India wants all digitised goods, such as e-books, e-music and video games, to be outside the scope of the moratorium on customs duties on e-transmissions, which has been getting temporary extensions at the World Trade Organisation since 1998. It has said that its scope and definition should be discussed at the multilateral body’s general council, sources have said.

“At the recently concluded 13th WTO ministerial conference in Abu Dhabi, India agreed to the extension of the moratorium for another two years, but it indicated that a further extension may not be allowed till there was an agreement on the scope and definition of the moratorium and the consideration of the effect it had on development. It wants the discussion to be continued at the WTO general council,” an official told businessline.

The moratorium, introduced in 1998 at the WTO’s second Ministerial Conference to promote e-commerce, has resulted in developing countries losing potential tariff revenue of $48 billion and least developed countries (LDCs) losing $7.8 billion in the period 2017-2020, per calculations made by UN officials.

“India and many other developing countries, such as South Africa, had been stressing for the last few years on the need to examine the scope of the moratorium as the global e-commerce sector has changed significantly since the moratorium was first introduced. Since then, several items that were traded physically have become digitised,” the official said.

New Delhi wants that discussions on the scope of the moratorium should take place at the multilateral body’s general council, so that there is an agreement on what exactly the moratorium would cover before the present extension runs out, the official added.

e-transmission moratorium

The argument is that the moratorium should apply to the transmission of signals and not the content itself.

The general council is the WTO’s highest-level decision-making body in Geneva, which meets regularly to carry out the functions of the WTO. It has representatives (usually ambassadors or equivalent) from all member governments and has the authority to act on behalf of the Ministerial Conference.

“There is no time to be wasted. If an informed decision on the moratorium has to be taken before the expiry of the present extension in March 2026, the matter has to be seriously discussed at the general council,” the official said.

While the extension of the moratorium of e-transmissions at the WTO has always been balanced with extension of moratorium on non-violation and situation complaints (NVSCs) under the TRIPS Agreement (which stops members from starting a dispute on matters where existing WTO rules have not been violated), the seriousness of the two issues do not match. “What developing countries stand to gain by the lapse of the e-transmission moratorium far out weighs what they might lose if the moratorium on TRIPS non-violation was to lapse,” the official said.

With the digital revolution still unfolding and increased diffusion of technologies such as additive manufacturing and 3D printing, data analytics, artificial intelligence, and internet-of-things etc, a re-examination of the implications of the moratorium was imperative, India had earlier said.

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