovation, and economic opportunity.