Economic - other issues

Updates

22 Sep 2017

Transport for London (TfL), the regulator of transportation services in the UK capital, announced that it is not renewing Uber’s licence as a private hire operator (which expires on 30 September). In a statement about its decision, TfL said that ‘Uber London Limited is not fit and proper to hold a private hire operator licence’, as Uber’s ‘approach and conduct demonstrate a lack of corporate responsibility in relation to a number of issues which have potential public safety and security implications’. The company, which has 21 days to appeal the decision, said that it would do so, ‘to defend the livelihoods of all […] drivers, and the consumer choice of million on Londoners who use our app’.

19 Sep 2017

Economic ministers from the Regional Comprehensive Economic Partnership (RCEP) - a proposed free trade agreement between the ten member states of the Association of Southeast Asian Nations (ASEAN) and the six states with which ASEAN has existing free trade agreements (Australia, China, India, Japan, South Korea and New Zealand) - pledged to ramp up their negotiating efforts on an extensive regional free trade deal, following a meeting in Pasay City, Philippines. The mega trade agreement aims to cover goods, services, investment, competition policy, and intellectual property rights, among other issues. The next negotiating round for RCEP is scheduled for mid-October in Korea. RCEP would cover more than 3.5 billion people, or half the world's population, and 30% of global gross domestic product and trade. Although the RCEP countries will likely not meet the target of concluding the negotiations within this year due to differences in tariff reduction as well as services to be opened up, they aim to achieve a significant breakthrough when the leaders of ASEAN and their dialogue partners meet in November.

13 Sep 2017

The European Commission published a Communication to the European Parliament on a “Balanced and Progressive Trade Policy to Harness Globalization”. In this document, the Commission lays out its vision and priorities in the field of trade negotiations, and makes some concrete proposals in several areas such as: creating a framework to screen foreign direct investment in the EU; starting negotiations to create a multilateral court for the settling of investment disputes and engaging in negotiations to conclude trade agreements with Australia and New Zealand. The multilateral court would build on the investment court system already enshrined in two EU deals, including the EU-Canada Comprehensive Economic and Trade Agreement (CETA) and in the Vietnam-EU free trade agreement. Both agreements contain a reference to a potential future multilateral system. The Commission also proposed measures to enhance transparency in trade negotiations, by making public its recommendations for negotiating directives and by creating a group to provide advice on EU trade policy. The document highlights the importance of trade objectives to the fulfilment of other European policies, such as development and security. Some of the topics included in the Communication were part of the European Commission President Jean-Claude Juncker’s annual “State of the European Union” speech.

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The impact of the Internet on businesses and the global economy has been crucial in shaping new economic models, and at the same time, raising new concerns.

The Internet is one of the primary drivers of economic growth, which is visible in many countries that have placed the development of ICT as one of the primary tools for boosting the economy.

This is even more evident on a regional and global level. For instance, the European Union directed a substantial amount of financial support to Horizon 2020, one of its largest programmes dedicated to financing research, development, and innovation, especially in the field of commerce, and particularly to assist small and medium-sized enterprises (SMEs).

The impact on the Internet economy

The impact of e-commerce - which in its broad term encompasses e-money, digital signatures, and online advertising and marketing - on individuals and businesses is far-reaching. E-commerce has brought about numerous advantages for consumers, such as the convenience of online shopping, flexibility and ease-of-access to different markets, more information and choice, and - perhaps more significantly - access to online banking and e-payments. Read more on e-money and digital signatures.

From a business perspective, e-commerce has influenced the supply chain management of  businesses by integrating inter-company and intra-company functions, optimising the flow of information, facilitating the payment process, affecting the delivery channels, reducing overall costs (especially the cost of promotion), and enabling companies to reach customers more easily through online advertising and marketing.

However, now that businesses have access to the global market, competition - together with the pressure this brings on businesses - has also increased exponentially, while shipping and delivery-related issues are more complex when serving a global market without the traditional borders.

Other issues which have been brought to the forefront are the liability of intermediaries for third party content, and human rights considerations. Since businesses are increasingly handling personal data of consumers, they also have to adhere to stricter rules concerning privacy and data protection, which requires a shift from traditional business processes.

