Les querelles commerciales entre l’UE et les Etats-Unis éclatent au sujet des produits TI[en] 

At a conference in Singapore in December 1996, 29 trade ministers signed the Declaration on trade in information technology products. The Declaration led to the adoption of the Information Technology Agreement (ITA) in July 1997.

The EU, the US, Japan, Australia, Canada, Switzerland and Turkey were among the first participants to the agreement, which is aimed at reducing tariffs on Information Technology (IT) products.

At the moment, the agreement is applied in around 70 countries in the world, but excludes important international players such as Brazil, Mexico or South Africa. 

Brussels has been pushing for months for a renegotiation of the ITA in order to include new states and to review the set of goods concerned.

The row occurs while the new global trade pact, under discussion in the Doha Development Round, is still uncertain after six years of negotiations (see our Links Dossier).

The official complaint was filed by the US, along with Japan, on Wednesday (28 May). It targets tariffs imposed by the European Union on a range of IT products for which global exports are estimated at over €450 billion.

The American and Japanese authorities are first requesting WTO dispute settlement consultations with the EU to resolve the issue. But the consultation procedure can last a maximum of two months, and after that, in the absence of an agreement, WTO experts will be forced to take a legally-binding position.

What has angered the US and Japan is the EU's policy not to consider new products developed from goods already in the ITA as covered by the agreement. In other words, while traditional printers are duty-free in the EU, their newer evolved versions, capable also of scanning or faxing, are not. 

The US argument is that such technological developments were foreseeable and that new machines should benefit from similar tariff reductions as those already developed ten years ago. "We all know that technology is organic. New features are developed, and advances are made, almost before we walk out of the store, and certainly before the ink is dry on most of our agreements," said US Trade Representative Susan Schwab.

But the EU retorts that the deal made in 1996 is explicit on products covered. It insists that the only way to review the list is therefore to proceed to new overall negotiations on the ITA. Brussels says it has requested this already on several occasions but that the US has always opposed it.

The products under scrutiny are LCD monitors or flat screen TVs, which Brussels argues are different from computer displays, indeed covered by the ITA. The US and Japan are also calling for the inclusion of multifunctional digital printers (alongside traditional printers) and video recorders (alongside set top boxes able to record but mainly to connect to the Internet).

US Trade Representative Susan Schwab commented : "Europe should be working with the United States to promote new technologies, not finding protectionist gimmicks to apply new duties to these products."

The European Commission's Trade services reacted  with the following statement: "The only way to adapt the ITA to changed technologies is to renegotiate the product scope of the ITA with all its signatories, as the ITA foresees. Such a renegotiation would also allow addressing other problems encountered in trade of IT products, the non-tariff barriers and the geographical coverage of the ITA. The EU has proposed such a negotiation, but the US has not followed up on such offer."

"European industry is disappointed that the parties have not been able to find agreement within the ITA Committee in the WTO," commented  EICTA, a digital industry association that includes US and Japanese giants like Microsoft or Sony and EU companies such as Nokia or Siemens.

"It is clear on both sides of the Atlantic that storm clouds are gathering; we hear ominous voices challenge the importance of concluding and respecting free trade agreements. Protectionism and economic patriotism are harmful to the economy, and lead to political and economic isolation," the statement concludes.