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Country Commercial Guides
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CHAPTER VI. TRADE REGULATIONS AND STANDARDS
Germany's regulations and bureaucratic procedures can be a difficult hurdle for companies wishing to enter the market, requiring close attention by U.S. exporters. Complex safety standards, not normally discriminatory but sometimes zealously applied, complicate access to the market for many U.S. products. U.S. suppliers are well advised to do their homework thoroughly and make sure they know precisely which standards apply to their product, and that they obtain timely testing and certification.
The European Union's (EU) attempts to harmonize the various product safety requirements of its member states have complicated the issue. The EU harmonization of safety requirements and related standards is being implemented for industrial products through EU directives. During a transition period national requirements must be met. (After the transition period, the Europe-wide "CE" mark supersedes all other compliance certificates, provided the products in question are covered by an EU-directive.) The EU's efforts to harmonize standards through the "New Approach" certification-facilitating directives (and separately developed European standards) are incomplete as far as sectors covered. In some cases U.S. firms, e.g., in the automotive or medical sectors, will have to worry about complying with the specific requirements of all applicable "Old Approach" product-specific EU standards legislation. The basic point here is that EU harmonization is incomplete, and sometimes certification is more complex because of the type of EU standards legislation (i.e., old or new) applicable.
This is doubly important because, to the extent EU-wide standards are developed, there is a high probability that the existing German standard will form the basis for the eventual European standard. In many cases, Germany will also be the first European country to implement EU-wide standards. The implementation of electromagnetic compatibility standards (EMC), despite a five-year phase-in period, surprised many affected companies - not only foreign but also German - with the result that accredited test laboratories are booked for months and market introduction for some products is delayed considerably.
German buyers may require additional performance or quality marks, which are not necessarily legally required, but greatly enhance a product's chances to be marketed. Both EU requirements and the standards for a German quality or performance mark will, in many cases, require a product to be modified. Even if the product does not require modification, it will require testing and certification before it can be marketed. Important marks are the "gepruefte Sicherheit" (GS) mark for mechanical products, and the "Verband Deutscher Elektrotechniker" (VDE) mark for electrical components. It should be emphasized that neither the "GS" license nor the "VDE" license are mandatory for products sold in Germany. The only exception is for products for use in certain work place applications, where either of these marks are required to meet insurance eligibility requirements.
The German organization that compiles the standards laying down the requirements for a "GS" mark is the "Deutscher Industrie Normenausschuss - DIN" (German Standards Institute). The organization responsible for testing is the "Technischer Ueberwachungsverein e.V. - TUV," (Technical Inspection Association).
Although the "VDE" license deals with electrical products, instead of mechanical products, the same process of certification can be followed. A company can obtain the "VDE" literature from the VDE publisher, VDE Verlag, GmbH, or from the VDE association directly (for contact information please see below).
The TUV tests for both the "VDE" license and the "GS" license. The process for "VDE" certification is the same as that of the "GS" mark.
TUV and Certification Process for the "GS" and the "VDE" Licenses:
TUVs are private companies set up by various German states to inspect and test products for compliance with German safety standards. Individual TUVs have also been authorized by the German Government to test products for compliance with EU legislation, and many have established representative offices in the United States.
Firms interested in certification should contact a U.S. TUV office (Contact information is provided below).
Self-Certification
For certain products, self-certification of manufacturers (through a Manufacturer's Declaration of Conformity) is sufficient. Further information is available from the U.S. Mission to the EU:
U.S. Mission to the EU (USEU)
40 Blvd. Du Regent
B-1000 Brussels
Telephone: [32][2] 508 2746
Telefax: [32][2] 513 1228Effect of EU Harmonization of Standards on the "GS" and "VDE" mark:
The effect of EU harmonization on the "GS" and "VDE" mark is difficult to analyze. It is estimated that about 75 percent of all American products sold in the EU must have the "CE" mark once all directives have been passed and all transition periods have expired. Where EU directives are in place the "CE" mark is mandatory by law for products that are covered by the appropriate directive; the mark allows the product to be marketed in all the EU member states. National certificates such as the "GS" and the "VDE" marks, may not be legally required, but enhance marketing chances. German consumers look for these marks in much the same way as Americans look for the "UL" mark.
