Digital Trade: IA's Digital Trade Agenda

IA’s digital trade agenda covers a broad array of policies that will promote and build on the U.S.’s digital success.

• Promote the free flow of information.

  The ability to transfer and access information across borders is critical to all economic sectors. When information is restricted, the economy and exports suffer. Data flows contribute hundreds of billions of dollars to the global economy. U.S. digital trade policies should prohibit governments from restricting the movement of information across the internet.

• Prevent data localization.

  Digital trade policies must prohibit governments from requiring that data be stored or processed locally. Requirements that force companies to manage, store, or otherwise process data locally, or other policies that link market access to investment or the use of local infrastructure, hurt businesses and consumers and threaten the open nature of the internet.

• Protect privacy and consumers.

  Privacy and consumer protections are critical underpinnings of U.S. digital trade. Clear and interoperable rules on these issues will enhance consumer confidence in digital trade. Policies should ensure that enforceable privacy protections will apply to the digital marketplace.

• Promote intermediary liability protections.

  Intermediary liability protections enable the continued development of digital platforms and the free flow of information. These protections ensure cloud and other internet services can host third-party content and communications without the service provider being considered the publisher or speaker. Intermediary liability protections enable features such as customer reviews, which have been essential to building customer trust for e-commerce businesses. Without intermediary liability protections, internet services would not be able to function as open platforms for trade and communication. Digital trade policies should prohibit governments from making online services liable for third-party content.

• Ensure encryption and source code integrity.

  Other countries require access to encryption keys or source code as a condition for letting technology imports into their market. Such measures, if left unchallenged, would compromise technology and hurt exports. Digital trade policies should prohibit governments from requiring access to encryption keys and source code as a condition for market access.

• Prevent customs duties on digital transmissions.

  Some countries have threatened to apply customs duties on digital products. World Trade Organization members have only agreed to a temporary moratorium on imposing such duties. Digital trade policies should ensure that governments cannot impose tariffs on the flow of music, video, software, e-books, games, and information as they move across borders. This will continue to benefit the creators, artists, and entrepreneurs who depend on online sales to get ahead.

• Limit unnecessary regulation of online services.

  Foreign governments are seeking to limit market access by imposing complex and unnecessary licensing requirements on online services. This makes little economic sense. Unlike traditional public utility infrastructure, online service markets typically have no serious barriers to new market entrants and have low switching costs. Sharing economy services also face significant market access and operational barriers in markets that limit the ability to supply or consume services offered by these platforms.

• Promote non-discriminatory taxation of the digital economy.

  Digital trade policies should ensure that every government provides full non-discriminatory treatment to digital services and service providers of the other countries, and does not apply taxation measures in a way that discriminates against digital services or is not technologically neutral.

• Promote open government data.

  Small and large companies are increasingly using public data to build innovative commercial applications and services, to improve their ability to navigate global markets, and to build machine translation and image recognition systems that rely on access to text and images. By releasing data in an open format that can be searched, retrieved, used, reused, and redistributed, governments can assist local companies in building these cross-border services.

• Promote innovation through protecting ‘fair use’ of copyrighted material.

  Overly restrictive copyright policies that lack limitations and protections for the ‘fair use’ of copyrighted material undermine creativity and innovation, and are harmful to the internet economy. Web search, machine learning, computational analysis, text and data mining, and cloud-based technologies all involve making copies of copyrighted content without the explicit consent of the copyright holder. These types of innovative activities are possible under U.S. copyright law because of its robust combination of limitations and exceptions.

• Promote copyright ‘safe harbors’ for online service providers.

  A ‘safe harbor’ system that protects the interests of copyright holders, online service providers, and users by imposing responsibilities and rights on each is important. Safe harbors provide powerful incentives for service providers to cooperate with rights holders, and are critical to the functioning of cloud services, social media platforms, online marketplaces, search engines, internet access providers, and many other businesses.

• Ensure proportionality and due process in copyright enforcement.

  Copyright damage regimes – if not properly calibrated – can have a stifling effect on innovation and legitimate services, especially smaller providers and emerging services. Unpredictable risks of massive damage awards can deter startups from developing new technologies, particularly when it comes to novel innovations like machine learning and comprehensive digital media services that may not fit neatly into existing safe harbors and exceptions.

• Promote access to cloud services.

  Cloud computing has brought forth a new and more efficient means of managing government information technology resources. It has opened up avenues for modernization, innovation, cost savings, and improvements in cybersecurity. Trade policies should take steps through the digital trade, procurement, and good regulatory practices to promote widespread and non-discriminatory access to commercial cloud services.

• Improve customs and trade facilitation.

  Burdensome and complex customs procedures discourage or block online sellers altogether from new markets. In some cases, internet-enabled exporters are often unable to reach international customers because of outdated trade rules that do not accommodate package-level e-commerce exports.