The undersigned associations urge WTO members to support continuation of the Moratorium on Customs Duties on Electronic Transmissions at the WTO’s Thirteenth Ministerial Conference (MC13).
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. All WTO members have a stake in the organization’s continued institutional credibility and resilience, as well as its relevance at a time of unprecedented digital transformation.
Continuation of the Moratorium is critical to the ongoing COVID-19 recovery. As detailed by the United Nations, the World Bank, the OECD, and many other organizations, the cross-border exchange of knowledge, technical know-how, and scientific and commercial information across transnational IT networks, as well as access to digital tools and global market opportunities have helped sustain economies, expand education, and raise global living standards.
Continuation of the Moratorium is also important to supply chain resilience for manufacturing and services industries. Manufacturers – both large and small, and across a range of industrial sectors – rely on the constant flow of research, design, and process data and software to enable their production flows and supply chains for critical products.
The Moratorium is particularly beneficial to Micro, Small and Medium-Sized Enterprises (MSMEs), whose ability to access and leverage digital tools has allowed them to stay in business amidst physical restrictions and lockdowns. Failure to renew the Moratorium will jeopardize these benefits, as customs restrictions that interrupt cross-border access to knowledge and digital tools will harm MSMEs and the global supply chain – increasing digital fragmentation. As UNCTAD has explained, such fragmentation “reduces market opportunities for domestic MSMEs to reach worldwide markets, [and] ... reduces opportunities for digital innovation, including various missed opportunities for inclusive development that can be facilitated by engaging in data-sharing through strong international cooperation. ... [M]ost small, developing economies will lose opportunities for raising their digital competitiveness.”
The risks of ending the Moratorium have been discussed in recent publications by the International Monetary Fund, OECD, World Bank, United Nations, and WTO, and by think-tanks in India, Indonesia, Switzerland, Belgium, and around the world. As the OECD has explained, “[t]he overall revenue implications of the Moratorium are small..., [t]ariffs on electronic transmissions would hit low-income country trade the most... Smaller and women-owned firms could be most impacted...” Other reports predict greater GDP losses due to potential implementation of retaliatory duties and note that goods and services taxes (GST) / value added taxes (VAT) are preferable to tariffs both from the perspectives of revenue collection, economic efficiency, and administrability. Countries that impose such duties also face longer-term harms due to a less predictable investment climate, reduced foreign direct investment, and reduced access to knowledge, information, and digital tools needed by local workers, artists, patients, students, consumers, and other constituents.
Finally, at a time when the G20, seeking to establish “a more stable and fairer international tax system,” has formally endorsed the OECD Inclusive Framework’s Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy, it seems unnecessarily disruptive for the WTO membership to abandon a foundational quarter-century old agreement regarding the treatment of electronic transmissions. We also note in this regard the G7 Digital Trade Principles, which state that “[e]lectronic transmissions – including the transmitted content – should be free of customs duties, in accordance with the WTO Moratorium on Customs Duties on Electronic Transmissions.”
We therefore urge all WTO members to show strong leadership and support of the digital economy by supporting continuation of the WTO Moratorium on Customs Duties on Electronic Transmissions.
Sincerely,
1. ACEA – European Automobile Manufacturers Association
2. ACTI - Asociación Chilena de Empresas de Tecnologías de Información
3. AdvaMed
4. Advertising Association
5. Africa Cloud Association
6. Africa Information and Communication Technologies Alliance (AfICTA)
7. AINAKI - Indonesia Animation Industry Association
8. Alianza del Pacífico
9. Allied for Startups
10. American Chamber of Commerce in Australia
11. American Chamber of Commerce in Brazil
12. American Chamber of Commerce in Chile
13. American Chamber of Commerce in Indonesia
14. American Chamber of Commerce in Malaysia
15. American Chamber of Commerce in New Zealand
16. American Chamber of Commerce in Peru
17. American Chamber of Commerce in Singapore
18. American Chamber of Commerce in Spain
19. American Chamber of Commerce to the EU
20. AMETIC La Voz de la Industria Digital
21. ACT | The App Association
22. APPLiA
23. Asia Business Trade Association
24. Asia Cloud Computing Association
25. Asia Internet Coalition
26. Asia Pacific MSME Trade Coalition (AMTC)
27. Asia Pacific Services Coalition
28. Asociación de Internet MX
29. Asociación Latinoamericana de Exportadores de Servicios (ALES)
30. Associação Brasileira das Empresas de Software
31. Association of Competitive Telecom Operators (India)
32. Association of Equipment Manufacturers (AEM)
33. AusFilm
34. Australasian Performing Rights Association /
Australasian Mechanical Copyright Owners Association (APRA AMCOS)
