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  June 17th, 2016 | Written by

European Parliament Backs Deal to End Duties on High-Tech Devices

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  • The European Parliament has given the green light for the ITA, already signed by the EU, to enter into force.
  • MEP: The Information Technology Agreement is important milestone, and Europe was the driving force behind it.
  • The European Parliament has ratified the Information Technology Agreement by 529 votes to 110.

A WTO deal struck by the European Union and 24 countries, including Japan, China, and the United States, to stop charging custom duties on trade in 201 different high-demand information technology products, such as video game consoles, medical imaging machines and touch screens, was backed by the members of the European Parliament (MEP) last week.

The EU has signed the deal, but now Parliament has given it the green light to enter into force.

“Through the revision and expansion of the Information Technology Agreement, now the new generation of modern IT products can also benefit from customs facilitation,” said MEP Godelieve Quisthoudt-Rowohl, of Germany, the sponsor of the legislation in the Parliament and a member of the center-right European People’s party. “This is an important milestone for the WTO, and Europe was the driving force for it. European companies are protected by these global trade facilitation measures from unfair competition.”

MEPs backed Quisthoudt-Rowohl consent recommendation by 529 votes to 110, with 37 abstentions.

The expanded World Trade Organization (WTO) Information Technology Agreement (ITA) is the biggest tariff-cutting deal in WTO history. It has been signed by 25 WTO members, with the EU counting as one. Australia, Canada, China, Japan, the U.S., and South Korea are all on board.

By joining the pact, members undertake to gradually eliminate customs duties on 201 listed information technology products, such as videogame consoles, GPS navigation systems, magnetic resonance imaging machines, telecommunications satellites, touch screens, and video cameras. Tariffs are to be reduced beginning July 1, 2016, and eliminated by July 1, 2019, with a more gradual phasing out of duties on imports that are sensitive for the EU industry, such as TV screens.

The value of the EU exports of products covered by the ITA is currently over $212 billion. The EU Commission estimates the likely gain to EU exporters at $5.6 billion to $9.3 billion, including the benefits to EU industry of being able to import development hardware more cheaply.