WTO to debate tariffs on $26.7tr in global e-commerce

For the past quarter century, the meteoric rise of the digital economy has been exempt from the kind of tariffs that apply to trade in physical goods.

That era may come to a screeching halt this week as a handful of nations threaten to scrap an international ban on digital duties in a game-changing bid to draw more revenue from the global e-commerce market that the United Nations estimated at $26.7-trillion.

If governments fail to reauthorize the World Trade Organization’s e-commerce moratorium, it could open a new regulatory can of worms that could increase consumer prices for cross-border Amazon.com purchases, Netflix movies, Apple music, and Sony PlayStation games.

“Absent decisive action in the coming days, trade diplomats may inadvertently ‘break the internet’ as we know it today,” International Chamber of Commerce Secretary-General John Denton wrote in a Hill opinion piece published last week.

E-Commerce Tariffs
The WTO’s e-commerce agenda dates back to 1998, when nations agreed to avoid taxing the then-fledgling market for digital trade. WTO members have periodically renewed that ban at their biennial ministerial meetings and are considering whether to do so again at this week’s gathering of ministers in Geneva.

But some nations like India and South Africa argue that the growth of the internet justifies a rethink about whether the WTO’s e-commerce moratorium remains in their economic interests. In 2020, they introduced a paper that said the moratorium prevents developing countries from gaining tariff revenue from transformative technologies like 3D printing, big-data analytics, and artificial intelligence.

While nations could draw somewhere between $280-million and $8.2-billion in annual customs revenue, new digital tariffs would also harm global growth by reducing economic output and productivity, according to the Paris-based Organization for Economic Cooperation and Development.

The International Monetary Fund previously calculated that a splintering of the digital economy could ultimately deliver a 6% hit to global economic output over the next decade.

If the moratorium lapsed, “it could set in motion a stampede to impose tariffs on digital flows across borders, put an unnecessary strain on an already battered global economy, and signal to the world that inflation be damned,” according to John Neuffer, the CEO of the Semiconductor Industry Association.

Practical Challenges
To be sure, it’s not immediately clear how exactly a government would impose customs duties on electronic transmissions.

It would probably be “prohibitively expensive” for customs officials to track and quantify the value of the countless data packets that bring these products to consumers’ devices, according to Denton.

“While viewing a single movie, a device could receive as many as 5-million data packets from nine jurisdictions,” Denton wrote. “How, then, would countries accurately (and impartially) calculate the tariff on a single viewing session, byte of data or file size – let alone on the endless stream of data and messages that enable modern business-to-business transactions?”

Furthermore, the WTO does not define the scope of e-commerce transmissions so there is no clarity as to which online services would be subject to new duties – be it Bitcoin cryptocurrency transactions, Airbnb lodging, Uber car rides, Doordash food delivery or Peloton fitness classes.

Finally, the proliferation of virtual private network applications that mask internet protocol addresses would complicate, if not render impossible, efforts to identify the origin of many digital commerce transactions.

Economic Trade-Off
There’s reason to believe that India is using the threat of new tariffs as a negotiating tactic to persuade other nations to concede to its demands for unrelated trade concessions.

India previously threatened to scrap the e-commerce moratorium during the WTO’s last ministerial in 2019 but backed off after nations agreed to avoid initiating disputes over certain questionable intellectual-property practices. The e-commerce debate may also be used as leverage for India’s demands to water down WTO subsidy rules for public stockholding food programs.

Such brinkmanship is made possible by the WTO’s principal of consensus, which allows any one of its 164 members to block any agreement for any reason.

“India, South Africa and their allies use the moratorium as leverage because they can,” said Hosuk Lee-Makiyama, director of the European Centre for International Political Economy in Brussels. “Developing countries have everything to win and nothing to lose by holding the WTO prohibition on data tariffs ransom.”

WTO – Trade in Knowledge

The WTO has launched a new book entitled “Trade in Knowledge: Intellectual Property, Trade and Development in a Transformed Global Economy” on 31 March. At the launch event, a wide cross-section of contributors to the publication discussed how their research and analysis had a bearing on current issues lying at the intersection of development, trade, technology and the diffusion of knowledge.

