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</o:shapelayout></xml><![endif]--></head><body bgcolor=white lang=EN-US link="#0563C1" vlink="#954F72"><div class=WordSection1><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>Dear colleagues,<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>Please find attached a letter signed by a large number of civil society organizations that calls on WTO to refrain from adopting a negotiating agenda for e-commerce. In my view, some of the proposals for e-commerce are directly related to Internet governance matters.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>The letter also covers other matters, so I reproduce below that part that is specifically about E-Commerce.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><br>Best,<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>Richard<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>==============<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>A number of new e-commerce proposals have been made at the WTO in the last year. Proponents often disguise<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>their proposals under the rubric of e-commerce as being necessary to unleash development through the power of<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>small- and medium-sized enterprises (SMEs). But SMEs are the least likely to be able to compete with giant<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>transnational corporations, which enjoy the benefits of scale, historic subsidies, technological advances, strong statesponsored<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>infrastructure, tax avoidance strategies, and a system of trade rules written for them and by their<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>lawyers.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>Key provisions of the proposals include prohibiting requirements to hold data locally; to have a local presence in the<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>country; no border taxes on digital products; prohibitions on regulating cross-border data transfers; and even<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>prohibitions on requiring open source software in government procurement contracts. There is no economic<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>rationale as to why digitally traded goods should not have to contribute to the national tax base, while traditionally<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>traded goods usually do. Data is now the most valuable resource; furthermore, privacy and data protection are<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>fundamental human rights and they cannot be abandoned in the interests of trade. Locking in rules in the WTO to<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>allow corporations to transfer data around the world without restrictions would forever deny the right of countries<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>and citizens to benefit from their own data and intelligence in the future, and it would restrict the ability of countries<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>to implement appropriate data privacy and consumer protection measures. What e-commerce proposal proponents<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>call “localization barriers” are actually the tools that countries use to ensure that they can benefit from the presence<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>of transnational corporations to advance their own development and the economic, social, and political rights of<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>their citizens.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>We need trade rules that allow for the creation of decent jobs, including in the technology sector. But the hallmarks<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>of companies like Amazon, Facebook, Google, and Uber include dislocation of local businesses and labor markets,<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>and increasing precariousness of work. These would accelerate if e-commerce proposals were accepted in the WTO.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>Existing technology giants would be able to further consolidate their monopoly power. Their infamous tax<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>optimization (which is tantamount to evasion), including base erosion and profit shifting, would be facilitated by a<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>binding international treaty, and it would be nearly impossible to rein in the political instability engendered by the<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>economic and financial consequences of such a scenario.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>WTO members do not currently have a mandate to negotiate new global rules on “e-commerce,” and they should<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>not obtain one in Buenos Aires. All of the issues proposed for the e-commerce agenda have either already been<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>discussed and resolved, or are currently being discussed, in other forums, most of which are more responsive and<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>accountable to public interest concerns than the WTO. E-commerce is already flourishing and SMEs can already sell<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>their products online without new WTO rules. Of course, e-commerce can be a force for job creation and<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>development, and certainly has the power to expand innovation, increase consumer choice, and connect remote<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>producers and consumers. But supporting e-commerce is not the same as having binding global rules that would<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>primarily benefit U.S.-based high-tech corporations, at the expense of public interest regulation to protect<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>consumers and promote development. While we support efforts by developing countries to address the digital<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>divide, transfer technology, and obtain financing for infrastructure and information and communications<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>technologies (ICTs), the WTO is not the proper forum to negotiate these issues; similar to the way other<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>development issues have been treated in the WTO, they will not become binding obligations, while the agenda of<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'>the high-tech corporations will be binding. <b><i>There should absolutely be no new mandate on e-commerce in MC11</i></b><i>.</i><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p></div></body></html>