Additionally, concerns over security are among the biggest issues that affect the development of the Internet economy.

Read more on IntermediariesHuman Rights, and Cybersecurity.

Emerging trends: Internet of Things, sharing economy, e-gambling

The Internet of Things (IoT) is an emerging trend which is having a major impact on the Internet economy. The integration of the IoT into business models reduces costs and increases efficiency. Many new businesses are now utilising ‘smart buildings’ to optimise energy costs and preserve the environment. The application of ICT solutions into business processes provides businesses with a competitive advantage, which helps them develop faster than in traditional surroundings. Businesses are therefore demanding new tailor-made and innovative approaches from the IT industry, which is contributing significantly to the general economic welfare. Read more on IoT.

The latest model in e-commerce is the so-called sharing economy, which catapulted new players - such as Uber and AirBnB - into the global market. Such businesses have taken full advantage of e-commerce, such as through the integration of ICT solutions, by leveraging reduced business costs, and through more direct access to consumers. At the same time, such models have found opposition from traditional professions such as taxi drivers and businesses in the rental market. The regulation of the shared economy, still in its embryonic phase, is controversial.

A by-product of e-commerce is the emerging freelance market. On one hand, this has given rise to a vibrant startup community of freelancers and has contributed to strengthening SMEs and to reducing unemployment. On the other, this requires a new approach to labour, not least due to the treatment of income arising from online freelance work.

Another area that has significantly contributed to the Internet economy - and at the same time raised numerous debates - is e-gambling. Different regulatory approaches have been applied to e-gambling, due to its unique characteristics. The EU, for example, extracts this area from the regulatory framework for e-commerce, taxation, and e-money, and leaves it up to member states to regulate it. The sensitivity of this area and its interrelation with public policy, morals, the protection of minors, and cybersecurity criminal matters made an argument that regulation of e-gambling is more suitable to be conducted on national level according to each country’s political and social background. However, the interest of the global community for this issue is growing from year to year and even the EU has started to intervene on soft manner with various broad policy documents.

The economic aspects of Internet and electronic communications, broadly speaking, have pushed the liberalisation forces in these markets and have represented the foundations for the concept of a new market specific to the digital world. Even though a digital market is an excellent opportunity for economic growth, it brings with itself a number of regulatory challenges, especially with regard to competition issues. One of the current debates that is strongly related to the area of competition law, but in the same time net neutrality, entrepreneurship, content diversity, and freedom of expression is the ‘zero-rating’ pricing mechanism offered by some mobile telecom providers. Read more on Network neutrality and zero-rating.

Finally, according to the UNCTAD Information Economy Report 2015, the global business-to-consumer (B2C) e-commerce is valued at about US $1.2 trillion, while the business-to-business (B2B) e-commerce is estimated at more than US $15 trillion. The report also notes that B2B electronic commerce is growing faster, especially in Asia and Africa.

Events

Actors

(UNCTAD)

UNCTAD is very active in the field of e-commerce.

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UNCTAD is very active in the field of e-commerce. It assists developing countries in developing e-commerce legislation, through its e-Commerce and Law Reform Programme. The entity has launched the eTrade for All initiative, aimed to improving the ability of developing countries to use and benefit from e-commerce.  As part of its ICT Policy Review Programme, UNCTAD undertakes reviews, research, and analysis on e-commerce-related issues. It also reviews national policies and provides policy advice to countries on areas such as developing e-commerce strategies and devising measures to strengthen e-commerce. UNCTAD holds an annual E-Commerce Week, featuring events focusing on specific policy areas of e-commerce.

(OECD)

Convergence is one of the digital policy issues that the OECD is paying attention to, especially in relation t

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Convergence is one of the digital policy issues that the OECD is paying attention to, especially in relation to the challenges this phenomenon brings on traditional markets, and the need for adequate policy and regulatory frameworks to address them. In 2008, the organisation issued a set of policy guidelines for regulators to take into account when addressing challenges posed by convergence. In 2016, a report issued in preparation for the OECD Ministerial Meeting on the Digital Economy included new recommendations for policy-makers. Digital convergence issues have been on the agenda of OECD Ministerial meetings since 2008, and are also tackled in the regular OECD Digital Economy Outlook report.

