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IGF 2017 - Day 2 - Room XII - DC on Trade

 

The following are the outputs of the real-time captioning taken during the Twelfth Annual Meeting of the Internet Governance Forum (IGF) in Geneva, Switzerland, from 17 to 21 December 2017. Although it is largely accurate, in some cases it may be incomplete or inaccurate due to inaudible passages or transcription errors. It is posted as an aid to understanding the proceedings at the event, but should not be treated as an authoritative record. 

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>> JEREMY MALCOLM:  Okay.  Good morning again, everyone.  Welcome to inaugural meeting.  I'm going to open by giving a few remarks describing how this dynamic coalition came into being and why, and then we'll start talking about the output we've been working on during the year and have a little briefing on the state of play in trade in the internet of which you've been able to hopefully learn more throughout the sessions during this IGF and upcoming sessions as well.  And the last third of the meeting will be about what we want to do for next year, and probably that's the most important part.  There are documents up here which are ‑‑ I'll tell you about in a minute. 

First, a little background.  So before there was an IGF dynamic coalition on trade in the internet, there was a mostly civil society group with a few private sector members called the open digital trade network.  Which was formed in 2016 and the reason for the formation of the dynamic coalition was to make it fully multi‑stakeholder and to be integrated better with the internet governance forum.  So it was formally recognized in February this year.  And when I compare the two groups, the open digital trade network and the dynamic coalition, two of the most important differences is we have more participation from all of the stakeholder groups and we have completely open membersip and an open e‑mail list whereas the other group has a closed list, just so that they can be some sort of strategizing outside of the open e‑mail list that the dynamic coalition has.  We have 42 members, and here is a graph of chart which shows the composition.  It's not unusual for civil society to be the majority of any of the dynamic coalitions.  I think that's pretty normal.  This may be slightly exaggerated because I couldn't tell if some of the civil society people were actually civil society or academic or technical community.  So probably the civil society part of this graph should be a little less than it's showing here.  But what you can see, we've got about a quarter of industry and academic members, which is not bad.  Probably the technical community has more than that, but that's all I could find on the membership list.  Oh, and sorry we have a government member who's not shown on this chart.  I think I may have left that off inadvertently.  So given we have also a government member, we have all the stakeholder groups represented as members of the dynamic coalition.  Now, when DC was formed, I think this year being the first year of the dynamic coalition and since we haven't met before, a lot of the work that we've done could be regarded as just some perpiatry work for what we're going to do in the future.  One of the main things we wanted to do was to create a background paper which would be a resource for us going forward and which everyone could use the get up to speed on areas that they're not as familiar with and to read about what's happened so far at different venues and the different initiatives that have taken place.  So we've created this background paper.  I have no more copies of the background paper available.  However, it is available online.  So we can distribute those to people who don't have hard copies. 

I want to reiterate, if there's something in the background paper that you disagree with, it's not a normative document.  We're not saying this is a statement of the dynamic coalition.  It's just meant as a resource to help us all going forward and provide a common understanding of the state of play of trade on the internet.  Congratulations to Jodi Penda who did the majority of the work on that, but we did have input and comments from members which helped to get it into the final form that it is now. 

The other thing we worked on ‑‑ what we've come up with is a draft resolution about transparency and inclusiveness in international trade negotiations and there are a few more copies of that up here.  If you don't have one, come grab it.  This document, we worked on during the year.  We had a large number of comments which were all integrated.  One of the things we were cautious of ‑‑ unlike the background paper, this one, we do want to reach a rough consensus around it in this group, and since it’s such a diverse group we had to take a great deal of care in drafting this to make sure it was something everyone could live with. So apart from the comments that we received online, I also had some 1 to 1 discussions with people who had particular expertise to ask them, look, are we on the right track here?  There's also a number of existing resources that we drew upon, which are referenced at the back of the document.  And we're going to go through that a little later in this session.  Ideally, I would like to see, coming to a rough consensus, that this is something we want to endorse.  And given we're all participants in the internet governance forum, I don't think it will be too difficult for us to endorse this resolution.  So that is coming up next. 

