US, allies try another NAMA pluri, cloaked as ICT-NTBs

Developed-country WTO members are spearheading a move – outside the multilateral framework of the Doha work programme – to lower non-tariff barriers to trade in information and communication technology products.

by D. Ravi Kanth

GENEVA: Major developed and some developing countries on 1 November signalled their intention to pursue yet another plurilateral initiative at the WTO, ostensibly for removing/reducing non-tariff barriers (NTBs) in global trade in information and communication technology (ICT) products, trade negotiators told the South-North Development Monitor (SUNS).

Instead of addressing the NTBs in the Doha work programme on non-agricultural market access (NAMA), these major industrialized and some developing countries – Switzerland, the European Union, Japan, Hong Kong-China, the United States, Singapore, Chinese Taipei, Korea and China, among others – indicated their intention to secure an agreement for tackling NTBs in the ICT sector at the WTO’s eleventh Ministerial Conference, to be held next year in Buenos Aires.

At a meeting of the WTO Committee on the Information Technology Agreement on 1 November, India and Egypt severely questioned the move to pursue a sectoral approach for tackling NTBs outside the NAMA negotiations.

The two developing countries said they will not accept such an approach which further undermines the NAMA negotiations as set out in the Doha work programme, according to negotiators who took part in the meeting.

The former chair of the Doha NAMA negotiations, Ambassador Remigi Winzap of Switzerland, in his last report delivered on 11 April, had said unambiguously that “many Members also flagged an interest in NTBs.”

He said “some members would see merit in continuing discussions on NTB proposals on which most work has been done in the past (e.g. Horizontal Mechanism, Transparency, Textile labelling)” while some others “see potential in new areas (e.g. on foodstuff).”

“I also heard that if a sectoral approach were to be pursued for NAMA tariff reductions, one could also seek to address the NTB part of such sector,” the former chair said, giving an indication that a sectoral approach to NTBs is being considered by some members.

“I further heard that work on NTBs undertaken in some RTA [regional trade agreement] negotiations, such as on regulatory coherence could be looked into and might inspire discussions in the WTO, either in the NAMA negotiating group or in the Committee on Market Access.”

Nevertheless, despite opposition from key developing countries, the trade majors at the WTO seem hell-bent on making use of the supposedly member-driven and multilateral WTO to address their specific concerns in accordance with the interests of their powerful industrial lobbies, said an African negotiator.

“Otherwise, how do we explain an unofficial document prepared by the ICT lobbies of the US, the EU and Japan being circulated at the meeting to reinforce their specific demands on reducing/removing NTBs?” the negotiator asked.

ICT lobby proposals

In the two-page unofficial room document titled “Furthering Global Trade in ICT Products by Streamlining the Application of Technical Rules”, the sponsors (the US, the EU and Japan on behalf of their ICT lobbies) proposed: “Following the agreement for an expanded Information and Technology Agreement (ITA), the ICT global industry would like to suggest to start with the following areas within the framework of the WTO-ITA Committee’s Non-Tariff Measures Work Programme, with the aim of removing or reducing these [technical] barriers to trade.”

“We encourage ITA Committee participants to achieve outcomes in these areas for the next WTO Ministerial Conference (MC11) in Argentina at the end of 2017,” the unofficial document demanded.

It identified three major areas: “alignment of conformity assessment procedures and increased transparency”; “adoption of e-labelling”; and “avoiding forced localization” measures, in which it mentioned the importance of crafting obligations on forced localization measures as set out in “regional trade agreements, such as the Trans-Pacific Partnership (TPP)”.

Under “alignment of conformity assessment procedures and increased transparency”, the document suggested that “there is a proliferation of unique and unnecessarily burdensome regulatory obligations at the national level in the areas of testing and certification requirements.”

“Redundant testing and certification increase customer costs, limit choice, and delay market entry in many cases by weeks or months, which is especially significant for ICT, given the rapid development and marketing/sales cycle of ICT products. WTO members should reduce these NTBs in accordance with the WTO Agreement on Technical Barriers to Trade (TBT Agreement).”

The document maintained that “work in the WTO ITA Committee to highlight these obstacles to trade with a view to their reduction could deliver a tangible, positive result by MC11.”

As a first step, the ITA Committee’s “Guidelines for EMC/EMI [Electromagnetic Compatibility/Electromagnetic Interference] Conformity Assessment Procedures from 2005” can simplify and align rules related to conformity assessment to enhance global trade in ICT products, according to the document.

Further, as part of this effort, the sponsors said “we propose that the ITA Committee send a survey to Members requesting specific information about their technical and administrative requirements for EMC/EMI, as well as other common regulated areas such as safety and radio aspects (where relevant).”

“In addition to asking which specific standards and what corresponding conformity assessments are required (e.g. in-country testing, third party, or SDoC), the survey could address Members’ approaches to the adoption of global standards,” according to the document.

On “adoption of e-labelling”, the industry lobbies said: “E-labelling is the option for the manufacturer to display required regulatory information and markings (e.g. CE mark in Europe, FCC in the US) via the product’s integral screen or other electronic method instead of physically affixing them on the product itself.”

They claimed that e-labelling will bring “many benefits for market surveillance, manufacturers and consumers alike, such as better access to regulatory information, removal of design restrictions, better traceability and a more environmental-friendly option.”

At WTO level, according to the ICT lobbies, “we propose the negotiators discuss the opportunity of adopting a global framework for e-labelling for ICT products.”

This framework would feature members’ adoption of the same legal requirements (based on common guidelines and standards), to ensure that manufacturers placing products on all markets can equally benefit from this option, it suggested.

On the last issue of avoiding forced localization barriers, the global ICT industry “would like to draw the Committee’s attention to forced localization measures impacting trade in ICT equipment and highlight how these measures raise prices, distort supply and demand, and increase costs for customers seeking to purchase ICT equipment, particularly SMEs [small and medium-sized enterprises].”

“This work could include discussion of how Members’ existing obligations under the WTO Agreement address forced localization measures and how regional trade agreements such as the Trans-Pacific Partnership also address these measures,” it maintained.

In a nutshell, industry lobbies are able to reach a supposedly member-driven and rules-based WTO directly and press for sectoral agreements regardless of opposition from members. The lobbies and their governments seem determined to press ahead with plurilateral initiatives if developing countries raise any opposition, the African negotiator argued. (SUNS8347)                            

Third World Economics, Issue No. 628, 1-15 November 2016, pp4-5