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Why do we need negotiation on E-commerce?
The volume of international trade in goods and services that is occurring via e-commerce continues to grow exponentially. Recent research by McKinsey(external link) estimated that cross-border data flows (used as a proxy for digital trade) grew by 45 times between 2004 and 2014 and generated $2.8 trillion in global economic revenue in 2014 alone.
Digital technology is impacting on New Zealand and the rest of the world in many different ways. It is driving the creation of new products, services and business models. It is disrupting the way that whole industries do business. It is changing how people live their lives. And it is also changing how government makes decisions and interacts with society.
These changes provide both challenges and opportunities for the global trading environment, traditional trade rules and architecture, as well as domestic policy approaches. So it’s important that international trade rules are developed to govern these areas as they evolve.
This includes finding a balance that facilitates economic growth for both individuals and businesses, while ensuring adequate safeguards for quickly evolving policy areas online, such as personal privacy, consumer protection, data flows, cyber security and customs procedures.
Who is involved?
Given this importance, New Zealand, together with over 80 members at the WTO, confirmed intentions in January 2019 to launch negotiations on trade related aspects of e-commerce. This announcement followed a year of exploratory discussions which had been agreed in a joint statement by Ministers in December 2017 at MC11 in Buenos Aires. The WTO deals with the global rules of trade. Its main function is to ensure that trade flows as smoothly, predictably and freely as possible between its members. More information about why New Zealand is participating in this negotiation is set out in a Briefing to the Minister of Trade and Export Growth. You can now read more about how New Zealand is approaching the WTO E-commerce negotiations and how we approached the Digital Economy Partnership Agreement (DEPA).
The process so far
Since the launch of negotiations was announced in January 2019, there have been seven meetings of the Joint Statement Initiative. The meetings have provided a valuable platform for Members to learn more about the varying domestic approaches to E-commerce and to better understand the text proposals that some participating Members approach these issues in different ways and we need to understand these differences if we are to develop a successful international framework of rules.
As the initiative progresses, Members are continuing to compare similarities and differences between proposals and are expressing general preferences in terms of options and in some areas, language preferences as well.
Ministers from Member States participating in the WTO E-commerce Joint Statement Initiative will have the opportunity to review the progress from the initiative at the June WTO Ministerial Conference in Nur-Sultan. You can read more about the twelfth Ministerial Conference here.
All WTO Members are able to participate in the discussions, and the breadth of participation has ranged from small to large, and developed to least developed country Members. Text proposals are able to be made at any stage, and continue to be received.
The key focus areas under discussion in the initiative include:
- Enabling digital trade/e-commerce:
- Customs, digital trade facilitation and logistics (e.g. paperless trading)
- Facilitating electronic transactions (this includes electronic authentication and electronic invoicing)
- Customs duties on electronic transmissions
- Openness and digital trade/e-commerce:
- Market access (for both services and goods trade)
- Flow of information/data
- Access and non-discrimination
- Trust and digital trade/e-commerce:
- Business trust
- Consumer trust (e.g. consumer protection and protecting against SPAM)
- Intellectual property
- Cross cutting issues
- Infrastructure gaps/digital divide
New Zealand has proposed targeted texts on:
- Discussion paper on Digital Inclusion [PDF 149 KB]
- Consumer Protection [PDF 87 KB]
- Customs duties on electronic transmissions [PDF 79 KB]
- E-Invoicing revision (joint proposal with Singapore) [PDF 64 KB]
- NZ Canada Ukraine non paper on transparency [PDF 91 KB]
- Paperless Trading and E Invoicing [PDF 169 KB]
In addition to these text proposals, we have also circulated along with Canada and Ukraine a note on transparency. The note expresses the intent of these Members for greater transparency in the negotiation process and proposes that the negotiating text be made publicly available at the appropriate point. We continue to talk with Members about this proposal.
Why is New Zealand getting involved?
New Zealand businesses and consumers are active users of e-commerce, from selling and buying goods (both physical and digital) via electronic platforms to providing cloud-based storage or processing services.
Digital technologies and services greatly help New Zealand to overcome the challenges posed by our small scale and distance from major markets. Despite unprecedented growth in this market, the development of international trade rules has not kept pace. The ability to move data between jurisdictions is also increasingly crucial to businesses involved in international trade and is an inevitable feature of the modern economy.
To help drive robust international rules and provide greater certainty for New Zealand businesses and consumers online, we are a member of the WTO Joint Statement Initiative and co-sponsored the Ministerial statement confirming intention to launch e-commerce negotiations in 2019.
What we want to achieve
We want to ensure our trade policy settings facilitate growth in this area, will contribute towards achieving the government’s economic diversification goals - as well as the transition to a low carbon economy, and protect areas of specific interest.
A key focus of our interventions and work at the WTO has been to try to achieve an outcome that is inclusive and commercially meaningful. We also want an outcome that ensures we have necessary public policy safeguards to address issues such as consumer protection and the protection of personal information in the digital environment.
Have your say
We appreciated the responses we received from New Zealanders when we sought public submissions on this negotiation in early 2019. We are always interested to hear your views and to meet with interested individuals or groups on issues regarding the negotiation as it progresses, so please get in touch and let us know about:
- what New Zealand should prioritise in the WTO e-commerce negotiations
- trade barriers you may face, or are concerned about, in trading online
- specific industries, businesses or products that you think could benefit from an outcome on e-commerce at the WTO
- other outcomes that will make it easier for New Zealanders to do business online
- any concerns you or your business have with a possible WTO outcome on e-commerce or that should be reflected in New Zealand’s approach to negotiations.
Email us at email@example.com to share your views and register your interest in future engagement opportunities.
For more information on WTO e-commerce, visit the WTO website(external link).
For details on our upcoming trade policy events, see our public engagement on trade page.