Is this a last renewal of the WTO e-commerce Moratorium?

On 1 March, during the extra day of negotiations, WTO Members gathered in Abu Dhabi for the 13th Ministerial Conference agreed to extend the current Moratorium on Customs Duties on Electronic Transmissions until the next ministerial meeting, or until 31 March 2026, whichever is earlier. In spite of that, this could be the beginning of the end of the Moratorium: this is likely to be the last renewal.

A new blog-post from Digital Watch Observatory expert Marilia Maciel, in which she explains the dynamics and the outcomes of the 13th World Trade Organization (WTO) Ministerial Conference (MC13) held from 26-29 February, 2024 in Abu Dhabi, United Arab Emirates

The negotiating positions on the Moratorium ranged from, on the one hand, OECD countries, some developing countries, and China, aiming to make the Moratorium permanent and, on the other hand, some developing countries led by India, Indonesia, South Africa and Indonesia requesting the end of the Moratorium.

In 2022, an extension was granted until MC13, but fears of another postponement of the Ministerial led Members to call for an explicit renewal by Ministers or by the WTO General Council if the Ministerial got delayed beyond 31 March 2024. This would prevent the Moratorium from sliding into permanence, revealing that the idea of non-renewal was by that time strongly held by some members.

WTO Joint Initiative on e-commerce aims to deliver agreement in 2024

The WTO Joint Initiative (JI) on e-commerce held its first round of negotiations of the year from 29 January to 2 February. Participating members expressed their willingness to work on the ‘chairs’ text’ circulated by the co-convenors in mid-January.

The text was produced by JI co-convenors, reflecting their perception on where consensus lies, and is seen as a major milestone towards a future e-commerce agreement. Co-convenors expressed optimism that an agreement could be reached in the next few months.

Nevertheless, discussions are still ongoing on some important topics, such as development issues, e-payments, cryptography, and on so-called ‘horizontal issues’, which are overarching provisions in the agreement. The next meeting is scheduled for 11-14 March, and it will take place after the 13th WTO Ministerial Meeting.

Source: WTO.

US withdraws digital trade demands in WTO talks

The US Trade Representative Katherine Tai has withdrawn longstanding US digital trade demands in World Trade Organization (WTO) talks, allowing the US Congress the space to regulate big tech firms, according to her office. United States administration’s 2019 proposals insisting on WTO e-commerce rules that promote free cross-border data flows and prohibit national requirements for data localization and software source code reviews have been revoked. Decision was made during a meeting of the WTO’s Joint Statement Initiative on E-Commerce in Geneva.

Senator Ron Wyden, who chairs the Senate Finance Committee, described the move as a “win for China,” claiming that it would strengthen China’s internet censorship and government surveillance model. On the other hand, some lawmakers, including Senator Elizabeth Warren, praised the withdrawal, as it rejects efforts by big tech lobbyists to exploit trade deals to undermine regulation.

The decision aligns with the current administration’s goal of strengthening regulation of large technology firms and reflects ongoing digital trade negotiations in the U.S.-led Indo-Pacific Economic Framework for Prosperity (IPEF) group. However, concerns have been raised about potential disadvantages for U.S. firms and the impact on international digital trade relationships. The U.S. Chamber of Commerce opposes the withdrawal, arguing that the digital trade principles, included in the 2020 U.S.-Mexico-Canada Agreement, have supported the success of U.S. tech firms globally. The U.S. remains an active participant in the WTO e-commerce talks.

Negotiations on e-commerce advance aiming at new consolidated text by end of 2022

From 25-28 October the participants of the Joint Initiative on e-commerce (JSI) held a series of meetings aiming to speed up progress in the negotiations. The co-conveners of the Initative – Australia, Japan and Singapore – affirmed that negotiations reached a critical moment and urged participants to “find a good landing zone for the articles of existing small groups”.  A new ‘consolidated document’ – working documents that capture the progress made in the negotiations and serve as the basis for further work – is expected to be published by the end of 2022. Negotiations are currently taking place within small groups. In October, small groups on e-invoicing, cybersecurity, privacy and telecommunications met, and a small group on ‘information and communication technology (ICT) products that use cryptography’ was created.

Mauritius joins the WTO JSI on e-commerce

Mauritius joined the Joint Initiative on e-commerce, bringing the total number of participants to 87. During a cluster of meetings that took place in September, negotiators sought convergence on topics such as cyber security, privacy, telecommunications services, electronic invoicing and electronic transaction frameworks. A stocktaking effort is being put in place in order identify proposals that have not yet attracted universal support in the negotiations. The withdrawal of proposals from single proponents is being encouraged. According to the co-conveners of the Initiative, it is possible to achieve convergence on most issues by the end of 2022, but “this will require members to energize in those areas where no convergence has been reached and pull back where it has become clear there is not enough support”.

E-commerce discussions make progress at MC12

The 12th WTO Ministerial Conference (MC12) took place from 12 to 17 June, in Geneva. The Conference had already been postponed twice because of COVID-19-related restrictions.

During MC12, the co-conveners of the Joint Initiative issued a statement in which they welcomed “the good results achieved in the negotiations to date and remain committed to agreeing on a global set of digital trade rules as rapidly as possible.” They committed to issuing a revised Consolidated Negotiating Text by the end of 2022 and to revise the JSI’s working modalities to “seek expedited progress in the negotiations, including on the key issues of data flows and data localisation”.

The co-conveners also recognised barriers faced by least developed and developing countries to “utilise e-commerce for their benefit”. In response to these challenges, they launched the E-Commerce Capacity Building Framework. The Framework is expected to “bring together a wide range of technical assistance and capacity building efforts to support countries participating in the E-Commerce JSI” in order to help them harness the opportunity of digital trade. The co-conveners also expressed the support from JSI participants to the continuation of the moratorium on customs duties on electronic transmissions.

During MC12, a Ministerial Decision concerning the Work Programme on Electronic Commerce was approved. The decision renews the moratorium on customs duties on electronic transmissions and instructs and General Council to hold periodic reviews on the moratorium, including on its scope, definition and impact.  Member countries also agreed to reinvigorate the work under the Work Programme on Electronic Commerce, particularly in line with its development dimension.