Drawing together insights from a diverse range of leading international scholars and analysts, the publication explores how to build more inclusive, up-to-date and precise ways of measuring knowledge flows, discusses how more nuanced and effective use of these data may guide policymakers and provides insights into the prospects for knowledge-based social and economic development, moving legacy models and adapting to the realities of the contemporary knowledge economy. The book also proposes ideas for updated systems of governance that promote positive sum approaches to the creation and sharing of the benefits of knowledge as a public good, with a view to informing planning for development.

The book’s table of contents is available here.

Source: World Trade Organisation

Meta’s social media sites an “empire” for counterfeiters

Meta’s top social media platforms Facebook, Instagram and WhatsApp have become enormously successful e-commerce channels, and the counterfeiters have followed the money, says a new report by Ghostdata.

Fuelled by technological additions like Facebook Pay, the emergence of Messenger as a unified chat and sales tool and WhatsApp’s online catalogues for businesses, the social media juggernaut has become a magnet for illicit traders who make use of this new integrated functionality.

“Meta and its subsidiaries have developed a strategy increasingly aimed at becoming an e-commerce leader, thus attracting a more diversified crowd of ruthless counterfeiters,” says the report.

“In turn this has further exposed Facebook’s inability to keep under control such activities on its platforms. This controversial behaviour led to an increase of counterfeit sellers and eventually to a general user distrust still evident today,” it continues.

Meta makes much of its efforts to protect intellectual property and fight the sale and promotion of counterfeit products, saying it makes ongoing improvements to enforcement measures and reporting tools and is investing in technology to prevent counterfeit activity.

However, the report finds that “despite Meta’s security reports and legal initiatives, the effects of their supposed crackdown on these illicit activities are disappointing and insufficient.”

“At the same time, WhatsApp has become the counterfeiters’ favourite and most used tool. Particularly WhatsApp Business, an option aimed at mom-and-pop companies, is now used by 40% of such Chinese counterfeiters, surpassing even the local and wildly popular WeChat.”

Ghostdata analysts used software including textual searches and visual recognition to try to identify sellers of counterfeits on the sites from online activity, and in just 20 days came up with a total of 26,770 counterfeiters’ accounts that were active on Facebook at the end of October 2021.

“Our study revealed that each counterfeiter profile counts an average of over 1,250 friends,” says the report, adding: “a very conservative estimate indicates that counterfeiters reach about 20 million unique contacts through newsfeed and private messages.”

It will be no surprise that the vast majority of these counterfeiters found by Ghostdata seem to be operating from mainland China, although it found examples of sellers in Russia, Turkey, Indonesia, Ukraine and Brazil.

“We estimate that on Facebook and Instagram combined there are about 6,000-7,000 wholesalers from China, with an annual business turnover ranging between $1.8bn and $2.1bn,” it says, adding: “this is a quite conservative estimate.”

Luxury clothing and accessories brands were most mentioned by counterfeiters, with the list headed by Louis Vuitton – accounting for 58% of activity – followed by Chanel, Fendi, Prada and Gucci.

Source: Securing Industry, Phil Taylor, 23 February 2022

International Customs Day 2022

The WCO dedicates 2022 to the Scaling up Customs Digital Transformation by Embracing a Data Culture and Building a Data Ecosystem

Traditionally, every year, the Customs community comes together on 26 January to mark International Customs Day. This day of celebration is a unique opportunity for WCO Members, the WCO Secretariat and global Customs’ partners to reflect on a particular theme and to act upon it. 

Thus, throughout 2022, under the slogan “Scaling up Customs Digital Transformation by Embracing a Data Culture and Building a Data Ecosystem”, the Customs community will be focusing on how to operate in a fully digital environment and create an operating model that captures and exploits data from across the trade ecosystem.

Over the years, digital technology has evolved rapidly and Customs can now tap into data from other government agencies, commercially available databases, and open-source information platforms such as digitized global public records and multilingual news sources. 

