The backdoor strategy to adopt plurilateral agreements in the WTO

When is a WTO agreement not a WTO agreement? Jane Kelsey considers the case of the Agreement on Electronic Commerce, the latest instance of the push by a few influential countries to lend the WTO’s institutional backing to a treaty that has no consensus support from the membership.

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ARGUABLY, the most significant outcome from the World Trade Organization (WTO)’s ‘reform’ ministerial conference (MC14) in Yaoundé was the adoption of an Agreement on Electronic Commerce by just 66 member states. Under the Marrakesh Agreement, the Organization’s constitution, an agreement among a subgroup of members can be adopted within the WTO framework only by consensus of the entire WTO membership, following which the accord is then listed under Annex 4 of the Marrakesh Agreement. This reflects the exceptional status of such a plurilateral agreement within the multilateral trade regime.

Yet, the Agreement on Electronic Commerce was never subject to discussion, let alone a consensus decision, by the WTO members at MC14. Ignoring that fact, its participants have branded it a WTO agreement – apparently with support from the WTO Director-General Dr Ngozi Okonjo-Iweala.

The agreement’s significance goes far beyond its content. It is being treated by its proponents as a precedent for other plurilateral agreements to become de facto WTO instruments, without needing a mandate to initiate negotiations or securing a consensus for their adoption:

(a) In March, prior to the ministerial, the United States Trade Representative foreshadowed the adoption of ‘interim plurilaterals’, which he described as ‘voluntary and temporary agreements among a subset of Members to move forward on specific issues without needing full consensus’. There is no such thing as an ‘interim plurilateral’ in the WTO.

(b) At the launch of the agreement on the third day of the ministerial, Japan’s trade minister said it ‘serves as a successful milestone of the WTO’s rule-making function in plurilateral format’.

(c) Canada’s trade minister went further, misleadingly describing it as ‘a path forward for a plurilateral initiative conceived and negotiated at the WTO’.

(d) At the conclusion of the ministerial, the Chair of the conference described it as a ‘pragmatic pathway’ to bring the agreement into effect while working towards its full incorporation into the WTO legal framework.

(e) At her final press conference in Yaoundé, the WTO Director-General proposed completing the work on the failed IFA plurilateral initiative (see below) and submitting that and the e-commerce agreement to the WTO secretariat for notification while waiting for the process to be agreed upon at the Organization’s General Council. She was quoted as saying, ‘Let’s see if within the configuration of the WTO we can also have willing coalitions of members who, when there is an opportunity, can seize it in a plurilateral and move ahead without necessarily waiting to go through the process.’

The strategic context

This strategy is the latest step in over a decade of moves to shift the WTO from being a multilateral to a plurilateral institution, allowing the more powerful players effectively to dictate what matters are given priority for the development of new rules and to sideline those they do not support. This will disproportionately impact on developing countries and least developed countries (LDCs).

The first step in this push was the negotiation of a Trade in Services Agreement (TiSA) on the margins of the WTO between 2013 and 2016. That was designed to bypass multilaterally-mandated negotiations under the General Agreement on Trade in Services (GATS) and develop a plurilateral agreement that would be adopted in the WTO. The negotiation was actively facilitated by the WTO secretariat. However, TiSA was never concluded, so the question of how to incorporate it into the WTO without consensus support was never resolved.

In 2017, at MC11 in Buenos Aires, several subgroups of WTO members, led by the wealthier and more powerful countries, launched joint ministerial statements on sectoral topics. These became known as Joint Statement Initiatives (JSIs). The lead proponents were almost identical to those who had declared the Doha ‘Development’ Round of multilateral negotiations dead at the previous ministerial.

These joint statements led to formal negotiations on three agreements that had no WTO negotiating mandate, and which bypassed existing institutional decisions, mandates and bodies on those matters. Again, this had the active support of the WTO secretariat. Despite the lack of formal status and multilateral participation, they were treated as negotiations within the WTO. However, this posed a dilemma for their adoption in the WTO, as that would require consensus. The first two attempts have been problematic.

