Info Service on WTO and Trade Issues (Feb18/20)
28 February 2018
Third World Network
DG inciting sponsors of plurilateral initiatives to intensify campaign
Published in SUNS #8629 dated 26 February 2018
Geneva, 23 Feb (D. Ravi Kanth) - The World Trade Organization Director-General
Roberto Azevedo appears to be encouraging the sponsors of various
plurilateral initiatives announced after the failed eleventh ministerial
conference (MC11) at Buenos Aires last December to intensify their
campaign, according to trade envoys familiar with the development.
These plurilateral initiatives on electronic commerce, investment
facilitation, disciplines for micro, small, and medium enterprises
(MSMEs), and trade and gender were announced by their sponsors in
the form of their own declarations when their proposals failed to
secure any multilateral consensus at MC11, and the conference adjourned
without any conclusions or declaration.
During a retreat meeting of the ACP (Africa, Caribbean, and Pacific)
countries on 15 February, the Director-General said: "I also
want to acknowledge the declarations put forward by various groups
of members in Buenos Aires - including some ACP members - covering
e-commerce, investment facilitation, MSMEs and women's economic empowerment."
Knowing full well that these "declarations" failed to get
adopted at the open-ended heads of delegations meetings convened by
different minister-facilitators on 12 December in Buenos Aires, the
Director-General is subtly inciting the sponsors of those declarations
to step up their campaign, said an ACP participant who asked not to
Instead of adhering to a member-driven process in which members have
spoken against these four initiatives, the Director-General said "it
will be up to proponents to take these initiatives forward,"
the participant pointed out.
This, participants said, amounts to a clear attempt by the Director-General
to undermine the WTO's multilateral decision-making process based
on the principle of consensus, when he told the ACP countries "it's
encouraging that, in each case, proponents are clear that these initiatives
will be open, inclusive and as transparent as possible."
The Director-General's jarring remarks on these controversial initiatives
failed to surprise the least-developed and developing countries, said
another participant who asked: "Is he openly lobbying for the
In what was viewed by some of the participants as "clever and
mischievous" remarks, the Director-General said, "I have
always stressed that these initiatives should not be a departure from
multilateralism, but a way to help and support it."
How can these plurilateral "initiatives," which lacked multilateral
approval, be anything but a "departure from multilateralism",
the ACP participant wondered. Surely, they are not "a way to
help and support it," the ACP participant said.
Azevedo said: "So I am urging that these processes should be
conducted very carefully. They should remain genuinely open, inclusive
and transparent - and take all perspectives into account."
Unsurprisingly, in his speech to the ACP group, the Director-General
made no reference to the unresolved multilateral issues in the Doha
Development Agenda (DDA). He did not also indicate how the DDA work
program which has the support of more than 100 countries will be carried
A day after the Director-General asked his plurilateral "constituency"
to intensify their war-like drumbeat, Chinese Taipei issued a plurilateral
"work program on electronic commerce" that made no reference
to the multilateral 1998 work program on electronic commerce.
In its proposal, titled "Removing Cyberspace Trade Barriers:
Towards A Digital Trade Environment with Reciprocally Equal Access",
Chinese Taipei has laid the markers for what needs to be discussed
before approaching the disciplines on e-commerce.
Chinese Taipei says that while governments can regulate "cyberspace",
there should be an attempt to frame regulations for both "offline"
activities as well as "online matters."
It says "driven by a variety of policy objectives, government
regulations on cyberspace activities can take different forms"
such as "interventions into the data-flow" which include
"mandatory data localization requirements that personally identifiable
information (PII) be stored in domestic servers, protecting the privacy
of the data owners and preserving the domestic authority's access
to those data."
The Chinese Taipei proposal is a throwback to the non-paper submitted
by the US in 2016 which had mentioned about the governments' ability
to intervene in internet traffic, directly or with assistance from
Internet services providers (ISPs), to filter online requests and
to block access to certain websites with immoral or illegal content.