(WTO)

The WTO has played a key role in the liberalisation of the telecommunications markets worldwide, thr

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The WTO has played a key role in the liberalisation of the telecommunications markets worldwide, through the Fourth Protocol to the General Agreement on Trade in ServicesIssued related to trade in telecommunications services are tackled in the WTO General Agreement on Trade in Services (GATS), which, in addition to principles applicable to trade in all services, also contains an Annex on telecommunications. The organisation has also elaborated a Reference Paper which includes a set of regulatory principles that are legally binding for WTO members which commit to it. Telecommunications are also included in the WTO services negotiations. Many WTO members have made commitments to facilitate such trade and to extend competition in basic telecommunications.

(ITC)

ITC’s activities in the area of

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ITC’s activities in the area of e-commerce are focused on assisting enterprises, in particular small and medium sized enterprises (SMEs) in acquiring the necessary skills and capabilities to trade on e-commerce channels. It has developed an e-Solutions Programme, which provides enterprises with access to a platform of shared technologies and services, including access to international payment solutions and logistics. A Virtual Market Place project aims to strengthen the skills of SMEs in the Middle East and North Africa region to effectively use new technologies to enhance their visibility on international markets. The Centre also offers e-learning programmes and produces publications related to e-commerce.

(EC)

The

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The Digital Single Market is a Commission strategy to remove barriers to online trade within the European market. The strategy aims at boosting the digital industry by creating an enabling environment for innovation. Other aspects of the strategy are advancing research, investing in networks and technology, building the European data economy, and improving connectivity and access. Other digital economy issues that the Commission focuses on, through policies and guidance, include the collaborative economy, online gambling, and the next generation Internet. The Commission also publishes the Digital Economy and Society Index (DESI), evaluating the performance of the EU and its member states in digital competitiveness.

(World Bank)

As part of its World Development Report series, the World Bank published the 

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As part of its World Development Report series, the World Bank published the Digital Dividends Report in 2016, arguing that the Internet does not automatically bring about benefits for society. Policy, education, and much more are needed in order to ensure that the Internet has a positive impact on society. The Bank has done further work on the link between broadband and economic growth in different countries. It has also launched country-specific initiatives aimed at fostering the evolution of the digital economy at a national level, one example being the Developing the Digital Economy in Russia initiative.

Instruments

Conventions

Resolutions & Declarations

Wuzhen World Internet Conference Declaration (2015)

Other Instruments

Resources

Articles

How the Sharing Economy can Make its Case (2015)
Taxation and Today's Digital Economy (2015)

Publications

Internet Governance Acronym Glossary (2015)
The Economics of Zero Rating (2015)
An Introduction to Internet Governance (2014)

Papers

The Sharing Economy: Reports from Stage One (2015)
Personal Data Storage in Russia (2015)
Zero-Rating: Kick-Starting Internet Ecosystems in Developing Countries (2015)
In Search of a Competition Doctrine for Information Technology Markets: Recent Antitrust Developments in the Online Sector (2014)
Communications and Competition Law: Key Issues in the Telecoms, Media and Technology Sectors (2014)
Comparative Analysis on National Approaches to the Liability of Internet Intermediaries for Infringement of Copyright and Related Rights (2014)
Cloud computing from EU Competition Law Perspective (2013)
Is EU Competition Policy an Obstacle to Innovation and Growth? (2011)
Antitrust Issues In Network Industries (2008)
Study on the Economic Impact of the Electronic Commerce Directive (2007)
Competition in the Software Industry: the Interface between Antitrust and Intellectual Property Law (1999)

