Major Expansion of WTO's Information Technology Agreement

August.03.2015

​On July 24, 2015, the World Trade Organization ("WTO") announced an expansion of the 1996 Information Technology Agreement ("ITA") to cover more than 200 additional widely traded information technology products.  On varying schedules, ITA signatories have committed to eliminate conventional import tariffs on these products.  ITA signatories include jurisdictions accounting for over 90% of trade in these products, including the United States, the European Union, China, Hong Kong, Japan, South Korea, Taiwan and Thailand.

The ITA, a plurilateral agreement established in 1996, requires all participating WTO members, currently more than 80, to eliminate and bind customs duties at zero for products identified in the agreement.  As a plurilateral agreement, the ITA is only binding upon the ITA participants, not all WTO members.  However, because the ITA-mandated tariff elimination is on a most-favored nation basis, ITA signatories eliminate tariffs for imports from all WTO members, including those not participating in the ITA.

The expanded list of ITA-covered products include additional items such as new-generation semiconductors, GPS navigation systems, magnetic resonance imaging machines and other medical products, tools for manufacturing printed circuits, telecommunications satellites, and touch screens.  Elimination of tariffs on these products is expected to occur between July 2016 and July 2019 in four stages of equal annual reductions, although staging of some reductions may be extended in limited circumstances.  A final schedule of ITA tariff elimination is to be approved in December 2015 after participating members submit their draft schedules by the end of October 2015. 

Separately, ITA participants agreed to hold follow-on consultations with respect to non-tariff trade barriers in the information technology sector and to review the ITA's product coverage again before January 31, 2018.

For more information about these developments, please contact Harry L. Clark at (202) 339-8499 or [email protected], W. Clark McFadden at (202) 339-8479 or [email protected], or your Orrick relationship lawyer.