Trade Compliance

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World Trade Organization Reaches “Landmark” Expansion of Information Technology Agreement

Posted July 24, 2015

The U.S. Trade Representative’s office announced that more than 50 countries today will reach final agreement on a product list that will update the 1996 Information Technology Agreement to include more than 200 new products, including next-generation semiconductors, machine tools for manufacturing printed circuits, touch screens, telecommunications satellites, and magnetic resonance imaging machines.

“This is the first major tariff-eliminating deal at the WTO in 18 years, and estimates from industry show that the elimination of tariff barriers on previously excluded U.S. technology exports under this breakthrough could support up to 60,000 additional American jobs,” USTR said in a press release.

“This is a big deal,” said WTO Director-General Roberto Azevêdo. “The trade covered in this agreement is comparable to annual global trade in iron, steel, textiles and clothing combined. By taking this step, WTO members will help to provide a jump-start to the global economy and underline the WTO’s role as the central global forum for trade negotiations.”

While not all WTO members participated in these negotiations, all will benefit from the outcome because the participants will scrap duties on imports of these products regardless of which WTO member has produced them. Applying duties in a uniform and non-discriminatory manner across the organization’s membership is known as the most favoured nation (MFN) principle.

When the product list and draft declaration are approved, WTO negotiators will spend several months hammering out the technical details and the timetable for tariff elimination. The objective would be for all elements to be completed in time for Ministers of those members who are involved in this initiative to conclude the ITA expansion agreement at the 10th Ministerial Conference in Nairobi in December. It would be the first tariff-cutting agreement in the WTO for 18 years.

The agreement also contains a commitment to work to tackle non-tariff barriers in the IT sector, and to keep the list of products covered under review to determine whether further expansion may be needed to reflect future technological developments.

The Information Technology Agreement was finalized in 1997 and covers 80 WTO members. Efforts to expand the coverage of this agreement were launched in 2012.

Click here for a list of the new information technology products that will now be covered by the updated Information Technology Agreement.