EU seeks to dodge IT row with trade pact overhaul

The EU will present plans to re-negotiate a multilateral agreement on trade in information technology (IT) products amid accusations that it is imposing excessive tariffs on imported high-tech goods such as flatscreen TVs and multifunctional printers.

The proposal, set to be unveiled at the World Trade Organisation in Geneva today (15 September), would seek to extend an existing agreement on trade in IT products to a larger array of goods. 

Indeed, according to the EU, the 1997 Information Technology Agreement (ITA) “risks being left behind after twelve years of technological development,” notably because its “product-based approach has not been able to take account of changes in the industry”. 

The proposal comes just a few weeks after the US, supported by Japan and Taiwan, asked the WTO to intervene in a dispute over tariffs imposed by the EU on products that the US insists are covered by the ITA and should therefore be exempted from any duties. 

The EU, for its part, argues that the products in question – which include LCD monitors and flatscreen TVs as well as multifunctional digital printers and video recorders – are different from any of the products listed in the ITA. It has rejected claims that it is not fulfilling its obligations under the ITA and insists the only way the dispute can be resolved is by renegotiating the current ITA with all signatories, not via litigation.

But the US has responded coolly to the EU’s proposals, describing renegotiation as “a separate issue and does not resolve our concerns about maintaining duty-free treatment for products already covered under our present commitments”.

The US trade representative’s spokeswoman Gretchen Hamel further stated that “if the [European Commission] is truly interested in providing duty-free treatment for IT products, it is unclear why it continues to apply duties to the ITA products that are the subject of the dispute”. 

But the EU also wants to use the renegotiation to extend the ITA to a number of nations that have become important international players but are not participants as yet, such as Brazil, Mexico and South Africa. 

Currently, the pact is applied in around 70 countries, representing more than 97% of world trade in IT products. 

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