TWN Info Service on WTO and Trade Issues (Mar26/42)
30 March 2026
Third World Network

MC14: JSI plurilateral on e-commerce concludes without US participation
Published in SUNS #10411 dated 30 March 2026

Yaounde, 29 Mar (D. Ravi Kanth) — A large group comprising some 66 countries on 28 March announced the conclusion of their Joint Statement Initiative (JSI) “Declaration on Interim Arrangements for Agreement on Electronic Commerce”, with the United States not joining the proposed plurilateral agreement, said participants familiar with the development.

Even though it was the Trump administration that pressed for the JSI on e-commerce at the WTO’s 11th Ministerial Conference (MC11) in Buenos Aires, Argentina in December 2017, the US chose to pull out of the agreement on account of security exceptions, procedural measures, and personal data protection exceptions, among others.

For instance, regarding the Agreement on Electronic Commerce, the Biden administration substantially diluted the draft final text by removing the provisions on cross-border data flows and source code, among others.

Though the former US Trade Representative (USTR) Ambassador Robert Lighthizer, along with Australia, Japan and Singapore, launched the JSI negotiations on e-commerce at the end of MC11, the Biden administration chose to remove the most important areas that it had initially campaigned for, said people familiar with the discussions.

Last year, the US as well as several other members of the JSI e-commerce negotiations expressed serious concerns and reservations over the “stabilized” text, allegedly stymying an early agreement, said people familiar with the discussions.

Prior to MC14, the co-conveners (Australia, Japan and Singapore) appear to have presented an allegedly “misleading” picture in their document (INF/ECOM/87), not revealing the continued differences over several issues in the draft text, said people familiar with the discussions.

Moreover, with US President Donald Trump having demanded that countries treat domestic taxes, particularly the value-added tax (VAT), as an import tariff, it is not clear how the participants of the proposed plurilateral Agreement on Electronic Commerce will respond.

Around 101 countries seem to have implemented a VAT, or goods and services tax (GST), on cross-border online sales.

In the European Union member states, VAT revenues on account of digital services provided by foreign companies collected from these measures increased sevenfold between 2015 and 2022, according to a study cited on taxfoundation.org.

The study suggests that “the maximum revenue potential of a VAT on e-commerce is 2.5 times higher than that of tariffs at the current rates.”

Against this backdrop, it remains to be seen whether the Trump administration will join the consensus at the General Council on the incorporation of the Agreement on Electronic Commerce into Annex 4 of the WTO Agreement, said people familiar with the development.

“A group of 66 countries, including New Zealand, has made a total mockery of claims to the high ground as defenders of the WTO’s “multilateral rules-based system”,” said Dr Jane Kelsey, Professor Emeritus in Law at the University of Auckland, who is attending the WTO’s 14th Ministerial Conference (MC14) in Yaounde, Cameroon.

As Professor Kelsey explained, “for several years, supposed sticklers for the WTO rules, who call themselves “Friends of the System”, have been complicit in a process dubbed “reform by doing”, designed to avoid having to play by the rules of the WTO’s constitution, the Marrakesh Agreement.”

That strategy includes a subset of countries negotiating new plurilateral agreements on cherry-picked topics, without a mandate but using WTO resources. The United States, the European Union and other, mainly wealthy countries, have made it clear they see this as the future of the WTO.

Developing countries have strongly criticized the systemic impacts that will see their priorities marginalized even further.

One such “Joint Statement Initiative” is on electronic commerce. Negotiations on the text were concluded in July 2024. To adopt it as a plurilateral agreement in the WTO requires consensus of all 166 members at a Ministerial Conference. The number of participants has dwindled from 91 to 66, so consensus was not going to happen.

Rather than abide by those WTO rules, the participants, including New Zealand, announced today that they will go ahead anyway and seek approval through their domestic processes, while continuing to press for its adoption in the WTO.

Adopting a plurilateral agreement outside the WTO, as with the Trans-Pacific Partnership Agreement, would be relatively uncontroversial.

But they are actually passing this off as a WTO instrument. The press release called it the “WTO Agreement on Electronic Commerce”. The text is on WTO letterhead with an incomplete WTO document number. An annex creates a parallel process for arbitration, cross-referenced to the WTO’s own processes.

“Perhaps most outrageously,” Professor Kelsey said, “it provides for the WTO Director-General to receive notifications of adoption of the agreement by individual WTO Members, which she has no mandate to do.”

Professor Kelsey points to the dangerous precedent this creates: the US talked last week of adopting “interim” plurilateral agreements that do not have consensus support in the WTO.

“In helping to spearhead this first precedent, New Zealand has aligned itself with the US in snubbing its nose at the “rules-based” multilateral trade regime that it purports to champion,” she said.

DRAFT “STABILIZED” TEXT

An earlier version of the draft “stabilized” text contained 38 articles comprising eight sections (A-H).

Section A includes “Scope” in Article 1; “Definitions” in Article 2; and “Relation to Other Agreements” in Article 3.

Section B, focusing on “Enabling Electronic Commerce”, covers “Electronic Transactions Framework” in Article 4; “Electronic Authentication and Electronic Signatures” in Article 5; “Electronic Contracts” in Article 6; “Electronic Invoicing” in Article 7; “Paperless Trading” in Article 8; “Single Windows Data Exchange and System Interoperability” in Article 9; and “Electronic Payments” in Article 10.

Section C on “Openness and Electronic Commerce” includes “Customs Duties on Electronic Transmissions” in Article 11; “Open Government Data” in Article 12; and “Access to and Use of the Internet for Electronic Commerce” in Article 13.

Section D, which addresses “Trust and Electronic Commerce”, includes “Online Consumer Protection” in Article 14; “Unsolicited Commercial Electronic Messages (Spam)” in Article 15; “Personal Data Protection” in Article 16; and “Cyber Security” in Article 17.

Section E, which deals with “Transparency, Cooperation, and Development”, includes “Transparency” in Article 18; “Cooperation” in Article 19; and “Development” in Article 20.

Section F deals with “Telecommunications” in Article 21.

Section G, which is focused on “Exceptions”, consists of “General Exceptions” in Article 22; “Security Exception” in Article 23; “Prudential Measures” in Article 24; “Personal Data Protection Exception” in Article 25; and “Indigenous Peoples” in Article 26.

Section H on “Institutional Arrangements and Final Provisions” covers “Dispute Settlement” in Article 27; “Committee on Trade-Related Aspects of Electronic Commerce” in Article 28; “Acceptance and Entry into Force” in Article 29; “Implementation” in Article 30; “Reservations” in Article 31; “Amendments” in Article 32; “Withdrawal” in Article 33; “Non-application of this Agreement between Particular Parties” in Article 34; “Review” in Article 35; “Secretariat” in Article 36; “Deposit” in Article 37; and “Registration” in Article 38.