Net plan falls victim to WTO failure

One of the initiatives that fell victim to the failure of the Seattle World Trade Organization (WTO) conference was a U.S.

One of the initiatives that fell victim to the failure of the Seattle World Trade Organization (WTO) conference was a U.S. proposal to extend a ban on Internet duties, a European Union official said Saturday.

The ministerial conference broke up late Friday with no agreement to launch a new round of trade liberalization talks and no accord on extending a temporary ban on customs duties on goods and services transmitted electronically such as software, digital books and music.

"Nothing is agreed on that," European Trade Commissioner Pascal Lamy told a news conference.

"It's probably up to normal WTO procedures to roll over the duty-free on e-commerce ... then it wouldn't be a problem and maybe we could take this issue rapidly in itself. But it was not agreed here and it will have to be agreed elsewhere," Lamy said.

WTO members agreed at a May 1998 meeting in Geneva to a temporary ban on customs duties on goods and services transmitted electronically. The United States pressed for agreement in Seattle to make the moratorium permanent or at least extend it.

U.S. Secretary of Commerce William Daley said earlier this week he was "very optimistic" trade ministers in Seattle would agree to extend the ban on Internet duties for 18 to 24 months.

Ban to stay in place
When the Seattle conference ended, trade officials held out hope it could reconvene at a future date after consultations to try to move the trade negotiations forward.

Despite the failure to extend the moratorium, U.S. trade officials said the ban would remain in place until the WTO conference reconvenes.

Another initiative whose future was in doubt was an initiative for wealthy countries to grant duty-free access to their markets for almost all products from the world's poorest countries.

The EU launched the initiative in the months running up to the Seattle conference to try to show it was meeting the concerns of developing countries which are lukewarm to the launch of a new trade round.

The EU hoped that the United States, Japan, and Canada would also line up behind the proposal.

Lamy said the EU had succeeded in getting Japan to back the proposal, but not the United States or Canada. EU officials said the United States still had problems with aspects of the initiative.

"As far as the EU is concerned, this is already in place for us," Lamy said, of the least developed country initiative.

U.S. Trade Representative Charlene Barshefsky said the U.S. administration had had a series of discussions with the EU, Japan and Canada on the least developed country initiative.

"I can't tell you when those discussions will conclude except that they are moving along, I think at a very good pace," she told a news conference.