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USTR-2019 CCIA Comments For Before the Office of the United States Trade Representative Washington, D.C. In re Request for Comments to Compile the National Trade Estimate Report on Foreign Docket No. USTR-2019-0012 Trade Barriers COMMENTS OF THE COMPUTER & COMMUNICATIONS INDUSTRY ASSOCIATION REGARDING FOREIGN TRADE BARRIERS TO U.S. EXPORTS FOR 2020 REPORTING October 31, 2019 Executive Summary Pursuant to the request for comments issued by the Office of the United States Trade Representative (USTR) and published in the Federal Register at 84 Fed. Reg. 46,079 (Sept. 3, 2019), the Computer & Communications Industry Association (CCIA)1 submits the following comments for consideration as USTR composes its annual National Trade Estimate Report on Foreign Trade Barriers (NTE). CCIA welcomes USTR’s continued focus and renewed commitments to reducing barriers to digital trade. The Internet remains an integral component to international trade in both goods and services and is also a key driver to development, enabling SMEs to reach new markets and serve customers around the world. In 2017, the digital economy accounted for 6.9% of GDP, $1.35 trillion, in the United States.2 These gains are facing growing threats from countries who continue to adopt laws and regulations that hinder growth and cross-border delivery of Internet services. Under the guise of promoting domestic champions, protecting national security, and upholding privacy, countries are adopting discriminatory policies that disadvantage, and often target, U.S. technology companies and pose significant barriers to the delivery of Internet-centric products and services. As the Internet continues its exponential growth and becomes even more intertwined with international commerce, it is essential that such barriers are identified and quelled. For the 2020 National Trade Estimate report, CCIA identifies barriers to trade facing U.S. Internet and digital exporters that relate to the following: (1) restrictions on cross-border data flows and data and infrastructure localization mandates, (2) government-imposed restrictions on Internet content and related access barriers, (3) digital taxation, (4) market-based platform regulation, (5) copyright liability regimes for online intermediaries, (6) imbalanced copyright laws and “link taxes”, (7) extraterritorial regulations and judgments, (8) customs duties on electronic transmissions, (9) backdoor access to secure technologies, and (10) market access barriers for communications providers. CCIA highlights countries whose current and proposed regimes pose a threat to digital trade and negatively affect foreign investment by U.S. technology companies. 1 CCIA represents technology products and services providers of all sizes, including computer hardware and software, electronic commerce, and telecommunications and Internet products and services. A list of CCIA members is available at https://www.ccianet.org/members. 2 BUREAU OF ECONOMIC ANALYSIS, Measuring the Digital Economy: An Update Incorporating Data from the 2018 Comprehensive Update of the Industry Economic Accounts (2019), available at https://www.bea.gov/system/files/2019-04/digital-economy-report-update-april-2019_1.pdf; BUREAU OF ECONOMIC ANALYSIS, Digital Economy Accounted for 6.9 Percent of GDP in 2017 (Apr. 4, 2019), https://www.bea.gov/news/blog/2019-04-04/digital-economy-accounted-69-percent-gdp-2017. Computer & Communications Industry Association | 2 Table of Contents I. INTRODUCTION .....................................................................................................................................................7 II. PROMINENT DIGITAL TRADE-RELATED BARRIERS ...............................................................................9 1. Restrictions on Cross-border Data Flows and Data and Infrastructure Localization Mandates ........................9 2. Government-Imposed Content Restrictions and Related Access Barriers .......................................................12 i. Online Content Regulations ..........................................................................................................................12 ii. Censorship and Internet Shutdowns ............................................................................................................14 3. Digital Taxation ...............................................................................................................................................15 4. Market-based Platform Regulation ..................................................................................................................17 5. Copyright Liability Regimes for Online Intermediaries ..................................................................................17 6. Imbalanced Copyright Laws and “Link Taxes” ...............................................................................................18 7. Extraterritorial Regulations and Judgments .....................................................................................................20 8. Customs Duties on Electronic Transmissions ..................................................................................................21 9. Backdoor Access to Secure Technologies .......................................................................................................22 10. Market Access for Communication Providers ...............................................................................................23 III. COUNTRY-SPECIFIC CONSIDERATIONS ..................................................................................................24 1. Argentina ..........................................................................................................................................................24 Additional E-Commerce Barriers ....................................................................................................................24 2. Australia ...........................................................................................................................................................24 Backdoor Access to Secure Technologies .......................................................................................................24 Copyright Liability Regimes for Online Intermediaries ..................................................................................25 Digital Taxation ...............................................................................................................................................26 Government-Imposed Content Restrictions and Related Access Barriers ......................................................26 Market-based Platform Regulation ..................................................................................................................27 Additional Barriers to E-Commerce ................................................................................................................27 3. Austria ..............................................................................................................................................................28 Digital Taxation ...............................................................................................................................................28 4. Brazil ................................................................................................................................................................28 Restrictions on Cross-Border Data Flows and Data and Infrastructure Localization Mandates .....................28 Copyright Liability Regimes for Online Intermediaries ..................................................................................29 Additional E-Commerce Barriers ....................................................................................................................29 5. Belgium ............................................................................................................................................................30 Asymmetry in Competition Frameworks ........................................................................................................30 6. Cambodia .........................................................................................................................................................30 Government-Imposed Content Restrictions and Related Access Barriers ......................................................30 7. Canada ..............................................................................................................................................................30 Additional Barriers to E-Commerce ................................................................................................................30 Digital Taxation ...............................................................................................................................................32 Extraterritorial Regulations and Judgments .....................................................................................................32 Restrictions on Cross-Border Data Flows .......................................................................................................33 8. Chile .................................................................................................................................................................34 Digital Taxation ...............................................................................................................................................34
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