The JSI on Services Domestic Regulation was the first to be concluded. Although the agreement added to the core rules of the GATS, its architects took a backdoor route for its adoption to avoid formally amending the GATS (which also requires consensus), by instead adding it to members’ GATS schedules of commitments. However, most of this subgroup also signed a side-letter saying this would not create a precedent. The potential to use this pathway in the future is also limited as the content of the agreement would need to relate exclusively to the GATS.

The first attempt to secure adoption of a JSI by consensus revolved around the Investment Facilitation Agreement (IFA). India, and initially South Africa, prevented its adoption at the WTO General Council over concerns about the systemic implications of the proliferation of plurilaterals and their overtaking multilateralism. India maintained that position at MC14. The IFA’s 129 participating countries issued a declaration at the end of the ministerial conference committing to seek timely integration of the IFA within the WTO framework. However, they would also ‘explore practical pathways’ towards the deal’s ‘effective implementation’. Informal discussions at MC14 indicate there has been consideration about pursuing the same pathway as that adopted for the Agreement on Electronic Commerce, the third of the JSI plurilateral agreements.

The JSI negotiations on the e-commerce agreement had been concluded in July 2024. At the WTO General Council in February 2025 and December 2025, there was no consensus for the adoption of the agreement as an Annex 4 plurilateral agreement. An early draft of the MC14 agenda proposed its formal adoption as a plurilateral agreement by consensus; however, that was dropped from later versions. This reflects the much lower level of support for this JSI compared with the IFA. Some months earlier, the proponents had begun developing an alternative strategy to finesse the adoption of the JSI as a quasi-WTO instrument, irrespective of the legalities. Subsequently, adoption of the agreement by its signatories, who would then initiate their respective domestic ratification processes, was announced during MC14. They described it as a WTO agreement. However, the number of participating members in the JSI had dwindled from the original 91 to 66.

Illegalities of the JSI on e-commerce

The original JSI e-commerce text was designed to be adopted, implemented and enforced within the WTO. That has not occurred. The Declaration on Interim Arrangements for the Agreement on Electronic Commerce issued by the 66 members at MC14 says the participants will continue to seek the agreement’s adoption as an Annex 4 agreement. Yet they are already describing it as a WTO agreement when it is not.

The Declaration contains the whole July 2024 agreement text, sandwiched between a 10-paragraph Declaration at the start and a 12-paragraph Annex on Interim Arrangements and a more detailed appendix on an alternative procedure for dispute settlement appeals through arbitration at the end. The Declaration says the participants ‘affirm their commitment to agree WTO rules on trade-related aspects of electronic commerce, as announced on 25 January 2019 (WT/L/1056)’ (emphasis added). Document WT/L/1056 is the 2019 Joint Ministerial Statement where 49 members announced their intention to ‘commence WTO negotiations on trade-related aspects of e-commerce’ (emphasis added) – despite there being no mandate from all the WTO members for such negotiations – and hence to describe them as WTO negotiations on ‘WTO rules’. The document does not indicate which WTO body circulated it on behalf of that group of members. Such a ‘bootstraps’ argument allows members to seek to legitimise a final plurilateral agreement by citing their own previous joint statement and its assertions of WTO status.

The Declaration and accompanying text was given a WTO document number in the Ministerial Conference series. The allocation of specific document numbers at ministerial conferences dates back to the 2001 Doha conference, but there appear to be no rules that restrict what document can be given such a reference. This potentially opens the door to an unlimited range of member-initiated communications being tabled at a ministerial and securing a document number that confers some legitimacy on it as belonging within the WTO.

The e-commerce agreement still provides for the WTO secretariat to administer it. Upon the deposit of 45 instruments of acceptance, the agreement is meant to come into force among its parties – necessarily outside the WTO. Yet this process is to be supported by the WTO Director-General and the secretariat. The Director-General would receive the instruments of acceptance by parties to the agreement, which would be serviced by the secretariat. This is beyond the legal capacity of the Director-General, which is limited to WTO agreements. Further, the appendix on arbitration appeals says the Director-General will notify the parties to a dispute and third parties about the results of selection of arbitrators in the dispute.