Echoing the concerns raised by the US in its non-paper, Chinese Taipei
has argued that "given the increasingly widespread use of the
Internet in the practice of international trade, government intervention
in the cross-border transmission of information by electronic means
may well cause trade concerns."
It says government interventions will "increase the marketing,
transaction and administration costs of suppliers, which weakens their
positions versus competitors who have access to the Internet, and
are able to reach or to be reached via the Internet."
To bolster its arguments on the restrictions imposed on data flows
and other barriers, Chinese Taipei has coined the term "cyberspace
trade barrier" (CTB) to refer to the interventions by governments
in the cross-border transmission of information by electronic means,
which can have a restrictive or prohibitive effect on international
Chinese Taipei says that "trade barriers can also be created
by the inaction of government, such as a lack of protection of Internet
privacy or the absence of proper signature legislation."
Citing the US non-paper for "enabling cross-border data flows,"
it has mentioned three issues for addressing data flow concerns.
These three issues include (a) "enabling cross-border data flows"
which relates to the tension between the free flow of information
and consumer data protection, (b) "promoting a free and open
internet" which deals with the general openness of the Internet,
and (c) "preventing localization barrier" that aims to address
the mandatory local data-centre requirement - data-flow is not specifically
Chinese Taipei has also referred to the proposals from other plurilateral
proponents such as Canada, Chile, Colombia, Cote d'Ivoire, the EU,
Korea, Mexico, Moldova, Montenegro, Paraguay, Singapore, Turkey and
Ukraine on "measures ensuring openness" and Brazil's proposal
for ensuring cross-border data flow.
Against the backdrop of the slew of proposals from e-commerce plurilateral
sponsors, Chinese Taipei has clarified that the term "cyberspace
trade barrier" will apply to "the trade restrictive effects
of government interventions in the cross-border transmission of information
by electronic means."
"In this context," it says, "the term "data"
or "information" should refer to its broadest scope: all
types of information transmitted via the Internet."
"Note should also be taken that data here refers not only to
data generated during the course of, or after the transaction (e.g.
personal data provided to foreign online vendors for shipment), but
also to data transmitted before a transaction is made (e.g. online
communications with the vendor regarding price negotiation) and even
before the parties match (e.g. as the consumer searches the Internet
to find the best vendors)."
Unlike "traditional trade barriers" such as customs duty,
quotas or other non-tariff requirements which apply after the transaction
has been formed or completed, Chinese Taipei says "CTBs often
prevent potential sellers and consumers from matching with each other
via the Internet, thus barring any trade opportunities in the first
"Under such circumstances, if the discussions do not properly
cover data associated with earlier stages in the trading process (i.e.,
the pre-matching phase), then they could not remedy the negative trade
effects brought about by CTBs," Chinese Taipei has pointed out.
In short, says Chinese Taipei, members must first address and clarify
the "existing WTO rules and commitments relating to CTB measures,"
and identify "the scope of legitimate policy objectives for which
CTB measures can be justified."
Subsequently, members "may further consider reaching concrete,
legally-binding disciplines on the CTB issue."
But none of the plurilateral issues raised in Chinese Taipei's proposal
can be discussed unless members complete the multilaterally-agreed
1998 work program on electronic commerce that deals with exploring
all the ramifications of e-commerce under different WTO bodies, some
trade diplomats pointed out.
Further, there is no clarity whether rule-making is permitted even
in open-ended plurilateral initiatives like the ITA (Information Technology
Agreement) which deals only with the elimination of tariffs.
Besides, the plurilateral initiatives on rule-making in different
areas seem inconsistent with a multilateral rule- making trade body.
However, the Director-General and the plurilateral sponsors seem to
reckon that the only way to save the WTO is by embarking on initiatives
which are acceptable to the US and other industrialized countries,
including their allies in the developing world, whether or not these
are acceptable to the large majority of the membership who oppose
such plurilateral initiatives.
Obviously, the Director-General and the plurilateral sponsors seeking
new rules seem least bothered about preserving the sanctity and integrity
of the member-driven WTO, said a trade envoy from a least-developed
country, who asked not to be quoted.