23 Jun

'Australia seeks to revive free-trade push with digital agenda' Hans van Leeuwen, Australian Financial Review

Australia seeks to revive free-trade push with digital agenda
Hans van Leeuwen

London | Australia will look to liberalise data flows and harmonise tech standards with Britain as part of the recently launched free-trade talks, in what appears to be a part of a broader Morrison Government push to drive forward a new digital trade agenda.

Trade Minister Simon Birmingham told an online business audience in Australia and Britain late on Monday (AEST) that he wanted to see the Australia-Britain free-trade agreement (FTA) adopt broadly the same suite of measures that Canberra recently nutted out with Singapore.

That follows the recent Australian Financial Review revelation that the US also wants to add a new chapter to its FTA with Australia covering the same areas as the Singapore Digital Economy Agreement (DEA).

"There is no doubt that the DEA can serve as a strong precedent - and indeed a trigger - for bilateral and multilateral developments well beyond its immediate regional context," said Michael Lawson, partner in charge at Mallesons King Wood in Singapore.

The DEA, agreed in March, eases curbs on data transfers between Singapore and Australia, and drops the requirement that data must be stored in a particular jurisdiction.

It also commits the two countries to collaborate on e-invoicing standards; develop shared ledger technologies for official documents; harmonise customs procedures and data standards; respect each other's privacy requirements; and not demand the transfer of source code when software is exported, distributed or sold from one country to the other.

Senator Birmingham told the two Australia-Britain chambers of commerce that he hoped Canberra and London could "build on some important breakthrough agreements that Australia has recently struck", citing the DEA.

"It is crucial for us to look at how we can harmonise wherever possible in terms of the recognition of technological platforms and what they can bring to business, whilst providing for the openness to innovate as well," he said.

The new digital focus could help Canberra make headway on the trade liberalisation agenda even as geopolitical tensions cloud progress in multilateral forums and also threaten higher tariffs and fresh barriers to the trade in physical goods.

Senator Birmingham said the push also recognised the surge in e-commerce during the COVID-19 crisis, as lockdowns prevented physical transactions and drove buyers and sellers on line.

"We see real potential there, you can certainly see the pick-up in digital trade and commerce has been astounding in these last few tragic months," he said.

"That is really only accelerating a trend that is already evident, one that we're sure will continue after the crisis is past."

"Some [British businesses] have talked about 10 years of digital innovation compressed into three months," Carolyn Fairbairn, head of the British business lobby group CBI, told the chambers' webinar.

"How we make the most of that is by setting the bar really high in our [free-trade] agreement, it's quite exciting."

US trade ambassador Robert Lighthizer was asked about potential trade deals, including with Australia, at a hearing of the Congressional Ways and Means Committee.  

Mr Lawson agreed, saying FTAs could "break down some of the barriers that presently exist simply because international and domestic rules and regulation haven’t kept up with the pace of change".

"Our clients and our economies stand to benefit enormously from improved inter-operability of digital economy policy and regulation," he said.

Australia and Britain launched their FTA talks last week, with the ambition to conclude a deal as soon as the end of this year. Negotiations have not yet begun, but there have been several rounds of informal 'scoping' talks.

Australia has meanwhile taken the lead in marshalling a group of about 80 countries to develop a new regime covering e-commerce and corporate data flows, potentially plugging a critical gap in the multilateral trading system and easing companies' ability to do business across borders.

Those "plurilateral" talks began last year and are taking place at the World Trade Organisation in Geneva, although they're not a formal WTO negotiation.


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