Currently, only 12 of the 22 proposed and planned EU directives are in place: low voltage electrical safety, toys, simple pressure vessels, construction projects, electro-magnetic capability, gas appliances, personal protective equipment, machinery, active implantable medical devices, non-automatic weighing machines, type approval of telecommunications terminal equipment, and medical devices. For products where there is as yet no EU directive, national standards, even if they are voluntary, should be adhered to, in order to ensure marketability of a product.
Who has the authority to actually affix the "CE" mark? For many products, the mark may be affixed by the manufacturer, based on his or her own testing to verify that the product meets EU requirements. However, EU legislation may require that an independent third party be involved in product assessment.
Who is qualified to be this third party? The EU establishes so-called "notified bodies," i.e. testing or certification agencies. The majority of the TUVs have already been approved - they will play an important role as notified bodies.
Contact information for EU "CE" standards:
Mr. Robert Straetz
Office of European Union and Regional Affairs
Room H-3036
International Trade Administration
U.S. Department of Commerce
Washington, D.C. 20230
Telephone: (202) 482-4496
Telefax: (202) 482-2155U.S. Contacts for Foreign Standards Information:
National Center for Foreign Standards Information
National Institute of Standards and Technology
TRF Room A163
Gaithersburg, MD 20899
Telephone: (301) 975-4040
Telefax: (301) 975-2128Europe\Regional, Political, and Economic Affairs
Room 6519
U.S. Department of State
Washington, D.C. 20520
Telephone: (202) 647-2395Office of the U.S. Trade Representative
600 17th St., NW
Washington, D.C. 20506
Telephone: (202) 395-3320American National Standards Institute
11 West 42nd St.
13th Floor
New York, NY 10036
Telephone: (212) 642-4900
Telefax: (212) 302-1286TUV offices in the United States (Headquarters): (Contact information for regional offices is available from these headquarters or from the U.S. Embassy in Bonn)
TUV Essen Laboratories
6 Brighton Rd.
Cliffton, NJ 07012
Telephone: (201) 773-8880
Telefax: (201) 773-8834
Contact: Wayne Gruber, Technical ManagerTUV America, Inc.
Headquarters
5 Cherry Hill Dr.
Danvers, Ma 01923
Telephone: (508) 777-7999
Telefax: (508) 777-8441
Contact: Kurt Else, PresidentTUV Rheinland of North America
Headquarters
12 Commerce Rd.
Newtown, CT 06470
Telephone: (203) 426-0888
Telefax: (203) 270-8883
Contact: John TyraValue added tax/Turnover tax (Mehrwertsteuer/Umsatzsteuer) In common usage, value added tax (VAT) and turnover tax are regarded as being identical. All imports and deliveries of goods to or in Germany are subject to VAT, as are services deemed to have been rendered within the country. The tax liability rests on the German business providing service or products or on the importer or buyer of goods or services from abroad. The tax levied on the business is invoiced to customers, who may deduct it from their own liability. The ultimate burden is therefore on the final consumer, who, not being a business, does not file VAT claims and therefore has no rights of deduction. The basic VAT rate is 16%. A reduced rate of 8% is levied on certain specified items, such as food, books and other publications. This will not change in 1998. Exports abroad and deliveries of goods to other EU countries are free of VAT. The full amount of the VAT should be listed separately on invoices. For invoices up to DM 200 ($114) it is sufficient to indicate only the percentage of the tax rate. Invoices amounting to higher sums must list the payable tax separately. In order to fulfill turnover tax liabilities, all revenues must be listed separately on a pre-payment form of the local tax office. It is important, however, to collect all invoices in order to deduct the VAT charged from one's own tax liability.
Custom regulations/tariffs: Information on customs regulations and tariffs is available from German customs offices, and can differ considerably depending on the products. Please contact the Commercial Service (for contact information, please see Chapter XI).
Agricultural Products
General Veterinary Requirements: In April of 1997, the United States and the European Union (EU) reached an agreement on an overall framework for recognizing as equivalent each other's veterinary inspection systems. Progress made should open new trade opportunities for red meat and preserve most pre-existing trade in products such as pet food, dairy and egg products. The veterinary equivalency agreement covers more than $1.5 billion in U.S. animal product exports to the EU and an equal value of EU exports to the United States.
