RCEP Discussions on Ecommerce: Gathering Steam in Hyderabad

by News on July 24, 2017, no comments

By jmalcolm

Sixteen countries from Asia-Pacific are meeting in Hyderabad for the 19th round of the Regional Comprehensive Economic Partnership (RCEP) which takes place in India from 18-28 July, 2017. EFF is participating to advocate for improved transparency and openness in the negotiations, and to express our concerns about possible new rules on intellectual property and ecommerce that some countries are proposing for the agreement.

RCEP is a free trade agreement (FTA) aimed at broadening regional economic integration and liberalising trade and investment between the 10 ASEAN economies and its trading partners including Australia, China, India, Japan, Korea, and New Zealand. The total population covered by RCEP exceeds 3 billion, and with the combined GDP of about US$ 17 trillion accounting for about 40% of the world’s trade makes RCEP the biggest mega-regional trade agreement that is under negotiation.

The idea of RCEP was first introduced at an ASEAN Summit in 2011 and formal negotiations were launched in 2012. Over the last five years, the scope of the agreement has grown to include commitments for trade in goods and services, boosting economic and technical cooperation, and intellectual property. Worryingly, discussions on ecommerce issues including rules on software, data flows, and regulatory standards that have not been addressed in other trade mechanisms are also being included in the RCEP negotiations.

Reports suggest that Japan, Australia, South Korea, and New Zealand have been pushing for binding commitments from the RCEP members on ecommerce. A separate working group on ecommerce (WGEC) has been established with the aim of formalising a chapter on ecommerce in the final agreement. The agreement and the issues being negotiated are being kept confidential, however a few chapters drafts have been leaked including the ‘Terms of Reference (TOR)’ for the WGEC. WGEC members are hopeful of concluding the deal by year end which would include ‘liberalisation commitments’ and norms for ecommerce including provisions on investment, dispute settlement and competition.

The proposed elements for the TOR (for negotiations) are understood to include domestic regulatory frameworks for market access, customs duties on electronic transmission, non-discriminatory treatment of digital products, paperless trading, electronic signatures, digital certificates and online consumer protection issues such as storage and transfer of personal data protection and spam.

Controversial issues such as prohibition on requirements concerning the location of computing facilities and allowing cross-border transfer of information by electronic means are also expected to be included within the scope of the chapter. Further, countries including Australia and Japan have proposed making a permanent commitment to zero duties on digital transmissions, and prohibiting rules requiring on compulsory disclosure of source codes.

Given the secrecy of the negotiations, the lack of opportunities for public input in the process, and the complexity of issues involved, EFF convened an expert panel on ecommerce issues in the RCEP negotiations in Hyderabad. The public meeting was organised in partnership with the National Institute of Public Finance and Policy (NIPFP) and the National Law University of Law, Hyderabad. Speakers included Professor Ajay Shah (NIPFP), Parminder Jeet Singh (ItforChange) and Professor VC Vivekananda (Bennett University).

Panelists raised several issues including ensuring non-discriminatory treatment of digital products transmitted electronically and the need for guaranteeing that these products will not face government-sanctioned discrimination based on the nationality or territory in which the product is produced. Security risks associated with the prohibition of source code disclosure, and the costs of imposing measures that restrict cross-border data flows and or require the use or installation of local computing facilities were also raised by panelists.

The event was a success with negotiators from nine countries including Vietnam, Japan, Australia, New Zealand, Laos, Cambodia, South Korea and Thailand showing up for the meeting. Given that access for users at such negotiations is restricted the large number of negotiators showing interest was very encouraging. Understandably, the negotiators did not ask questions or participate in the discussions, however their interest in the issues is evident in WGEC members turning up for the panel. This is definitely an improvement on the previous negotiations where there has been limited participation from negotiators at similar events. We also received feedback that the WGEC would like to see specific issues being discussed in-depth including positive commitments that could be included.

EFF is maintaining a cautious and critical stance on the inclusion of e-commerce rules in RCEP, and the inclusion of similar rules in NAFTA, simultaneously being negotiated on the other side of the world. While it is possible to deal with e-commerce in a trade agreement in a balanced way that respects users’ rights, this is made unnecessarily difficulty when those rules are being negotiated in secret. Nonetheless, until a better way of engaging with negotiators exists, EFF will continue to provide our input through unofficial side events and bilateral meetings, because this is the best way that we can stand up for your rights in what remains an unfair and secretive process

Read more here:: Electronic Frontier Foundation