The International Practice of the European Communities - Current Survey International Trade Developments, Including Commercial Defence Actions XIV: 1 July 1997 - 30 June 1998 1 International Developments A Second ASEM Heads of State Meeting The second ASEM Heads of State meeting, which joins the EC and ASEAN members plus Korea, China and Japan, took place in April 1998. It endorsed the creation of the World Bank ASEM fund aimed at providing financial aid to provide technical assistance in financial matters and to fight poverty. Furthermore, the Heads of State also agreed to reinforce economic cooperation through the adoption of the Investment Promotion Action Plan (IPAP) aimed at encouraging and intensifying investments flows, and the Trade Facilitation Action Plan (TFAP); the ASEM Business Forum; and, cooperation in the science and technology fields. The TFAP aims at, inter alia , reducing non-tariff barriers and promoting trade opportunities by facilitating and liberalizing trade between the two regions. The TFAP, which covers areas such as customs procedures, standards, testing, certification, accreditation and technical regulations or intellectual property rights, should become a forum of discussion to bring the above objectives into reality. The third ASEM meeting to be held in Korea in the year 2000 will review the work done in each of the above areas. Other measures agreed during the ASEM meeting include setting up an Asia-Europe Environment Technology Centre in Thailand and cooperation in fighting against illicit and synthetic drugs and money laundering. B New Generation Trade Issues Electronic commerce has emerged as a major trade issue. In an OECD report, it is stated that e-commerce activity could grow from $26 billion in 1997 to $1,000 billion by 2005. 2 The European Commission recognized that, although e-commerce is still in its initial phase in the Community, its potential is large. Therefore, the Commission proposed several measures at EC and multilateral levels to create a "favourable environment" for e-commerce. First, the EC made a request to the US that the administration of internet domain names be transferred to an international agency at the expiry of the contract with the US company currently managing internet domain names. A second major issue was the discussion about the need to enact legislation in areas affected by e-commerce. In this respect, the US and the EC supported opposing views. Whereas the US favoured the self-regulation principle, the Community took the stance that certain areas such as data protection need state regulation. The EC proposed the establishment of an international charter aimed at lifting obstacles to the development of electronic trade. This charter should cover, inter alia , sectors such as interoperable technical solutions, labour law for transnational work, digital signatures and means of authentication, liability, intellectual property rights, data protection taxation, internet domain names, and consumer protection. Finally, the entry into force of the EC Directive on data protection by the end of October 1998 must be considered. This directive contains provisions banning the transfer of electronic data to countries that do not ensure an adequate level of protection and threatens to seriously disrupt trade between the EC and several third countries. In all the above-mentioned areas, negotiations were still taking place at the end of July 1998. C Multilateral Agreement on Investment (MAI) Negotiations on the MAI, an agreement aimed at offering protection for foreign investments and broad access to third country markets, continued under the auspices of the OECD. During the OECD Council meeting of 27-28 April 1998, the existing discrepancies between the OECD Members on labour and environment standards, scope of exceptions and the extra-territorial application of laws blocked the agreement. As a consequence, the drafters decided to suspend the negotiations until October 1998. 2 The economic and social impact of electronic commerce: preliminary findings and research agenda , http://www.oecd.org//subject/e_commerce/summary.htm.
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