Policy on cards for cross-border electronic transmissions

The government is going to formulate a policy on cross-border electronic transmissions in a bid to help guide the country's thriving e-commerce industry in this regard, according to a senior official of the commerce ministry.

Cross-border electronic transmissions refer to the transmission of information in electronic form, such as digital copies of books purchased online.

"The formulation of this policy is important as e-commerce transactions have been growing with consumers buying large quantities of products and services from both home and abroad," Hafizur Rahman, additional secretary to commerce ministry, told The Daily Star yesterday.

The ministry will hold a meeting with the stakeholders concerned tomorrow to formulate the cross-border electronic transmission policy that will address relevant issues of e-commerce companies, he added.

Currently, member countries of the World Trade Organisation (WTO) cannot impose customs duty on cross-border electronic transmissions even though they are losing billions of US dollars every year as a result.

Member countries decided in the WTO Ministerial Conference of 1998 that customs duty will not be imposed on cross-border electronic transmissions as such transactions are considered as a trade in services.

According to the agreement made that year, levying duty on the import of digital products is prohibited. As such, Bangladesh loses more than $6 billion worth of business each year because of the tariff-free trade of digital products, according to different estimates.

However, after numerous meetings over several years, the General Council of the WTO came to a conclusion that cross-border transmission could also be brought under customs duty as it is a form of trade.

The member countries then reached a consensus that cross-border electronic transmissions will be brought under customs duty at the 12th WTO Ministerial Conference held in Geneva, Switzerland between June 12-17.

Earlier, the WTO had said its members will continue their current practice of not imposing customs duty on electronic transmissions.

"We shall intensify discussions on the moratorium and instruct the General Council to hold periodic reviews based on the reports that may be submitted by relevant WTO bodies, including on scope, definition, and impact of the moratorium on customs duties on electronic transmissions," the WTO said in its earlier declaration.

"We agree to maintain the current practice of not imposing customs duties on electronic transmissions until the 13th Ministerial Conference, which should be held by December 31, 2023. Should the conference be delayed beyond March 31 2024, the moratorium will expire on that date unless ministers or the General Council take a decision to extend," it added.