Technology Standards - New Technical Barriers to Trade?

Abstract

At a time when the high-tech industry has increasingly demanded harmonized standards, China has signaled its intention to follow a different direction. China's recent actions seeking to set its own unique standards instead of adopting international standards shifts focus to the impact on international trade and the corresponding legal framework defining responsibilities for State members of the World Trade Organization. While trade barriers of the past - high tariffs and quotas imposed on imports - have been greatly reduced, less obvious impediments normally referred to as non-tariff barriers (NTBs) have in many cases replaced them. One area ripe for the incursion of NTBs concerns technology standards. The WTO's Agreement on Technical Barriers to Trade recognizes the important contribution that international standards can make by improving efficiency of production and facilitating the conduct of international trade, but also cautions that standards should not be used to create NTBs. China's WAPI standard provides a test-case for ICT standards and their relationship to the international trade regime. It serves to illustrate standards' dual nature as trade facilitators and indispensable elements of the ICT industry, on the one hand, and as potential measures of protectionism when applied inappropriately, on the other hand. As China's economic power grows and it becomes more adept at playing the standards game, it may find new means for pressing its own concerns in relation to international standards and trade-related issues.

Keywords: standard-setting, non-tariff barriers, NTB, standard-setting organizations, SSO's, USTR, United States Trade Representative, TBT, Technical Barriers to Trade, China, WAPI

JEL Classification: F13, K21, K33, O30, O31, O32, O33, O34, O38, O39