The national employer association Ai Group today joined with six other national industry bodies to call on the World Trade Organisation to strengthen key mechanisms to support global trade.
Ai Group Chief Executive, Innes Willox said: “As a mid-sized economy Australia is reliant on a robust multilateral system to cushion us against economic coercion.
“Crucially, given the extensive digitalisation of the economy, business models and supply chains, the free and open transmission of data and digital services is critical.
“There is a real risk that the current WTO Moratorium on Customs Duties on Electronic Transmissions will not be renewed at this upcoming Ministerial meeting. We believe that rather than being merely extended, it is essential that it is made permanent,” Mr Willox said.
The joint statement on business priorities for the coming WTO meeting is available here.
Media enquiries (Ai Group)
Tony Melville – 0419 190 347
What is the WTO Moratorium on Customs Duties on Electronic Transmissions?
Since 1998 World Trade Organization (WTO) Members have committed not to impose customs duties on electronic transmissions, under an agreement that has been renewed biannually. There is a substantial risk that the moratorium will not be renewed this MC12. The end of the Moratorium would likely result in the imposition of a completely new class of customs duties and related restrictions on the transmission over global IT networks of knowledge, technical information, data, and digital tools, as well as music, films, written materials, and software.
What are "Electronic Transmissions"?
While "electronic transmissions" is not defined, some countries have already outlined plans to impose customs duties on such transmissions if the Moratorium ends. Indonesia, for example, has developed a plan to impose customs duties on knowledge, technical information, data, and digital tools relating to various types of manufactured products and services, as well as film, music, and other digital products.
What are the Economic Implications of Ending the Moratorium?
The end of the Moratorium could lead to the imposition of new customs duties that could cause widespread economic harm. This includes GDP losses due to potential implementation of retaliatory duties, less predictable investment climates, reduced foreign direct investment, and reduced access to knowledge, information, and digital tools.