May 3, 2019 / 3:04 PM / 21 days ago

EU fleshes out WTO e-commerce proposal, faces obstacles

BRUSSELS/GENEVA (Reuters) - The European Union began a push for improved protection for traders and consumers involved in online transactions, as it published proposals on Friday launching what are likely to be long and hard WTO negotiations on regulating e-commerce.

FILE PHOTO: FILE PHOTO: A woman use a touch screen to access a commerce application during Indonesia E-Commerce Summit & Expo at Serpong district near Jakarta, Indonesia, April 27, 2016. REUTERS/Beawiharta/File Photo/File Photo

The World Trade Organization rulebook was largely written in the 1980s and 1990s before the internet revolution, and major trading powers have conflicting red lines over e-commerce.

Of the WTO’s 164 members, 77 have agreed to try to bring the rules up to date.

The nine-page EU proposal would aim to strengthen consumer confidence in online transactions, keep internet access open, and shield traders from attempts to restrict data flows or seize their data and source code.

Businesses and consumers had to rely on a patchwork of bilateral or regional rules and a global framework was needed, the European Commission said.

The United States is pushing for rapid reform of the WTO. President Donald Trump has threatened to withdraw from it, blocked the appointment of trade judges and adopted tough tactics in trade disputes.

A European Commission source said there was a very strong incentive to try to agree new WTO rules.

“We’re trying our best to save the multilateral trading system in a situation where one member, the U.S., is doing everything it can -  it seems sometimes - to bring it down,” the source said.

Almost all past attempts at writing new global trade rules have failed due to a lack of consensus at the organization, and reformers have increasingly aimed for critical mass of a subset of members instead.

India has declined to take part in the e-commerce talks, while China has joined with a caveat: rules on data flows must be “subject to the precondition of security”.

The EU Commission source said change would not be easy or quick. “Those that express the hope that this (e-commerce reform) could all be concluded by the next WTO ministerial meeting (in June 2020)... that is just not realistic.”

Reporting by Tom Miles; editing by John Stonestreet

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