This seriously undermines the requirement in Article VI of the Marrakesh Agreement that the Director-General discharge her duties independently: ‘In the discharge of their duties, the Director-General and the staff of the Secretariat shall not seek or accept instructions from any government or any other authority external to the WTO. They shall refrain from any action which might adversely reflect on their position as international officials.’ WTO Members have a corresponding duty to ‘respect the international character of the responsibilities of the Director-General and of the staff of the Secretariat and shall not seek to influence them in the discharge of their duties’.

In the case of the e-commerce agreement, it appears that the secretariat, led by the Director-General, and the subset of members participating in this JSI have collaborated to advance a position favoured by those members, thereby breaching their respective obligations under the Marrakesh Agreement. In addition, there has been no specific budget allocation in the WTO to support the unmandated JSIs or the Director-General’s role.  

Unclear status of dispute settlement

The original text of the e-commerce agreement applied the dispute settlement provisions of the GATT and GATS and the WTO Dispute Settlement Understanding (DSU) to disputes under the agreement. This obviously cannot apply if the agreement has not been adopted by the WTO. So the annex on interim arrangements provides for a parallel process that replaces the WTO Dispute Settlement Body (DSB) with the Committee of the Parties until the agreement is adopted into the WTO.

But this does not address issues of enforcement whereby the DSB can authorise the suspension of obligations or commitments in areas that are beyond the scope of the provision breached. Permission to authorise the suspension of concessions across the same and other covered WTO agreements requires consultation with the relevant WTO councils and sectoral bodies with responsibility for those agreements. Leaving that unamended would require those bodies to engage with a dispute settlement process for a non-WTO agreement.

Which agreement is next?

A crunch issue at MC14 was the fate of the moratorium on customs duties on electronic transmissions, with the US wanting the moratorium to be made permanent and to explicitly cover the ‘content’ of such transmissions, and other members resisting its extension beyond another two years. No agreement was eventually reached at the ministerial, and the moratorium expired as a result. However, the US demands have already been accepted by some states in non-WTO agreements.

After the ministerial failed to agree, a subgroup of 23 members issued a new joint statement saying they would maintain the current practice of not imposing tariffs on e-transmissions, including content. This was described as an open-ended ‘temporary plurilateral measure’ that only applies until the next WTO General Council meeting in May 2026. Its function therefore seems symbolic, but it may be intended to send a message to other WTO members that the participants will enter a future plurilateral on the moratorium on their terms if they do not like the outcome at the General Council.

Interestingly, this joint statement did not include all the signatories to the JSI on e-commerce (the JSI also makes the moratorium permanent among its participants) but did include several members that are not party to the JSI (Ecuador, Guatemala, Mexico, Panama, Paraguay, Taiwan, the US, Uruguay).

Implications of the e-commerce JSI as a precedent

This latest step in seeking to legitimise and normalise plurilateral agreements in the WTO has gone further than previous moves and actively snubbed the WTO rules. The Director-General’s catchphrase of ‘reform by doing’ is now, with her sanction, allowing powerful states to remake the organisation at will. This has a number of profound systemic implications:

1. Unmandated plurilateral negotiations, and the adoption of the resulting agreements as WTO instruments, using a ‘pragmatic’ approach that is not provided in the rules would create a precedent for non-compliance with WTO rules more generally.

2. If plurilaterals can be adopted as de facto WTO agreements in this way, members will have no incentive to comply with the explicit requirements for consensus.

3. An open-ended plurilateral initiative that provides for future negotiations based on the will of a subgroup of members can override inbuilt negotiating mandates within the WTO on the same subject matter by making them irrelevant.

4. If the Director-General and secretariat facilitate and then service these plurilateral agreements, they will be exceeding the constitutional limits on their power and have no effective constraints on what they do.

5. If the WTO’s instruments and the scope of its agreements can be expanded by collective action outside the rules, the institution itself will have no boundaries.

6. All of this works in favour of the power-brokers in the WTO whose economic and strategic influence will enable them to dictate the future direction, subjects and activities of the WTO at the expense of developing countries and LDCs. 

Jane Kelsey is Emeritus Professor at the Faculty of Law, University of Auckland, Aotearoa New Zealand.

*Third World Resurgence No. 367, 2026/2, pp 18-20