The extent to which data can be used effectively depends on various factors surrounding data ethics, including privacy, commercial secrecy and legal issues regarding the use of data by Customs and Tax administrations, and the importance assigned to innovation in public administrations. 

To build data ecosystems, or consolidate existing ones, the following enabling actions may be considered:

  • establishing formal data governance to ensure the relevance, accuracy and timeliness of data;
  • making use of the standards developed by the WCO and other institutions regarding data format and data exchange;
  • providing appropriate management of data to ensure that the right people have access to the right data, and that data protection regulations are respected; and,
  • adopting progressive approaches, such as data analytics, to collect and successfully exploit data to drive decision-making.

A robust data culture empowers people to ask questions, challenge ideas and rely on detailed insights, not just intuition or instinct, to make decisions.

In order to nurture a data-driven culture, administrations need to enhance the data-literacy of their staff – in other words, their ability to interpret and analyze data accurately. 

Customs administrations should integrate data science into their curriculums for newly recruited officers and participate in the development of distance learning courses to familiarize Customs officers with the collection and analysis of data in order to forge a data-driven culture. Staff also need to understand the bigger picture, namely the impact of Customs on the effective protection of society, trade facilitation and fair revenue collection. 

On the other hand, Customs administrations are invited to consider leveraging data in their relationships with other actors along the supply chain, as well as making data available to the public and academia as a means of enhancing transparency, stimulating the production of knowledge and enabling dialogue with civil society.

Sharing data analysis with other government agencies increases the role and visibility of Customs in policy-making and in obtaining necessary resources, including donor funding. Disseminating Customs data and information in society is part of governments’ response to the general demand for open governance.

To support Customs administrations, the WCO Secretariat has placed data-related topics on the agendas of several committees and working groups, organized awareness-raising seminars, developed e-learning modules, drafted a Capacity Building Framework for Data Analytics which was adopted by the WCO Council in December 2020, issued practical publications and published articles in the WCO News Magazine.

Moreover, a community of experts has been established, under the name of BACUDA (BAnd of CUstoms Data Analysts), which brings together Customs and data scientists with the objective of developing data analytics methodologies. 

The Secretariat will continue to investigate ways to collect and share data on Customs administrations with a view to enhancing the way it delivers capacity building, and will continue to undertake data-driven assessments and work with international experts to respond to assistance requests.

More measures will be presented in the WCO Data Strategy that the WCO Secretariat is currently working on. The ambition will be to make data a vernacular language among Customs administrations and between the WCO Secretariat and WCO Members. The road ahead is not an easy one, there will inevitably be challenges along the way, but as we have learned during the COVID-19 pandemic, the Customs community is united, stronger and more resilient in the face of adversity. 

Dr. Kunio Mikuriya

WCO Secretary General

26 January 2022

France orders block on online store Wish on safety grounds

France has ordered search engines and other platforms to delist the online retail site Wish, saying it is a source of non-compliant and unsafe products. 

The website – which has also been accused of allowing the sale of counterfeit goods – has been investigated by France’s DGCRF, which regulated good and services in France.

The agency carried out test purchases of products including electronic devices, toys and costume jewellery, and determined that 95 per cent of toys did not meet EU standards, and 45 per cent were dangerous to children.

Moreover, 95 per cent of electronic devices were non-compliant, almost all of which (90 per cent) were hazardous, with 62 per cent of costume jewellery also deemed risky to consumers.

The DGCRF also concluded that Wish wasn’t meeting its obligations on carrying out product withdrawals and recalls “as is required by its status as a distributor.” It is the first time that such an action has been taken by an EU member state, according to the regulator.

“This decision aims to protect consumers and fight against unfair competition from economic operators,” said Bruno Le Maire, France’s economy and finance minister.

“These players are flouting product safety regulations,” he added. “The same rules must be applied in physical stores and online stores.”

Last year, the DGCRF said it had conducted a year-long investigation into Wish which found evidence of the sale of counterfeit products falsely claiming to be from major brands.

