Members of the World Trade Organization Joint Statement Initiative on E-commerce announced Wednesday that they have reached “the substantial conclusion on a number of global digital trade rules.”
But the three countries leading the negotiations – Singapore, Australia and Japan – admitted that “challenging proposals” like data flows and localization and source code will require more time for discussion as “divergent approaches and sensitivities remained.”
In a press release issued by the three co-convenors from their respective capitals, they said that “as of 20 December 2023, participants have substantially concluded negotiations on 13 articles.”
The articles include 1) E-authentication and E-Signatures; 2) E-contracts; 3) Paperless trading; 4) open government data; 5) Online consumer protection; 6) Unsolicited commercial electronic messages (spam); 7) Transparency; 8) Electronic transactions framework; 9) Cybersecurity; 10) Open Internet access; 11) E-invoicing; 12) Single Windows and 13) Personal data protection.
“Members continue to strive for convergence on provisions of ICT (Information and Communication, Technology) products that use cryptography, telecommunication services (which is an area of interest for the European Union and which ought to be discussed in further liberalization of services under Article 19 of the General Agreement on Trade in Services),and E-Payments,” the three countries said.
According to the release, “most participants have also advocated the importance of an ambitious commitment on customs duties on electronic transmissions,” with the co-convenors urging other participants to join the emerging consensus on this issue.
At this juncture, continuation of the moratorium remains uncertain, as India, South Africa, Indonesia and few other countries seem wedded to the MC12 mandate that suggests the termination of the moratorium.
The MC12 mandate says: “We agree to maintain the current practice of not imposing customs duties on electronic transmissions until MC13, which should ordinarily be held by 31 December 2023. Should MC13 be delayed beyond 31 March 2024, the moratorium will expire on that date unless Ministers or the General Council take a decision to extend.”
The United States, which is the main propellor of the JSI initiative on E-commerce negotiations, pulled its support for proposals on cross-border data, location of computing facilities and source code.
Since then, the co-convenors seemed more focused on face-saving attempts to claim that there is substantial conclusion on a number of global digital trade rules, in sharp contrast to the level of progress achieved in another JSI plurilateral agreement on investment facilitation, said people familiar with the negotiations.
“Looking ahead in 2024,” the co-convenors said “the JSI Membership will focus on resolving outstanding issues, including those related to horizontal provisions (e.g. preamble and exceptions) and legal architecture, in relation to the integration of the JSI outcome in the framework.”
“The JSI Membership will strive to conclude negotiations in a timely manner in 2024,” the co-convenors suggested, but they did not specify whether they will be concluded at the MC13 that is starting in Abu Dhabi on February 26, 2024, or by the end of the year.
A JSI participant, who asked not to be quoted, suggested a deal may emerge under the leadership of Australia which will take over the reins from Singapore in 2024.
In the 65-page fifth version of the revised draft text (Inf/Ecom/62/Rev.5) issued on November 15, seen by WTD, the co-convenors said “For transparency, a box has been included under most provisions to indicate Members' positions or which Members' proposals the text is based on. For text on which discussion has been concluded in the small group, such a box has not been included.”
The co-convenors said the “draft text reflected in this document is subject to the consideration of several cross-cutting issues that many Members have highlighted in the negotiations, including the following:
Some Members have said they may require sectoral carve-outs.
Several have noted the need to determine the relationship of provisions with Members' market access commitments, the legal architecture of the JSI outcome, and existing WTO agreements.”
However, according to the press release, several trade ministers from major industrialized countries and some developing countries, including China and Gambia among others made upbeat pronouncements on the goals that would be accomplished through this agreement when it is concluded.
Notwithstanding its decision to pull out its core proposals, US Trade Representative Katherine Tai said: “Digital trade and e-commerce represent important growth opportunities for traders around the world, while at the same time posing regulatory challenges to governments who want to ensure that the marketplace is fair and consumers are protected.
"The United States welcomes the progress made to date on the WTO E-Commerce JSI and commends the hard work of the three co-conveners, as well as the 90 Members who have contributed to the meaningful disciplines developed over the past couple of years. The United States will continue to work in 2024 to help achieve further progress with a view to a final package of articles that brings meaningful benefits to workers, businesses, governments, and the public, particularly MSMEs and women-owned businesses.”
WTO Director-General Ngozi Okonjo-Iweala also spoke her mind in support of the JSI deal on e-commerce. “The JSI on E-Commerce offers a unique opportunity for participants to design shared global rules that will enhance stability and predictability and lower costs for businesses in this fast-growing area of cross-border trade. Participants are demonstrating how they can deliver practical, everyday benefits for businesses and consumers whilst building a digital economy that aims to benefit people everywhere.”
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