All beef and pork exported to Germany for human consumption must come from slaughterhouses, cutting plants and cold stores approved for export to the EU. Since 1989, the EU has prohibited importation of beef from cattle treated with growth hormones. Soon after this ban went into effect, an agreement was reached between the United States and the EU that allows American producers of beef from animals not treated with hormones to export to the EU. Under the terms of this agreement, the cattle must come from an EU-approved source, and the animals must be slaughtered in a slaughterhouse that has been approved by the EU for handling untreated beef.
Beef: The EU beef market is largely insulated from the world market by high import duties on most products. Import opportunities do exist, however, for selected products that are covered by fixed, relatively low tariffs or special quota. Most notably, the EU grants market access for annual imports of up to 12,250 MT of beef from the United States and Canada under its high-quality beef (HQB) quota. (Imports under this quota are still subject to an ad valorem duty, which will be reduced according to the Uruguay Round Agreement.) Under the Uruguay Round Agreement, the EU duty on beef livers (which was seven percent in 1994) will be eliminated in six equal annual installments by July 1, 2000.
Pork: Selected market opportunities exist for imports of pork. Market access within the EU has been improved through the creation of a tariff-rate quota totaling 75,000 MT by the year 2000, including a 39,000 MT allocation for tenderloins, boneless loins and boneless hams.
Poultry: Unfortunately U.S. and EU negotiators were not able to reach agreement on a number of important points during the veterinary equivalency negotiations, particularly in the poultry sector. The most contentious issue in the negotiations concerned the use in the United States of chlorinated water and other anti-microbial treatments in poultry processing. However, most forms of anti-microbial treatments are prohibited in the EU. The EU's ban on anti-microbial treatments effectively blocks U.S. poultry exports to the EU which were estimated at $50 million in 1996.
Dairy Products: The veterinary agreement allows for the resumption of U.S. dairy product exports to Germany, which had been banned for more than one year. Under the Uruguay Round Agreement, the variable levy on dairy products has been replaced by a fixed tariff equivalent.
Plant Health: As part of the Single Market exercise, plant health regulations in the fifteen European Union Member States have been harmonized. The new regulations went into effect on June 1, 1993. The EU has been successful in reducing the number of phytosanitary restrictions, and new marketing opportunities have been created for U.S. horticultural exports. Phytosanitary certificates are required for most fresh products.
Horticultural Products: Germany is an important market for United States horticultural products. Principal products include almonds, citrus, raisins, prunes and walnuts. Horticultural products entering Germany face a number of border restrictions. In addition to considerable tariffs which vary by product, imports of selected produce are subject to an entry price system. Under such a system imports which have a price at or above the respective entry price are assessed only the appropriate ad valorem duty. Imports which have a price below, but within a certain range of the entry price are assessed the ad valorem duty plus a specific duty which is the difference between the import price and the entry price. "Within a certain range" generally means within eight percent of the entry price. Imports having a price more than eight percent below the entry price are assessed the ad valorem duty plus a very large specific duty (known as the tariff equivalent) which generally takes the cost of the product (import price plus duties) far above the entry price.
Under the Uruguay Round Agreement duties for horticultural products will be reduced in six equal annual installments by an average of 36 percent by July 1, 2000. Increased export opportunities will be created for single-strength orange juice, fresh foliage, shelled and roasted almonds, walnuts, apples, fresh asparagus, fresh grapes, roasted pistachios and potato chips.
Organic Products: There is a growing market within Germany for certified organic products. Since July 1992, Union-wide regulations on marketing organic products have been in effect. Administrative hurdles still slow down the development of this promising import market. The completion of an American National Organic Program promised for the end of 1999 will significantly reduce bureaucratic requirements for trade in certified organic products with the European Union. Until then importers must work through German authorities to submit technical information on certified organic products on a case-by-case basis.