The investigation came after UK consumer group Which carried out test purchases of a number of items on Wish which turned out to be either fake, illegal, dangerous, never delivered, or arrived too late to be tested properly.

US-headquartered Wish has responded by saying it will challenge what it considers to be “an illegal and disproportionate act” in the courts.

The company says it is under no obligation to carry out controls on the 150 million products sold by the platform – many from suppliers in China – but claims it has invested in measures to weed out quality problems.

Source: Securing Industry

WCO – New technology-assisted capacity building: the Virtual Reality (VR) assisted training program

The WCO has announced that it has set up a VR training program with the support of CCF-Korea at the WCO Headquarters on 9th November 2021. 

This program was developed and first established in RTC Korea last September to support customs officials to learn and understand the basic procedures of physical inspection on containerized cargo at a maritime port.

With the help of VR devices and a cyber master, a trainee is requested to select one of three individual scenarios and detect contraband items such as drugs, counterfeit goods and explosives smuggled in imported cargo.

After selecting one case, documents have to be compared and discrepancies identified. The program will show necessary steps to wear safety gear, inspect the exterior of the container, scan it with ZBV vehicle and study the X-ray black/white and coloured images. In the following step, the container is opened and inspected with tools like a chisel, magnifying glass, scanner, etc., at a bonded area of a dedicated warehouse.

RTC Korea, KCS and WCO Secretariats contributed to the program production and provided materials on drug smuggling cases with pictures, advice on preparatory steps, inspection scenarios taking into account risk indicators from the WCO RM compendium.

The length of one training session is approximately 10 to 15 minutes depending on the trainee‘s progress, and the devices for the VR training are the headset, controller, high-end computer, TV screen and kiosk. The program also developed a screen version that Customs officials can play on their desktop computer and notebook and have the 3D experience.   

During the experience session, Dr. Kunio Mikuriya, the Secretary General of the WCO, expressed high interest and called on feedback on future activities from those who experience the program to make it more relevant for Members’ capacity building. In this regard, the immediate task is to prove its effectiveness through regional capacity building activities and WCO meetings. 

Dr. Taeil Kang, the Director of Capacity Building Directorate expressed his plans to develop content for other topics including e-commerce transactions, X-ray image screening and uploading on CLiKC and installation in other WCO regions. 

For more information, please contact Sungsig Kim, CCF-Korea manager at the Capacity Building Directorate (sungsig.kim@wcoomd.org).

WCO News, October 2021 Edition

The WCO has published the 96th edition of WCO News, the Organization’s magazine aimed at the global Customs community, providing a selection of informative articles that bring the international Customs and trade world to life.

This edition’s “Dossier” focuses on cross-border e-commerce, in other words those “transactions which are effected digitally through a computer network (e.g. the internet), and result in physical goods flows subject to Customs formalities”. We have invited several administrations to share information on the initiatives they are taking to build their capacity for monitoring the compliance of such flows. Despite every country’s situation being unique, we still believe that it is important to share experiences and explain initiatives.

The “Panorama” section addresses a broad variety of topics such as rules or origin, goods classification, training and reforms. It also includes two articles which respectively present, from a Customs perspective, two recent regional Free Trade Agreements: the Regional Comprehensive Economic Partnership (RCEP) and the African Continental Free Trade Area.

The “Focus” section brings together two articles dealing with non-intrusive inspection (NII). In the first one, the WCO Secretariat shows how some Customs administrations and manufacturers manage the decommissioning of NII equipment when it has reached the end of its life. The second article describes the challenges of X-ray image analysis and the value of training.

Lastly, in the “Point of View” section, Dutch Customs explains the structure of the ISO Audit Data Collection Standard and why it supports the Standard’s extension to cover data related to Customs and indirect tax audits, while an attorney from Israel argues that governments should consider waiving taxes on transport costs until we are back to “normal” and the effects of the COVID-19 pandemic are no longer being felt.

To discover the full content of this edition please visit the magazine website.

