By TIOL News Service

NEW DELHI, NOV 26, 2016: CHINA and Pakistan’s proposed approach to e-commerce negotiations drew interest at the November 17 meeting of the WTO Goods Council. Over 20 members took the floor, with many emphasizing the importance of delivering an outcome for next year’s Ministerial Conference.

China, introducing the proposal, said that discussions should focus on the promotion and facilitation of cross-border trade in goods enabled by the Internet. It said discussions could also include services directly supporting this, such as payment and logistic services. Discussions should not lead to new market access commitments, China said, adding that the needs of developing countries should be reflected in any outcomes. Priority should be given to “easy issues”, with a focus on realizing “pragmatic progress” at the 11th Ministerial Conference (MC11) to be held in December 2017, China said.

Pakistan meanwhile said it was ready to engage with other WTO members to continue work on e-commerce.

China and Pakistan’s proposal was well received by delegations and provoked comments from 22 members. Several affirmed the importance of working towards delivering outcomes at MC11. There was also support for incorporating the needs and concerns of developing country members in the deliberations. Some members emphasized the importance of maintaining discussions on other aspects of e-commerce, such as online trade in services as well as commitments for consumer protection, data privacy, and intellectual property rights. Several delegations said there is a need to make permanent the moratorium on customs duties on electronic transmissions instead of continuing with the current practice of renewing the moratorium every two years. Some said that taxation issues contained in China and Pakistan’s proposal were outside the scope of the WTO.

A number of delegations said negotiations should continue in line with the Work Programme on E-Commerce approved in 1998, which calls on members to examine in mandated WTO bodies the trade-related e-commerce issues relating to goods, services, intellectual property and the needs of developing countries. China said that their proposal intends that discussions, at the present stage, should be based on the existing mandate.

At their 10th Ministerial Conference in Nairobi last December, trade ministers agreed to continue work under the WTO’s existing Work Programme on Electronic Commerce. They also instructed the General Council to hold periodic reviews, based on the discussions in the Goods Council and other WTO bodies, in its sessions of July and December 2016 and July 2017 and to report back to the next Ministerial Conference.

To advance the e-commerce discussions, China said a seminar on e-commerce and trade in goods should be organized under the auspices of the Council for Trade in Goods. Several members supported holding a joint informal meeting of the mandated WTO bodies.

Trade concerns

The Goods Council is the forum for hearing members’ concerns over certain measures affecting trade in goods. Russia, Japan and the European Union brought new trade concerns to the Council’s attention.

Russia expressed concerns about measures in Croatia restricting imports of Russian petroleum products and biofuel in favour of imports from the EU and other countries. These include pre-approval requirements, mandatory use of warehouses, and licensing. The EU said it will address the matter in consultation with Croatia.

Japan voiced concerns about Turkey’s duties on imported tyres, which it said were higher than what it had committed to the WTO. Turkey said it was working on this issue and assured members its policies were consistent with its WTO commitments.

The EU raised concerns about Russia’s mandatory certification measures for cement, which it said were a de facto ban on EU cement imports. The EU said certificates previously approved had been cancelled. Russia responded that the measures are justified due to a sharp decline in the quality of cement and that it applied the measure in a non-discriminatory manner.

Several trade concerns previously brought to the Goods Council’s attention were raised again at the meeting.

Issues involving seafood were raised. China complained about a draft US measure to combat illegal fishing and seafood fraud, warning that the measure poses significant burdens on seafood exporters to the US. Russia, which had raised the same issue previously, said it was closely following the matter. The US said it was carefully considering information and its international obligations as it finalizes the first phase of the programme. Norway reiterated its complaint against the lack of transparency and technical consultations over China’s measures for imported seafood which include testing, licensing, and quarantine. China said the measures were justified due to detections of parasites and virus in certain seafood from Norway.

Nigeria’s import restrictions, particularly in the form of foreign exchange restrictions for importers and local content requirements in the oil and gas sector, remained a cause for concern for the EU, Uruguay, US, Norway, Iceland, Thailand, Argentina, Australia and Japan. These measures are currently under review, Nigeria said, adding that it was committed to its WTO obligations.

Various import restricting measures in India continued to concern the EU, US, New Zealand, Thailand, Japan, Australia, Korea, Canada, Chinese Taipei, and China. These include India’s 10% customs duty on certain information technology (IT) goods, minimum import prices on steel, and port restrictions on apple imports. India said the steel measures were temporary and a response to a surge in steel exports by some major steel producers.

Nine members (US, Japan, EU, Brazil, New Zealand, Chinese Taipei, Korea, Australia, Canada) reiterated their complaints against Indonesian measures affecting meat, dairy, fresh plants, wood, mobile phones, telecommunications, retail, energy, and more. Indonesia renewed its statement that it did not intend to implement trade barriers and that the measures were justified due to considerations over the environment, health, and public morals.

Japan registered its interest in China’s import taxes on personal effects (hand luggage). China said it indeed imposes a flat duty rate on personal effects brought in by inward passengers and that there was no prohibition against this.

Several members reiterated their reservations against Ecuador’s import restricting measures intended to address Balance of Payment (BOP) issues, which have affected a variety of goods, most notably imported automobiles and phones.

Other business

For the fourth Goods Council meeting in a row, China reminded WTO members that a provision in its 2001 Protocol of Accession, Section 15(a), will expire on 11 December 2016. China thus reiterated its call for members to take steps to amend or put their legislation in line with the new conditions after the expiry date. According to China, this means that, after 11 December, WTO members shall stop using surrogate or analogue country methodologies in anti-dumping investigations against Chinese imports, and determine the dumping margins on the basis of the prices and costs reported by Chinese companies.

The US disagreed with China’s interpretation of its accession protocol. The US said that if it were to accept China’s interpretation, it would require more than one provision to expire; however this was not the case, the US added. The US also said that it continues to encourage China to take additional steps to reform its economy and to limit government intervention in sectors to lessen distortions in prices and costs of goods.

The EU said it had a legislative proposal before the EU Parliament and Council to amend anti-dumping regulations to address overcapacity in sectors like steel while fully meeting its WTO obligations. Canada urged further discussions on this “systemic issue” while Mexico similarly said it would like to see members advance on a feasible path.