The other thing we wanted to do was in just building out the dynamic coalition and bringing members of the trade community.  I think that's part of the 2017 work plan we'll want to carry over to 2018.  And the final item on our 2017 plan was to meet today, which we're doing, so that's great. 

Now, before I go into the future, I'm going to hand over to Jodi who's going to go through the background paper.  She's not going to go through all of it because there's 66 pages long, but she's going to give an outline of what's in there, so kind of an executive summary.  So I'll hand over to Jodi.

Also, apologies if I keep looking at my laptop and I'm not looking at the audience because I do have to go through a lot.  So without further ado, I'll start with the background paper. 

The W agreements were developed in the pre-cyber age. And while the role of nation states in regulating physical goods and services has been established in the global trade order, the rule of nations states with respect to cross border flow of information is not very well understood at the moment.  Existing internet governance frameworks approach from a multi‑stakeholder perspective of decision making and where state and nonstate actors address issues to open and transparent arrangements of rulemaking which is very different from traditional trade areas where states are the negotiating parties.  So in the absence of global binding norms and internet related issues and in light of fears of digital protectionism, states are seeking to draw rules and frameworks through the digital economy through the conventional trade mechanisms.  All the trade and internet governance appear to be disconnected with the growing significance of the internet for international trade of complex relationships between the fields as emerging which will have repercussions from the digital economy. 

Regulating commercial aspects of trade agreements requires coming up with global solution that strike a balance between trade liberalization and preservation of fundamental goals such as openness and transparency and the protection of human rights.  It also requires dissolving sudden political and ideological stances on issues like privacy, innovation, and demographic standard setting. 

So despite recent initiatives, there is an open question where the trade agreement should be concerned with setting standards on internet technologies or national security and privacy.  It's very important we understand the complexities of the risks involved in aligning the disciplines of trade policy and internet governance. 

So with the aim of bringing in a multi‑stakeholder approach to the application of international trade, this paper is a resource for the dynamic coalition on trade and internet governance.  Summarizing some of the issues, concerns, and the state of play that is developing in some of these global trade arenas. 

The paper is divided in four parts.  The first section deals with the history of intellectual property and trade frameworks.  So we've covered on the first worldwide multicultural trade agreement.  The gad stayed in effect until the world trade organization was established in April 1994.  This was followed by the general agreement on trade and services which contained explicit commitments telecommunications and for financial services and both of these issues underline several e-commerce issues. 

Importantly, the gats set a standard because it created two sets of exceptions.  The general and national security exceptions under which signatories can restrict trade in the interest of protecting public health, public models, privacy, national security, or intellectual property.  And these issues we'll see keep coming up in these negotiations. 

After the gads, we had the information technology agreement.  The mandate of the ITA was to establish a tariff free trade in six product groups which included computers (?) Manufacturing and testing equipment.  The participating countries agreed to find and eliminate all customs duties and charges on information technology products by the year 2000.  And then another very critical development was the (?) Agenda which is called (?) Of trade talks is the latest cycle of negotiations within the WTO.  Concrete results on e‑commerce have not really big topic because there is disconnect between how country want to move forward on many of these issues.  So the conversation is pretty much just stagnant at the moment. 

Although gads states nothing explicit about cross border flow of information, members have been applying gats and those frameworks for disputes settlements.  So for example Mexico telecoms, U.S. gambling, China publications and audio visual product, these are four of case studies we have included in the background paper which hopefully provide a little background to how states are resolving or trying to use the dispute settlement mechanisms prevalent in trade bodies to create some sort of standards. 

In May 1998, the WTU members established the comprehensive work program on electronic commerce to examine all trade related issues relating to Google electronic commerce.  Taking into account the economic, financial, and developing needs of developing countries. 

The 1998 declaration establishing the program also included a statement that members will continue the current practice of not imposing custom duties on electronic transmissions. 