EU – Import Control System 2 (ICS2)

The European Union makes it a top priority to ensure the security of its citizens and single market. Every year trillions of Euros worth of goods are imported into EU, with the EU-27 now accounting for around 15 % of the world’s trade in goods. The European Union is implementing a new customs pre-arrival security and safety programme, underpinned by a large-scale advance cargo information system – Import Control System 2 (ICS2). The programme is one of the main contributors towards establishing an integrated EU approach to reinforce customs risk management under the common risk management framework (CRMF).

The pre-arrival security and safety programme will support effective risk-based customs controls whilst facilitating free flow of legitimate trade across the EU external borders. It represents the first line of defence in terms of protection of the EU internal market and the EU consumers. The new programme will remodel the existing process in terms of IT, legal, customs risk management/controls and trade operational perspectives.

The EU’s new advance cargo information system ICS2 supports implementation of this new customs safety and security regulatory regime aimed to better protect single market and EU citizens. It will collect data about all goods entering the EU prior to their arrival. Economic Operators (EOs) will have to declare safety and security data to ICS2, through the Entry Summary Declaration (ENS). The obligation to start filing such declarations will not be the same for all EOs. It will depend on the type of services that they provide in the international movement of goods and is linked to the three release dates of ICS2 (15 March 2021, 1 March 2023, and 1 March 2024).

Advance cargo information and risk analysis will enable early identification of threats and help customs authorities to intervene at the most appropriate point in the supply chain.

ICS2 introduces more efficient and effective EU customs security and safety capabilities that will:

  • Increase protection of EU citizens and the internal market against security and safety threats;
  • Allow EU Customs authorities to better identify high-risk consignments and intervene at the most appropriate point in supply chain;
  • Support proportionate, targeted customs measures at the external borders in crisis response scenarios;
  • Facilitate cross-border clearance for the legitimate trade;
  • Simplify the exchange of information between Economic Operators (EOs) and EU Customs Authorities.

For more information on the ICS2 programme, refer to the EU Webpage here!

Source: European Union

WCO – The full E-Commerce Package is now available online

Picture courtesy – Unsplash

Following the adoption by the December 2020 Policy Commission and Council of key documents forming part of the WCO E-Commerce Package, the WCO web-site now features the complete set of tools supporting the implementation of the Framework of Standards on Cross-Border E-Commerce (E-Commerce FoS).

The documents endorsed by the December 2020 Policy Commission and Council are “Reference Datasets for Cross-Border E-Commerce”, “Revenue Collection Approaches”, “E-Commerce Stakeholders: Roles and Responsibilities”, a document on a PTC decision on the E-Commerce FoS update/maintenance mechanism, and the first edition of the Compendium of Case Studies on E-Commerce. In addition, the Policy Commission and Council took note of the progress in the area of cross-border e-commerce, including the finalization by the Permanent Technical Committee in June 2020 of key performance indicators for possible monitoring and evaluation of the E-Commerce FoS implementation. 

The WCO E-Commerce FoS was endorsed by the Policy Commission and Council in June 2018, while the June 2019 Council sessions witnessed the endorsement of the WCO E-Commerce Package, with the exception of three Annexes to the E-Commerce FoS Technical Specifications.

The E-Commerce FoS provides 15 baseline global standards with a focus on the exchange of advance electronic data for effective risk management and enhanced facilitation of the growing volumes of cross-border small and low-value Business-to-Consumer (B2C) and Consumer-to-Consumer (C2C) shipments, through simplified procedures with respect to areas such as clearance, revenue collection and return, in close partnership with E-Commerce stakeholders. It also encourages the use of the Authorized Economic Operator (AEO) concept, non-intrusive inspection (NII) equipment, data analytics, and other cutting-edge technologies to support safe, secure and sustainable cross-border E-Commerce.

