WTO talks eye fresh extension of e-commerce duties moratorium

YAOUNDÉ: A moratorium on customs duties on electronic transmissions could be heading towards a fresh extension after India lifted its veto, two sources close to WTO negotiations in Cameroon said Saturday.

World Trade Organization members generally apply tariffs to imported goods and services but in 1998 they agreed not to impose them on e-commerce.

The moratorium, which has been renewed every two years since then, is highly important for developed countries — notably for the United States which is calling for it to be made permanent rather than kept under regular review.

So far, only India has openly voiced disagreement with renewing the moratorium when it expires at the end of this month.

Since all WTO agreements are made by consensus, India’s opposition has raised the possibility that duties could begin raining down on e-commerce trade starting next week.

But a source close to the talks at the WTO’s ministerial conference in the Cameroonian capital Yaounde — its biennial supreme decision-making body — suggested India was now open to a two-year extension.

“We have at this moment … all members supporting the renewal of the moratorium,” another source, who asked not to be named, told AFP.

It remains to be seen though whether Washington will be satisfied with kicking the can down the road once again, with US Trade Representative Jamieson Greer insisting this week that his country was “not interested in another temporary extension of the moratorium”. The e-commerce moratorium “applies to everything that is digital”, Valerie Picard, an official with the International Chamber of Commerce, who is attending the conference, told AFP. “It goes far beyond digital books and music. It also includes, for example, security updates, online courses, telemedicine,” she pointed out.

The United States, supported by several countries including Japan, Mexico, Australia, Norway and Switzerland, wants to make the moratorium permanent this time. Some developing countries are more reticent because they see it as a loss of tax revenue and argue that the rapid pace of digital transformation only exacerbates the problem.

To limit opposition to the moratorium, the United States under President Donald Trump has negotiated a clause in recent bilateral agreements with certain countries, notably Indonesia.