So another agreement which is of relevance here is the trade related aspects of intellectual property rights objects.  The agreement deals with progressive agreements and remedies for enforcement of intellectual property rights.  It does not specifically cover IPR (?) But arguably has application to the digital environment and sets a provision.  In meta digital (?) And also many have been exploring plus provisions which is slightly problematic.  The members designed the language to remain unchanged as technology evolves.  But southern states now are seeking to clarify points and they want to update these rules.  Academics and business leaders also argue that the rules are incomplete, out of data, in need of clarification.  Yet other have insisted (?) Get renegotiated in the framework of the e‑commerce work program.  The 11th administrative conference, of which I'm sure we'll hear from some of the audience members who were there, concluded with no clear part forward on the development agenda, reflecting on the ongoing wide division amongst member states.  While the stalling of the negotiations, members and experts have raised various options to take these discussions forward, and some include updating the rules and WT a favor to address digital trade, including multilateral gats to cover cross pedestrian data flows, technology transfer, and data market issues. 

Another suggestion is using existing (?) So basically taking what we already have and recrafting it for the digital environment.  Another suggestion has been to establish a permanent working group dedicated to exploring digital issues, possibly based on the current e‑commerce work program or create a new standalone trade agreement exclusive to trade services or digital trade, possibly as an open natural team.  And we see movement on this happening following the recent legal concluded in Argentina. 

Another suggestion has been creating a separate digital trade agreement and eWTO as some have suggested.  The U.S. trade we presented noted that new rules are critical 21st century issues such as e‑commerce and the digital economy are emerging.  A better part forward is a new form ‑‑ whatever that may mean. 

In July 2016, the U.S. put forward a submission on electronic commerce. Often trade related policies that can contribute meaningfully to the (?) But without specific negotiating proposals.  The non paper included 16 policies included in the U.S. submission and you can go through.  We covered that in the background paper.  Similarly, China also put forward a proposal in November 2016 in which it seeks to clarify and improve the application of existing multilateral trading rules with a focus on facilitating e‑commerce (?)

(?)  However, this did not move forward.  The second part of ‑‑ so the first part of the background paper basically provides the history of how IT issues have evolved in the WTU framework and what are some of the relevant agreements that member states are exploring. 

The second part, we cover trade negotiations that have included digital issues, including those that are currently being negotiated.  We delved into the status of these negotiations including the areas where countries have reached consensus and others where negotiations face difficulty and outlined what experts have been saying on this issue.  So we cover the transpacific partnership, as you may know, the U.S. withdrew ‑‑ and initially it was a group of 12 countries including the U.S.  after U.S. is withdrawn.  The 11 countries are trying to move ahead with the deal and there's no agreement on that at the moment. 

We also cover the trade and services agreement.  It was included 28 European nation ‑‑ European and nations and several other countries.  According to the TSA negotiating framework, the forum is open to all member nations and they can join the discussion after they define the agreement. 

Again, the discussions have stalled at the moment on that as well.  We all talked about the agreement on transAtlantic trade and investment training.  Between the EU and the U.S. which began at the same time as the TSA, several contentious issues remain unresolved and subsequently, negotiations have slowed down to the point but no new negotiation rounds have been scheduled. 

We cover NAFTA negotiations and are expected to rotate between three countries and a proposed timeline for agreement has been set for the end of 2018, but based on current progress, the deadline is likely to slip. 

The idea of the regional comprehensive economic partnership was initially has been grounded as a counter to the FPP because it largely involves China.  But again, very little consensus between the nations part of the negotiating framework.  So if you go through a background paper, we cover at what state of play these negotiations are at the moment and what some of the positions of the country are and where did I ‑‑ how are they different and what are some of the contentious issues. 

So we address some of the emerging teams.  So from the framework and the trade agreements, what else about the provisions related to digital economy that are being included and we find we've treated the list and gone into what is a rationality and how nation states are seeking to push for some of these issues.  I'll just quickly name a few of them so there's paperless trading, custom duties on transmission, source code, disclosure, or handing over encryption keys.  Limits on the review of software score, net neutrality, spam and malware, data exclusivity for test data, copyright expansion, (?) dispute settlement mechanisms, trade secret, domain names, personal information across data flows, data localization and financial services.  So as you see, there's a whole range of issues that have been included in many of these agreements.  We also kind of provide a background to why these issues are relevant to e‑commerce and the digital economy and why having including them in trade agreements, why some of these issues may not be appropriate to be included in trade agreements and maybe that addressed to a conventional internet governance mechanisms that have been working on these issues for a very long time. 