The E-Commerce Package contains Technical Specifications to the E-Commerce FoS, definitions, E-Commerce Business Models, E-Commerce Flowcharts, Implementation Strategy, Action Plan and Capacity Building Mechanism, which have now been supplemented by the documents on Reference Datasets for Cross-Border E-Commerce, Revenue Collection Approaches and E-Commerce Stakeholders: Roles and Responsibilities.
The document on Reference Datasets for Cross-Border E-Commerce is an evolving, non-binding document that can serve as a guide to WCO Members and relevant stakeholders for possible pilots and implementation of the E-Commerce FoS. The Revenue Collection Approaches document has been designed to describe existing revenue collection models with the objective of providing a better understanding thereof. The document on E-Commerce Stakeholders: Roles and Responsibilities provides a clear description of the roles and responsibilities of various E-Commerce stakeholders for transparent and predictable cross-border movement of goods, and does not place any additional obligations on stakeholders.

The first edition of the Compendium of Case Studies on E-Commerce compiles seventeen case studies and supports the WCO Membership with practical examples of how individual Members address priority issues, such as exchange of advance electronic data, facilitation, safety, security and revenue collection (including de minimis levels).

For more information please visit http://www.wcoomd.org/en/topics/facilitation/instrument-and-tools/frameworks-of-standards/ecommerce.aspx

E-Commerce: Joint Statement Initiative (JSI) Update

The importance of developing global digital trade rules has never been clearer. The COVID-19 pandemic has accelerated the digital transformation, bringing about a surge in online activities. E-commerce will be critical to the global economic recovery. The Joint Statement Initiative on E-commerce (JSI) is an opportunity for the WTO to respond to this urgent need.

There has been encouraging progress in the JSI since negotiations were launched in 2019. Despite the challenges presented by COVID-19, co-conveners Australia, Japan and Singapore have ensured that work continues in virtual and hybrid formats. The number of participants in the initiative has grown to 86 WTO Members, collectively accounting for over 90 per cent of global trade and representing all major geographical regions and levels of development.

Consolidated Negotiating Text

JSI participants have developed a consolidated negotiating text that captures progress so far and will form the basis of the next stage of negotiations. The consolidated text was circulated among participants on 7 December 2020.

The consolidated text is based on Members’ proposals. These proposals cover the following themes:

  • enabling electronic commerce;
  • openness and e-commerce;
  • trust and e-commerce;
  • cross-cutting issues;
  • telecommunications;
  • market access; and
  • scope and general provisions.

We have been able to advance the negotiations, guided by the objective of achieving WTO-plus outcomes that deliver meaningful benefits for businesses and consumers. Highlights include the good progress made in small groups on issues such as e-signatures and authentication, paperless trading, customs duties on electronic transmissions, open government data, open internet access, consumer protection, spam and source code, among others. Proponents of services market access commitments have also developed a possible framework for negotiations on these issues.

Provisions that enable and promote the flow of data are key to a high standard and commercially meaningful outcome. Discussions on these issues are ongoing and will intensify from early 2021. Japan and Singapore hosted an information session on data flows and localisation rules in November 2020, involving negotiators and the private sector, to build better understanding and support for strong commitments.

Source: World Trade Organisation, 20 December 2020

WTO – Negotiations on e-commerce continue, eyeing a consolidated text by the end of the year

WTO members participating in the negotiation of rules on e-commerce shared updates on the work done to streamline the negotiating text at a plenary meeting on 23 October. The co-conveners, Australia, Japan and Singapore, encouraged members to propose constructive solutions and show flexibility in an effort to deliver a consolidated negotiating text by December this year.

Facilitators of small group discussions reported on the work done in between plenary meetings to further streamline text proposals in the areas of spam, source code, open government data, trade facilitation in goods, services market access, electronic signatures and authentication, and online consumer protection.

Participants also re-engaged on topics that had been scheduled for consideration in the postponed March and April-May negotiating rounds, namely protection of personal information/data.

The co-conveners set common principles for the small groups to make their work more efficient and consistent, noting that transparency and inclusion should guide their work. 

