The European Union will mount a fresh bid to persuade the United States to free up the billions of euros in collateral it requires foreign re-insurers to set aside against policies.

EU states agreed on Tuesday to give the bloc’s executive European Commission a mandate to negotiate a regulatory pact with the United States.

European re-insurers, such as Munich Re and Hannover Re of Germany and syndicates on the Lloyd’s of London market, comply with EU solvency rules but must also meet additional U.S. collateral requirements when underwriting in the United States.

Re-insurers say this puts them at a competitive disadvantage to American rivals by increasing capital costs and making premiums more expensive.

“An agreement with the U.S. will greatly facilitate trade in reinsurance and related activities,” Janis Reirs, minister of finance for Latvia, which holds the EU’s rotating presidency, said in a statement.

“It will enable us for instance to recognize each others prudential rules and help supervisors exchange information.”

European and other non-American re-insurers helped to pay for damage from the 1906 earthquake in San Francisco and met 64 percent of the claims related to the 9/11 attacks in New York.

The EU introduces new solvency rules for insurers next January and the European Commission must decide if U.S. and other foreign insurers should comply as well to continue operating in the 28-nation bloc.

This may give the EU executive some leverage this time round in its negotiations on collateral.

“One of the key objectives for the Commission will be the establishment of fair conditions for reinsurers, especially as regards collateral requirements,” European Commission spokeswoman Vanessa Mock said.

Brussels has been trying for years to persuade the United States to scrap its collateral requirements, but this has been difficult partly because the U.S. insurance sector is regulated by state-level supervisors.

Some U.S. supervisors have cut collateral requirements but a country-wide deal is needed to be effective.

Both sides made some progress with their “Way Forward” joint statement in July last year which contained a commitment to “examine the further reduction and possible removal of collateral requirements in both jurisdictions.”

Jesus Cisneros, policy adviser for international affairs and reinsurance at Insurance Europe, an industry body, said a bilateral agreement should seek the total elimination of collateral requirements for non-American reinsurers.

“Such an agreement would set an important global precedent for how cross-border reinsurance transactions should be regulated,” Cisneros said.