The final section of the part four of the background paper, we highlight some of the procedural inconsistencies between the multi‑stakeholder approach which is part of the internet governance.  We provide a broad range of recommendations, producing transparency and opening up digital trade negotiation processes by governance put back to participation by affecting the stakeholders. 

A lot of these, I've been working on this for a year and it's very difficult or impossible to be a part of ‑‑ to follow these discussions because civil society is not part of it.  And all to influence how these discussions move forward.  So the recommendations need to establish a framework about the position of diverse stakeholders.  So the process associated with trade negotiation (?) With form the participation.  And the adoption of digital trade rules needs to be researched and studied from diverse fields to understand the impact on the agreement on internet and internet society.  If you don't have open processes and for it to be taken from a ‑‑ we stay colder.  I don't know what's going on.  It's very difficult to understand where we will end up in the future. 

We have had to rely on leaks of many of these proposals and we've highlighted that.  If trade agreements are to be used to address internet related public policy issues, public support for this would appear to be contingent on the exclusively, accountability and transparency of the negotiations so that civil society does not feel it has been excluded.

An expert group of stakeholders came together in 2006 to forge the Brussels declaration on the trade and internet.  The stakeholders will ‑‑ they represent internet users, consumers, business, cultural institution and scholars. 

The participants were at the meeting were selected by EFF based on personal contacts and recommendations.  The ideas expressed in the declaration have been created to provide a road map and means to hold governments accountable.  The main demand of the Brussels declaration include regular release of draft proposals and consolidated text.  Opportunities from meaningful and involvement and collaboration that civil society represented, applying freedom for recommendation principles to the development and negotiation of government positions.  The need of balanced representation on any traded value.  Affirmative measures to engage authorization and exposing (?) And ensuring that the resulting agreement support realization of the targets of the UN tried to get the agenda for assisting. 

The parts from the Brussels meeting were against the (?) Which is formed in February 2016.  The idea of dynamic coalition on trade on the internet is an extension of the open digital trade network in that extending the conditions to a broader set of stakeholders.  Thank you. 

>> JEREMY MALCOLM:  Thank you very much.  And I'm going to follow on with that.  Don't worry, we are going to open this up to the rest of you very soon.  And also, people who participate from the floor get to have a tart. 

Before that, I'm going to lead you through the resolution that we've been working on this year.  Let me just bring it up. 

A number of you have been able to pick up a hard copy, but for those who haven't, the version on the screen also has ‑‑ no, that didn't work. 

So the short link to this document is listed at the top of the page here.  It's goo.GL/as you can see, VI five VMR.  But I'm going to read some of the highlights of it. 

If you're a member of the mailing list, you've already seen this and probably given some comments on it.  So I'm not going through the preamble is just talking about how there's the possibility of supporting an international trade agreement free and open internet, but there's also risk and part of the risk is these agreements are being developed without adequate input from all stakeholders.  And without adequate transparency and therefore we posit a couple of principles.  The principles are basically there should be transparency and consultation.  And then a slightly longer list of recommendations.  So the principles transparency just the governments have a responsibility for inform their citizens of how they regulate and receive public comments.  Hence, trade negotiators should proactively and regularly (?) To meaningfully participate in that process. 

Consultation is the government's conducting trade negotiations have responsibility to take affirmative measures to ensure that representatives of all interested parties have opportunity for meaningful involvement.  So it doesn't necessarily mean having them in the negotiating room because that may be a step too far but at least having a degree of collaboration, we've got during the development of the text proposals.  So those are the two principles and the recommendations that flow from us so that the text actual proposals brought by countries should be published.  Consolidated texts should be published after each round of trade negotiations.  The trade ministries should act transparently by publishing records of their meetings with stakeholders which doesn’t mean the content of the meetings, but just the fact that there have been meetings and should have an independent transparency officer where that's applicable. 

There should be domestic consultations on the text actual proposals and that if there are trade advisory bodies, there’s a need to be sure those are balanced.

