Following five years of negotiations, today (Friday 26th July, the UK joined 90 other countries in signing the Agreement on Electronic Commerce which have been finalised at the World Trade Organisation (WTO). The new initiative focusses on making digital global trade faster, fairer, cheaper and more secure. It becomes the first agreement of its kind and looks to end the fragmented approach to digital trade regulations.
The agreement brings several benefits to businesses including the permanent ban on customs duties on digital content, the recognition of e-documents and e-signatures and committing all participants to the digitalisation of customs documents and processes which should bring around the end of physical customs documentation.
Globally, digital trade was estimated by the OECD to be worth around £4 trillion in 2020 which is roughly 25% of global trade. Steps will now be taken to incorporate the agreement into the WTO legal framework. Once it has been incorporated, UK ratification will take place.
On the UK’s involvement, the Business & Trade Secretary Jonathan Reynolds said “We are proud to play our part in securing the first global digital trade agreement, cutting costs for business and delivering on this government’s ambition to deliver economic growth”.
For more information on the benefits of the Joint Initiative on Electronic Commerce and the Agreement on Electronic Commerce, click here.
Also, if you would like to read more about the benefits of digitalisation of trade processes, the importance of services trade to the UK economy and the relationship between exporting services, productivity, employment and output, the London School of Economics and Political Science have released a report which can be found here.
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