Ambassador George Mina (Australia), on behalf of the co-conveners, noted that reports from small groups are encouraging and that there is still some work that needs to be done. He said that the participating members are only two months away from the deadline for delivering a consolidated negotiating text and that the consolidated text should include “clean text” on e-signatures, authentication, spam and online consumer protection. To that end, he urged participants to engage with each other informally, not only in small groups but also bilaterally, and to show flexibility wherever possible. 

The co-conveners set 16 November as a deadline for any new proposals to be submitted by participating members.

Ambassador Mina highlighted that COVID-19 has increased the urgency of developing global rules on digital trade and that these negotiations are seen as a key test for the WTO to respond to modern commercial realities.  

WTO negotiations on trade-related aspects of electronic commerce were launched in Davos in January 2019 with the participation of 76 members. The number of participating members now stands at 86. Participating members seek to achieve a high-standard outcome that builds on existing WTO agreements and frameworks with the participation of as many WTO members as possible. The e-commerce initiative was created on the margins of the WTO’s 11th Ministerial Conference in Buenos Aires. 

Throughout their negotiations of the several e-commerce related topics, members have been encouraged by the co-conveners to consider the unique opportunities and challenges faced by members, including developing countries and least-developed countries, as well as by small businesses. 

Ambassador Tan Hung Seng of Singapore, as a co-convener, encouraged members to propose constructive solutions as discussions intensify. He said that the initiative is well placed to swiftly develop something concrete that would benefit the global economy. 

Ambassador Kazuyuki Yamazaki of Japan, as a co-convener, said that it was important to make as much progress as possible, and for the consolidated text to be comprehensive in reflecting issues proposed by members. He also urged members to take a holistic approach to the work of the initiative and address more challenging issues. 

The co-conveners plan to hold ambassador level consultations to discuss and hear members’ views on the way forward between 28 and 30 October. The next plenary session will be on 5 November, during which an information session for members on data-related provisions will be hosted by Japan and Singapore.

Source: WTO, 23 October 2020

WCO holds its first Accreditation Workshop on E-Commerce

A Global On-line Accreditation Workshop for English-speaking experts on E-Commerce was held from 31 August to 7 September 2020 via the CLiKC! platform of the World Customs Organization (WCO). 

Due to the increasing needs of WCO Members for Capacity Building support for a harmonized and efficient implementation of the WCO Framework of Standards on Cross-border E-Commerce and other supporting tools, the Secretariat organized this first Accreditation Workshop in the area of E-Commerce as a pilot virtual accreditation initiative.

The event was organized with the objective of setting up a pool of English-speaking Technical and Operational Advisors capable of independently leading, on behalf of the WCO for its Members, Capacity Building missions in the field of Cross-border E-Commerce.

Twelve selected candidates representing five of the WCO regions took part in the Workshop. Mr. Mike Leahy of the Canada Border Services Agency (CBSA), former Customs Co-Chairperson of the WCO Working Group on E-Commerce, joined the workshop as a co-facilitator. Participants from Australia, Belgium, Brazil, Canada, China, Ireland, Japan, Mauritius, the Netherlands, Nigeria, Pakistan and the United Kingdom worked intensively and demonstrated their knowledge and skills to deliver Capacity Building activities in the area of Cross-border E-Commerce. Moreover, the Workshop served as a forum for sharing knowledge and experience, as well as discussing challenges and solutions. 

The participants that successfully completed the Accreditation Workshop will be invited to the next stage of the WCO expert accreditation process, an in-field mission with a qualified WCO expert in the area of E-Commerce. Fully accredited experts will be expected to conduct future WCO Capacity Building activities.

Also read – Facilitating E-Commerce (WCO Article)

Source: WCO, 8 September 2020

Benefits and Drawbacks of the E-commerce Moratorium

India and South Africa circulated a communication to members of the World Trade Organization (WTO) General Council, arguing that the WTO moratorium on customs duties on electronic transmissions has “catastrophic” impacts on developing countries’ economic growth, jobs, and the attainment of the SDGs. In another communication, a group of WTO members highlighted “the overall benefits” of duty-free electronic transmissions.

