China will join a group of countries, including the U.S. and the European Union, in negotiating new rules to cover the USD25 trillion e-commerce market. The EU and 47 other members of the World Trade Organization (WTO) have launched the discussions, which – if successful – would establish an international regime for 21st century trade and reduce cross-border hurdles to e-commerce. China resisted joining the talks until last week, when China’s Ambassador to the WTO, Zhang Xiangchen, said China had decided to join the negotiations out of concern over a broader crisis surrounding the WTO, which has been coming under attack from U.S. President Donald Trump’s administration. “The multilateral trading system is in a deep crisis,” Ambassador Zhang said. “Against this backdrop, the launching of e-commerce negotiations will in a significant way help reinvigorate the negotiating function of the WTO, and shore up confidence in the multilateral trading system and economic globalization.” China is likely to register USD5.5 trillion in online sales this year.

U.S. Trade Representative Robert Lighthizer said in a statement that the U.S. is seeking a “ambitious, high-standard agreement that is enforceable and has the same obligations for all participants”. He called the digital economy a “powerful force for global economic growth” that should be guided by market-based rules and lowered barriers. The inclusion of China was important because of its scale and role in the global economy, Cecilia Malmstrom, the EU’s top trade negotiator, said. With China on board, the negotiations will include WTO members accounting for more than 90% of global trade. “It shows that the WTO is still alive and that we can take on board one of the biggest challenges on global trade – e-commerce,” Malmstrom said.

The new rules will seek to reduce barriers that prevent cross-border sales, ban duties on electronic transmissions, ensure the validity of e-contracts and e-signatures and address forced data localization requirements, according to an EU statement. Australian Trade Minister Simon Birmingham said the hope was that some tangible progress could be made in negotiations before a Group of 20 summit in Japan in June and that the negotiations could be wrapped up next year. The WTO is expected to hold the first formal negotiating session in March, the South China Morning Post reports.