Info Service on WTO and Trade Issues (Dec17/34)
Buenos Aires, 20 Dec (Roberto Bissio*) - The public endorsement by WTO Director-General Roberto Azevedo of the "Enabling E-commerce" initiative and his active participation at its launch here last week during the eleventh ministerial conference (MC11) of the WTO in Buenos Aires is a drastic departure from his stated policy and may be "illegal" or contrary to explicit WTO rules, according to observers and some trade delegations.
Azevedo had announced the initiative on 11 December in Buenos Aires, at a press conference along with Chinese billionaire tycoon and chairman of Alibaba group, Jack Ma, and Rick Samans, a manager of the Switzerland- based World Economic Forum.
Speaking on that occasion, Azevedo had claimed: "The vibrant debate on these issues has shown the desire of many WTO members to bridge the digital divide, and to gain a deeper understanding of the challenges and opportunities of e-commerce."
During MC11, some 70 countries (out of 164 Members of the WTO), led by Australia, Japan and Singapore, had endorsed a statement in favour of electronic commerce "and the opportunities it creates for inclusive trade and development".
Their statement had claimed that micro, small and medium enterprises (MSMEs) will benefit from their "Enabling E-commerce" initiative.
Moreover, they agreed to undertake a parallel initiative, starting in 2018, open to all countries, to "initiate exploratory work together towards future WTO negotiations on trade-related aspects of electronic commerce".
The proposed initiative of the 70-odd countries is clearly an attempt to circumvent the formal procedures of the WTO (where there is already a working group on e-commerce, but without a negotiating mandate), in order to "explore" and come back to the whole membership with a pre-negotiated agreement.
When MC11 was under way, organisations of MSMEs, in both the developing and developed world, had issued statements questioning such claims, and these were made available at MC11 to delegates, media and NGO participants.
These statements had said that E-commerce initiatives and proposed rules and disciplines at the WTO, including on such matters as free flow of data across borders, would disadvantage and perhaps drive out of business MSMEs, and increase oligopolistic control of the three or four US Silicon Valley technology giants.
"The MSMEs are the bait to attract adherence," commented Sally Burch, an Anglo-Ecuadorian expert on electronic communications who was deported from Argentina and not allowed into the ministerial conference, even though she had valid WTO accreditation.
She argues that the real objectives for GAFA-A (the joint lobby of Google, Apple, Facebook, Amazon and now Alibaba) behind that bait could be the "free flow of data", allowing for the commoditisation of personal information, the ability of foreign e-commerce corporations to operate without a physical presence in the country (and thus escape local civil or criminal jurisdiction for their activities) or not requiring companies offering digital service contracts to open up their source code, or to use national software.
Edouard Bizumuremyi, commercial attache at the Permanent Mission of Rwanda, concurred with this view, and said, "We have seen texts that were presented containing rules such as the free flow of data, [and] no localisation requirement."
The African Group, said Bizumuremyi during a panel debate organized by Third World Network, sees the effort at new discussions on e-commerce at the WTO as a disguised manoeuvre to have a mandate on e-commerce, while Africa needs policy space for its digital industrial policy.
Vahini Naidu, counsellor at the South African Permanent Mission to the WTO, said although e-commerce can be used for development and has many benefits, the kind of rules being proposed are not necessarily going to contribute towards development.
Cross-border e-commerce is highly asymmetrical in nature, and is very concentrated and dominated by six countries, she said.
The wider digital transformation of which e-commerce is a little part is important but very disruptive, she said.
Automation and artificial intelligence also mean job losses and governments need the ability to have foresight in terms of adopting innovative policies to address this, she added.
Bangladesh, India and almost all African countries rejected the e-commerce declaration, together with other so-called "21st century issues" that Conference chair Susana Malcorra wanted to introduce into the WTO negotiations.
Nevertheless, Director-General Azevedo estimated that "the Enabling E-commerce initiative will provide a valuable resource - bringing a range of stakeholders together to further explore these issues," and he thanked Alibaba and the World Economic Forum for it.
In doing so, Azevedo may be violating his obligations in terms of Article VI, para 4 (VI:4) of the Marrakesh Treaty, which demands that the Director-General "shall not seek or accept instructions from any government or any other authority external to the WTO".
The next sentence in that para goes on to demand of the DG and the secretariat: "They shall refrain from any action that might adversely reflect on their position as international civil servants."
En plus, the para also adds: "The Members of the WTO shall 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."
During the launch, Azevedo went on public record to say "when the eWTP [Electronic World Trade Platform, the organization that Ma was formally representing at the joint press conference] and the World Economic Forum approached us a few months ago with the idea of joining forces on a high-level, public-private dialogue on e-commerce, I didn't think twice. It struck me as an ideal opportunity...."