Reports

Global Information Technology Report 2016 (2016)
Enabling Growth and Innovation in the Digital Economy (2016)
One Internet (2016)
The 2016 National Trade Estimate Report on Foreign Trade Barriers (2016)
The Economic Impact of Rural Broadband (2016)
World Development Report 2016: Digital Dividends (2016)
Addressing the Tax Challenges of the Digital Economy (2015)
The Sharing Economy and the Competition and Consumer Act (2015)
OECD Digital Economy Outlook 2015 (2015)
Country Factsheets for the Digital Single Market (2015)
Information Economy Report 2015 - Unlocking the Potential of E-commerce for Developing Countries (2015)
The Global Information Technology Report 2015: ICTs for Inclusive Growth (2015)
Commission Expert Group on Taxation of the Digital Economy (2014)
Consumer Market Study on the Functioning of E-commerce and Internet Marketing and Selling Techniques in the Retail of Goods (2011)
Summary of the Results of the Public Consultation on the Future of Electronic Commerce in the Internal Market and the Implementation of the Directive on Electronic Commerce (2000/31/EC)
Cyberlaws and Regulations for Enhancing E-commerce: Case studies and Lessons Learned

GIP event reports

Key-note Speech of Norway’s Prime Minister Erna Solberg (2017)
International Trade Agreements and Internet Governance (2017)
How the Digital Revolution Changes Our Work Life (2017)
Domain Names Innovation and Competition (2017)
Can E-commerce Trade Rules Help Micro, Small and Medium Enterprises in Developing Countries? (2017)
Supporting the Involvement of Small and Medium-Sized Enterprises in E-Commerce (2017)
Youth Employment in the Digital Economy (2017)
Special Session on Assessing eTrade Readiness of the Least Developed Countries (2017)
Global Survey of Internet User Perceptions (2017)
The Organization of Work and Production (2017)
The Governance of Work (2017)
ICANN58: Joint Meeting ICANN Board & Customer Standing Committee (2017)
Report for Briefing for Heads of Missions: Digital Policy in South Eastern Europe (2017)
Report for Think Tank Talk - The Uberisation of the Labour Market (2017)
Report for World Economic Forum Annual Meeting 2017 (2017)

Other resources

Internet of Things: Antitrust Concerns in the Pipeline? (2016)
Uber and the economic impact of sharing economy platforms (2016)
Zero-rated Internet Services: What is to be Done? (2015)
Policy Brief: Access’ position on zero rating schemes (2015)
The Real Threat to the Open Internet is Zero-Rated Content (2014)
New Rules and Regulations on IT and Fair Competition (2011)

Processes

Sessions at WSIS Forum 2016

Sessions at IGF 2015

IGF 2016 Report

 

Discussions at IGF 2016 brought into focus recently agreed trade agreements. One aspect was that negotiations were criticised due to their lack of transparency and openness. At the same time, some speakers argued that although some negotiations were secretive, this does not make evil (Main session on Trade Agreements and the Internet).

Recent e-commerce trends were also discussed in the context of other areas, most notably development. The app economy, overt-the-top services (OTT) services (Internet Fragmentation: Getting Next 4 Billion Online - WS37), new industry requirements (Digital Economy and the Future of Work - WS34), and high costs of access are posing challenges for developing countries. Despite the challenges, many developments carry a strong potential for developing countries, including the Internet of Things, the creation of new (skilled) jobs, and new revenue streams. Stronger protection for human rights, improved policies for affordability and access, and better access to scientific knowledge (The Internet and ESCRs: Working From Experience to Policy - WS90), are some of the developments that can help countries reap the benefits of the Internet economy.

WSIS Forum 2016 Report

 

Several sessions at the WSIS Forum underlined the fact that ICTs are an effective tool for raising productivity, improving access to consumers and suppliers, and connecting least developed countries (LDCs) to the global value chain.  How the Internet Enables Sustainable Development: Incorporating Data-Driven Policies to Measure Impact (session 149) referred to the mobile revolution, the importance of accountability at governmental level, and the need to foster private-public partnerships at national and international levels. ICT4SDG: Digital Economy for Development (session 179) shared best practices for economic development and inclusion, and highlighted the potential opportunities for engagement mainly through advertising and marketing, education, and entertainment. In a session dedicated to the postal network - Putting Public Assets to Work (session 159 ) - panellists discussed the role that the postal network can play in linking the physical world with the digital world, and in addressing issues such as financial inclusion. 

 

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