The European Union (EU) and Singapore have finalised negotiations for a Digital Trade Agreement (DTA) in a move to set global standards for digital trade rules and cross-border data flows. Both parties will now proceed with their respective procedures towards formal signature and conclusion of the DTA. Complementing the 2019 EU-Singapore Free Trade Agreement, the DTA will further connect the two economies and benefit businesses and consumers engaged in digital trade.
The agreement includes binding rules designed to foster consumer trust, ensure predictability and legal certainty for businesses, and remove or prevent the emergence of unjustified barriers to digital trade. It aims to explore new economic opportunities along with maintaining a safe online environment in both jurisdictions.
Digital trade agreement expected to rationalise trade between EU and Singapore
Besides this, the DTA is expected to strengthen EU-Singapore trade relations by facilitating digitally-enabled trade in goods and services and ensuring cross-border data flows free of unjustified barriers. The new agreement is also intended to improve trust in digital trade, including through strong rules on spam.
“Building smart, modern rules for digital trade with our global partners is crucial at a time when more than half of EU trade in services is delivered digitally,” said the EU’s Trade Executive Vice-President and Commissioner, Valdis Dombrovskis. “Today’s deal with Singapore, the first agreement of its kind, will benefit businesses and consumers on both sides, bringing our economies closer together, while representing a significant step forward for the EU’s ambition to be a global standard-setter in the domain of digital trade.”
According to the EU, the DTA positions itself and the Asian country at the forefront of global digital policy development while supporting open and fair digital economies.
The EU said that the digital trade agreement also upholds its approach to building digital and data rules centred on people and their rights. It will also enable both parties to develop and execute policies addressing new challenges in the digital economy.
New agreement builds on 2023 deal
The DTA also builds on the digital partnership launched by the EU and Singapore in February 2023. That deal aimed to enhance research cooperation in advanced technologies like artificial intelligence (AI) and semiconductors, while also seeking to promote shared regulatory approaches, particularly in AI and Electronic Identification (eID).
The partnership also focuses on fostering investments in resilient and sustainable digital infrastructures, such as data centres and submarine telecommunications cables, to improve connectivity between the EU and Southeast Asia. Additionally, it ensures trusted cross-border data flows in line with data protection rules and public policy objectives.
The digital trade agreement will also promote information exchange and cooperation in cybersecurity and seeks to build alliances in international organisations and standardisation forums. It also aims to facilitate digital trade by supporting initiatives like paperless trading, electronic invoicing, electronic payments, and an electronic transactions framework.
Earlier this month, a new agreement on cross-border data flows between the EU and Japan came into effect. Included in the EU-Japan Economic Partnership Agreement (EPA), this deal offers tangible benefits to companies across various sectors, including financial services, transport, machinery, and e-commerce. Businesses in both jurisdictions can now, its authors hope, manage data more efficiently, free from burdensome administrative or storage requirements, and within a predictable legal framework.
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