We are increasingly living in datafied societies and data have become the lifeblood of multiple economic and broader societal contexts. This trend has been critically observed by both scholars and policymakers with a particular focus on the risks and perils that this datafication brings and the ways to appropriately manage them. As Shin-Yi Peng rightly points out, it would however be wrong to treat digital technologies as ‘disastrous’, as they ‘do both good and harm’.Footnote 1 The monograph International Economic Law in the Era of Datafication by Professor Shin-Yi Peng is firmly embedded in this nuanced understanding of datafication and seeks to systematically explore how a particular field of regulation – namely international economic law – may have contributed to the creation of the contemporary datafication ecosystem's architecture and may also help change it – that is, remedy its negative ramifications, down the road. As Peng herself summarizes the gist of her work, it is about addressing two fundamental questions: ‘Do trade rules perpetuate datafication practices and data capitalism in any manner? If so, what can be done to mitigate the damage?’.Footnote 2 Peng's work certainly links to existing debates on digital trade law and data governance more broadly but also differs from them as it adopts a more holistic perspective that is also enhanced by Peng's deep knowledge of global trade law as well as her understanding of the distinct affordances of datafication, especially vis-à-vis ‘older’ digitalization processes. This review sketches key elements of Peng's analysis following the book's structure.
1. Data Networks and International Economic Law
The book's first Part spans two chapters focused on the infrastructural foundations of datafication. Chapter 1 addresses the data network as an enabler, paying particular attention to digital inclusion and trade policy. As Peng rightly shows, while trade liberalization has certainly brought about benefits – such as reducing market access barriers and breaking down monopolies, especially in the telecommunications sector – gaps in Internet access do remain, particularly in developing and least developed countries. These gaps are often bridged through cross-subsidization and universal service obligations, yet these measures can clash with the commitments made under the World Trade Organization (WTO) agreements, as evidenced in the Brazil–Taxation case.Footnote 3 Brazil's unsuccessful invocation of the public morals exception to justify its universal service policies in that dispute reveals the lack of flexibilities under WTO law to close the digital divide.
In this respect, Peng advocates for forward-looking policies that are adjusted to the realities of the digital age, and also suggests that big tech companies should bear certain responsibilities. Importantly, Peng pays due attention to the more innovative forms of addressing the digital divide, such as the module on digital inclusion contained in the Digital Economy Partnership Agreement between Chile, New Zealand, and Singapore (now also joined by South Korea). The module seeks to facilitate participation in the digital economy by including women, rural populations, low socio-economic groups, and Indigenous Peoples. She further refers to new regulatory flexibilities in certain free trade agreements (FTAs) governing digital trade, such as the ‘right to regulate’. Peng pleads for the inclusion of such flexibilities in the plurilateral efforts to address digital trade under the WTO Joint Statement Initiative on E-Commerce (JSI), so as to accommodate more policy space and particularly notes the need for special and differential treatment provisions under the JSI. Missing, however, in my opinion, is a deeper analysis of the contemporary data inequalities that certainly go beyond the ‘original’ digital divide of simple Internet connectivity and translate into the bigger (and more complex) societal issues of digital inclusion, such as digital skills and ability to adequately navigate the data economy.Footnote 4 Furthermore, it should be clarified in this context that the ‘right to regulate’, although asserting the regulatory autonomy of states, does not provide a clear path for tackling clashes of economic and non-economic interests and is of mere ‘residual character’ should a trade conflict unfold.Footnote 5
Next, Peng discusses the subject of network neutrality and how it has been implemented in a soft law manner in FTAs, while drawing attention to the important issue of Internet access and non-discrimination. As the author herself notes, ‘such obligations carry little institutionalized enforcement for non-compliant behavior’Footnote 6 and they do not therefore provide a channel for better digital inclusion.
The second chapter proceeds to examine the data network as a critical infrastructure. A key element of this analysis is the interplay between national security and data networks, particularly the proliferation of security-based trade restrictions on 5G and ICT (information and communication technology) goods and services. Peng highlights how these restrictions often conflict with the non-discrimination obligations enshrined under trade law. While the inclusion of exceptions within these agreements offers a potential solution, Peng stresses that their application is fraught with complexities, and is highly dependent on both technical and (geo)political factors. She proposes a taxonomy of exceptions, distinguishing those in multilateral contexts from those in FTAs, and argues that the latter are more adept at reconciling trade and security concerns – though still inefficient in addressing legitimate security interests. This inquiry into security exceptions, as well as Peng's proposition to scope the concepts of ‘essential security interests’ and ‘critical infrastructure’ as a touchstone for more coherent and pragmatic rulemaking, will certainly be much appreciated by the readers.Footnote 7 Already here, Peng's overall agenda of ‘good regulatory practices’ becomes discernible and is further developed towards the end of the book.
2. Digital Platforms and International Economic Law
The book's second Part, encompassing three chapters, delves into the role of international economic law in the era of digital platformization. Chapter 3 addresses the old but still highly relevant debate around the correct classification of digital services under the General Agreement on Trade in Services (GATS). This debate is particularly topical today considering that a great number of new digital offerings have recently emerged, while the existing GATS commitments are still based on the outdated W/120 services classification list that was compiled for the purposes of the Uruguay Round negotiations back in 1991.
