Mr. Mark O'Mahoney:

Chambers Ireland is the largest business network in the State. With members in every geographic region and economic sector in Ireland, we are well positioned to represent the views of SMEs on TTIP and trade.

The transatlantic trade and investment partnership is a negotiation between two of the largest trading economies in the world. There is tremendous potential here. My colleagues outlined some of the potential for Irish SMEs. I will speak about the benefit to Irish SMEs.

As a member of the European Chambers of Commerce, Eurochambres, we actively promote the interests of Irish SMEs at European level. The European chambers are recognised as being a strong voice for SMEs and that is why they have been nominated as the SME representative body on the TTIP advisory group, and that is where we feed in our input to the negotiation process.

The trade agreement is predicted to go a long way towards reducing the cost of exporting for the Irish businesses, particularly SMEs. Although tariffs between the EU and US are relatively low, Irish exporters still pay in excess of $300 million per year in tariffs to the US Treasury. Efforts to reduce it, from an average rate of 3% to a zero rate, will have a significant benefit for companies, especially SMEs. A relatively low tariff impacts larger companies much less than smaller companies. The material impact of a low tariff percentage on an SME can be an inhibitor to it investing in the US market.

Where we see the real benefit for Irish SMEs is in the non-tariff barriers. Regulatory divergence, such as complex certification procedures and duplication of standards, can be particularly burdensome to smaller firms. If one needs to complete 20 or 30 pages of documentation to get some goods through customs, it is the same amount of documentation that needs to be completed for a large company as for an SME. The resource strain on SMEs is considerable. This is one of the main barriers we see to SMEs looking beyond the domestic market and moving internationally.

The fixed cost of these regulatory complexities are easily borne by large companies. Our research shows that to get exports certified in both the EU and the US can cost between $5,000 and $10,000, depending on the product. A large company can absorb that cost; a small company cannot. Fundamentally, the benefits for us of TTIP will be on the mechanics of trade. It will be on synchronising rather than reducing legislation, ensuring SMEs can access it on an equal footing and opening up markets.

The following is what needs to be done to ensure SMEs can benefit from the agreement. We pushed fairly hard for a dedicated SME chapter within the negotiations that will set out how SMEs can access the benefits to be derived from the trade agreement. This needs to be apprehensible by a small company. It needs to stand out from the overall broader agreement.

There also needs to be serious motivation towards real regulatory co-operation. If there is some sort of half-baked effort at regulatory co-operation, the benefits to the SMEs will not materialise. The bigger companies can allocate the resources to meet a new standard, but if it is a halfway house, the SMEs will be left out again. There needs to be a comprehensive agreement reached on regulatory standards.

We would be very much in favour of ISDS, especially for SMEs. If such companies are taking a risk to invest or trade with another jurisdiction and if there is a change in policy of a particular US state, they will have no chance of pursuing that through the courts. They need an ISDS mechanism to have access to justice and to try to recoup their investment. We would have different views about how that ISDS might be structured but it is important, from the point of view of SMEs, that it includes an ISDS. I thank the committee for the opportunity to speak and I am happy to answer any questions.