US-Japan Trade Deal Needs ‘Robust Chapter’ on Digital Trade, Says Chamber

A new U.S.-Japan trade agreement should “promote innovation” and U.S. "competitiveness," so it should include “a robust chapter” on digital trade modeled after the text of the U.S.-Mexico-Canada trade deal, testified Charles Freeman, U.S. Chamber of Commerce senior vice president-Asia, Monday at an Office of the U.S. Trade Representative hearing on U.S. negotiating objectives for a free-trade agreement with Japan (see 1811270002). The digital economy “is growing at almost two and a half times faster than the global economy, and trade in digital goods is growing more rapidly than trade in traditional manufactured goods and agricultural products,” said Freeman. Negotiations with Japan are “a real opportunity to set the highest global standard” intellectual property “creativity and innovation,” he said. “Both countries should take this opportunity to advance a model approach to sustainable access to innovation and creativity by promoting respect for property rights and a return of fair value for innovation.” Along similar lines on negotiating objectives for a potential U.S.-EU pact, the Computer & Communications Industry Association wants the USTR to “seek a holistic trade agreement with the EU to reduce barriers and encourage investment across the economy,” it commented Monday in docket USTR-2018-0035. The USTR is “strongly encouraged” to make digital trade a “priority in these negotiations with the EU,” said CCIA. “Failure to do so would be a significant missed opportunity.” Commitments to digital trade in a U.S.-EU agreement “will be important in ensuring continued EU market access for innovative American firms and in establishing a model elsewhere in the world,” said the Software & Information Industry Association. Though the EU’s position is that privacy can’t be subject to a trade negotiation, the U.S. “should nonetheless strive to come to an agreement providing for a positive cross-border data flow commitment,” it said. The U.S. “should also push back against a highly likely EU request for a cultural carve-out,” it said. There also should be an effort “to establish closer U.S.-EU cooperation on both digital and intellectual property rights issues vis a vis third countries,” it said. A hearing on U.S.-EU negotiating objectives is set for Friday. Comments in the docket were due midnight Monday.