Peng is understandably highly critical of the adequacy of the W/120 and the Central Product Classification (CPC) to match today's digital services landscape. While WTO case law has tried to address classification issues through a technologically neutral and evolutionary interpretation of the GATS services schedules, Peng warns of the potential risks of overreaching. Overextending these concepts, she argues, could blur the line between new service supply modalities and entirely new services, potentially conferring unfair advantages to big tech and undermining states’ regulatory capacities. Peng finds the European Union's (EU) Digital Services Act (DSA) a particularly instructive example of nuanced platform regulation as its approach ‘offers a high degree of generality, which is key in reducing the risk of regulatory disconnection’.Footnote 8
The analysis of FTAs that follows is also very helpful, in particular as Peng highlights the relationship between FTAs' ‘Cross-Border Trade in Services’ and ‘E-Commerce/Digital Trade’ chapters, which often deal with the same subject matter. This complicates the conditions of global market access, as Peng argues, especially as states have undertaken various measures to exempt non-conforming measures, particularly when the services commitments are based on a negative list approach.Footnote 9 A bit missing from this very interesting discussion is the debate on whether we are in the first place dealing with goods or services, and in this sense whether the more binding General Agreement on Tariffs and Trade 1994 or whether the GATS apply. In this respect, mention should also perhaps have been made to the 2017 Comprehensive Economic and Trade Agreement between the EU and Canada, which includes an Annex to the services chapter that specifies how parties will deal with new services not classified in the UN Provisional CPC of 1991.
Chapter Three explains finally the relationship between market access and domestic regulation – an ‘old’ GATS discussion that Peng links however to the contemporary debates on digital sovereignty. I particularly liked the hypothetical example of Teleland and Digiland,Footnote 10 which illustrates well how market access commitments matter and how domestic policy space may be accordingly impacted.
In an interesting reflection on FTAs, Peng also looks at the tensions between trade and culture, as translated now to digital platforms, and the palette of measures that states have adopted to safeguard cultural diversity. One of these flexibilities are local content requirements, such as those found under the United States–Mexico–Canada Agreement pertaining to Canada. This certainly is a complex topic, but Peng's inquiry contributes to the overall goal of the book to explore the multi-faceted nature of the challenges before international economic law in the age of datafication. Missing in this analysis, however, is the hottest topic on the policymakers' agenda: how to reconcile privacy and personal data protection with trade commitments in the digital age, in particular with regard to cross-border data flows and data localization measures.
Peng does, however, explore two critical questions related to concerns over highly concentrated digital markets, asking how governments can promote competition in data markets, while reducing data colonialism, and whether it is possible to ensure algorithmic transparency. Drawing on the EU's recent regulatory efforts in the broader area of data governance (such as the DSA, the Digital Markets Act, the Artificial Intelligence Act and the General Data Protection Regulation), Peng acknowledges that there is a room for intervention in both fields and that the ‘EU's intensified efforts to set international standards for the digital economy could be part of the solution toolkit to curb data capitalism’.Footnote 11 With regard to competition, the idea of a ‘Data Reference Paper’ is certainly interesting, yet, as the author also notes, unlikely. As a second-best option, Peng advocates for the use of soft law and more generic treaty language – this can on the one hand allow for keeping up with technology's rapid pace and accommodate domestic needs and preferences, on the other. Indeed, we observe this happening in a number of agreements, especially in the new generation of Digital Economy Agreements.Footnote 12
3. Cross-Border Data Flows and International Economic Law
The book's final chapter turns to the well-studied area of cross-border data flows. It examines whether and how privacy and security can be safeguarded and asks if governments can move from the current state of regulatory fragmentation to one of coherence. Peng addresses privacy concerns related to the uneven levels of protection across jurisdictions, focusing on the public–private governance models that have emerged and puts forward a very helpful and insightful typology of public interactions. She compares the APEC Cross-Border Privacy Rules system with certification under the EU's General Data Protection Regulation, highlighting their different levels of state involvement and enforcement. Peng examines further the public–private interactions with regard to cybersecurity standards, highlighting the existing intricate institutional and actor landscape. Peng proposes tools that could remedy the current situation and concludes with a proposal to restructure the global architecture for cross-border data flows, by combining elements from the multi-stakeholder model of Internet governance and the multilateral framework of trade.
4. Concluding Remarks
Overall, Peng's book is an excellent contribution to trade law scholarship and its new strand of digital trade law. It maps not only the potential but also the limitations of international economic law as an instrument to regulate datafied economies and highlights the perils of datafication that policymakers should address and adjust their regulatory toolboxes accordingly. The ‘beauty’ of datafication, as Peng eloquently puts it, can only then be realized. Peng's analysis is insightful and combines older WTO debates around the subject of electronic commerce and newer and more forward-looking research on data governance that was prompted by recent technological developments. In some parts, however, Peng is perhaps somewhat too optimistic and does not consider sufficiently the complex political economy of international rulemaking in general and the geopolitical tensions with regard to data governance in particular, as evidenced by the US shift on data-related negotiation topics. Finally, as the author herself notes, the book chapters can be read separately, which is certainly helpful for modern readers, but I thought that some interdependencies between the different topics are actually worth highlighting, such as treating data inequality as part of the digital divide, looking at ‘trade and …’ issues, such as free speech and cultural considerations, together with digital trade and privacy, or exploring the implications of cross-border data flows for free speech. For the time being, Peng's book has given us plenty of food for thought that is accessible for trade lawyers and will make digital trade experts particularly happy.
