Major WTO agreement sees 91 countries agree to not charge for cross-border data transfers
In an important update for cross-border trade, 91 countries have reached a consensus on new ecommerce norms, marking the end of half a decade of back-to-back negotiations.
The latest agreement includes an extension of the moratorium on taxing cross-border electronic transmissions and forms part of the World Trade Organization’s Joint Statement Initiative on Electronic Commerce.
The moratorium, which is critical for global digital trade, ensures that no customs duties will be imposed on electronic transmissions between different countries.
Cross-border electronic transmissions will not be taxed
The agreement covers a wide range of transmissions, such as video, audio, and written text. Although customs duties have never been applied to the sector, the agreement reaffirms the importance of free data flow. It also leaves the door open for future “internal taxes, fees, or other charges on electronic transmissions.”
Internal taxes could address the issue of social networks and search engines paying taxes to support local journalism, a proposal Meta and others oppose.
Other key areas highlighted in the statement include facilitating cross-border ecommerce for SMEs by reducing red tape, making government data both available and machine-readable, combating spam and addressing cybersecurity.
Australia, Japan and Singapore also committed to supporting less developed countries by offering technical assistance and opportunities to build capacity.
However, what may be good news for consumers and businesses now may not last forever. The moratorium on taxing electronic transmissions is set for a two-year extension, after which a review may see stances change.
Even so, the agreement represents an important step in global trade and addresses a growing area of commerce that must be fostered appropriately to encourage growth without limiting countries, companies and consumers.
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In an important update for cross-border trade, 91 countries have reached a consensus on new ecommerce norms, marking the end of half a decade of back-to-back negotiations. The latest agreement includes an extension of the moratorium on taxing cross-border electronic transmissions and forms part of the World Trade Organization’s Joint…