So there's a revision history here to this as well.  If you go to the Google doc, which you can, you can see the revision history and how this evolved during the course of the year and a number of comments were quite useful to like adding in references to human right and development, things like that.  Taking out language like that was whistle language to some people that talks about data flows in a way that they don't think is appropriate.  So I think what we've ended up is something we ought to be able to come to agreement with.  I'm going to open up the floor now to anyone who has comments on this text.  If you do not have a hard copy in front of you, maybe the person nearest you can share it with you.  Otherwise, you can check the link. 

Does anyone wish to offer comments to the draft text?  Yes, Bill.

MODERATOR:  No.  We developed it in the context of this grouping.

>> JEREMY MALCOLM:  So the mailing list has basically endorsed this already.  But what we want to do is to say that it was also approved by rough consensus of the inaugural face to face meeting of the dynamic coalition.  And the only reason we're phrasing it that way so if there's particular people in this room, who can't add their names physically to a document because they have to get approval from office holders to ‑‑ by saying we have rough is consensus, that means that you individually are not implying you've signed on separately to this.  That's the way we're hoping to do it.  This is kind of a common practice in take‑up.  You know it's to ‑‑ as long as there are no really strong objections, everyone can pretty much get mind the document and it can be declared as being adopted by rough consensus.  So that's the plan.  But now you have an opportunity, if you do have strong objections, to voice them.  Yes.

>> JEREMY MALCOLM:  Thank you for that.  That was ‑‑ the way that suggestion had been made before.  And the way we reached a compromise on that is to insert it into the, oopsy, I’ve just done something very bad...  It's become very small.  I don't know how I did that. Anyway, let me get some help there.

So the final one of the recommendations, which I'll read off here instead.  So the last of the recommendation says country should make trade advise, blah blah blah.  Take steps to include more diverse legitimate stakeholders such as representatives working in human rights, development, media and consumer issue.  And the issues of the human rights development organization were in response to a comment like that.  So that was the way we tried to address that in the stakes.  Yes, Sonja.

>> JEREMY MALCOLM:  So that sentence has been highlighted on the overhead ‑‑ on the projector.  I'll also read it out.  This is one that has gone through a round of changes already, but I'm grateful for your input and maybe if there are other views on the room about whether we want to maintain this as it is or change a word or two.  I don't want to make wholesale changes here.  So the tech says international trade agreements did support the free and open internet and the upper ability of internet information services can assist member countries to harness the potential of the internet to promote social and economic development for all.  So that's the sentence Sonja has drawn to. 

>> JEREMY MALCOLM:  Let me propose something, then.  How about if you and Sonia could while we go on to the next part of the agenda, you could just take a paper copy of this into a corner and suggest amendments to that sentence and then we can come back and see, like a show of hands in the room, do we prefer the amended version or the original version?  Does that sound like a way forward?  Okay, thanks for that.

>> JEREMY MALCOLM:  Yeah, or just drop that sentence, I think, rather than drop the whole preamble.  We could just drop that sentence.  Yes, at the back.

>> JEREMY MALCOLM:  That may be leading us into the next phase of our meeting because it doesn't seem to be a direct suggestion related to this text.  The next part of the meeting is about issues that we should be dealing with over the next year.  I think you phrased one.  I think William Drake or so mentioned he would be able talk about something we could do over the next year linking the trade to internet governance communities and discussions.  Do you want to say anything to that, Bill.

One stop along the way for that could be e‑commerce week which comes up in April.  I think it's April 16th to 20.  And we might consider whether or not between now and then something could be done to try to build something of a process would outreach to more players, bring them in, and do some sort of a session there.  And I think Jordan would be open to coming like that happening.  I think more generally just in terms of the dynamic coalition itself and the broader ODTN, I think you looked at the slide you put up there at the beginning with the pie chart for participation.  We're cheating a little bit.  If you count the academics, in fact that's a very largely group of people.  We need to get more engagement from people in the internet business community if this is going to be a dynamic coalition in the tradition (?)

I want to point out also we have a member of the European parliament here in the room who's been very involved in shaping the European parliment initiative on trade issues.  We also have the WTO here. 

