THE POTENTIAL IMPACT OF THE WTO JOINT STATEMENT INITIATIVE ON E-COMMERCE ON KENYAN LAW

& THE AfCFTA NEGOTIATIONS ON E-COMMERCE

Clinic: Kenyatta University, Spring 2022

Beneficiary: The Permanent Mission of the Republic of Kenya

Executive Summary

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Although e-commerce has become highly relevant in the national policy agenda–just to mention the digital service tax introduced recently in Kenya–, there is hardly any international legal framework governing cross-border e-commerce transactions. While customs duties are being levied on physical goods, levying of the same on digitalised products such as e-books has been banned by the WTO Declaration on Global Electronic Commerce in 1998. Being consumers of e-commerce products developed in the North, African countries keep suffering revenue losses. On the other hand, however, free trade in digital products may contribute to the rise of African e-commerce platforms. Regulation of international trade of digital products requires thus consequential political decisions.

The international legal environment and consequently the national space for political decisions are likely to change. In 2017, a group of WTO Members initiated negotiations aiming at adoption of a plurilateral WTO Agreement on e-commerce (the Joint Statement Initiative (JSI)). In 2020, the Assembly of the AfCFTA directed that an adoption of an e-commerce protocol withing the AfCFTA should be prioritised during the Phase III negotiations. E-commerce strategies have also been adopted at the level of African Regional Economic Communities.

The aim of this research paper is to assess the potential impact of the WTO JSI on e-commerce on Kenyan legislation and AfCFTA negotiations. It will be divided into four sections. The first section will outline Kenya's obligations as a WTO Joint Statement member once negotiations are completed. The second section will identify the pieces of Kenyan legislation that are likely to be impacted once the WTO Plurilateral Agreement on E-commerce is signed. In addition, an assessment of the consequences and changes that may be required following the agreement's entry into force will be carried out. The third section will evaluate the regulatory or policy space that Kenya will have after the agreement is ratified. The fourth section will provide an assessment of Kenya’s regulatory space upon adoption of the WTO Plurilateral Agreement. Finally, a comparison will be made between the current wording of the WTO Plurilateral Agreement and the ongoing discussions surrounding the AfCFTA Protocol on Ecommerce before concluding the paper.

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