Tech firms call for US, EU cooperation on regulations

IT vendors urged the U.S. Congress to advocate for less tech regulation in the E.U. during meetings on Wednesday.

Conflicting regulations authored by the European Union and the U.S. government are increasing the cost of IT products and threatening U.S. and European leadership in the tech industry, a group of technology executives told a U.S. Congress subcommittee Wednesday.

Executives from five tech-related companies and a large IT trade group urged Congress to champion the U.S. government's traditional hands-off approach to technology regulation during trade negotiations and other discussions, including a presidential summit between U.S. President George Bush and EU leaders June 20.

While the US and EU continue to struggle with disagreements on tech issues such as who should control the Internet and disability standards for software, countries such as China and India threaten the traditional tech industry dominance of the U.S., Europe and Japan, said Harris Miller, president of the Information Technology Association of America, a trade group based in Arlington, Virginia.

"The EU and U.S. must stop arguing about how to build a better sand castle and focus on the economic tsunami headed our way from China, India, Brazil and Eastern Europe," Miller said during a hearing of the U.S. Senate Foreign Relations Committee's Subcommittee on European Affairs. "While these issues are important, we dwell on them at a price."

While most witnesses at the hearing urged senators to push the EU to mirror the US approach toward less technology regulation, Miller also advocated a U.S. government program to encourage more U.S. students to pursue college degrees in math, science and technology. Noting that China already produces more than double the number of engineers per capita than the U.S. does, Miller called for a government program that would pay for the college educations of math, science and technology students.

After the Soviet Union launched the space satellite Sputnik in 1957, Congress responded with the National Defense Education Act, which increased funding for university research and helped pay for math and science education, Miller noted. "We should do it again," he added. "We need to get that radical."

Last month, Representative Frank Wolf, a Virginia Republican, introduced the Math and Science Incentive Act of 2005, which would pay off the interest on college loans for qualified math and science students. But Miller said the U.S. needs to go beyond Wolf's proposal and pay for the complete education of math and science students, at a potential cost of a few billion dollars a year.

"It's not chicken feed," Miller said of the cost. "But think about the return on investment."

Beyond Miller's call for a new government program, other witnesses generally focused on how the U.S. can urge the E.U. to reduce tech-related regulations. Executives with Philips Electronics North America Corp. and Hewlett-Packard Co. decried a common practice in European nations of levying copyright taxes on devices that can be used to make copies of music, movies or written products, saying the levies drive up vendor and customer costs. The copyright levies are meant to allow creators of copyrighted works to get paid.

Philips must comply with up to 20 national copyright levies, said Thomas Patton, vice president of government relations at Philips Electronics North America. The levies "create nothing less than a toxic environment for investment, and stands in marked contrast to the United States, which has chosen quite wisely to promote innovation and economic growth in Internet-based services by shielding them from this very type of redundant and excessive taxes," Patton added.

Executives from IBM and SAP Public Services called on Congress to work with E.U. regulators on a global standard governing accessibility for disabled people using technology products. A 1998 law passed by Congress requires U.S. government agencies to purchase the most accessible products available, but some European governments are moving toward tougher regulations that vendors would have to follow, said Joseph Duffy, vice president of SAP Public Services.

"If we get into a situation where there are multiple standards for a given technology, then IT developers must either choose one set of standards and forego certain markets, or go to the trouble of implementing multiple standards and hope they do not conflict with each other," Duffy said in written testimony.

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