So we might try to figure out how to open conversations a little more and think about how to take them forward in a more constructive way.  I think having started with the question of transparency, which is a process issue, it was a good choice because as we found throughout the witnesses process, when you get into the substantive issues, you start to get disagreements.  And what was said by Milton Meular, we're not all on the same page about a lot of the subsequent policy issues but we all I think generally agree that trade processes if they proceed must be done in a more transparent way.  So building on the process stuff I think is a good place to start.

>> JEREMY MALCOLM:  Thank you very much.  I agree 100 percent with everything you said there.  Anyone else want to respond.

>> JEREMY MALCOLM:  In the event, unless there's an objection, I'm proposing we leave it as it is.

In a multi‑stakeholder dynamic coalition on an issue about economy, trade, I'm not really expecting that we would have trade agreements (?) We could have agreed on trade or many other issue at the time but this is one of the most difficult times.  But notice not to have a dynamic coalition still, then the process becomes more tiring.  What is it that you've got to sit and talk and help each other understand things, nothing that would remain the focus.  And in this regard, I wanted to point out an issue that we should as a process, it got nice that ‑‑ I mean IGF followed the (?) Those who are not here, sorry for you guys.  But that's a problem.  That's not how representation works.  There are 1,000 fewer countries that have ruined their reference with me.  And especially the second group had very cogent papers on why ‑‑ I mean the keeping of balance of prospect is going to be important.  And even in case of industrial, we were working in India with a joint press conference.  The small traders and manufacturers, some have 70,000 association members who gave press conference that they do not want.  We're talking about e‑commerce at this moment and millions of industries.  And those are typically not.  In the process, we remember that just those who are present do not represent everyone and take a very conscious effort that not everyone having but only few of them maybe present here and balance would be really important as to process goes forward.  I just wanted to put that out there.  Thank you

>> JEREMY MALCOLM:  Thanks very much for that.  Given we only have a few minutes left, let's take this and this and then maybe we can go to your amendments to the resolution.

So I think the WTOias trying.  They're doing a lot more now than they did before.  You read something about making things available for comment before

>> JEREMY MALCOLM:  Uh‑huh.

>> JEREMY MALCOLM:  Thank you very much.  I'm going to have to cut short the discussion.  I'm really sorry about this.  So I'm going to turn back to either ‑‑ to suggest their amendments to the resolution.

>> JEREMY MALCOLM:  Oh, yes.  It's easiest to drop that particular sentence because otherwise require heavy negotiation.  If we can't just drop it, some minimalist changes to prove it, would be if the national trade support which is fair.  Further, the interrupter building, that could assist (?) Promote social and economic development for all.  I'm going to paste that into the document and we can view those. Is it big enough?  Yeah.  We can view those two sentences side by side and I'm going to ask for a show of hands as to whether we want the original one or the revised one.  So bear with me.  Or to drop it.  So those are the three choices.  I'm not hearing any strong disagreement with just taking it as a whole.  So let's just firstly go through, do we want the first or second option or neither of them?  And then I'll call if there's affirmation and let's prove the statement to the whatever we suggested in the preamble. 

Option one ‑‑ and then the proposed revision is national (?) Harness the potential of the internet.  So let's call that option one.  1, 2, and option three is delete that sentence.  So a show of hands for option one, which is the original text.  A few.  Option two, the revised text, show of hands.  Option three, deletion.  That's close.  I'm going to have to count.  Let's do that again.  We're so close.  Let's just push it through.  I think it was between options 2 and 3.  Let's do two again, a show of hands.  And option three is deletion.  So I think we have the revised version of Sonja so I'm going to delete that first one.  Can we then say that the inaugural meeting of the dynamic coalition on the trade and the internet has adopted by rough consensus this resolution on transparency?  Yes?  Anyone against?  Congratulations.  I think we have a rough consensus now.  So we've finished right on the dot of 11:40. Wish we had long. I particularly would like to invite our WTO friend and anyone else you know particularly if you have contacts in government or the tech community, please encourage them to come.  So thank you very much for contributing.

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