USCIB argued for a permanent extension of the WTO moratorium on customs duties on electronic transmissions during a March 9 meeting of the OECD Working Party of the Trade Committee.
The OECD plans to publish a paper this fall to inform the debate at the WTO on extending the e-commerce moratorium set to expire at the next WTO ministerial conference (MC13) in February 2024. Speaking on behalf of Business at OECD (BIAC), Vice President for International Investment and Trade Policy Alice Slayton Clark lauded OECD efforts to provide evidence-based data, facts and insight relating to the direct and collateral costs of expiration and urged the OECD to address head-on the issues raised by opponents, including alternative revenue sources for countries struggling with budget shortfalls linked to the pandemic.
The intervention condemned recent actions by the Government of Indonesia that violate the spirit of the moratorium, creating a domestic tariff classification for, and applying customs formalities, to digital downloads. “While Indonesia is not currently assessing duties on these downloads, the new administrative requirements are burdensome, disruptive to commerce, create a trade barrier and deter investment, with unbudgeted and onerous costs particularly for Indonesian small businesses,” Clark asserted.
Clark urged the OECD to finalize and publish its paper as soon as possible to have the maximum influence on Indonesia and others at the WTO who remain non-aligned or unconvinced about the benefits of a permanent moratorium. She suggested the OECD share early findings from the paper at WTO e-commerce workshops and other discussions this spring. Finally, she encouraged all OECD members to take leadership positions at the WTO, particularly with non-aligned and opposing countries, to promote continuation of the moratorium.
“Allowing the moratorium to expire would be a historic setback for the WTO, representing an unprecedented termination of a multilateral agreement in place nearly since the WTO’s inception – an agreement that has allowed the digital economy to take root and grow. It risks destabilizing the very fabric of a multilateral trading system already under intense strain,” she concluded.