Large international treaties hurt small businesses

E-commerce has grown so quickly and become such a dominant force in global trade that lawmakers and regulators the world over have had difficulty keeping up with the many challenges of an internet-enabled global marketplace.

From data privacy and consumer protection to issues of forced labor, counterfeiting, intellectual property theft, taxation, and more, e-commerce challenges many of the rules that govern traditional commerce. Consequently, those who are responsible for crafting the rules of governance for e-commerce are quite literally making it up as they — and we — go along.

The latest front in this ongoing effort to harness the power of the internet without strangling it is an attempt — by such global institutions as the World Trade Organization (WTO) and the World Commerce Organization (WCO), along with lawmakers from the United States, the European Union, and many other countries — to devise a binding set of rules for e-commerce that everyone can agree upon, or at least accept to try, for now, until some better ideas come along.

One of the more problematic issues in the debate about how to regulate global e-commerce is the fact that the traditional rules governing international trade were devised with large multinational corporations in mind, not small businesses. Until the internet came along, after all, international trade was dominated by large companies that shipped equally large quantities of goods through ports (by air, sea, and land), where customs agents catalogued shipments and governments used that information to collect tax revenue, enforce compliance, formulate economic policy, and monitor trade balances, among other activities.

E-commerce upended the traditional trade model by giving small businesses and even individual people the means to sell almost anything, to anyone, anywhere in the world. Now, people everywhere sell an unimaginable variety of goods through marketplaces such as Amazon, Alibaba, eBay, and Etsy — and small businesses can have a global reach through websites they manage from home.