Consumer-Ready Products: Imports of consumer-ready food products into Germany face many market access restrictions and very strict food laws. In addition to bound import duties, the EU has established a complex system of border protection measures for food products. Since prices for basic agricultural commodities such as dairy products, sugar and cereals are considerably higher than world market prices, the EU maintains a mechanism to protect European consumer-ready food products from imports made with lower-price inputs. Therefore, most processed products entering the EU are subject to additional import charges based on the percentage of sugar, milk fat, milk protein and starch in the product. These additional import charges have made many imported processed food products non-competitive in the EU market. In 1998 the Foreign Agricultural Service completed "Accessing Germany's Retail Food Sector - A Guide for U.S. Food and Beverage Suppliers" which is available from USDA/FAS Trade Assistance Promotion Office by contacting SmithMark@fas.usda.gov or hamptonk@fas.usda.gov.
Packaging Disposal: With the tremendous growth of waste and increasing disposal problems, Germany has established legislation which contains certain rules for the disposal of packaging materials. In response to this legislation, a cooperative effort for the collection and recycling of packaging materials was initiated. The organization involved is called the "Duales System Deutschland," and it administers the use of the "Green Dot," a recycling symbol which is found on the packaging material of virtually all products sold in Germany. While packaging material for products sold in Germany is not legally required to carry the Green Dot, it is almost impossible to market a product in Germany without it. Typically, the importer pays a license fee to the user of the Green Dot, dependent on the type and amount of packaging, and provides the exporter with the information necessary.
U.S. Agricultural Commodity Associations Active in Germany A number of U.S. agricultural commodity and other trade associations conduct market development programs in Germany. In some cases, these associations maintain staffed field offices in Germany, others may have a trade representative or public relations company representing their interests, and others may cover Germany from other European offices or from offices in the United States. A portion of the funding for the market development programs of these associations is provided by the USDA-operated Market Access Program (MAP) and Foreign Market Development program (FMD).
These associations can be contacted through the U.S. Agricultural Trade Office (ATO) (see first section for phone, address and e-mail).
A listing of the agricultural associations which operate market development programs/activities in Germany, or in Germany as part of a European program, is provided below. Most of these associations receive USDA funding for their activities. Three U.S. agricultural trade associations (American Plywood Association, American Soybean Association and USA Rice Federation) maintain offices in the ATO Hamburg, are located at the American Consulate.
-- Alaska Seafood Marketing Institute
-- Almond Board of California
-- American Forest and Paper Association
-- American Hardwood Export Council
-- American Jojoba Association
-- American Plywood Association
-- American Peanut Council
-- American Quarter Horse Association
-- American Seafood Institute
-- American Seed Trade Association
-- American Soybean Association
-- Asparagus USA
-- California Agricultural Export Council
-- California Pistachio Commission
-- California Prune Board
-- California Walnut Commission
-- Chocolate Manufacturers Association
-- Cotton Council International
-- Cranberry Marketing Committee
-- Eastern U.S. Agricultural and Food Export Council (EUSAFEC)
-- Florida Department of Citrus
-- Hop Growers of America
-- Intertribal Agricultural Council
-- Mohair Council of America
-- Michigan Agricultural Cooperative Marketing Association, Inc.
-- Mid-America International Agri-Trade Council (MIATCO)
-- National Dry Bean Council
-- National Honey Board
-- National Sunflower Association
-- Organic Trade Association
-- Southern Forest Products Association
-- Southern Pine Marketing Council
-- Southern United States Trade Association (SUSTA)
-- The Catfish Institute
-- The Popcorn Institute
-- U.S. Dairy Export Council
-- U.S. Livestock Genetics
-- U.S. Meat Export Federation
-- U.S. Wheat Associates
-- USA Dry Pea and Lentil Council
-- USA Poultry and Egg Export Council
-- USA Rice Federation
-- Washington Apple Commission
-- Western United States Agricultural Trade Association (WUSATA)
-- Western Wood Products Association
-- Wine Institute
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[end of document] Note* International Copyright, United States Government, 1998 (or other year of first publication). All rights under foreign copyright laws are reserved. All portions of this publication are protected against any type or form of reproduction, communications to the public and the preparation of adaptations, arrangement and alterations outside the United States. U. S. copyright is not asserted under the U.S. Copyright Law, Title 17, United States Code.
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