Isn't that a public confession of having accepted instructions from an external authority and/or undertaking action "that might adversely reflect on their position as international civil servants"?
Aren't WEF and Alibaba external and by virtue of the billions they mobilize or the billionaires that they gather, an impressive (albeit illegitimate) power or "authority"?
How can the Director-General join them to promote issues that members - whole regions, in fact - reject?
Actually, back in 2014, after having attended the WEF's annual jamboree, the winter conference in Davos, for his first time as DG of the WTO, Azevedo had written in a column for The Huffington Post: "We have learnt a great deal from the failures of the last 18 years. (...) For example, negotiations have to be undertaken with the participation of all 160 [now 164] WTO Members. The process may be a little slower this way, but reaching a consensus is easier and the final result is more likely to be accepted. Moreover, it's important that all Members benefit from the outcomes they negotiate, especially those countries which are least-developed."
In less than four years, that promise seems to have been forgotten. And in a few weeks Azevedo is due to take his espousal of the interests of US Silicon Valley tech giants and Chinese tycoon Ma's Alibaba, and promote this "Enabling E-commerce" initiative at the Davos symposium - without any authority emanating from the WTO's MC11 or the General Council (GC).
After Davos, according to a WTO press release, the initiative will be followed by "other conversations" and "a major event in Geneva later in the year".
The WTO Budget Committee, which has to clear any extra budgetary spending or use of existing resources for such activities, could question Azevedo about those plans, or ask which MC or GC decisions authorize them.
Further challenging the legality of the joint WTO-Alibaba-WEF "initiative", Professor Robert Howse, who teaches international law at New York University School of Law, commented in a piece posted at the International Economic Law and Policy (IELP) blog that Article V of the Marrakesh Agreement might also be affected.
(See SUNS #8598 dated 18 December 2017 and http://www.twn.my/title2/wto.info/2017/ti171233.htm)
Article V:2 reads: "The General Council may make appropriate arrangements for consultation and cooperation with non-governmental organizations concerned with matters related to those of the WTO."
In citing this, Prof. Howse has asked whether Mr. Azevedo will be requesting forthwith the General Council to "make appropriate arrangements" for cooperation with eWTP and the WEF?
The New York law academic also points out that in 1996, the General Council in a decision, clarified what Members viewed as appropriate relations with NGOs, and said in relevant part: "This interaction with NGOs should be developed through various means such as inter alia the organization on an ad hoc basis of symposia on specific WTO-related issues, informal arrangements to receive the information NGOs may wish to make available for consultation by interested delegations and the continuation of past practice of responding to requests for general information and briefings about the WTO."
This means that Azevedo has no authority as Director-General to "consult and cooperate" with the World Economic Forum, which is after all an NGO for all legal purposes, no matter how high the fees it charges to CEOs and billionaires to allow them to mingle (and make profitable deals on the side with Ministers and governmental authorities in various countries) in an exclusive ski resort, with global decision-makers - like Azevedo himself - and celebrities.
So, according to Professor Howse, "the first question is this: will Mr. Azevedo be requesting forthwith the General Council to "make appropriate arrangements" for cooperation with Alibaba and the WEF?"
And if he does not, but goes ahead (without authority) to participate in the Davos event on e-commerce with Alibaba and WEF, is it not time for concerned WTO members to convene a special meeting of the General Council (ahead of the Davos event), to ask the DG to explain and hold him to account?
Prof. Howse has noted that the 1996 decision of the General Council states that "there is currently a broadly held view that it would not be possible for NGOs to be directly involved in the work of the WTO...."
[This was why during Ministerial Conferences like the one in Buenos Aires last week, NGOs have no access to meeting rooms and, basically, less rights than the media.
[Accredited NGO delegates - or at least those allowed by the Argentine government - could attend press conferences at MC11 but not ask questions.]
These and other elements of the 1998 Work Programme were re-affirmed by the General Council in 2015.
"Unless I am missing something", concludes Howse, "the common venture between the WTO, the World Economic Forum and the eWTP goes considerably beyond the kind of cooperation with NGOs envisaged so far by the General Council."
The General Council, which has authority over relations with NGOs, can always change its mind.
And if it agrees with Azevedo's idea of "bringing a range of stakeholders together to further explore these issues", the critics of the e-commerce initiative should also be invited.
Starting with those accredited by the WTO to attend the Buenos Aires ministerial conference but barred by Argentina from doing so... without any public word of complaint or protest from Azevedo.
[* Roberto Bissio is a Uruguay-based civil society activist and coordinator of the international secretariat of Social Watch, an international network of citizens' organizations. He attended MC11 as a WTO-accredited NGO representative, and contributed this comment.]