The UK has joined a global trade agreement that was finalised as of 26 July 2024, along with 90 other countries. This agreement was brought upon by the World Trade Organisation , and is created to accommodate the demands of the new trade world: the ecommerce space.
Business and Trade Secretary Jonathan Reynolds said,”We are proud to play our part in securing the first ever global digital trade agreement, cutting costs for business and delivering on this government’s ambition to deliver economic growth.”
This agreement will be helping with global ecommerce trading by bringing centralised, open and non-discriminatory policies that have the global economy and its growth in mind with the rise of the digital economy.
How Will The Agreement Help Ecommerce?
One of the biggest challenges when it comes to ecommerce trading internationally, is the different legislation and requirements when it came it existing trading embargoes, such as hassles when it comes to customs, for example.
This agreement looks at how joint policies can be implemented to avoid the back and forth usually associated with the import/export processes in ecommerce.
UNCITRAL Model Law On Electronic Commerce
The plan is for countries to adapt to the UNCITRAL Model Law on Electronic Commerce. The United Nations Commission on International Trade Law adapted this law. It gives recognition and acknowledges electronic documents for ecommerce transactions, so that businesses can perform internationally.
Chris Southworth, Secretary General, International Chambers of Commerce UK said, “Businesses and economies thrive when there is one common set of rules. The E-Commerce Agreement is a major breakthrough and an excellent reminder of the power of international collaboration.”
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Why Do We Need These Transformations?
The agreement will be tackling this so that countries are better at regulating electronic transactions, by moving processes from requiring paperwork, to becoming completely paperless.
This is being discussed for authentication, signatures and other such processes. Science Secretary Peter Kyle mentioned, “This global agreement aims to help people use technology safely by protecting them from fraud, while driving economic growth through the digitalisation of trade so it’s faster and more secure.”
The digitsation of customs documentation is a step towards digital transformation, a big aspect of the agreement, with plans on providing assistance to developing countries when it comes to bringing technologies that allow for more efficient border processes.
How Will The Agreement Become Effective?
With the digital trade agreement set to become part of the WTO’s legal framework, the way from here is ratification by the UK and other member countries. This is so the agreement can take effect and start delivering its benefits.
Matt Hammerstein, Head of Barclays UK Corporate Bank also commented, “As co-chair of the Trade Digitisation Taskforce with ICC United Kingdom, we have worked closely with the Government to support efforts to secure the competitiveness of UK exports, champion the digitalisation of trade at scale and continue to work on streamlining processes related to fraud and financial crime risk.
“We welcome this announcement, which will help make the trade process easier for small, medium and large-sized businesses in the UK by removing paper-based barriers to trade. Barclays stands ready to play its part in supporting the success of British exports.”
