WTO: E-Commerce JSI Talks Intensify

The Joint Statement Initiative on electronic commerce co-convenors – Australia, Japan, and Singapore – have escalated negotiations, aiming for a decision at the World Trade Organization's 13th ministerial conference. They race to announce a decision concurrent with the proposed plurilateral Investment Facilitation for Development at MC13, issuing a draft chair's text.

The co-convenors released two restricted proposals (INF/ECOM/84 and INF/ECOM/85), reviewed by WTD, for intensive negotiations at the upcoming meeting from January 30 to February 2.

Australia's first proposal on January 10 includes the "Final Provisions": 1) Acceptance and entry into force; 2) Accession; 3) Implementation (still bracketed); 4) Reservations; 5) Amendments; 6) Withdrawal; 7) Non-application of this Agreement between Particular Parties; 8) Secretariat (noting WTO Secretariat's role); 9) Deposit; and 10) Registration.

Australia specifies in "Acceptance and Entry into Force" that WTO members may accept the Agreement by depositing an acceptance instrument with the WTO Director-General. The Agreement takes effect 30 days after depositing the [X]th acceptance instrument.

Disagreements over JSIs

Some WTO members oppose the plurilateral JSIs, challenging their alignment with the WTO’s mandate. However, numerous WTO members participate in various JSIs. A legal negotiator questioned the legitimacy of depositing this agreement with the DG without a mandate. The Joint Statement's circulation at MC 11 for E-commerce exploratory discussions doesn't constitute a multilateral mandate, the negotiator remarked. They also speculated on the Director-General's prior consent and the WTO Secretariat's involvement without Budget Committee approval.

In proposal INF/ECOM/84, paragraph 10, the co-convenors state, "This Agreement shall be registered under Article 102 of the United Nations Charter," a move unprecedented in WTO negotiations without a ministerial mandate, as pointed out by a negotiator.

"Draft Chair's Text"

The second proposal, INF/ECOM/85, presents the "draft chair's text" for further review and negotiation, prepared solely by the co-convenors, reflecting their consensus judgment. This 28-page draft, per the co-convenors, retains all proposals from the Consolidated Text INF/ECOM/62/Rev.5 issued on November 15, 2023.

The agreement's value diminished after the U.S. withdrew proposals on cross-border data flows, server localization, and source code. The co-convenors then intensified negotiations on digital trade liberalization measures, urging members to consider the Chair's Text holistically, representing a commercially meaningful and inclusive package since discussions began in 2019.

Placeholders in the Chair's text address issues requiring further discussion or dependent on core obligations stabilization, including ICT products using cryptography, electronic payments, development, scope and exceptions/carve-outs, and protection of personal data and privacy.

The Draft Chair Text covers digital trade facilitation sections like electronic transactions frameworks, authentications, contracts, invoicing, paperless trading, and single window data exchange. Customs Duties in Section B address electronic transmissions, acknowledging the Work Programme on Electronic Commerce (WT/L/274) and prohibiting customs duties on electronic transmissions, though not internal taxes, fees, or charges consistent with the WTO Agreement. This coverage was never agreed in the E-commerce moratorium on customs duties, an e-commerce negotiator noted.

Sections C and D focus on trust in electronic commerce and transparency, domestic regulation, and cooperation and development, respectively. Section E covers telecommunications. The "Final Provisions" chapter, initially shared by Australia, remains in the draft text with brackets.