The WTO e-commerce moratorium, which bans countries from imposing customs duties on electronic transmissions, dates back to 1998 when ministers at the Second Ministerial Conference adopted the Declaration on Global Electronic Commerce, calling for the establishment of a work programme on e-commerce, which was adopted later that year. Since then, at every Ministerial Conference, WTO members have agreed “to maintain the current practice of not imposing customs duties on electronic transmissions.”

The WTO Work Programme on Electronic Commerce defines “electronic commerce” as the “production, distribution, marketing, sale or delivery of goods and services by electronic means.” According to a recent WTO report, the enforcement of social distancing, lockdowns, and other measures to address the COVID‑19 pandemic resulted in an uptake in e-commerce, including online sales and streaming of videos and films.

In March 2020, India and South Africa circulated a communication, outlining the implications the moratorium has on developing countries, including: tariff revenue losses; impacts on industrialization; impacts on the use of digital technologies like 3D printing in manufacturing; as well as losses of other duties and charges. The countries argue that the moratorium is “equivalent to developing countries giving the digitally advanced countries duty-free access to [their] markets.”

According to a UN Conference on Trade and Development (UNCTAD) article, in 2017 alone, the potential tariff revenue loss to developing countries due to the moratorium was USD 10 billion. The article further notes that removal of the moratorium could provide policy space for developing countries to regulate imports of electronic transmissions and generate annual tariff revenue of up to 40 times greater than that in developed countries.

communication from Australia, Canada, Chile, Colombia, Hong Kong, China, Iceland, the Republic of Korea, New Zealand, Norway, Singapore, Switzerland, Thailand, and Uruguay, circulated in June 2020, highlights a paper by the Organisation for Economic Co-operation and Development (OECD) titled, ‘Electronic Transmissions and International Trade: Shedding New Light on the Moratorium Debate.’ The members state that, according to the paper, “the overall benefits” of duty-free electronic transmissions “outweigh the potential forgone government revenues” due to the moratorium. The members recommend that these findings be considered in the current discussions on the extension of the moratorium.

A decision on whether or not the moratorium should continue will be taken at the 12th WTO Ministerial Conference (MC12). Originally scheduled for June 2020, the Conference has been tentatively postponed until June 2021.

Source: SDG Knowledge Hub, 23 July 2020

WCO News – June 2020

As the title suggests, the latest edition of WCO News contains a variety of articles concerning Customs approach to COVID-19 and even one article relating to Customs Brokers on COVID-19. Other features include C-2-C cooperation and information exchange, Risk Management and the future invisible supply chain and Secure Border . Of interest for Customs Policy are articles on improvements to simplification and harmonisation of components to the Revised Kyoto Convention; WCO’s development of draft “Practical Guidance on Free Zones” as well as Internet domain name ownership data – understanding changes and useful suggestions for Customs. All in all another great read!

Source : World Customs Organisation

Guide to the WCO E-Commerce Framework of Standards

It is often difficult to navigate and assimilate the myriad of documentation and annexes associated with significant initiatives such as WCO’s ‘framework of standards’. True, the documentation is detailed and technical. There are, however, online training courses available on the WCO website for users wishing to attain a level of proficiency on a particular subject. Furthermore, member states can request technical assistance from WCO in the establishment of capacity for the implementation of specific Customs initiatives.

However, sometimes one requires a synopsis or insight as to what a particular initiative aims to achieve. This is important so as to establish the nature and extent of change and capacity required in one’s own domestic situation. In my area of operation, MS PowerPointTM plays an important role in uniformly conveying key information to a multitude of people across different disciplines in the organisation. Im happy to share a ‘guide’ which consolidates most of the ‘official’ WCO documentation that comprise the Framework of Standards on E-Commerce. When viewed as a PowerPoint Show, all hyperlinks to the official WCO E-Commerce documentation are available for download or display. Below are versions for both standard PowerPoint or PowerPoint Show. I hope it will serve some useful purpose.

Guide – WCO Framework of Standards on E-Commerce [PPTX, 3MB]

Guide – WCO Framework of Standards on E-Commerce [PPSX, 3MB]