35. Australian Chamber of Commerce and Industry (ACCI)
36. Australian Information Industry Association
37. Australian Industry Group
38. Australian Services Roundtable
39. Autos Drive America
40. BDI – Federation of German Industries
41. Belize Coalition of Service Providers (BCSP)
42. Bitkom e.V.
43. Brazilian National Confederation of Industry
44. British Chamber of Commerce Kenya
45. Broadband India Forum (BIF)
46. BSA | The Software Alliance
47. Business Alliance for Customs Modernization
48. Business Council of Canada
49. Business Europe
50. Business NZ
51. Business Roundtable
52. CAINCO - Cámara De Industria, Comercio, Servicios Y Turismo De Santa Cruz – Bolivia
53. Câmara Brasileira da Economia Digital
54. Cámara Colombiana de Comercio Electrónico
55. Canadian Chamber of Commerce
56. Cámara de Comercio de Lima - CCL
57. Cámara de Industrias de Costa Rica
58. Cámara de Infocomunicación y Tecnología (INFOCOM)
59. Canadian Services Coalition (CSC)
60. Cape Chamber of Commerce and Industry [S. Africa]
61. Caribbean Network of Services Coalition
62. Center for International Economic Collaboration (CFIEC)
63. The Chambers of Commerce of Ireland
64. Chamber of Digital Industry and Services of National Business Association of Colombia – ANDI
65. China Council for Promotion of Int’l Trade
66. China Semiconductor Industry Association (CSIA)
67. City of London Corporation
68. Coalition for Digital Prosperity for Asia
69. Coalition of Services Industries (CSI)
70. Computer and Communications Industry Association
71. Confederation of Danish Industry (DI)
72. Confederation of Finnish Industry (EK)
73. Confederation of Norwegian Enterprise (NHO)
74. Confederation of Swedish Enterprise
75. Consumer Technology Association (CTA)
76. Copyright Overseas Promotion Association (COA)
77. Costa Rican Chamber of Information and Communication Technologies (CAMTIC)
78. DIGITALEUROPE
79. Digital Trade Network
80. Dominican Republic Services Association
81. Ecommerce Forum Africa
82. Emerging Business Factory (Morocco)
83. ENGINE
84. Entertainment Software Association
85. EU-ASEAN Business Council
86. Eurochambres
87. European Chamber of Commerce in Indonesia
88. European Chamber of Commerce in Thailand
89. EuroCommerce
90. European Services Forum (ESF)
91. European Semiconductor Industry Association (ESIA)
92. Federation of Korean Information Industries (FKII)
93. Forum for Internet Retailers, Sellers & Traders of India
94. German Chamber of Commerce and Industry (DIHK)
95. German Emirati Joint Council for Industry & Commerce (AHK)
96. Global Data Alliance
97. Global Innovation Forum
98. Global Trade Solutions (South Africa)
99. Grenada Coalition of Service Industries (GCSI)
100. Hong Kong Coalition of Services Industries
101. India Electronics & Semiconductor Association (IESA)
102. INDIA SME FORUM
103. Independent Film & Television Alliance (IFTA)
104. Indonesia Services Dialogue (ISD)
105. Information Technology Industry Council (ITI)
106. Interactive Games and Entertainment Association
107. The International Association of Scholarly, Technical and Medical Publishers (STM)
108. International Chamber of Commerce (ICC)
109. International Generic and Biosimilar medicines Association (IGBA)
110. IP Federation (United Kingdom)
111. Japan Association of New Economy (JANE)
112. Japan Business Council in Europe (JBCE)
113. Japan Electronics and Information Technology Industries Association (JEITA)
114. Japan Information Technology Service Industry Association (JISA)
115. Japan Semiconductor Industry Association (JSIA)
116. Japan Services Network (JSN)
117. Joint Foreign Chambers of Commerce in Thailand
118. Kenya Private Sector Alliance
119. Korea International Trade Association
120. Korea Semiconductor Industry Association
121. Korean Broadcasters Association
122. Korean Film Digital Distribution Association
123. La Chambre de Commerce d’Industrie et d’Agriculture de Saint-Louis (Sénégal)
124. La Conférence permanente des chambres consulaires et organisations intermédiaires africaines et francophones (Cpccaf)
125. Malaysian Service Providers Confederation (MSPC)
126. Malaysia Semiconductor Industry Association
127. MedTech Europe
128. Mexican Business Council for Foreign Trade, Investment and Technology
129. Mexican Chamber of Electronics, Telecommunications and Information Technologies (CANIETI)
130. Motion Picture Association (MPA)
131. Motion Picture Distributors Association of Australia (MPDAA)
132. Motion Picture Producers Association of Japan
133. National Association of Manufacturers (NAM)
134. National Association of Cinema Operators – Australasia (NACO)
135. National Foreign Trade Council (NFTC)
136. National Retail Federation
137. New Zealand International Business Forum
138. Philippine Exporters Confederation (PHILEXPORT)
139. Professional & Business Services Council
140. Papua New Guinea Chamber of Commerce and Industry
141. Payments Leadership Council
142. Recording Industry Association of America (RIAA)
143. Saint Lucia Coalition of Services Industries (SLCSI)
144. Saint Kitts & Nevis Coalition of Services Industries
145. Semiconductor & Electronics Industries in the Philippines Foundation, Inc. (SEIPI)
146. SEMI
147. Semiconductor Industry Association (SIA)
148. Screen Producers Australia (SPA)
149. SGTECH
150. Small Business and Entrepreneurship Council
151. SPADA NZ – The Screen Production and Development Association
152. Singapore Business Federation
153. Singapore Semiconductor Industry Association
154. Sociedad de Comercio Exterior del Perú (ComexPerú)
155. Sociedad de Fomento Fabril (SOFOFA)
156. Taiwan Coalition of Services Industries (TWCSI)
157. Taiwan Semiconductor Industry Association (TSIA)
158. techUK
159. TECHNATION Canada
160. Technical Service Providers Association of South Africa
161. Technology Trade Regulation Alliance (TTRA)
162. Telecommunications Industry Association (TIA)
163. TheCityUK
164. The National Customs Brokers & Forwarders Association of America (NCBFAA)
165. Trinidad and Tobago Coalition of Services Industries
166. Unión Costarricense de Cámaras y Asociaciones del Sector Empresarial Privado (UCCAEP)
167. Uruguay: National Chamber of Commerce and Services
168. US-ASEAN Business Council
169. US-Bangladesh Business Council
170. US Chamber of Commerce
171. US Council for International Business
172. US-India Business Council
173. US-India Strategic Partnership Forum (USISPF)
174. US-Pakistan Business Council
175. US-South Africa Business Council
176. US Information Technology Office (China)
177. Vietnam E-commerce Association (VECOM)
178. World Information Technology and Services Alliance (WITSA)
