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Jul
30
ragupathyrenganathan
India, US on a collision course over e-commerce, IP norms
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Geneva: The US and India are heading for a clash over the fate of two moratoriums at the World Trade Organization (WTO): one on introducing new norms for the protection of intellectual property rights and other on making recommendations for a robust work programme to negotiate new rules for e-commerce, including customs duties.
The US made a strong pitch at the WTO’s general council on Tuesday for continuing with the existing moratorium on customs duties and for preparing a work programme on electronic commerce, including cloud-computing and electronically delivered software.
“Cloud computing is a critical component for any e-commerce, and it is essential trade commitments reflect a high degree of openness for this service,” the US had argued in a proposal submitted several months ago.
US companies, such as Amazon.com Inc., Microsoft Corp., andInternational Business Machines Corp. have the lion’s share in cloud-computing business.
As part of the mandate agreed at the WTO’s ninth ministerial meeting in Bali, Indonesia, in December 2013, WTO members are also required to make “recommendations on possible measures related to electronic commerce” at the upcoming tenth WTO ministerial conference in Nairobi later in the year.
The moratorium also includes the current practice of not imposing customs duty on electronic transmissions until December 2015.
US companies, such as Amazon and EBay Inc., are among the biggest players in e-commerce.
The US now wants a permanent moratorium on customs duties on electronic transmissions. “Permanent moratorium would be a very good idea and clearly we want the WTO to be part of the discussion on the future of the Internet,” US trade envoy Michael Punke said after the general council meeting. “It would be sad if the WTO miss out on that opportunity.”
Without naming countries, he said “there are some [members] here who do not want that dialogue to take place here. We will see what consensus we will get on this [issue] here”.
At the same meeting, India made a brief statement against preparing any recommendations on e-commerce at this juncture.
The Indian trade envoy Anjali Prasad has maintained that it is premature to sketch out the deliverables for the work programme. She said the discussion which is taking place on e-commerce in various WTO bodies, including the moratorium for not imposing customs duties on electronic transmissions, is not advanced enough to make recommendations.
Many developing countries, such as India, Brazil, South Africa, China and Nigeria, are concerned about the implications of foregoing customs revenue on electronic transmissions.
The chair for the WTO general council, Fernando de Mateo, has appointed Alfredo Suescum of Panama as a “friend” to oversee discussion on e-commerce.
In a recent informal meeting with members, Suescum conceded that there is simply not enough information to fully appreciate the consequences of a permanent moratorium on customs duties on electronic transmissions.
If the moratorium on e-commerce expires at the Nairobi meeting due to a lack of consensus, then customs duties can be imposed by WTO members on electronic transmission, which would be a setback to the US in its drive to negotiate new trade rules for e-commerce.
The second moratorium is on what are called non-violation complaints, or NVCs.
Normally the WTO allows a member country to bring a complaint against another country to the dispute settlement panel on the grounds that the offending country has broken a trade rule.
However, NVCs allow a WTO member to raise a dispute against another member even if there is no violation of a WTO agreement.
The US and Switzerland are demanding an end to the moratorium so that, for instance, their pharmaceutical companies can bring non-violation complaints against generic drug companies. But this would mean extending non-violation complaints to the TRIPS agreement on intellectual property—a proposal which is opposed by a group of 16 countries led by Peru.
On Wednesday, Peru, on behalf of Bolivia, Brazil, China, Colombia, Cuba, Ecuador, Egypt, India, Indonesia, Kenya, Malaysia, Pakistan, Russian Federation, Sri Lanka and Venezuela submitted a proposal for the WTO ministerial conference in Nairobi to oppose the US-Swiss move.


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