RCEP, digital economy and innovation

News of the mega trade deal RCEP is trickiling in here, here, here and here. The IELP blog has a preliminary analysis of some of the provisions. 

The signing ceremony of RCEP

That took me to the Electronic Commerce chapter of RCEP legal text and I was curious to know the data localisation standard. A number of interesting aspects in Article 12.14 covering "Location of Computing facilities".

Article 12.14: Location of Computing Facilities 

1. The Parties recognise that each Party may have its own measures regarding the use or location of computing facilities, including requirements that seek to ensure the security and confidentiality of communications. 

2. No Party shall require a covered person to use or locate computing facilities in that Party’s territory as a condition for conducting business in that Party’s territory.11 

3. Nothing in this Article shall prevent a Party from adopting or maintaining:

(a) any measure inconsistent with paragraph 2 that it considers necessary to achieve a legitimate public policy objective12 provided that the measure is not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on trade; or 

(b) any measure that it considers necessary for the protection of its essential security interests. Such measures shall not be disputed by other Parties. 

11 Cambodia, Lao PDR, and Myanmar shall not be obliged to apply this paragraph for a period of five years after the date of entry into force of this Agreement, with an additional three years if necessary. Viet Nam shall not be obliged to apply this paragraph for a period of five years after the date of entry into force of this Agreement.

12 For the purposes of this subparagraph, the Parties affirm that the necessity behind the implementation of such legitimate public policy shall be decided by the implementing Party. 

The mandate to not require local computing facilities ahs its exceptions. Cambodia, Lao PDR and Myanmar can have measures that require dta localisation for a periof of 5 more years, extendable to eight. Transition time seems to apply only to these three members.

Essential security exception is available to all members wherein obligations under paragraph 2 are violated. Moreover, there is a non-justiciable element here.  Article 12.4 (3)(b) states that such measures shall not be disputed by other Parties. Therefore, it is self-judging to the core. Whether it satisfies the standard set forth in the exception si to be decided by the Party whileno other Party can challenge it in the dispute settlement proceedings under RCEP.

It would be an interesting to compare three new norm setting legal paradigms and their impications for policy space and standradisation - CP-TPP, RCEP and the Australia Singapore Digital Economy Agreement.

Fertile ground for experimentation and innovative solutions.